ORDERED that this motion by the plaintiff for a preliminary injunction is granted to the following extent; and it is further *2

ORDERED that, pending the final resolution and determination of the above-entitled action, the defendants are enjoined and restrained from using, appropriating, representing as their own, maintaining, or disclosing to third parties any of the plaintiff's confidential and proprietary information, intellectual property, and trade secrets including, but not limited to: (1) any and all creative, intellectual property and work, in whatever form or format, belonging to the plaintiff, (2) any and all banking, financial, and client billing information, (3) any and all confidential or personal information about the plaintiff's employees, (4) any and all information relating to the advertising and marketing plans and strategies of the plaintiff's clients and accounts, and (5) any and all URL's for the plaintiff's client's websites purchased and hosted by the plaintiff, with associated passwords; and it is further

ORDERED that, within 30 days after service of a copy of this order with notice of entry, the defendant return to the plaintiff any and all of the aforementioned confidential and proprietary information, intellectual property, and trade secrets in their possession in whatever form or format; and it is further

ORDERED that the motion is otherwise denied; and it is further

ORDERED that the plaintiff post an undertaking pursuant to CPLR 3212 (b) in an

amount to be determined by the parties; and it is further

ORDERED that, if the parties cannot stipulate to an appropriate amount, they shall submit papers to the court regarding the amount of the undertaking no later than October 5, 2012.

The plaintiff is a full-service advertising and marketing agency specializing in higher-education marketing (the “company”). It is an expert in the fields of creative design, marketing, advertising, film production, programming, and data management. It provides creative, marketing, management, and analytical services to its clients, who are colleges and universities, and it creates intellectual properties in various forms and formats including, but not limited to, print, radio, broadcast, and internet communications.

The defendants Michael McGetrick and Steven Kerge were employed by the plaintiff from 1994 and 2007, respectively, until November 21, 2011, when their employment was terminated. At the time of their termination, they both occupied positions as Vice Presidents. According to the plaintiff, they were entrusted with the company's confidential and

proprietary information, trade secrets, and intellectual property, and they had close contact with the company's clients. They formed a competing business, the defendant Spark451, Inc. It is undisputed that neither McGetrick nor Kerge signed an employment or non-competition agreement with the plaintiff. Thus, there were no contractual restrictions on their ability to compete with the plaintiff after their employment ended.

The plaintiff commenced this action on March 27, 2012, against McGetrick, Kerge, and Spark451. The plaintiff alleges that McGetrick and Kerge, prior to their departure from the *3 company, started Spark451 and copied the entire contents of the plaintiff's computer server, on which the company's confidential and proprietary information, trade secrets, and intellectual property, among other things, were stored. The plaintiff alleges that the defendants used that information for their own benefit to obtain a competitive advantage over it. The complaint contains several causes of action that are based on the defendants' purported misappropriation of the plaintiff's confidential and proprietary information, intellectual property, and trade secrets, including breach of fiduciary duty, unfair competition, and unjust enrichment. The complaint contains additional causes of action for tortious interference with contract and prospective economic advantage, conversion¹, fraud, and defamation. The complaint seeks both monetary damages and injunctive relief.

The plaintiff moves for a preliminary injunction enjoining the defendants from using or disclosing any of its confidential and proprietary information, intellectual property, and trade secrets; from disparaging or defaming the company; and from soliciting any of its clients. The plaintiff also seeks the immediate return all of its confidential and proprietary information, intellectual property, and trade secrets; expedited discovery, and an accounting. In opposition, the defendants deny using or possessing any of the plaintiff's confidential or proprietary information and contend, inter alia, that the plaintiff has not met its burden of establishing that the information it seeks to protect are trade secrets.

