WCG CLINICAL, INC. v. SITERO, LLC

               UNITED STATES DISTRICT COURT                             
               SOUTHERN DISTRICT OF INDIANA                             
                   INDIANAPOLIS DIVISION                                

WCG CLINICAL, INC.,                )                                      
DA VINCI PURCHASER HOLDINGS LP,    )                                      
                                 )                                      
                Plaintiffs,      )                                      
                                 )                                      
              v.                 )   No. 1:24-cv-01080-JRS-MKK          
                                 )                                      
SITERO, LLC,                       )                                      
ERICKA ATKINSON,                   )                                      
MICHAEL DEMO,                      )                                      
SANKESH ABBHI,                     )                                      
DAVID INGRAHAM,                    )                                      
                                 )                                      
                Defendants.      )                                      

           Order on Motion for Preliminary Injunction                   
WCG Clinical, Inc. ("WCG") has filed suit against Sitero, LLC ("Sitero"), et al. 
alleging  various  claims  stemming  from  the  departure  of  two  employees,  Ericka 
Atkinson and Michael Demo, from WCG to Sitero.  (ECF No. 1.)  WCG subsequently 
moved for a preliminary injunction, seeking to, among other things, enjoin Atkinson 
and Demo from continuing their employment at Sitero for the remainder of the 
twelve-month term enshrined in a set of contentious restrictive covenants.  (ECF No. 
8.)  For the reasons outlined below, WCG's motion for a preliminary injunction is 
denied.                                                                   
I.   Legal Standard                                                     
To obtain a preliminary injunction, a plaintiff must first show (1) that they have 
"some" likelihood of success on the merits; (2) that traditional legal remedies are 
inadequate; and (3) that they will suffer irreparable harm without preliminary relief.  
Speech First, Inc. v. Killeen, 

968 F.3d 628, 637

 (7th Cir. 2020).  To demonstrate the 
merits of their claim, a plaintiff must show that their "claim has some likelihood of 
success on the merits, not merely a better than negligible chance."  Mays v. Dart, 

974 F.3d 810, 822

 (7th Cir. 2020) (internal quotation marks omitted) (citing Eli Lilly and 
Co. v. Arla Foods, Inc., 

983 F.3d 375

, 381 (7th Cir. 2018)).  To show irreparable harm, 
the moving party must demonstrate that they will suffer "harm that 'cannot be 
repaired' and for which money compensation is inadequate."  Orr v. Shicker, 

953 F.3d 490

, 502 (7th Cir. 2020) (quoting Graham v. Med. Mut. of Ohio, 

130 F.3d 293, 296

 
(7th Cir. 1997)).                                                         
If the plaintiff proves the three baseline elements, "the court next must weigh the 

harm the plaintiff will suffer without an injunction against the harm the defendant 
will suffer with one" and consider "any effects on non-parties" to determine whether 
a preliminary injunction would be in the public interest.  Courthouse News Serv. v. 
Brown, 

908 F.3d 1063, 1068

 (7th Cir. 2018).  Under the Seventh Circuit's "sliding 
scale" approach, "the more likely the plaintiff is to win on the merits, the less the 
balance of harms needs to weigh in his favor, and vice versa."  Mays, 

974 F.3d at 818

 

(citing Ty, Inc. v. Jones Grp., Inc., 

237 F.3d 891, 895

 (7th Cir. 2001)). 
In  weighing  the  harms,  the  court  must  bear  in  mind  that  "[a]  preliminary 
injunction is 'an exercise of a very far-reaching power, never to be indulged in except 
in a case clearly demanding it.'"  Cassell v. Snyders, 

990 F.3d 539, 544

 (7th Cir. 2021) 
(quoting Orr v. Shicker, 

953 F.3d 490

, 501 (7th Cir. 2020)).  Moreover, "[a] preliminary 
injunction ordering the defendant to take an affirmative act rather than merely 
refrain from specific conduct is 'cautiously viewed and sparingly issued.'"  Graham v. 
Med. Mut. of Ohio, 

130 F.3d 293, 295

 (7th Cir. 1997)).                    
II.  Discussion                                                         

Both WCG and Defendants have filed comprehensive briefs complete with dozens 
of exhibits, each endeavoring to paint the Court a picture of the situation at hand.  
But the filings tell two different stories.  WCG portrays Atkinson's role at its company 
as having a central focus, InvestigatorSpace, but with a multi-faceted and global goal 
involving lots of collaboration with other WCG departments.  (See Pl.s' Br. in Supp of 
Mot. for Prelim. Inj. 5-10, ECF No. 32.)  Meanwhile, Sitero frames the corporate 
structure of WCG as highly segmented, and Atkinson's role as isolated to the Training 

& Safety department and the InvestigatorSpace product.  (See Defs.' Resp. in Opp'n. 
to Pl.'s Mot. for Prelim. Inj. 4-7, ECF No. 49.)  WCG alleges that Atkinson and Demo 
are poised to use trade secrets, proprietary information, and customer goodwill they 
acquired at WCG to improve Sitero's offerings and ultimately siphon business away 
from WCG.  (See Pl.'s Br. in Supp. of Prelim. Inj. 12-13, ECF No. 32.)  But Sitero 
argues that Atkinson and Demo's new roles are different and not directly competitive 

with what they did at WCG, and any information or knowledge the pair acquired 
while at WCG remains only in their minds.  (See Defs.' Resp. in Opp'n. to Pl.'s Mot. 
for Prelim. Inj. 6,8, ECF No. 49.)                                        
Determining whether to issue preliminary injunctive relief involves a highly fact-
sensitive  inquiry,  in  which  the  court  considers  the  entire  evidentiary  record  in 
determining whether to issue this "extraordinary" remedy.  Winter v. Nat. Res. Def. 
Council, Inc., 

