CourtSupreme Judicial Court
DocketSJC 13881
ReleasedOctober 14, 2026
ArguedApril 6, 2026
PanelBudd, C.J., Gaziano, Kafker, Wendlandt, Georges, Dewar, & Wolohojian, JJ
Full opinionRead the full text of the decision
Question
When a plaintiff shows a likelihood of success on a misappropriation-of-trade-secrets claim, is irreparable harm presumed for purposes of a motion for preliminary injunction, or must the plaintiff make a specific showing of irreparable harm under traditional equity principles?
Rule
Under the Massachusetts Uniform Trade Secrets Act, G. L. c. 93, § 42A(a), “[a]ctual or threatened misappropriation may be enjoined upon principles of equity, including but not limited to consideration of prior party conduct and circumstances of potential use.” The statute thus incorporates common-law equity principles, which require a party moving for a preliminary injunction to show that “without the requested relief, it may suffer a loss of rights that cannot be vindicated should it prevail after a full hearing on the merits.” Packaging Industries Group, Inc. v. Cheney, 380 Mass. 609, 616 (1980).
Harm is irreparable if it cannot be remedied through a final judgment. Packaging Industries Group, 380 Mass. at 616–17. Generally, economic harm may be remedied by a monetary judgment. Tri-Nel Management, Inc. v. Board of Health of Barnstable, 433 Mass. 217, 227–28 (2001). Economic harm may be irreparable, however, if the nonmovant’s actions threaten “the very existence of the movant’s business.” Business Interiors Floor Covering Business Trust v. Graycor Construction Co., 494 Mass. 216, 226 n.8 (2024), quoting Hull Municipal Lighting Plant v. Massachusetts Municipal Wholesale Electric Co., 399 Mass. 640, 643 (1987).
A preliminary injunction is “an extraordinary remedy never awarded as of right.” Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7, 24 (2008). To obtain one, the moving party must demonstrate (1) likelihood of success on the merits; (2) irreparable harm in the absence of the requested injunction; and (3) that, in light of its likelihood of success, the risk of irreparable harm outweighs potential harm to the nonmoving party. Tri-Nel Management, 433 Mass. at 219.
Holding
The court held that no presumption of irreparable harm applies when a plaintiff establishes likelihood of success on a misappropriation-of-trade-secrets claim. Ordinary equitable principles requiring a specific showing of irreparable harm govern such motions.
The court reasoned that presuming irreparable harm “departs from traditional ‘principles of equity'” that G. L. c. 93, § 42A(a) incorporates by reference. A preliminary injunction requires case-by-case consideration of whether the movant will suffer “a loss of rights that cannot be vindicated” after a full hearing. Categorical presumptions cannot be squared with equity practice. The court cited eBay Inc. v. MercExchange, LLC, 547 U.S. 388, 393–94 (2006), which rejected presumptions of irreparable harm in patent cases because such categorical rules conflict with equity principles, and noted that Federal Courts of Appeals have declined to apply irreparable-harm presumptions in trade-secrets cases after eBay.
Here, Daikin presented no evidence that the defendants’ solicitation of customers (now barred from using any confidential information) would cause irreparable harm. Daikin asserted only that it would lose HVAC sales and maintenance contracts, which are quantifiable losses compensable by damages. The company offered no proof that monetary damages would fail to make it whole, nor that the loss threatened the existence of its business.
Result
The order denying the motion for a preliminary injunction was affirmed.
Players
- Court: Supreme Judicial Court (interlocutory appeal from Superior Court, transferred from the Appeals Court on the SJC’s own initiative)
- Opinion by: Budd, C.J.
- Panel: Budd, C.J., Gaziano, Kafker, Wendlandt, Georges, Dewar, and Wolohojian, JJ.
- Below: Superior Court (Middlesex County), motion heard by John Pappas, J., May 2025
- Plaintiff: Daikin Applied Americas Inc. (HVAC service and maintenance company)
- Defendants: Joseph Russo and Andrew Porter (former Daikin employees), and RPAC LLC (their newly formed HVAC company)
- Counsel for Plaintiff: Stephen T. Melnick
- Counsel for Defendants: Ronald W. Dunbar, Jr., and Jaffar Bari Shiek
Daikin Applied Americas Inc. sued two former employees for taking its trade secrets when they left to start a rival HVAC business. The trial judge granted part of Daikin’s requested preliminary injunction, ordering the defendants to return confidential information and stop using it. But the judge refused to go further and bar them from soliciting Daikin’s customers for a year. Daikin appealed, arguing that once it showed a likelihood of success on its trade-secrets claim, irreparable harm should be presumed. The Supreme Judicial Court disagreed and affirmed.
