Atmel Corp. v. Vitesse Semiconductor Corp - 30 P.3d 789 (Colo. App. 2001)

Rule:

Injunctive relief should not be indiscriminately granted but should be exercised sparingly and cautiously and with a full conviction on the part of the trial court of its urgent necessity. The trial court must find that the moving party has demonstrated: (1) a reasonable probability of success on the merits; (2) a danger of real, immediate, and irreparable injury which may be prevented by injunctive relief; (3) that there is no plain, speedy, and adequate remedy at law; (4) that the granting of a preliminary injunction will not disserve the public interest; (5) that the balance of equities favors the injunction; and (6) that the injunction will preserve the status quo pending a trial on the merits. Unless all of these criteria are met, injunctive relief is not available.

Facts:

When defendant employees were hired at plaintiff company, they were required to sign an employment agreement that contained a "non-solicitation clause" pertaining to plaintiff’s employees. After defendant employees left plaintiff company’s employment to work for defendant company as managers, they assisted in defendant company’s efforts to hire qualified employees. Contending that defendants were “raiding” its work force, plaintiff company filed the present action and sought a temporary restraining order. The trial court granted the plaintiff company a preliminary injunction which forbade defendant employees from soliciting plaintiff company’s employees to apply for employment at defendant company, screening resumes, conducting interviews, participating in hiring decisions, or making employment offers. Defendants appealed. 

Issue:

Was the grant of injunction in favor of the plaintiff company proper under the circumstances? 

Answer:

No.

Conclusion:

The preliminary injunction was reversed to the extent it prohibited defendant employees from participating in defendant new employer's hiring process. The court held that the injunction, which prohibited any indirect participation in hiring, was too broad and amounted to restraint of trade. The clauses were void and unenforceable under Cal. Bus. & Prof. Code § 16600 (2000), and Colo. Rev. Stat. § 8-2-113(2) (2000), to the extent they could be interpreted to prohibit anything other than initiating contact with plaintiff's employees.