555 U.S. 7, 8

 (2008).  As discussed, WCG must demonstrate three 
elements to cross the threshold for a preliminary injunction: 1) some likelihood of 
success  on  the  merits;  2)  irreparable  harm  if  the  injunction  is  denied;  and  3) 

traditional legal remedies are inadequate.  If the threshold is met, the Court can 
proceed to a broader balance-of-harms analysis.                           
Ultimately,  WCG  fails  to  convince  the  Court  on  any  of  the  three  threshold 
elements.                                                                 
i.   Likelihood of success on the merits                                
In its supporting brief, WCG relies primarily on two allegations to meet the bar 
for  injunctive  relief:  trade  secret  misappropriation  and  breach  of  contract.  

Defendants argue that both claims are destined to fail on the merits.     
     a.  Trade secret misappropriation                                  
WCG alleges that Atkinson and Demo misappropriated trade secrets under the 
Defend Trade Secrets Act ("DTSA") and the Indiana Uniform Trade Secrets Act 
("IUTSA").  (Pl.'s Compl. 26, ECF No. 1.)                                 
Under both statutes, a reviewing court is empowered to grant injunctive relief if 

the movant succeeds in showing actual or threatened misappropriation of trade 
secrets.    

18 U.S.C. § 1836

(3)(A);  Ind.  Code  24-2-3-3.    The  elements  of  a 
misappropriation  claim  under  both  the  DTSA  and  the  IUTSA  boil  down  to  an 
"'acquisition of a trade secret' by 'improper means,' or 'disclosure or use of a trade 
secret' by an unauthorized person meeting certain other conditions."  Motorola Sols., 
Inc. v. Hytera Commc'ns Corp., 

108 F.4th 458, 484

 (7th Cir.), reh'g and reh'g in banc 
dismissed, No. 22-2370, 

2024 WL 4416886

 (7th Cir. Oct. 4, 2024) (quoting 

18 U.S.C. § 1839

(5)(A)–(B)); see also Elevance Health, Inc. v. Mohan, No. 1:23-cv-01497-SEB-
MJD, 

2023 WL 6049674

, at *7 (S.D. Ind. Sept. 15, 2023) (considering the likelihood 

of  success  on  the  merits  of  a  misappropriation  claim  under  IUTSA  and  DTSA 
combined).  WCG claims that Atkinson and Demo are in possession of a variety of 
confidential information  including  "(1)  pricing  strategies  and  methodologies  and 
financial  information;  (2)  product  development  details  and  strategies;  and  (3) 
customer information and goodwill."  (Pl.s' Br. in Supp of Mot. for Prelim. Inj. 31, 
ECF No. 32.)  Defendants do not dispute the categorization of this information as 
trade secrets, so the Court will assume the assertion as true.  (Defs.' Resp. in Opp'n. 

to Pl.'s Mot. for Prelim. Inj. 13-14, ECF No. 49.)                        
As it stands, WCG has provided no evidence in their vast array of exhibits to 
indicate actual misappropriation—in other words, that Atkinson and/or Demo have 
either  1)  acquired  WCG  trade  secrets  in any  way  other  than  through  ordinary 
experiences at the company, or 2) used or disclosed these trade secrets after leaving 
WCG.  WCG's brief does not seem to allege that Atkinson and Demo used "improper 

means" to acquire trade secrets.  Instead, to support its claim for misappropriation, 
WCG cites to a decision from this district in arguing that a "risk" of, as opposed to 
actual, use or disclosure of trade secrets is enough to warrant injunctive relief.  (Pl.s' 
Br. in Supp of Mot. for Prelim. Inj. 32, ECF No. 32) (citing to BioConvergence LLC v. 
Attariwala, No. 1:19-cv-01745-SEB-TAB, 

2019 WL 6893704

, at *11 (S.D. Ind. Dec. 18, 
2019).)  But this  citation is misplaced.  In BioConvergance,  the defendant  stole 
confidential documents from her former employer, including client project plans, 
client contact information, supply chain plans, engineering specifications, etc., and 
that led the Court to find a risk of misappropriation.  Id. at 10.  ("[A]n employee who 

illicitly takes and retains [her] employer's proprietary information creates a risk of 
disclosure and misappropriation that warrants a finding that the movant has a 
reasonable likelihood of success on the merits of [its] legal claim.") (quoting Badger 
Daylighting Corp. v. Palmer, No. 1:19-cv-02106-SEB-MJD, 

2019 WL 4572798

, at *10 
(S.D. Ind. Sept. 20, 2019)).  Here, WCG does not allege that Atkinson and Demo did 
anything of the sort.                                                     
Ultimately, all WCG can demonstrate is that Atkinson and Demo learned trade 

secrets through their work at WCG and may refer to whatever information they have 
retained in their minds while continuing their careers at Sitero.  That is not enough 
to rise to a traditional DTSA or IUTSA misappropriation violation.  As a case from 
this district notes, "mere allegations that former employee possesses proprietary 
information is [sic] insufficient to plausibly suggest actual disclosure or use of trade 
secrets."  Elevance Health, Inc., 