The Facts
Joseph Russo worked for Daikin as a service supervisor who scheduled technicians and collaborated on customer pitches. Andrew Porter was a technician. Both had access to business information including customer data, project pricing, and profit margins. Beginning in 2024, Daikin alleged, the two men began emailing confidential Daikin information to their personal accounts: work contacts, bid details showing costs and pricing, photographs of equipment, internal service bulletins, equipment passwords, and a link to Daikin’s internal website. In December 2024, while still employed, they formed RPAC LLC. They left Daikin in March 2025 and began competing for its customers.
Daikin sued in May 2025, asserting misappropriation of trade secrets under common law and the Massachusetts Uniform Trade Secrets Act. It moved for a preliminary injunction with four demands: return all confidential information, stop using it, submit devices for forensic scanning, and refrain from soliciting seventy-five Daikin customers for one year (including withdrawing pending bids).
The Posture Below
Before the hearing, the defendants agreed to the first two conditions and expressed willingness to negotiate a narrower forensic search. The only contested issue at the hearing was the one-year customer-solicitation ban. Daikin argued it had shown likelihood of success on the merits and was entitled to a presumption of irreparable harm. The judge was unconvinced. He noted genuine disputes about whether the information taken was confidential or whether Daikin had taken steps to protect it. (Daikin had no nonsolicitation or noncompetition agreements with Russo or Porter.) More fundamentally, the judge applied the traditional preliminary-injunction standard requiring specific proof of irreparable harm. Because Daikin did not allege that monetary loss would threaten the existence of its business, the judge denied the motion. The SJC transferred the interlocutory appeal on its own initiative.
What the Court Held
Chief Justice Budd, writing for a full bench, held that a plaintiff seeking a preliminary injunction in a trade-secrets case must prove irreparable harm under ordinary equity principles. No presumption applies. The court reviewed the denial for abuse of discretion, examining whether the judge applied proper legal standards and whether there was reasonable support for his evaluation. Because no evidence was taken at the hearing, the court drew its own conclusions from the record.
The Reasoning
Daikin’s principal argument was that a likelihood of success on a trade-secrets claim triggers a presumption of irreparable harm, relieving it of the burden to prove harm. The court rejected that approach as inconsistent with MUTSA and common-law equity. The statute provides that misappropriation “may be enjoined upon principles of equity, including but not limited to consideration of prior party conduct and circumstances of potential use.” A preliminary injunction is an extraordinary remedy, never awarded as of right, that requires a moving party to show on the record that it will suffer a loss of rights that cannot be vindicated at a final hearing. Presuming harm rather than requiring proof departs from those principles.
The court noted that the United States Supreme Court rejected automatic presumptions of irreparable harm in patent and copyright injunctions, reasoning that categorical rules cannot be squared with equity. In eBay Inc. v. MercExchange, the Court held that “a major departure from the long tradition of equity practice should not be lightly implied.” Federal appellate courts have since declined to apply irreparable-harm presumptions in trade-secrets cases. Massachusetts follows the same path.
The court emphasized that equity requires case-by-case consideration of the specific allegations, the type of harm likely to arise, and the form of relief most likely to mitigate it. Here, the defendants had already agreed (and been ordered) to return confidential information and stop using it, including any customer list. Daikin presented no evidence that solicitation by defendants now barred from using confidential information would cause irreparable harm. It asserted only that it would lose sales and maintenance contracts. Those are quantifiable losses. Even if the precise value of a future maintenance contract is unknown ex ante, a robust approximate value can be derived using economic models based on historic data. Daikin offered no proof that monetary damages would fail to compensate it or that the loss threatened its existence.
The court observed that Daikin relied on its counsel’s argument at the hearing and on a district manager’s affidavit. The affidavit stated only that the seventy-five listed customers were those with which Russo or Porter had access to confidential information or significant contact. It did not assert that continued outreach by the defendants would harm Daikin’s goodwill or that monetary damages would be inadequate. Counsel’s argument, standing alone, was insufficient.
Why It Matters
This decision reaffirms that equity is not a rubber stamp. A trade-secrets plaintiff seeking to enjoin a competitor must still shoulder the burden of proving irreparable harm, even after demonstrating likelihood of success on the merits. The holding aligns Massachusetts with federal courts that have rejected automatic presumptions post-eBay. It also puts employers on notice: if you want to restrict former employees from soliciting customers, bargain for a nonsolicitation agreement and pay consideration for it. Daikin did neither. The court’s footnote pointedly observed that Daikin sought a benefit for which it had not bargained and for which it had not compensated Russo or Porter. Absent a contract or proof of harm that money cannot remedy, a preliminary injunction will not issue.
Read the full opinion: Daikin Applied Americas Inc. v. Russo (SJC-13881, October 14, 2026).