Shilling, 179 Cal. App. 3d 124, 224 Cal. Rptr. 456 (1986); Loral Corp. v. Moyes, 174 Cal. App. 3d 268, 219 Cal. Rptr. 836 (1985).
Here, the alleged employment contract and the English Order based thereon, purport to prohibit Plaintiff from doing any business with Defendant's clients, regardless of who initiates contact. Plaintiff has demonstrated a probability of succeeding on the claim that such a restriction is invalid under § 16600.
2. Balance of Hardships.
Plaintiff claims that he will suffer immediate and irreparable injury if a preliminary injunction does not issue because he will be prevented from pursuing his livelihood by competing freely in the insurance business.
In particular, his ability to serve clients who choose to transfer their business to AON would be interrupted, causing loss or damage to those client relationships.
Defendant counters that if a preliminary injunction is issued, Defendant will suffer the greater injury because it will lose employees and clients to AON, and Plaintiff will continue to disclose trade secrets to AON for the purposes of soliciting Defendant's clients. However, Defendant's statements are merely conclusory. Defendant has not even attempted to identify a legally protected trade secret, or a basis for protecting that trade secret. Moreover, Defendant has failed to explain how the potential loss of a few clients and employees to a company of its size outweighs the hardship to an individual employee in Plaintiff's position.
In light of the foregoing, Plaintiff has shown a possibility of immediate and irreparable harm, which outweighs the risk of harm to Defendant.
Defendant concedes that this Court may properly and fairly enjoin enforcement of the English Order in the United States.
The primary issue before the Court, therefore, is whether Defendant should be enjoined from enforcing the English Order in England.
As a general principle, one court will not interfere with or try to restrain proceedings in another court in an ordinary action in personam. Compagnie Des Bauxites De Guinea v. INS Co. of North America, 651 F.2d 877, 887 (3d Cir. 1981) (citing Donovan v. City of Dallas, 377 U.S. 408, 412, 12 L. Ed. 2d 409, 84 S. Ct. 1579 (1964)). Where judgment is sought in personam, two courts with concurrent jurisdiction may proceed with litigation at least until judgment is obtained in one case which may be used as res judicata in the other. Id. (citing Princess Lida v. Thompson, 305 U.S. 456, 466, 83 L. Ed. 285, 59 S. Ct. 275 (1939)). This principle applies even where one action is foreign. Id.
Nevertheless, a district court with jurisdiction over the parties has "the power to enjoin them from proceeding with an action in the courts of a foreign country, although the power should be 'used sparingly.'" Seattle Totems, et al. v. National Hockey League, 652 F.2d 852, 855 (9th Cir. 1981). The issue is not one of jurisdiction, but of comity. Id. The fact that an anti-suit injunction is aimed at the parties to a foreign suit rather than the court itself does not alter the analysis. China Trade and Development v. M.V. Choong Yong, 837 F.2d 33, 35 (2d Cir. 1987) (citing Peck v. Jenness, 48 U.S. 612, 12 L. Ed. 841 (1849)).
In the Ninth Circuit, foreign litigation may be enjoined where it would "(1) frustrate a policy of the forum issuing the injunction; (2) be vexatious or oppressive; (3) threaten the issuing court's [sic] in rem or quasi in rem jurisdiction, or (4) where the proceedings prejudice other equitable considerations." Seattle Totems, 652 F.2d at 855.
As the Ninth Circuit has expressly noted, Seattle Totems stands for the proposition that later-filed foreign actions may in certain cases be enjoined.
Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 843 (9th Cir. 1984).
a. Policy of the Forum. Plaintiff claims that the English action frustrates California's public policy against unreasonable restrictions on lawful competition.
While enforcement of the English Order in the United States may undermine California public policy, enforcement of the English Order in England presents no such conflict. Plaintiff was admittedly an employee of a British corporation in London at the time he allegedly entered into the non-compete provisions.
He may therefore be subject to an English court's determination of his future rights to engage in business in England without offending California public policy.
b. Vexatiousness of Foreign Litigation. Plaintiff complains that being forced to defend against the English action in England is vexatious.
However, the English action was filed first. So, if Plaintiff was concerned about the prospect of pursuing two actions simultaneously, he could have appeared in the English action rather than initiating a second suit here. Moreover, equity does not favor relieving Plaintiff of his duty to defend against the English action in England. Plaintiff claims that an injunction prohibiting enforcement of the English Order in the United States only is inadequate because he travels frequently to England to conduct his business. At the same time, Plaintiff claims that it is vexatious to require him to defend against a suit brought by his former English employer in England. Plaintiff cannot have it both ways. If he intends to conduct business in England, he can expect to have to abide by English law in the course of his English business dealings.
c. In rem or quasi in rem action. Both actions here are in personam, so there is no threat to this Court's in rem or quasi in rem jurisdiction.
d. Other Equitable Considerations. Plaintiff has presented no other equitable factors in support of enjoining enforcement of the English Order in England.
The principle of comity is based on "deference to the foreign country's legal, judicial, legislative and administrative system of handling disputes over which it has jurisdiction, in a spirit of international cooperation." Brinco Mining Ltd. v. Federal Insurance Co., 552 F. Supp. 1233 (D.C. 1982). If the legal system of any foreign jurisdiction is entitled to deference, certainly that of England is. Although both this Court and the English Court have asserted jurisdiction over this matter, if both courts act to define the rights of the parties exclusively within their respective jurisdictions, the interests of both parties can be protected without the threat of inconsistent judgments.
All of the foregoing constitutes this Court's findings of fact and conclusions of law.
1. Defendant is hereby enjoined from enforcing or attempting to enforce in the United States the ex parte order issued on April 12, 1994, in the matter of Jardine Insurance Brokers International Limited v. Peter Conroy Robinson, action no. 1994-J-721, by the High Court of Justice, Queen's Bench Division, London, England.
2. Defendant is not hereby enjoined from enforcing the ex parte order in England, nor from serving English court documents on Plaintiff in the United States solely for the purpose of rendering the English Order enforceable in England.
3. This Preliminary Injunction is binding on Jardine Insurance Brokers International Limited, its officers, agents, servants, employees, and attorneys, and upon those persons in active concert or participation with them who receive actual notice of the order by personal service or otherwise.
4. No person who has notice of this Preliminary Injunction shall fail to comply with the letter and spirit hereof nor shall any person subvert the letter or spirit hereof by any sham, indirection or other artifice.
5. The Court retains jurisdiction to modify this Preliminary Injunction at any time and from time to time on its own motion or upon the motion of any party in the interest of effectuating its intendments or in the interest of furthering the ends of justice under all applicable law.
6. The above Preliminary Injunction is effective upon Plaintiff's filing a security in cash or corporate security in the sum of $ 5000.
Dated: June 22, 1994.
Stanley A. Weigel