2023 WL 6049674

, at *7 (S.D. Ind. Sept. 15, 2023) 

(citing LigTel Commc'ns, Inc. v. Baicells Techs., Inc., 

455 F. Supp. 3d 792

, 808 (N.D. 
Ind. 2020)).                                                              
With no concrete evidence of disclosure, acquisition, or use, WCG is relegated to 
the so-called "inevitable disclosure" theory, to which it limply gestures in various 
filings.  (See Pl's Compl. ¶ 76, 78, ECF No.1; Pl.'s Mot. for. Prelim. Inj. ¶ 3, ECF No. 
8; Pl.'s Br. in Supp. of Mot. for Prelim. Inj. 33, ECF No. 32.)  This theory is premised 
on the idea that, given the similarity of the respective companies and positions, 
Atkinson and Demo cannot help but rely on WCG trade secrets resident in their 
memory as they continue their careers at Sitero.  See PepsiCo, Inc. v. Redmond, 

54 F.3d 1262, 1270

 (7th Cir. 1995).  Recently, courts in this circuit have held that "[w]hile 
'inevitable  disclosure'  can  be  a  viable  theory  under  state  law,  it  appears  to  be 
foreclosed for claims under the DTSA."  Aon PLC v. Alliant Ins. Servs., Inc., No. 23-
CV-03044, 

2023 WL 3914886

, at *5 (N.D. Ill. June 9, 2023); see also Admiin Inc. v. 
Kohan, No. 23-CV-04430, 

2023 WL 4625897

, at *12 (N.D. Ill. July 19, 2023). 
But WCG's claim under the IUTSA does not fare any better.  WCG can point to no 
relevant case law that supports an inevitable disclosure claim under Indiana state 

law.  In fact, Indiana courts generally disfavor the inevitable disclosure theory, 
applying it only in the "rare and narrow set of circumstances in which the departing 
employee has acted in bad faith in taking or threatening to take valuable confidential 
information from the employer."  Dearborn v. Everett J. Prescott, Inc., 

486 F. Supp. 2d 802, 820

 (S.D. Ind. 2007) (citing to Ackerman v. Kimball Int'l, Inc., 

652 N.E.2d 507

 
(Ind. 1995)).  WCG has not offered any evidence to show that Atkinson and Demo 

acted in bad faith, or that they threatened to take proprietary information with them 
before leaving the company.                                               
Ultimately, WCG does not flesh out how it meets the elements of an inevitable 
disclosure  claim,  and  the  Court  declines  to  engage  in  a  comprehensive  factual 
analysis on its own accord.  The Court concludes that WCG is unsuccessful in alleging 
a  misappropriation  claim  under  the  DTSA  or  the  IUTSA,  both  for  purposes  of 
injunctive relief under the statute, and as it pertains to its likelihood of success on 
the merits.                                                               
     b.  Breach of contract                                             

WCG alleges that Atkinson and Demo violated a set of restrictive covenants 
contained in "Award Agreements" the pair had signed; the agreements granted 
Atkinson and Demo equity in WCG's holding company, Da Vinci Purchaser Holding, 
LP.  (Pl.'s Br. in Supp. of Mot. for Prelim. Inj. 26–30, ECF No. 32.)  The equity-
awarding  contracts  contained  non-compete,  non-solicitation,  and  non-disclosure 
provisions, all of which WCG alleges Defendants violated.  

Id.

            
Because  no  federal  statute  is  invoked,  WCG's  breach  of  contract  claims  are 

governed by state law.  The Erie doctrine requires that "federal courts applying state 
law . . . use state substantive law and federal procedural rules." Sumrall v. LeSea, 
Inc., 

104 F.4th 622, 629

 (7th Cir. 2024); see Erie R. Co. v. Tompkins, 

304 U.S. 64

 
(1938).  "[T]he Supreme Court has made clear that the [Erie] doctrine applies equally 
to state law claims . . . that are brought to the federal courts through supplemental 
jurisdiction."  Houben v. Telular Corp., 

309 F.3d 1028, 1032

 (7th Cir. 2002).  "Federal 

courts hearing state law claims under diversity or supplemental jurisdiction apply 
the forum state's choice of law rules to select the applicable state substantive law." 
McCoy v. Iberdrola Renewables, Inc., 

760 F.3d 674, 684

 (7th Cir. 2014).  WCG asserts 
that the Limited Partnership agreement Atkinson and Demo signed contained a 
Delaware choice of law provision.  (Pl.'s Compl. ¶ 50, ECF No. 1.)  Interestingly, WCG 
offers no citation to this agreement in order to demonstrate the existence of the choice 
of law clause; in its abundance of exhibits, WCG seems to have left this one out.  
Because a merits analysis under both Indiana and Delaware law yields the same 
conclusion, the Court here will presume the choice of law provision exists.  Operating 

under  this  presumption,  "Indiana  choice  of  law  doctrine  favors  contractual 
stipulations as to governing law," so the Court will analyze the restrictive covenants 
under Delaware law.  Allen v. Great Am. Rsrv. Ins. Co., 

