The opinion of the court was delivered by: Andrew J. Guilford United States District Judge
ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR PRELIMINARY INJUNCTION
In this case, a formerly licensed distributor is allegedly still distributing. Plaintiff Zoll Circulation, Inc. ("Plaintiff") filed this Motion for a Preliminary Injunction ("Motion"). Plaintiff asks the Court to enjoin Defendant ELan Medizintechnik GmbH ("Defendant") from (1) representing itself as a distributor of Plaintiff's products in certain countries, (2) contacting Plaintiff's customers in those countries about the products, and (3) making false, misleading, or defamatory statements about Plaintiff and Plaintiff's products until the resolution of a pending arbitration.
Plaintiff requested an expedited hearing on this Motion. After ensuring that Defendant received notice of this Motion, the Court granted Plaintiff's request. The Court adopted Plaintiff's proposed expedited briefing schedule where Defendant would have a chance to file an opposition, but Plaintiff would not file a reply. No opposition has been filed.
After reviewing all papers and arguments submitted, the Court GRANTS IN PART and DENIES IN PART the Motion.
Plaintiff offers evidence seeking to support the following facts.
Plaintiff manufactures "temperature management technology" and related products. (Declaration of James Palazzolo ("Palazzolo Decl.") ¶ 3.) James Palazzolo ("Palazzolo") is Plaintiff's president. (Palazzolo Decl. ¶¶ 1-2.) Plaintiff's products are designed for "controlling [the] core body temperature of critically ill or surgical patients...." (Palazzolo Decl. ¶ 4.)
On May 1, 2007, Alsius Corporation ("Alsius") entered into a three-year distribution agreement (the "Agreement") with Defendant that made Defendant the exclusive distributor for Alsius' temperature control products in Germany, Austria, Czech Republic, Slovakia, and Slovenia (the "Territory"). (Palazzolo Decl. ¶ 6.) In May 2009, Plaintiff acquired "substantially all" of Alsius, including its products and rights and obligations under the Agreement. (Palazzolo Decl. ¶ 7.) In late February 2010, Plaintiff informed Defendant that Plaintiff would not renew the Agreement upon its expiration on April 30, 2010. Id.
Since the expiration of the Agreement, Defendant has "continued to hold itself out as [Plaintiff's] distributor in the territory, and has been making false and misleading statements to [Plaintiff's] customers that... have caused them [to refuse to] order" products from Plaintiff. (Palazzolo Decl. ¶¶ 15, 17.) On June 18, 2010, Defendant sent a letter (the "June 18 letter") to its customers stating that Plaintiff had "'terminated' [Defendant] and refuse[d] to 'pay any compensation.'" (Palazzolo Decl. ¶ 19.) Plaintiff has received numerous calls and emails from "irate and confused" customers due to Defendant's June 18 letter. (Palazzolo Decl. ¶ 20.)
Palazzolo also contacted customers who purchased Plaintiff's products in the past through Defendant and were unwilling to purchase the products directly from Plaintiff. (Palazzolo Decl. ¶¶ 21-26.) Some of these customers stated their intent to continue to buy Plaintiff's products from Defendant. Id.
Plaintiff estimates it has lost over $237,600 in orders by "customers [that] would have ordinarily been submitted to [Plaintiff] if [Defendant] had not made false representations." (Palazzolo Decl. ¶¶ 27- 28.) Plaintiff "competes with several... entities in the Territory," and Defendant's disruptive "conduct threatens to cause [Plaintiff] to lose customers" to these competitors. (Palazzolo Decl. ¶ 29.)
Under the Agreement, the parties agreed to settle any disputes arising from their relationship "under the Rules of Conciliation and Arbitration of the International Chamber of Commerce." (Agreement § 15.4.2.) The parties also agreed that "the place of the arbitration shall be in Orange County...." Id.
On June 23, 2010, Defendant filed a lawsuit in a German court seeking an injunction directing Plaintiff's affiliates to continue supplying Defendant with Plaintiff's products, and related relief. (Declaration of Suzanne Geraghty ("Geraghty Decl.") ¶ 3.)On July 1, 2010, Plaintiff filed an arbitration demand with the International Chamber of Commerce. (Geraghty Decl. ¶ 2.) In the arbitration, Plaintiff asserts claims for breach of contract, tortious interference with contract and prospective business relationships, violations of the Lanham Act, and ...