No Free Pass in Mass: Massachusetts Supreme Judicial Court Says Irreparable Harm Must Be Proven, Not Presumed, in Trade Secret Cases

Employers seeking to enjoin a departing employee in Massachusetts from using or disclosing their trade secrets face a higher evidentiary bar than what previously seemed available.

In Daikin Applied Americas Inc. v. Russo, SJC-13881 (Mass. Oct. 14, 2026), the Supreme Judicial Court (SJC) held that a plaintiff who shows a likelihood of success on a trade secret misappropriation claim is not entitled to a presumption of irreparable harm, and trade secret plaintiffs must prove irreparable harm like any other plaintiff.

How the Case Reached the SJC

Daikin provides and maintains heating, ventilation, and air conditioning (HVAC) systems for institutional clients. Two former employees, a service supervisor and a technician, allegedly began emailing information from Daikin to their personal email accounts in 2024. Daikin alleges the material included work contacts, project and bid information showing pricing and costs, equipment photographs, internal service bulletins, and equipment passwords. With the exception of one document relating to a non-public bid, the defendants denied that the information was confidential or proprietary.

While still employed, the defendants formed a separate HVAC business, RPAC LLC, in December 2024. They left Daikin to work at RPAC in March 2025, and Daikin filed suit in May 2025 asserting claims for, among other things, the misappropriation of its trade secrets under common law and the Massachusetts Uniform Trade Secrets Act (MUTSA).

Daikin moved for a preliminary injunction seeking return of its information, a bar on its use, a forensic review of the defendants’ devices, and a one-year bar on soliciting seventy-five customers, including withdrawal of pending bids.

Before the hearing, the defendants agreed to return the information and not to use it, and said they would agree to a more tailored forensic search than the one Daikin proposed. They did not agree to the one-year customer bar, so the hearing went forward on that request. The motion judge entered an order reflecting the parties’ agreement. Daikin argued that a likelihood of success on its trade secret claim entitled it to a presumption of irreparable harm and, alternatively, that it could show irreparable harm without one. The motion judge, who apparently was not persuaded by the presumption argument, required specific proof of irreparable harm and denied the motion, noting that Daikin did not allege that its monetary losses would threaten the existence of its business.

The motion judge also was not convinced that Daikin had shown a likelihood of success, citing genuine disputes about whether some of the information was confidential or a trade secret and whether Daikin had taken steps to protect it.

The Holding

The SJC affirmed the denial of the injunction. It declined to adopt a presumption of irreparable harm and did not decide whether Daikin was likely to succeed on the merits. The Court’s reasoning, and its treatment of the federal cases Daikin cited, can be summarized as follows:

• MUTSA Incorporates Equity. The statute allows enjoining actual or threatened misappropriation “upon principles of equity.” See L. c. 93, § 42A(a). The Court reasoned that a presumption would eliminate the irreparable harm analysis once likelihood of success is shown, which is inconsistent with MUTSA and the equitable principles it incorporates. A preliminary injunction is an extraordinary remedy, and the analysis has traditionally been case-specific.
• The Federal Analogy. The Court drew on eBay Inc. v. MercExchange and its rejection of categorical presumptions in patent and copyright cases, and noted that federal courts of appeals, including the Seventh and Tenth Circuits, have declined to apply a presumption in trade secret cases (Life Spine and First Western Capital). We previously reported on the Tenth Circuit’s decision in First Western here.
• The D. Mass. Cases. Daikin pointed to decisions of the U.S. District Court for the District of Massachusetts, including DraftKings v. Hermalyn, that appear to endorse such a presumption. The SJC observed that in nearly all of the reported cases Daikin cited, the court found irreparable harm notwithstanding any presumption. To the extent any of them rests solely on a rote presumption, the Court said it remains “unpersuaded.”

Daikin’s Showing of Irreparable Harm

The Court also agreed that Daikin had not shown irreparable harm on this record. It treated lost HVAC sales and the value of lost maintenance contracts as quantifiable losses, even if the precise value of a contract is unknown in advance. The Court noted that economic models based on historical information can produce a “robust approximate value.” Economic harm generally can be remedied by a damages award, and interference with existing customer relationships, standing alone, does not suffice. Economic harm may be irreparable, however, where it threatens “the very existence” of the movant’s business, and the motion judge noted that Daikin did not allege that.

Daikin argued that it would lose goodwill with its customers, but the Court found that it presented no evidence of that. In support of its appellate argument, Daikin relied only on counsel’s statements at the hearing. The only affidavit, from a district manager, did not say that Daikin’s losses would be immeasurable or that continued outreach by the defendants would threaten its goodwill. It said only that the seventy-five customers were ones with which the defendants had access to confidential information or significant contact.

The Court also pointed out that the defendants had already agreed, and been ordered, not to use any Daikin confidential information, including the alleged customer list. A footnote adds that the motion judge had noted Daikin did not have non-solicitation or non-competition agreements with these employees, which the Court described as a tacit reference to Daikin seeking “a benefit for which it had not bargained.” The Court’s ruling, however, turned on the absence of a showing of irreparable harm.

Practical Considerations for Employers

1. Prepare the irreparable harm evidence early. Do not rely on a presumption. Support irreparable harm with evidence, such as sworn declarations, rather than counsel’s argument. Because the Court treated lost sales and contract value as quantifiable and said interference with customer relationships alone does not suffice, the evidence should address why money damages would not fully compensate the employer.
2. Expect (or offer) an early stipulation. Defendants may agree to return the information and refrain from using it, and then argue that no further relief is needed. In Daikin, the Court pointed to that agreement and the resulting order in affirming the denial of the customer non-solicitation request. An employer seeking additional relief should be prepared to show what irreparable harm remains despite the agreement. A defendant should consider whether to offer an early stipulation.
3. Match the relief requested to the harm shown. The Court instructed judges to consider what form of injunctive relief would best mitigate the harm at issue. A request for relief that is broader than the harm the employer can show, such as the one-year bar on soliciting seventy-five customers in Daikin, may draw the same scrutiny.
4. Consider restrictive covenants. The motion judge noted that Daikin had no restrictive covenants with these employees, and the SJC mentioned that observation in a footnote, but the ruling did not turn on it. Where customer protection is the goal and applicable state law permits, an employer may consider a narrowly tailored customer non-solicitation covenant. Under G. L. c. 149, § 24L, customer non-solicitation covenants are not “noncompetition agreements” for purposes of the Massachusetts Noncompetition Agreement Act, but they remain subject to Massachusetts common-law enforceability requirements. Daikin did not address whether a covenant would change the irreparable harm analysis.

Daikin leaves preliminary injunctions available in trade secret cases in Massachusetts, but the movant must prove the irreparable harm that justifies the particular relief it seeks. Whether harm such as lost goodwill can support relief will depend on the evidence a plaintiff presents.

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The Trade Secrets & Employee Mobility blog is currently edited by David J. Clark and Daniel R. Levy.