766 N.E.2d 1157, 1162

 (Ind. 
2002).                                                                    
Generally, Delaware's courts are more eager than Indiana's to enforce contractual 
terms as agreed to by the parties, holding "freedom of contract in . . . reverential 
regard."  Cantor Fitzgerald, L.P. v. Ainslie, 

312 A.3d 674

, 676–77 (Del. 2024).  Still, 

when it comes to restrictive covenants between employees and employers, Delaware 
does not "'mechanically' enforce or deny non-competes but 'closely scrutinize[s] [them] 
as restrictive of trade.'"  Labyrinth, Inc. v. Urich, No. 2023-0327-MTZ, 

2024 WL 295996

 (Del. Ch. Jan. 26, 2024) (quoting FP UC Hldgs., LLC v. Hamilton, No. 2019-
1029-JRS, 

2020 WL 1492783

, at *6 (Del. Ch. Mar. 27, 2020); and then quoting 
Centurion Serv. Grp., LLC v. Wilensky, 

2023 WL 5624156

, at *2 (Del. Ch. Aug. 31, 

2023)).  Delaware law requires that a covenant not to compete "(1) be reasonable in 
geographic scope and temporal duration, (2) advance a legitimate economic interest 
of the party seeking its enforcement, and (3) survive a balancing of the equities in 
order to be enforceable." Lyons Ins. Agency, Inc. v. Wilson, 

2018 WL 4677606

, at *5 
(Del. Ch. Sept. 28, 2018).  WCG's non-compete does not survive this scrutiny. 
As drafted, the noncompete provision lasts for twelve months after departure from 
WCG  and prohibits  Atkinson  and  Demo from  engaging  with any business  that 
conducts "competitive activities . . . within the United States of America or any other 

jurisdiction in which any of the Company or any of its Subsidiaries engages in 
business, derives a material portion of its revenues, or has demonstrable plans to 
commence business activities."  (Pl.'s Compl, ¶ 52, ECF No. 1.)  A twelve-month 
noncompete  is  not  necessarily  too  long  if  the  geographic  scope  is  limited.    See 
Delaware  Elevator,  Inc.  v.  Williams,  

2011 WL 1005181

  (Del.  Ch.  Mar.  16, 
2011), judgment entered, (Del. Ch. 2011) ("When evaluating the reasonableness of a 
restrictive  covenant,  a  court  must  consider  how  the  temporal  and  geographic 

restrictions operate together.").  But WCG's business is "global in scope" spanning 
throughout the "United States, European Union, and Asia Pacific," (Pl.'s Compl. ¶ 2, 
ECF No. 1), meaning the non-compete intends to prevent Atkinson and Demo from 
taking any job at any "healthcare or related institution" involved in "competitive 
activities" and based in any relevant areas of America, the E.U., or the Asia-Pacific.  
(Pl.'s Reply Br. in Supp of Mot. for Prelim. Inj. 9, ECF No. 54.)  WCG claims that the 

agreement's seven-part definition of "competitive activities" significantly narrows its 
scope, (Pl.'s Reply Br. in Supp of Mot. for Prelim. Inj. 8, ECF No. 54); to this, the Court 
quotes the Court of Chancery: "[t]hat is a pile of words."  Sunder Energy, LLC v. 
Jackson, 

305 A.3d 723

 (Del. Ch. 2023), aff'd in part, rev'd in part, No. 455, 2023, 

2024 WL 5052887

 (Del. Dec. 10, 2024).  It seems that upon leaving WCG, Atkinson and 
Demo, professionals in the clinic-trial space, were expected to find a job at a company 
essentially unrelated to the healthcare industry, or otherwise remain unemployed for 
twelve months.  The Court cannot see how this agreement possibly comports with the 
values  of  the  Delaware  courts,  namely  the  "encouragement  of  competition  and 

discouragement of restraints on trade, the recognition of an individual's right to 
choose her employment, and the desire to avoid oppressive or unclear obligations 
arising from contracts of adhesion." Hub Grp., Inc. v. Knoll, No. 2024-0471-SG, 

2024 WL 3453863

, at *1 (Del. Ch. July 18, 2024), appeal refused, No. 337, 2024, 

2024 WL 4343006

 (Del. Sept. 30, 2024).                                            
In its reply brief, WCG gestures to the fact that Atkinson and Demo's roles as 
shareholders  in  WCG's  parent  company  could  allow  for  a  broader  noncompete 

provision.  In support, WCG includes several citations to Indiana case law, which are 
inapposite given the operative choice of law provision, along with a few Delaware 
cases that are not quite on point.  The first, Kan-Di-Ki, LLC v. Suer, 

2015 WL 4503210

 
(Del.  Ch.  July  22,  2015),  involved  the  alleged  breach  of  restrictive  covenants 
contained in a contract entered into by defendant when he sold his stake in several 
businesses to plaintiff; WCG directs the Court's attention to the following language: 

"[i]f the restrictive covenant in question was obtained as 'part of a contract for the 
sale of stock, this inquiry is less searching than if the Covenant had been contained 
in an employment contract.'" 

