EQT wins appeal over deal proceeds
Clients EQT Production Company
Jones Day client EQT Production Company successfully appealed the denial of preliminary injunctive relief. The trial court found that two former employees stole a business opportunity to purchase mineral rights, including in the Marcellus Shale formation, while they were still employed by EQT. The former employees made nearly $1 million on the stolen deal, and the trial court found that EQT would be harmed if they spent that money. But the court denied EQT's request for an injunction imposing a constructive trust to prevent dissipation of those ill-gotten gains, because it found that the former employees would suffer greater harm if they could not access the money. Jones Day was retained to appeal that decision.
On July 24, 2015, the Pennsylvania Superior Court unanimously reversed the trial court's order. It agreed with EQT that the trial court committed legal error by considering any harm to the former employees from losing access to their ill-gotten gains. Although the trial court did not consider all of the factors necessary for the injunction, the Superior Court determined that those factors "do not present any impediment to relief." As a result, it concluded "that the trial court misapplied the law . . . to the facts of this case and unreasonably denied EQT's request to restrict the dissipation of the [stolen] deal proceeds." It reversed and remanded for further proceedings consistent with its decision.
EQT Production Company v. Bochter, No. 1405 WDA 2014 (Pa. Super.)