ALL COVERED, INC., Plaintiff and Respondent, v. Chad M. MOORE et al., Defendants and Appellants No. D046485 OPINION October 25, 2005 (Super.Ct.No. GIC844809) APPEAL from orders of the Superior Court of San Diego County, William R. Nevitt, Jr., Judge. Affirmed. Counsel Peter C. McMahon, McMahon Serepca LLP, Redwood Shores, CA, Alan Charles Dell'Ario, Dell' Ario & LeBoeuf, Oakland, CA, for plaintiff-respondent. Mark D. Magarian, Irvine, CA, for defendants-appellants. Panel members: Huffman, Richard D., Aaron, Cynthia, Irion, Joan K. Huffman, Richard D., Associate Justice Opinion Not Officially Published (Cal. Rules of Court, Rules 8.1105 and 8.1110, 8.1115) *1 In this action for injunctive relief and damages, plaintiff All Covered, Inc. (plaintiff or ACI) sued individual defendants, its former employees Chad M. Moore, Mike Fields, Anthony Deysher, Jeff Vogt, Josh Schlieff, and their newly formed company Xonicwave, LLC (collectively defendants) on a number of theories, including misappropriation of trade secrets, unfair competition, and breach of contract. (Civ.Code, § 3426 et seq.) Pending trial, plaintiff obtained preliminary injunctive relief, restraining defendants from engaging in business or performing services in competition with plaintiff with respect to its actual customers, as further defined at a subsequent hearing, and also with respect to “(b) any entity or person which was actively solicited for business ” during the relevant time period after defendants' new company was formed in June 2004, but before they left their employment with plaintiff in February 2005. (Code Civ. Proc.,1 §§ 527, 529.) By issuing the order, the trial court made a determination that plaintiff had shown a reasonable probability it would prevail on the merits of the action, and that the interim harm the plaintiff was likely to sustain if the injunction were denied would outweigh any harm the defendants were likely to suffer if the preliminary injunction were issued. (Hilb, Rogal & Hamilton Ins. Services v. Robb (1995) 33 Cal.App.4th 1812, 1819 (Hilb ).) Defendants appeal, contending the trial court erred and/or abused its discretion in granting the preliminary injunction, based on their contentions that plaintiff's evidentiary showing was insufficient regarding both (1) any actual use by the defendants of confidential trade secret information, as opposed to their mere previous authorized access to it, and (2) any unfair solicitation by them or unfair competition to seek out plaintiff's customers, as opposed to their merely making permissible announcements of their departures from plaintiff's company. Further, defendants argue the undertaking ordered as to defendants Moore, Schlieff and Fields in the amount of $35,000 each was insufficient.[2] The injunctive orders are properly appealable, and the record fully supports the trial court's exercise of discretion in granting the preliminary injunction and setting the amount of the undertaking. We affirm. FACTUAL AND PROCEDURAL BACKGROUND A. Background and Complaint The individual defendants were formerly employees of plaintiff, a nationwide information technology outsourcing services company that provides technical computer assistance to small and midsize businesses and branch offices of large companies. Plaintiff hired defendant Moore as a managing consultant in August 2003, and he received a promotion in May 2004 to director of consulting services for the San Diego and Orange county offices. The other individual defendants worked at plaintiff's San Diego office as information technology consultants.[3] All these defendants had signed employment agreements that included confidentiality clauses requiring them not to disclose proprietary information, including customer lists, and not to solicit plaintiff's customers for other business while employed by plaintiff, or to solicit plaintiff's other employees from leaving the company. *2 In June 2004, the individual defendants formed their own company, defendant Xonicwave (the new company), to be a provider of information technology services. At that time, they were still working at plaintiff's office. Their duties there involved dealing with customers and having access to confidential customer list information, which plaintiff maintains as a proprietary database known as “GoBase.” The GoBase system includes for each customer the client's name, address, telephone, fax, web address, primary decision maker's direct contact information, office locations, billing and accounting information, agreement type, pricing information, client's specific likes, dislikes, and expectations. Also, it contains marketing data, network configuration, history of all service calls and contacts between plaintiff and the client, and past, present, and future scheduled appointments. In early February 2005, defendant Moore resigned from plaintiff's employ, and the other individual defendants soon followed (three resigned and two were fired). Plaintiff immediately lost a significant number of its customers at the San Diego office, when they terminated its services or requested on-call status only (12-15 out of 37). Plaintiff began an investigation and hired forensic computer consultants, Kroll Associates. Lee Curtis of that company and his assistant determined that the hard drives on the defendants' work computers that were returned to plaintiff when defendants left had been electronically wiped clean or, in Moore's case (one of two computers), removed. Plaintiff's