Kan-Di-Ki, LLC at *20

 (citations omitted).  But the 
WCG Award Agreements were not contracts for the sale of stock or for the sale of 
business;  rather  they  were  "awards"  of  equity  presumably  rendered  as  partial 
compensation.   There is nothing in Kan-Di-Ki indicating that restrictive covenants 
contained in equity award agreements granted to company executives should be read 
with the same sort of deference as when such provisions arise from the sale of stock 
or the business.  The other case WCG cites, from the Delaware Supreme Court, deals 

with a dispute over various restrictive covenants contained in limited partnership, 
merger,  and  employment  agreements,  but  contains  no  language  about  how 
ownership/shareholder status affects the validity of such provisions.  (Pl.'s Reply Br. 
in Supp of Mot. for Prelim. Inj. 10, ECF No. 54) (citing to Bako Pathology LP v. 
Bakotic, 

288 A.3d 252

 (Del. 2022)).  Because WCG does not explain how Atkinson and 
Demo's status as shareholders of WCG's parent company may impact the analysis of 
the relevant restrictive covenants, the Court declines to take up this vein of analysis. 

WCG asserts that it has adequately alleged legitimate economic interests, worthy 
of protection by such an agreement, in its "customers, trade secrets, confidential and 
proprietary information, and good will are legitimate and worthy of protection."  (Pl.'s 
Reply Br. in Supp of Mot. for Prelim. Inj. 7, ECF No. 54).  While Delaware courts have 
recognized "protection of employer goodwill and protection of employer confidential 
information" as legitimate economic interests in the context of non-competes, the 

Court does not believe that WCG has identified any especially strong concerns to 
demonstrate that the vast scope of this agreement is "essential for the protection of 
[its] economic interest," nor has it demonstrated that the balance of equities weighs 
in its favor.  Rsch. & Trading Corp. v. Pfuhl, No. CIV. A. 12527, 

1992 WL 345465

, at 
*7 (Del. Ch. Nov. 18, 1992); Norton Petroleum Corp. v. Cameron, 

1998 WL 118198

, at 
*3 (Del. Ch. Mar. 5, 1998).  WCG's non-compete is overbroad, both in geographic scope 
and scope of conduct, "casting a limitless net" over Atkinson and Demo.  Centurion 
Serv. Grp., LLC v. Wilensky, No. CV 2023-0422-MTZ, 

2023 WL 5624156

, at *4 (Del. 
Ch. Aug. 31, 2023) (finding unenforceable a non-compete spanning "any area within 

the United States of America, and any other countries within the world where the 
Company is then actively soliciting and engaging in (or actively planning to solicit 
and engage in) the Business."); see generally Hub Grp., Inc. v. Knoll, No. 2024-0471-
SG, 

2024 WL 3453863

, at *11-12 (Del. Ch. July 18, 2024), appeal refused, No. 337, 
2024, 

2024 WL 4343006

 (Del. Sept. 30, 2024) (finding overbroad a non-compete 
agreement narrower in scope than WCG's.)  The Court need not and now declines to 
engage in a lengthy analysis of the balance of equities, given the findings on the other 

factors.  Ultimately, it is the Court's view that WCG's non-compete provision is likely 
unenforceable under Delaware law, and a claim for its violation is unlikely to succeed 
on the merits.                                                            
The analysis for the enforceability of non-solicitation agreements requires the 
Court to consider the same factors as that for non-compete provisions: scope; the 
employer's legitimate economic interests; and balance of equities.  See Focus Fin. 

Partners,  LLC  v.  Holsopple,  

250 A.3d 939

,  958  (Del.  Ch.  2020).    WCG's  non-
solicitation agreement states as follows:                                 
   [T]he Executive shall not, directly or indirectly: (a) encourage, induce, hire or 
solicit or seek to induce, hire or solicit any person engaged with the Company or 
its  Subsidiaries  as an  employee,  agent,  independent  contractor  (or  any  such 
person that was so engaged during the one-year period immediately preceding 
such initial inducement or solicitation during the Term)… to end his or her 
engagement or employment with the Company or its Subsidiaries, or . . . (b)(i) 
solicit, encourage or induce any customer, supplier or client of the Company or its 
Subsidiaries to reduce or refrain from doing any business with the Company or its 
Subsidiaries, (ii) interfere with (or attempt to interfere with) any relationship 
between the Company or its Subsidiaries and any of their respective customers, 
suppliers or clients (or any person or entity in respect of which the Executive is 
aware  that  the  Company  or  its  Subsidiaries  has  approached  or  has  made 
significant plans to approach as a prospective customer, supplier or client), or (iii) 
aid other person or entities involved in such acts.                     

(Ex. 3, Atkinson and Demo's Award Agreements, ECF No. 1-3 at 7.)          
As to the employee non-solicitation provision, the Delaware Court of Chancery in 
a comparable case held that "if the Personnel Restriction . . . (i) only restricted 
[employee],  (ii)  only  lasted  for  a  reasonable  time,  (iii)  only  applied  to  current 
[company]  personnel,  and  (iv)  only  restricted  recruiting  existing  personnel  for 
another business," then it could be found reasonable.  Sunder Energy, LLC v. Jackson, 

305 A.3d 723

 (Del. Ch. 2023), aff'd in part, rev'd in part, No. 455, 2023, 

2024 WL 5052887

 (Del. Dec. 10, 2024).1  But in Sunder, the Court concluded that "[a]s written, 
[the  provision]  is  overly  broad.    In  conjunction  with  the  other  Covenants,  it  is 
oppressive."  

Id.

