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Material Handling v. Nacco Materials Handling Group

February 10, 2011

MATERIAL HANDLING PRODUCTS CORP., PLAINTIFF,
v.
NACCO MATERIALS HANDLING GROUP, INC., DEFENDANT.



1500 AXA Tower I Syracuse, NY 13221 HON. GLENN T. SUDDABY, United States District Judge

DECISION and ORDER

Currently before the Court in this breach-of-contract action is a motion for a temporary restraining order ("TRO") and preliminary injunction filed by Material Handling Products Corporation ("Plaintiff") against Nacco Materials Handling Group, Inc. ("Defendant"). (Dkt. No. 7.) For the reasons stated below, Plaintiff's motion for a temporary restraining order is granted, decision on Plaintiff's motion for a preliminary injunction is reserved, and the parties are directed to appear before this Court at 1 p.m. on Thursday, February 17, 2011, for oral argument on the issue of whether the TRO should be converted to a preliminary injunction and/or revoked.

I. RELEVANT BACKGROUND

On January 27, 2011, Plaintiff filed a motion for a TRO and preliminary injunction in New York State Supreme Court. (Dkt. No. 1.) It appears that Defendant did not oppose Plaintiff's request. On January 28, 2011, Plaintiff was granted a TRO, which enjoined Defendant from (1) terminating Plaintiff's long-standing written Dealer Selling Agreement ("Agreement"), and (2) communicating to any of Plaintiff's customers or known prospective customers any information relative to the Agreement. A hearing on the TRO was scheduled for February 10, 2011.

On February 3, 2011, Defendant removed the action to this Court. (Dkt. No. 1.) Plaintiff now seeks an Order "continuing" the TRO, and enjoining Defendants from terminating Plaintiff's long-standing written Dealer's Agreement, pending a final determination in this action. (Id.) (Dkt. No. 7.)

II. ANALYSIS

Pursuant to the well-known legal standard governing motions for temporary restraining orders,*fn1 a party seeking such relief must establish two things. First, the party must establish a likelihood of irreparable harm if the requested relief is denied. Second, the party must establish either (a) a likelihood of success on the merits of its case, or (b) sufficiently serious questions going to the merits to make them a fair ground for litigation, and a balance of hardships tipping decidedly in its favor.

1. First Requirement--Likelihood of Irreparable Harm

a. Findings of Fact

Based on the affidavit testimony of Scott Minich, the Verified Complaint, and exhibits thereto, the Court finds as follows: (1) Plaintiff is a small, family-owned business that has been a dealer of Defendant's forklifts since 1953; (2) Defendant is a corporation that designs, engineers, manufactures, sells, leases and services branded lift-trucks, including forklifts, and related after-market parts; (3) during the more than forty-year relationship between Plaintiff and Defendant, Plaintiff has disclosed to Defendant significant amounts of proprietary and confidential business information; (4) having been in business for more than fifty years as Defendant's franchisee, Plaintiff has established relationships with its customers, financiers, and employees, the value of which to Plaintiff is not readily calculable; (5) Plaintiff's company has several employees who have been trained, at Plaintiff's expense, to service and maintain Defendant-branded lift trucks, which training is not readily transferable to another manufacturer's products; and (6) on August 31, 2010, Defendant sent Plaintiff a letter, which indicated that Plaintiff had failed to meet the agreed requirements for 2010, and in three of the last four years, and therefore, Plaintiff's dealership appointment would be terminated on January 31, 2011.

b. Conclusion of Law

As a result, the Court concludes that Plaintiff has established a likelihood of irreparable harm if the requested relief (i.e., a TRO pending a hearing on Plaintiff's motion for a preliminary injunction) is denied.

2. Second Requirement--Probability of ...


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