Appealing injunctions for employment issues in South Carolina takes a lot of time and money, which most employees cannot afford. A recent case, which I’ll discuss further below, provides some potent lessons for employees faced with fighting a lawsuit and an injunction at the same time.
When Will a South Carolina Court Issue a Preliminary Injunction?
I’ve written previously about court-issued injunctions related to non-compete agreements or other employment-related claims in South Carolina. While courts are generally hesitant to issue to injunctions at the beginning of the case—because the facts haven’t been fully developed yet and there’s only been one hearing—they will issue them in certain circumstances, but only as a drastic remedy.
A court order of this type binds an individual employee with onerous restrictions and limitations that interfere with the employee’s ability to perform his/her job functions. On top of all that, the company can use the injunction to go back to the court and seek sanctions if the company claims that the employee has violated the court’s order.
Appealing Injunctions for South Carolina Employees
When the trial court judge does issue an injunction, that decision is immediately appealable, meaning that the question of whether the injunction was properly issued then goes up to the South Carolina Court of Appeals for a review.
The case itself will continue through litigation down at the trial court, and the company will have to put up a bond while the appeal proceeds. (In the event that the appeals court determines that the injunction was improperly granted, the employee can seek recovery from the bond for any damages that the improperly-issued injunction has caused.) The appeals process can take several years.
Appealing Injunctions for Employment Claims in Practice: A Greenville Case
We don’t see a whole lot of new court of appeals decisions related to appealing injunctions for trade secrets or non-compete cases in South Carolina, probably because most employees don’t have the funds to defend a lawsuit and pursue an appeal at the same time. But earlier this week, the Court of Appeals did issue a new decision related to an injunction granted in Greenville County against an employee, Jennings-Dill, Inc. v. Eric Israel.
Jennings-Dill is a commercial plumbing and gas piping company. Mr. Israel worked there as a plumbing superintendent. In June 2021, Mr. Israel put in his notice, basing his decision to leave on the poor pay that he and his subordinates were receiving from Jennings-Dill. Prior to his final day, he accessed two or three files (personnel documents related to employees and their contact information, etc.) on his company iPad, which he stated was to find information related to a question asked by another employee. No evidence was presented to the trial court that Mr. Israel had copied or transferred the documents to any other device or means of electronic storage.
However, Jennings-Dill alleged that within three weeks of Mr. Israel’s resignation, twelve other employees left Jennings-Dill, and at least one went to work for Mr. Israel’s new employer, PSI. Jennings-Dill assumed that all of these employees were leaving because of Mr. Israel, and that Mr. Israel must be using the documents he accessed on his company iPad. (There was some hearsay testimony about alleged solicitation.) Mr. Israel had never signed a non-solicitation agreement, so in July 2021 Jennings-Dill brought a lawsuit against Mr. Israel for violations of the SC trade secrets laws, conversion (theft), breach of duty of loyalty, civil conspiracy, and a host of other claims. This is a pretty common tactic when the company didn’t have the employee sign a non-compete or non-solicit.
At the same time, Jennings-Dill filed a motion for a preliminary injunction, asking that the trial court restrain Mr. Israel from using the information from the files he accessed and from improperly soliciting any of Jennings-Dill’s employees.
At the Hearing
The court scheduled a hearing on that motion within two weeks of filing. These injunction hearings are scheduled far more quickly than normal motions, because the whole basis of the injunction request is that the employee’s conduct is creating irreparable harm (damage that can’t be compensated by money) if the court doesn’t act.
At the hearing, the company provided affidavits (sworn statements, normally from people with personal knowledge of what’s being described) of from Mr. Israel’s former supervisor and from a VP of the company. Most injunction hearings don’t include live testimony, only affidavit testimony and documentary evidence (emails, policies, texts, that sort of thing).
The company alleged that Mr. Israel had likely taken copies of those documents from the iPad and used the information contained within to solicit their employees. The company also alleged that a particular employee, Strickland, had told them that Mr. Israel had solicited him. Mr. Israel provided his own affidavit denying that he had taken or kept any copies of the documents, and he also provided a sworn affidavit from Strickland denying that Mr. Israel had solicited him at all.
A month after the hearing, in August 2021, the trial court ruled in favor of the company and issued a 9-page injunction against Mr. Israel that prevented him from using the documents or from improperly soliciting any employees of Jennings-Dill. Mr. Israel appealed that order in September/October 2021. The court of appeals heard oral argument over a year later, in December 2023, and this formal decision was issued about six weeks after that, nearly 18 months since Mr. Israel left his former employer. The Court of Appeals upheld the decision of the trial court, ruling that the preliminary injunction had been properly granted.
Takeaways for South Carolina Employees on Appealing Injunctions
I meet with dozens of employees every month about issues involving non-competes, non-solicits, confidential business information, and trade secrets, especially as it relates to an employee who is planning to leave their current employee and take another job. The piece of advice I repeat over and over again is that an employee should take special care to not take any documents or information that belong to their employer.
Don’t email anything to your personal email account. Don’t download anything to a thumb drive, cloud drive, hard drive, or any other drive. Don’t access any documents you wouldn’t normally access. My parents used to tell me and my siblings to avoid even the appearance of evil. Good advice in the employment context, too. Even if you’re not doing anything wrong or illegal, certain actions can look improper to those looking in, especially those who are already upset that you’re leaving their employ.
For South Carolina employees, you can see from this case how thin the evidence can be and how the court can still issue such a drastic remedy like an injunction. The employee in this case never signed a non-compete or non-solicit, and there’s no evidence that he copied or took a single document while employed (at least that was presented at the hearing 18 months ago; litigation since then may have uncovered other facts). Yet a company has been able to tie up this employee in litigation for those 18 months, cost him thousands of dollars in attorney’s fees, and render untold stress and anxiety. All because he accessed three documents.
The other object lesson is just how long this process can take. I can tell a client all day how many months or years a case can drag on, but this situation provides a compelling reality check. The appeals process—and just to the court of appeals, not the SC Supreme Court—took over 18 months. And in the meantime, the lawsuit itself still rages at the trial level. I’m sure there has been extensive document requests, subpoenas to third parties, review of every email or text message the employee sent over the last few years, depositions, and—judging by the docket report of all the filings in this case—contentious motions practice with several expensive hearings. All that will culminate, ultimately, in a trial at some point in the future.
My biggest piece of advice before you leave a SC employee, especially if you’re a little higher up in the company or have access to company information, is to speak with an employment lawyer in your area before you resign. Know what your options are and how you can best protect yourself from this sort of litigation. Understand that companies often use this type of litigation to terrify and bully employees into staying at jobs that offer subpar pay and experiences instead of seeking out new and better employment opportunities. Know that some companies spend their money on litigation against fleeing employees instead of pay raises to keep them. And most importantly, know the costs, both financial and emotional, that go into defending a lawsuit like this one, let alone appealing injunctions that go with it.
Look, I know that sometimes employees do wrongfully take information and documents with them in violation of contracts and the state and federal laws. I’ve seen it, and I’ve helped resolve those types of claims, both for employers and employees. But after a decade of law practice, the only thing I can confidently say is that at the end of this litigation, the lawyers will be the only ones who make any money. And employees of that pursuing company will be even more scared to leave for fear of retributive litigation.
Until next time, readers.