  WCG's  personnel  restriction  suffers  the  same  fate.    While  the 
provision  restricts  only  Atkinson  and  Demo  and  lasts  for  what  is  arguably  a 
reasonable  time  (twelve  months),  it  applies  to  essentially  anyone  WCG  or  its 
Subsidiaries currently employ or employed in the year preceding a breach, and it 

1 In Sunder Energy, LLC v. Jackson, the Delaware Supreme Court reversed only the part of 
the Chancery Court's opinion that declared the entire LLC operating agreement 
unenforceable as to all signatories as a matter of law, holding that this was an 
inappropriate finding at the preliminary injunction stage. 

2024 WL 5052887

 (Del. Dec. 10, 
2024). At the same time, the Delaware Supreme Court signaled its agreement with the 
Chancery Court's finding of overbreadth as to the agreement's noncompete and 
employee/customer non-solicitation covenants.  See Sunder Energy, LLC 

2024 WL 5052887

, 
at *11.                                                                   
prohibits too broad a slate of activity.  For example, imagine an employee "leave[s] 
the [clinical trial] industry entirely and join[s] a non-profit . . . [Atkinson and Demo] 
would have breached the Personnel Restriction if [they] . . . discuss[ed] whether 

joining a non-profit would be more personally rewarding and aligned with that 
person's values."  Id. at 759.  It is likely that the employee non-solicitation provision 
to which Atkinson and Demo agreed is overbroad under Delaware law, and thereby 
a claim under it unlikely to succeed on the merits.                       
WCG's  customer  non-solicitation  provision  is  arguably  also  overbroad  in  its 
inclusion of current and prospective customers, neither of which are limited to clients 
Atkinson and Demo worked with or were in the process of recruiting.  See Sunder 

Energy,  305  A.3d  at  757  (Del.  Ch.  2023).    Regardless,  while  WCG alleges  that 
"Atkinson and Demo also violated the non-solicit by soliciting business from their 
former WCG customers and helping Sitero Personnel with soliciting business from 
WCG customers," (Pl.'s Br. in Supp. of Mot. for Prelim. Inj. 29, ECF No. 32), it does 
not actually present any supporting evidence for this claim.  Instead, WCG cites to 
page 22 of its own brief, which contains no discussion of the solicitation of WCG 

clients by Sitero, and to support its allegation that Atkinson and Demo were soliciting 
clients "on the backend," a citation to ECF No. 31-72, an exhibit that in fact does not 
contain this quote.  All this to say, were it the case that a Delaware court would 
uphold WCG's customer non-solicitation provision, because the record is devoid of any 
evidence of actual breach of the customer non-solicitation provision, WCG is still 
unlikely to succeed on the merits of such a claim.                        
Finally, as to the alleged violation of the non-disclosure provision, WCG points to 
various exhibits that purportedly prove that Atkinson and Demo used or disclosed 
confidential information to benefit Sitero.  (Pl.'s Br. in Supp. of Mot. for Prelim. Inj. 

30, ECF No. 32.)  As discussed in the context of WCG's trade secret misappropriation 
claim, there is no evidence that Atkinson and Demo disclosed or used any confidential 
information while working at Sitero.  The swath of emails to which WCG cites in 
support does little to bolster its allegations.                           
One such referenced email contains a short message from a Sitero employee 
discussing  how  Atkinson  worked  her  "magic"  to  help  the  group  better  target 
institutional  review  board  customers;  nothing  in  the  email  indicates  that  she 

disclosed WCG proprietary information to do so.  (Ex. 58, ECF No. 34). In another, 
Atkinson writes that she and Demo "learned a lot from the Bausch bid defense" which 
would  help  in  gaging  pricing  and  preparing  a  draft  for  an  entirely  different 
prospective Sitero customer, (Ex. 41, ECF No. 34).  While Atkinson and Demo may 
have worked on Bausch while at WCG, there is nothing prohibiting them from using 
learned experience to inform their work on a new project involving a different client, 

and nothing indicating they revealed proprietary WCG information in the process.  
WCG's strongest piece of evidence contains a message from Sitero's Vice President of 
Research Compliance Services about reaching out to people Atkinson and Demo are 
"familiar with at CROs to message partnering on their next bid," (Ex. 58, ECF No. 
34).  The Court infers that "CRO" stands for contract research organization, (see Defs.' 
Resp. in Opp'n. to Pl.'s Mot. for Prelim. Inj. 8, ECF No. 49,) and it seems that WCG 
works with CROs in its business, (https://www.wcgclinical.com/solutions/cros/).  Still, 
nothing in this email suggests that Sitero expects Atkinson and Demo to target 
clients they are specifically "familiar with" through WCG, or if so, to reveal any 

confidential information in the process.                                  
   Ultimately, these emails are not enough to indicate that Atkinson or Demo 
disclosed proprietary WCG information at any point after leaving the company.  The 
Court finds that WCG has not demonstrated a likelihood of succeeding on the merits 
of its claim that Atkinson and Demo violated the non-disclosure provision, regardless 
of its validity under Delaware law.                                       
ii.  Irreparable harm                                                   

