United States District Court, N.D. California
ORDER DENYING PLAINTIFF'S MOTION FOR PRELIMINARY
INJUNCTION RE: DKT. NO. 185
NATHANAEL M. COUSINS United States Magistrate Judge.
trade secrets theft case, plaintiff Citcon moves for a
preliminary injunction to prevent defendant RiverPay from
using, disclosing, accessing, or copying any of its allegedly
misappropriated source code. The Court finds that Citcon
failed to identify its source code with sufficient
particularity and failed to present admissible evidence of
misappropriation. Therefore, Citcon has not demonstrated a
likelihood of success on the merits. The Court also finds
that Citcon has not shown that it will suffer irreparable
harm in the absence of preliminary relief, or that the
balance of equities or public interest weigh in its favor. As
such, the Court DENIES Citcon's motion for a preliminary
Citcon provides services to merchants in the United States to
facilitate customer payments using major Chinese mobile
payment systems. Dkt. No. 136 at ¶ 13. Citcon brings
claims for (1) misappropriation of trade secrets under the
DTSA; (2) misappropriation of trade secrets under the CUTSA;
(3) conversion of funds; (4) conversion of a POS device, and
(5) unfair competition. Dkt. No. 136. Citcon's first two
claims include five categories of trade secrets allegedly
misappropriated by defendants, one of which is Citcon's
source code. Id. at ¶ 55. The Third Amended
Complaint defines the allegedly misappropriated source code
by listing five payment processing algorithms. Id.
at ¶ 55(a). Citcon alleges that defendant RiverPay,
which offers competing services, created its products using
source code copied from Citcon by defendants Hua and Shi-
both former Citcon employees now working for RiverPay.
Id. at ¶¶ 15-17, 53-72.
parties consented to the jurisdiction of a magistrate judge.
Dkt. Nos. 7, 13.
plaintiff seeking a preliminary injunction must demonstrate
that “he is likely to succeed on the merits, that he is
likely to suffer irreparable harm in the absence of
preliminary relief, that the balance of equities tips in his
favor, and that an injunction is in the public
interest.” Winter v. Nat'l Res. Def. Council,
Inc., 555 U.S. 7, 20 (2008); see also Fed. R.
Civ. P. 65. A preliminary injunction is an
“extraordinary remedy that may only be awarded upon a
clear showing that the plaintiff is entitled to such
relief.” Winter, 555 U.S. at 22.
Likelihood of Success on the Merits
succeed on its trade secret misappropriation claims under
both the California Uniform Trade Secrets Act and the Defend
Trade Secrets Act, Citcon must show that it possessed a trade
secret, that the defendant misappropriated the trade secret,
and that the defendant's conduct damaged the plaintiff.
Cal. Civ. Code § 3426.1(b); Alta Devices, Inc. v. LG
Elecs., Inc., 343 F.Supp.3d 868, 877 (2018).
Citcon fails to show that it is likely to succeed on its
source code trade secret misappropriation claim for two
reasons. First, Citcon fails to identify with sufficient
particularity what source code has been misappropriated.
Second, Citcon fails to provide admissible evidence of
Identification of Source Code
seeking injunctive relief “has the burden to show that
the information that was misappropriated constitutes a trade
secret” and, to do so, must identify that information
“with sufficient particularity.” Agency
Solutions Com., LLC v. Trizetto Group, Inc., 819
F.Supp.2d 1001, 1015, 1017 (E.D. Cal. 2011).
motion for preliminary injunction simply refers to the
allegedly misappropriated trade secret as its “source
code.” Dkt. No. 185 at 7. Citcon describes a few
specific categories of source code, but these categories
appear to function primarily as exemplars to show instances
of alleged misappropriation rather than to define
comprehensively the source code at issue in the case.
Id. at 5-6. This Court recently held in its order
denying defendants' motion for partial summary judgment
that the parties currently dispute material facts about the
identification of the source code. Dkt. No. 237 at 4-6. That
order found a lack of clarity in the record as to the
authorship of the source code and as to precisely what of its
source code Citcon alleges RiverPay misappropriated.
Id. Since then, Citcon has not defined the source
code with any more particularity. In contrast, a court in
this district recently found that the plaintiff in
WeRide had sufficiently identified its source code
trade secrets for purposes of a preliminary injunction motion
when it filed a twenty-page identification of ten specific
trade secrets ...