computer consultants also recovered a November 2004 e-mail from defendant Calderon to an unknown correspondent, stating that Moore was forming a new company and some of plaintiff's employees were going with him, and defendant Calderon was assisting in the plan by scheduling meetings and appointments in an admittedly misleading and inaccurate way. Plaintiff's network engineer, Ben Villatore, reviewed activity logs from the GoBase database for January through early February, and determined that the individual defendants (except Deysher) had examined the calendars of various other San Diego employees, which included a summary of client names and cities for each, which was confidential information. He also found that the defendants' work computers were not set up to automatically back up data in compliance with company policy, and that three of the defendants had utilized company e-mail for Xonicwave business. However, the defendants had “wiped” the hard drives of their company computers and thereby destroyed copies of critical customer information. On March 25, 2005, plaintiff filed its complaint for damages and injunctive relief, alleging misappropriation of trade secrets, unfair competition, intentional interference with prospective economic advantage, trade libel, breach of contract, and a number of other causes of action. Plaintiff immediately sought a temporary restraining order and preliminary injunctive relief, chiefly to restrain defendants from engaging in business or performing services in competition with plaintiff with respect to (a) any entity or person that was an actual customer of ACI between the date of formation of defendant's new company (June 2004) and the date when the individual defendants left employment with ACI (February 2005); and (b) any entity or person “which was actively solicited for business by ACI” during the same time. Plaintiff also sought an order preventing defendants from destroying, divulging or using the trade secrets of plaintiff, including GoBase information and customer information. The temporary restraining order was granted on March 30, 2005, preserving the confidential information collected and setting a hearing on the remaining relief requested. *3 In support of its application, plaintiff provided declarations from its own employees and from its forensic computer consultants, outlining the sequence of events, including the recent resignations or terminations of the defendants and the recent loss of more than a dozen local customers who had canceled its services or requested on-call status only, as opposed to maintaining regular service. According to plaintiff's director of consulting services, Miriam Scally, when she investigated why some customers who had been serviced by the defendants were leaving plaintiff, she learned that those clients had the impression that plaintiff was experiencing financial difficulty and was probably going out of business in the near future. This was not accurate. Clients who were served by other representatives of plaintiff had not been given that impression. Declarations by plaintiff's forensic computer consultant and its network engineer gave details of their investigation into and their findings about the erased records, the downloaded customer list data, the secret e-mails on the defendants' returned company computers, and the removal of the hard drive on one of Moore's returned computers. Some e-mails sent by defendants from plaintiff's system were retrieved and showed references to Xonicwave addresses and business events. In opposition, defendants provided their own declarations denying that they had utilized any confidential information, even though they had been permitted access to it in connection with their job duties during their employment. Several defendants had returned their copies of those customer lists to plaintiff. They also contended that since each customer is provided by plaintiff with a copy of this information about itself as a “guidebook,” and plaintiff does not place restrictions on the customer's use of the guidebook, the information is not really confidential. Defendants Fields and Schlieff denied in declarations and interrogatory responses that they had solicited any of plaintiff's current customers or prospective customers, and stated that they had instead only announced their departure from plaintiff's company and their formation of the new company. Fields's interrogatory responses explained that he left because he did not believe he had any future with plaintiff. Moore's declaration stated he had started up a new company because he was unhappy working for plaintiff. Any announcements of his departure were made by plaintiff after he left. Defendants also supplied declarations from four of their current customers, who had previously utilized plaintiff's services, stating that they had decided to stop doing business with plaintiff, but were not influenced by the individual defendants (particularly Schlieff and Vogt) into leaving plaintiff. Both parties then filed a series of evidentiary objections to the declarations submitted by the other. In plaintiff's reply papers, it provided a declaration from its chief financial officer and vice president Robert Zapotosky, stating that plaintiff does not provide each customer with copies of the “guidebook,” and what was provided would be covered by a confidentiality agreement with the customers. B. Terms of Preliminary Injunction and Order