Google LLC v. Point Financial, Inc.

Background

Google sued Point Financial, Inc. (PFI) and sought a temporary restraining order (TRO) and preliminary injunction. Google asked the court to prevent PFI from interfering with Google’s contractual relationships with CNEX Labs, Inc. and vendors involved in manufacturing and testing a product used in Google’s servers. Google also sought to prevent PFI from taking possession of, selling, or otherwise transferring software and equipment that allegedly contained Google’s intellectual property and trade secrets.

Google and CNEX entered into a Master Purchase Agreement in 2016 and later entered into a statement of work concerning the product. The agreements included confidentiality provisions and gave Google certain license and access rights. CNEX ceased operations in April 2024. PFI later asserted that it had a security interest in CNEX’s assets based on a loan on which CNEX had defaulted. PFI contacted Google’s vendors and instructed them to stop using specified information and materials to fulfill Google’s orders. Google alleged that PFI might continue those efforts and might sell the materials to Google’s competitors.

Legal standard

The court applied the same standard to the TRO and preliminary-injunction requests. Under the four-part test identified in Winter v. Natural Resources Defense Council, Inc., Google had to show that it was likely to succeed on the merits, likely to suffer irreparable harm without relief, that the balance of equities favored an injunction, and that an injunction served the public interest.

Likelihood of success

Google asserted three claims: tortious interference with contractual relationships, violation of the federal Defend Trade Secrets Act, and violation of the California Uniform Trade Secrets Act.

For the contract-interference claim, the court found that Google was likely to prove the required elements, including valid contracts, PFI’s knowledge of those contracts, intentional efforts to disrupt them, actual disruption, and resulting damage. The court rejected PFI’s argument that its conduct was lawful because it was enforcing rights in CNEX’s assets. The court concluded that PFI’s rights could not exceed CNEX’s rights under the agreements and that the agreements appeared to allow Google to continue working with the vendors after CNEX ceased operations. The court also found that Google was likely to succeed in showing that it had not invoked a royalty provision, based on evidence that CNEX had not invoiced Google for royalties and had not listed royalties due from Google in its bankruptcy filings.

For the federal and state trade-secret claims, the court found that Google had shown a likelihood of proving that it possessed protected trade secrets, that PFI misappropriated or threatened to misappropriate them, and that the conduct caused or threatened damage. The court relied on declarations describing technical and engineering information that Google protected through nondisclosure and confidentiality agreements. The court stated that Google’s trade secrets were intertwined with CNEX’s intellectual property in the disputed materials. It also recognized that CNEX retained rights to its own intellectual property and stated that the injunction might later be narrowed if CNEX’s separately owned rights were shown to be segregated from Google’s intellectual property.

Irreparable harm, equities, and public interest

The court found that possible disclosure of trade secrets, reputational harm, and harm to Google’s market position supported a finding of irreparable harm. The court found that the balance of equities favored Google because disclosure of trade secrets could cause irreparable harm, while the potential harm to PFI from delaying a sale was financial. The court viewed the public-interest factor as generally neutral because the injunction was largely limited to the parties, but also found that protecting contractual and statutory rights and guarding against cybersecurity threats supported Google’s position.

Security and expedited discovery

Federal Rule of Civil Procedure 65 permits a court to require security to cover costs and damages if the restrained party is later found to have been wrongfully enjoined. PFI requested $150 million based on its asserted valuation of the CNEX assets. The court found that PFI had not provided adequate evidentiary support for that valuation and that CNEX had apparently valued the assets at zero in bankruptcy filings. The court estimated PFI’s potential loss as the attorneys’ fees and costs of defending the lawsuit, estimated those costs at $250,000, and set security at that amount.

The parties jointly requested expedited discovery to determine whether CNEX’s and Google’s intellectual property could be separated so that PFI could sell assets belonging to CNEX. The court found good cause and granted the request.

Order

The court granted the TRO, which had been issued from the bench on May 19, 2025. PFI and persons acting together with PFI were restrained from contacting the vendors or taking action intended to interfere with Google’s license and access rights or to disrupt manufacture of the product. They were also restrained from taking further possession of the disputed materials and from disclosing, selling, or licensing them to third parties.

The TRO was set to expire on July 10, 2025, at 9:00 a.m., unless extended for good cause or with the parties’ consent. The court ordered PFI to appear that day and show cause why a preliminary injunction should not be granted. The opinion does not finally resolve Google’s claims or determine the parties’ ultimate rights after trial.