Preliminary injunctive relief is a drastic remedy which is not routinely granted (Marietta Corp. v Fairhurst, 301 AD2d 734, 736). In order to demonstrate that the moving party is entitled to a preliminary injunction, it must show a probability of success on the merits, danger of irreparable injury in the absence of a preliminary injunction, and a balance of the equities in its favor (Atena Insurance Co. v Capasso, 75 NY2d 860, 862). The burden of proof rests with the moving party, who must establish each of the three elements by clear and convincing evidence (Network Fin. Planning v Prudential-Bache Sec., 194 AD2d 651, 652).

In the absence of a restrictive covenant, an employee is free to compete with his former employer unless trade secrets are involved or fraudulent methods employed (Catalogue Serv. of Westchester v Henry, 107 AD2d 783, 784). Although there is no generally accepted definition of a trade secret, New York and other courts have cited with approval the definition found in the Restatement of Torts, which defines a trade secret as “any formula, pattern, device, or compilation of information which is used in one's business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it (Ashland Mgt. v Janien, 82 NY2d 395, 407). Knowledge of the intricacies of a business operation does not necessarily constitute a trade secret; and, absent any wrongdoing, it cannot be said that a former employee should be prohibited from utilizing his knowledge and talents in an area (Reed, Roberts Assoc. v Strauman, 40 NY2d 303, 309). In determining whether something is protectable as a trade secret, courts frequently examine the method by which the defendant acquired it, such as by *4 stealing or copying (Ecolab, Inc. v Paolo, 753 F Supp 1100, 1111 [EDNY], citing Ferranti Elec., Inc. v Harwood, 43 Misc 2d 533). Even when the information does not rise to the level of a trade secret, the unauthorized physical taking and exploitation of internal company documents by an employee for use in his future business or employment may be enjoined as unfair competition (Ecolab, Inc. v Paolo, supra [and cases cited therein]).

The plaintiff has established a likelihood of success on its causes of action sounding in unfair competition and misappropriation of trade secrets and propriety information. The plaintiff has provided detailed factual support for its allegations that McGetrick and Kerge formed Spark451 prior to their termination, copied the plaintiff's computer server and stole its designs, among other things. The opposition, which consists of general denials that the defendants have not used or disclosed any of the plaintiff's confidential and proprietary information or trade secrets, is insufficient to rebut the plaintiff's clear and convincing evidence.

The plaintiff has also established irreparable injury. The loss of client relationships and customer good will constitutes irreparable harm for which injunctive relief is appropriate (see, Alside Div. of Associated Materials v Leclair, 295 AD2d 873, 874; Sylmark Holdings, Ltd. v Silicone Zone Intl. Ltd., 5 Misc 3d 285, 299).

The balance of the equities favors the plaintiff. The benefit to the plaintiff if the injunction were granted and the irreparable harm to it if the injunction were not granted substantially outweigh any injury to the defendants if the injunction were granted (see, Brown v Nelson, 55 AD3d 317, 318). Accordingly, the motion is granted to the extent indicated above.

The plaintiff contends that the defendants have disparaged the company and solicited its clients, causing clients to sever their business relationships with the plaintiff and do business with the defendants. The defendants deny disparaging the company or soliciting its clients and contend that any of the plaintiff's clients who came to them did so of their own accord after the plaintiff advised them that McGetrick and Kerge no longer worked there. The court finds that the plaintiff's conclusory allegations, which are based upon information and belief, are insufficient to establish by clear and convincing evidence that the defendants disparaged the plaintiff, solicited its clients, and induced them to stop doing business with the company. Accordingly, the motion is denied insofar as it seeks to enjoin the defendants from disparaging or defaming the plaintiff and soliciting its clients.

The plaintiff contends that the defendants falsified expense reports and obtained reimbursement from the company for items and services that they procured for their own personal use and for Spark451. Such expenses are clearly compensable by money damages. Therefore, injunctive relief is not appropriate, and an accounting is not a provisional remedy that may be obtained by motion (see generally, CPLR articles 60 through 65).

Finally, the motion is deemed abandoned insofar as it seeks expedited discovery since the plaintiff makes no arguments in support thereof.

Dated:September 4, 2012

J.S.C.