On the question of irreparable harm, WCG alleges that "Defendants' actions have 
already, and will continue to, result in loss of proprietary information and trade 
secrets,  reputation,  and  customer  and  employee  goodwill.  These  losses  are 
irreparable."  (Pl.'s Br. in Supp. of Prelim. Inj. 24, ECF No. 32.)  Plaintiff also refers 
to an irreparable harm provision in Atkinson and Demo's restrictive covenants, 
alongside some friendly Delaware law, as additional evidence for having met this 

requirement.  (Id.)  In a 30+ page brief, this is the extent of Plaintiff's discussion on 
irreparable harm.                                                         
The Seventh Circuit has held that "[i]n some cases, a former employee's use of an 
employer's confidential information could support a finding of irreparable harm to 
the  former  employer,"  but  it  must  be  accompanied  by  an  identifiable  threat  of 
irreparable harm that cannot be alternatively remedied.  DM Trans, LLC v. Scott, 

38 F.4th 608, 621

 (7th Cir. 2022).  Here, there is no evidence that Atkinson or Demo 
currently possess any confidential WCG documents or files, nor that they have 
disclosed  confidential  WCG  information  during  their  employment  at  Sitero.  

Consequently, there is no identifiable impending threat of irreparable harm to WCG.  
The risk of Atkinson or Demo employing knowledge and skills gained from years of 
experience at WCG in their new positions at Sitero is, for better or worse, the cost of 
doing business.  Besides, industry skills acquired while working at WCG, along with 
any knowledge about customers or practices stored in the repository of one's mind, 
will not disappear after a year's time.                                   
While the loss of customer goodwill can, in some contexts, constitute irreparable 

harm, the Court in this case is not convinced.  See Promatek Indus., Ltd. v. Equitrac 
Corp., 

300 F.3d 808, 813

 (7th Cir. 2002) (finding that loss of consumer goodwill 
constituted irreparable harm for purposes of injunctive relief where defendant, a 
market competitor, embedded in its website a meta-tag to plaintiff's trademarked 
product in an effort to manipulate user search traffic).  WCG explains that Atkinson, 
and Demo as her subordinate, worked closely with the company's customers to 

develop WCG's unique InvestigatorSpace product and market it as part of WCG's 
clinical-trial safety offerings.  (Pl.'s Br. in Supp. of Prelim. Inj. 9-10, ECF No. 32.)  
Now, WCG is convinced that Atkinson, as chief commercial officer at Sitero, will build 
up Sitero's safety department and subsequently lure customers away from WCG.  
(Pl.'s Br. in Supp. of Prelim. Inj. 13, ECF No. 32.)  Although Sitero itself does not offer 
a product comparable to WCG's InvestigatorSpace, it partners with a third-party 
company  to  offer  LifeSphere,  which  WCG  alleges  is  competitive  with 
InvestigatorSpace and which it believes Atkinson will help integrate into Sitero's 
current  safety  offerings  and  market  the  integrated  product  to  WCG's  current 

customers.  (Pl.'s Br. in Supp. of Prelim. Inj. 12-13, ECF No. 32.)       
WCG cites to nothing in the evidentiary record that provides even an inkling of 
suspicion to substantiate the company's fears.  The  two lines of Kristin Giffin's 
(General Manager of WCG’s Training and Safety Department) deposition that WCG 
cites to merely state that Atkinson had "deep knowledge" of the InvestigatorSpace 
product, but offer no independent corroboration for WCG's assertion that Atkinson is 
poised to use that knowledge in developing a similar product at Sitero.  WCG's 

musings about Atkinson's intentions are pure speculation.  WCG cannot point to any 
clients who have been approached by Atkinson or Demo since  they began their 
employment at Sitero, nor those whom WCG has lost or is at impending risk of losing 
to Sitero.  Atkinson has testified that she has not been in contact with anyone from 
LifeSphere, nor has she heard references to the product or its parent company while 
working at Sitero.  (Ex. 3, Atkinson Dep. Tr. 134:24-–135:8, ECF No. 44-1 at 36-37.)   

Cases in this circuit have found irreparable harm stemming from loss of consumer 
goodwill when goodwill is stolen through trademark infringement,  which is not 
alleged here, or when an ex-employee actively solicits an employer's customers, which 
is not evidenced here.  See Promatek Indus., Ltd. v. Equitrac Corp., 

300 F.3d 808, 813

 
(7th Cir. 2002); Holbrook Mfg LLC v. Rhyno Mfg. Inc., 

497 F. Supp. 3d 319

, 334 (N.D. 
Ill. 2020); Brown & Brown, Inc. v. Ali, 

494 F. Supp. 2d 943, 955

 (N.D. Ill. 2007).  This 
case does not fit the bill.  Ultimately, WCG has not made a showing that it is at risk 
of irreparable harm stemming from the loss of customer goodwill.          
In a final hail-Mary, WCG directs the Court’s attention to a provision in Atkinson 

and  Demo's  restrictive  covenants  which  states  "that  a  breach  of  any  covenant 
contained in this Agreement would cause the Company irreparable damage for which 
damages at law would not be an adequate remedy."  (Pl.'s Br. in Supp. of Prelim. Inj. 
24, ECF No. 32) (citing to ECF No. 1-1 at 14 § 10.)  Delaware courts have come out 
on both sides of the issue of whether such a contract provision is sufficient for a court 
to find irreparable harm, but none have held such a clause to mandate a finding of 
irreparable harm, absent further indicia of irreparable harm.  Compare Vitalink 

Pharm. Servs., Inc. v. Grancare, Inc., No. 15744, 

1997 WL 458494

, at *9 (Del. Ch. 
Aug. 7, 1997) (finding that the provision "alone suffices to establish the element of 
irreparable harm"); SLC Beverages, Inc. v. Burnup & Sims, Inc., No. CIV.A. 8860, 

1987 WL 16035

, at *2 (Del. Ch. Aug. 20, 1987) (finding that defendant having agreed 
to  the  contract  "cannot  now  assert  that  plaintiff  cannot  seek  to  [enforce  the 
irreparable harm provision]"), with Kansas City S. v. Grupo TMM, S.A., No. CIV.A. 

