Labor & Employment Law Daily Wrap Up, TRADE SECRETS—E.D. Tex.: Health staffing tech firm denied preliminary injunction in trade secret dispute, (Jul 31, 2025)

By Steven Melendez

The company failed to prove irreparable harm requiring an injunction or temporary restraining order, a court found.

ShiftKey, LLC, a healthcare technology firm, failed to convince a federal judge to award it a temporary restraining order (TRO) or preliminary injunction in a trade secrets case against a competitor and two former employees (ShiftKey, LLC v. NurseIO, LLC, No. 4:25-cv-00521-ALM (E.D. Tex. July 28, 2025)).

ShiftKey, which "operates a platform that connects licensed healthcare professionals with healthcare facilities to fill open shifts," alleges it has developed alleged trade secrets like "client lists, internal strategies, pricing information, and other data central to its operation," according to the court's ruling.

Background. In April 2024, the company terminated employee Christian McNamee, who was subsequently hired by competitor NurseIO. ShiftKey alleges McNamee didn't promptly return his company laptop, and when he finally did, all of its data had been erased.

Separately, ShiftKey says, employee Yulia McKinney resigned in May 2025, after having sent various internal documents to her personal email address, then deleting the sent messages. She also came to join NurseIO shortly after her resignation.

ShiftKey sued McNamee, McKinney, and NurseIO, alleging the two ex-employees violated their agreements with ShiftKey in soliciting clients and employees, and that NurseIO benefits from the misappropriation of ShiftKey trade secrets. Shiftkey's suit, filed on May 15, 2025, alleges violations of the Defend Trade Secrets Act, among other claims.

Irreparable harm. In order to secure a preliminary injunction, a party needs to show "a substantial threat that plaintiffs will suffer irreparable harm if the injunction is not granted," among other factors, according to the ruling.

With regard to McNamee, ShiftKey alleges he caused irreparable harm through a plan to steal ShiftKey clients.

But, he argued, the company didn't seek a TRO until over a year after he had been employed at NurseIO. The court agreed that the delay weighs against the "claim of urgency and weighs heavily against a finding of irreparable harm," denying a TRO or preliminary injunction against McNamee.

Similarly, with regard to McKinney, ShiftKey argued that her alleged misappropriation of trade secrets and confidential material causes harm that "cannot be undone or adequately compensated by monetary damages alone." But McKinney argued that ShiftKey hasn't shown any concrete evidence of harm or that she "used or disclosed any confidential information since her resignation," according to the ruling.

The court agreed, citing precedent that merely possessing company documents isn't enough to support a finding of irreparable harm.

Additionally, the court found, the "balance of harms" favors McKinney, who would suffer damage to her livelihood and reputation if a court order was issued against her.

With respect to NurseIO, ShiftKey claimed the company could use the information allegedly taken by McKinney to "unfairly leapfrog years of development and erode Plaintiff’s competitive edge and goodwill in a way that monetary damages cannot repair," according to the ruling.

But NurseIO argued that there's no evidence provided that it ever received or used the information and said that it has no intention of using any ShiftKey trade secrets. NurseIO offered to return or destroy any information identified by ShiftKey as a trade secret, arguing that the company is trying to use trade secret law to suppress legal competition.

The court agreed that there hasn't been sufficient evidence of irreparable harm done by NurseIO, such as proof of clients lost or confidential data used. ShiftKey failed to show any potential trade secret misuse can't be prevented from NurseIO's proposed destruction of any identified, confidential data, according to the ruling.

Expedited discovery. The court also denied a motion by ShiftKey for expedited discovery, finding that isn't available without a TRO or preliminary injunction. Discovery will proceed as normal under the Federal Rules of Civil Procedure and a scheduling order to be issued by the court, according to the ruling.

The case is No. 4:25-cv-00521-ALM.

Judge: Mazzant, A.

Attorneys: Michael Andrew McCabe (Munck Wilson Mandala, LLP) for ShiftKey, LLC. Brian Patrick Lauten (Brian Lauten, PC) for NurseIO, LLC.

Companies: ShiftKey, LLC; NurseIO, LLC

Cases: TradeSecrets Procedure EvidenceDiscovery TexasNews