20518-NC, 

2003 WL 22659332

, at *5 (Del. Ch. Nov. 4, 2003) ("If the facts plainly do 
not warrant a finding of irreparable harm, this Court is not required to ignore those 
facts."); AM Gen. Holdings LLC v. The Renco Grp., Inc., No. CV 7639-VCN, 

2016 WL 787929

, at *2 (Del. Ch. Feb. 19, 2016) ("such a provision does not deprive the Court 
of its discretion with respect to one of the critical forms of equitable relief").  Because 
the  facts  indicate  that  WCG  is  not  at  risk  of  suffering  irreparable  harm,  even 
assuming  the  contract  stipulation  lessens  WCG's  burden,  the  Court  declines  to 
conclude that WCG has shown irreparable harm through the contract provision 
alone.                                                                    

iii.  Alternative legal remedies                                        
WCG argues that a preliminary injunction is the only remedy for potential loss of 
goodwill and reputation, and trade secret misappropriation, (Pl.'s Br. in Supp. of 
Prelim. Inj. 33). But WCG has not shown that they have or are likely to suffer such 
loss, nor that they are likely to succeed on a misappropriation claim.  Were they to 
succeed on the latter, WCG could sue for damages stemming from actual loss or 
unjust enrichment. See Ind. Code 24-2-3-4; 

18 U.S.C. § 1839

(b)(3)(B).     

Otherwise, if WCG can show that their restrictive covenants are valid under 
Delaware law, and that Atkinson and Demo breached them, they can seek damages 
for lost profits.  See Symbiont.io, Inc. v. Ipreo Holdings, LLC, 

2021 WL 3575709

, at 
*57 (Del. Ch. Aug. 13, 2021), judgment entered, (Del. Ch. 2021)("A standard measure 

of damages that courts deploy in cases involving breaches of restrictive covenants 
[are] the profits that the venture could have obtained but for the prohibited conduct"); 
Base Optics Inc. v. Liu, 

2015 WL 3491495

, at *16 (Del. Ch. May 29, 2015)("In the 
context of a breach of a non-compete agreement, lost profits from business within the 
scope of the parties' non-compete are direct, not consequential damages"); Delaware 
Exp. Shuttle, Inc. v. Older, 

2002 WL 31458243

, at *15 (Del. Ch. Oct. 23, 2002)("The 
Plaintiff is thus entitled…to any profits earned by the Defendants that may be 

attributed to the breach of the Non–Competition Agreement.")              
iv.  Balance of harms                                                   
Because  WCG  failed  to  successfully  show  the  three  baseline  elements  of  a 
preliminary injunction, the Court need not reach the balancing-of-harms analysis.  

See Courthouse News Servs., 

908 F.3d at 1067

.                             
It is worth noting that the Court is uncertain how putting Atkinson and Demo "on 
the bench . . . for the duration of their contractual obligations," in other words 
enjoining them from working at Sitero for the next four or so months, will alleviate 
WCG's alleged concerns about trade secret use and loss of customer goodwill.  (Pl.'s 
Reply Br. in Supp of Mot. for Prelim. Inj. 24, ECF No. 54.) WCG claims "the 12-month 
restrictive period would allow [it] to entrust Atkinson's and Demo's customers to their 

new  WCG  contacts,  and  safeguard  use  of  any  business  strategies  that  were  in 
progress at the time they left."  (Pl.'s Br. in Supp. of Prelim. Inj. 27, ECF No. 32).  
This vague plan of action does not seem fit to remedy WCG's alleged concerns. 
Whether WCG seeks for the Court to enforce the entire year-long restrictive covenant 
anew is unclear from its filings; regardless, this Order makes clear that WCG has not 
met the burden for a preliminary injunction.                              

While WCG's frustration over losing executive-level employees to a competitor is 
understandable, based on the evidentiary record and the Parties' briefs, preliminary 
injunctive relief is not justified.                                       
III.  Conclusion                                                        
WCG's motion for a preliminary injunction, (ECF No. 8), is denied.  Defendants' 
motion for oral argument on the injunction, (ECF No. 50), is denied as moot. 
 SO ORDERED.                                            __5 
   Date:   1/15/2025 
                                     JAMES R. SWEENEY I,   JUDGE 
                                     United States District Court 
                                     Southern District of Indiana 

Distribution: 
Justin A Allen 
Ogletree Deakins Nash Smoak & Stewart, P.C. 
justin.allen@ogletree.com 
Marisa L. Berlinger 
Morgan Lewis 
marisa.berlinger@morganlewis.com 
Mark F. Criniti 
SouthBank Legal 
meriniti@lck-law.com 
Erin Linder Hanig 
SouthBank Legal 
ehanig@lck-law.com 
August W. Heckman, III 
Morgan Lewis 
august. heckman@morganlewis.com 
Patrick Joseph O'Rear 
SouthBank Legal 
porear@southbank.legal 

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