After Hearing *4 The trial court issued rulings on the evidentiary objections by both sides and heard oral argument on the preliminary injunction application. After confirming the evidentiary rulings, the trial court granted the preliminary injunction on May 16, 2005 with a standard undertaking. Then, on May 23, 2005, it held a telephonic hearing on defendant's ex parte motion for various forms of relief and/or clarification. The court issued an order after hearing to clarify certain of the terms in the preliminary injunction. We will first outline those portions of the preliminary injunction that are not contested on appeal: Pending the trial and the ultimate determination of plaintiff's claims, defendants were first ordered to return to plaintiff immediately all copies of any trade secrets of plaintiff, including GoBase information and customer information documents, including but not limited to, the “guidebook” containing detailed information about the clients' networks.[4] Next, defendants were enjoined from “divulging, making known or making any use whatsoever of the trade secrets of ACI, including GoBase information and ACI customer information;” and from destroying any electronically stored information pertaining to plaintiff, Xonicwave, their customers, or the GoBase system. In particular, in paragraph 5 of the injunctive order, defendants were enjoined from “soliciting business from (a) any entity or person that was an actual customer of ACI at any time” between the date of formation of defendants' new company and the date when the individual defendants left employment with ACI and “(b) any entity or person which was actively solicited for business by ACI ” during the same time. (Italics added.) Also, defendants were enjoined from using or disclosing any customer information, etc ., removed from plaintiff by any of its former employees.[5] In this appeal, defendants are particularly challenging the scope of paragraphs 4(a) and (b) of the order, as now clarified in the order after hearing. These provisions originally enjoined them “from engaging in business or performing services in competition with ACI with respect to (a) any entity or person that was an actual customer of ACI ” at any time between the formation of defendant's new company and the date when the individual defendants left employment with it, and “(b) any entity or person which was actively solicited for business by ACI ” in that same time period. (Italics added.) The definitions of “actual customer” and “actively solicited for business” were further outlined in the order after hearing issued May 23, 2005, when the trial court granted defendants' motion to clarify paragraphs 4(a) and 4(b) of the preliminary injunction, as follows: “The term ‘actual customer of ACI ’ as used in 4(a) means an entity or person for whom plaintiff has actually provided services for compensation or for whom plaintiff has contracted to provide services for compensation, excepting those entities and persons for whom plaintiff chose to terminate services. [¶] The term ‘actively solicited for business ’ as used in 4(b) means either at least one outgoing telephone call from plaintiff (not including any telemarketing firm hired by plaintiff) soliciting business to the entity or person, or a sales appointment was held (not merely scheduled) between plaintiff and the entity or person.” (Italics added.) *5 Accordingly, plaintiff was ordered to promptly provide to defendants revised alphabetical lists of names of actual customers and the entities and persons actively solicited for business, as defined in paragraphs 4(a) and (b) of the preliminary injunction. Plaintiff then provided revised lists of the customers and prospective customers defined accordingly. These numbers were 3,534 actual customers, and 10,229 prospective customers, respectively. Further, the court ordered that the motion to increase the undertaking was granted as to defendants Moore, Schlieff and Fields only, to increase it to $35,000 each, which would be sufficient to cover projected attorney fees. The motion to increase the undertaking was denied as to the other moving defendants.[6] The bond thus totaled $135,000, when the remaining four defendants' amounts were included ($7,500 each). The trial court also granted a stay of the action, including all discovery, except as to enforcement of the preliminary injunction, particularly its paragraphs 4(a) and 4(b), pending appeal. We expedited defendants' appeal of these injunctive orders, after denying their petition for supersedeas. (§ 904.1, subd. (a)(6).)[7] DISCUSSION I STANDARDS OF REVIEW; APPEALABILITY “ ‘An order granting or denying a preliminary injunction is appealable, as being within the meaning of the provision for appeals in cases involving injunctions. [Citations.]’ [Citation.]” (Valley Casework, Inc. v. Comfort Construction, Inc. (1999) 76 Cal.App.4th 1013, 1019, fn. 4.) Because this is an early stage of the proceedings in the trial court, the scope of the inquiry on appeal is narrow. As summarized by the Supreme Court in People ex rel. Gallo v. Acuna (1997) 14 Cal.4th 1090, 1109 (Gallo ): “We review an order granting a preliminary injunction under an abuse of discretion standard. [Citations.] Review is confined, in other words, to a consideration whether the trial court abused its discretion in ‘ “evaluat[ing] two interrelated factors when deciding whether or not to issue a preliminary injunction. The first is the likelihood that the plaintiff will prevail on the merits at trial. The second is the interim harm that the plaintiff is likely to sustain if the injunction were denied as compared to the harm the defendant is likely to suffer if the preliminary injunction were issued.” ‘ [Citation.] And although we will not ordinarily disturb the trial court's ruling absent a showing of abuse, an order granting or denying interlocutory relief reflects nothing more than the superior court's evaluation of the controversy on the record before it at the time of its ruling; it is not an adjudication of the ultimate merits of the dispute. [Citation.]” (Also see Hilb, supra, 33 Cal.App .4th 1812, 1820.)[8] “Regardless of whether the trial court has granted or denied an application for a preliminary injunction, if the evidence before that court was in conflict, we do not reweigh it or determine the credibility of witnesses. ‘[T]he trial court is the judge of the credibility of the affidavits filed in support of the application for preliminary injunction and it is that court's province to resolve conflicts.’ [Citation.] Further, if the evidence on the application is in conflict, we must interpret the facts in the light most favorable to the prevailing party and indulge in all reasonable inferences in support of the trial court's order. [Citation.]” (Hilb, supra, 33 Cal.App.4th at p. 1820.) *6 We first address as a threshold matter plaintiff's claim that the order after hearing issued May 23, 2005 was separately appealable, and because defendants have only filed a notice of appeal as to the original May 16, 2005 preliminary injunction order, this court should not have any jurisdiction to hear this appeal. We first take note that the defendants' notice of appeal was filed immediately after the injunction was issued, on May 18, 2005, and their designation of record followed on May 27, 2005. The defendants' designation of the record on appeal includes the reporters' transcripts from both of those dates. As explained by the Supreme Court in Walker v. Los Angeles County Metropolitan Transp. Authority (2005) 35 Cal.4th 15, 21 (Walker ), the pertinent inquiry when closely related orders are challenged on appeal (there, a new trial order and a judgment), is whether the appellant apparently intended to appeal from the underlying significant order and whether the respondent would be prejudiced by allowing the appeal to go forward. (Ibid.) Where only one notice of appeal is filed under such circumstances, but dismissal of the appeal on technical grounds (e.g., problematic jurisdiction with one of the closely related orders) would have the effect of completely denying an appeal, the appellate court may under those circumstances construe the notice of appeal to encompass the underlying related order or judgment. (Ibid.) Following this approach, we conclude there is a sufficient basis for appellate jurisdiction in this case, where the preliminary injunction order was timely appealed, and ex parte proceedings then took place to “clarify” the order. The defendants' designation of the record on appeal includes the reporters' transcripts from both of those dates, and both parties have argued the significance of both orders made. Notices of appeal are to be liberally construed in order to promote resolution of cases on the merits. (Collins v. Hemet Valley Hospital District (1986) 186 Cal.App.3d 922, 927.) “ ‘The law aspires to respect substance over formalism and nomenclature.’ [Citation.]” (Walker, supra, 35 Cal.4th at p. 22.) This reviewing court will construe defendants' notice of appeal from the preliminary injunction to be an appeal from the closely related order clarifying it, because it is reasonably clear the appellant intended to appeal from the injunctive order together with the clarification. Respondent here can make no showing of having been misled or prejudiced in this respect. (Ibid.) II REVIEW OF PRELIMINARY INJUNCTION A Issues Presented We now turn to defendants' arguments that the trial court abused its discretion in issuing the preliminary injunction. The two major factors to be considered are the trial court's conclusions regarding the likelihood that the plaintiff will prevail on the merits at trial, and “ ‘ “the interim harm that the plaintiff is likely to sustain if the injunction were denied as compared to the harm the defendant is likely to suffer if the preliminary injunction were issued.” ‘ [Citation.]” (Gallo, supra, 14 Cal.4th at p. 1109 .) *7 In addition to defendants' main contentions that the evidentiary showing in the trial court was insufficient to support an injunction against their “use” of confidential information, or any unlawful “solicitation” of customers through the use of confidential information, defendants are contending that the injunction is overbroad as a matter of law. Specifically, they are contending that it amounts to a judicially imposed covenant not to compete which fails to meet the standards of Business and Professions Code section 16600, which provides in relevant part, “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.”[9] With those contentions in mind, we will first discuss the defendants' arguments about the evidentiary showings regarding their access to or “use of” confidential information, then turn to the respective showings concerning whether defendants made only permissible announcements of their departures, as opposed to “solicitation” using confidential information that amounted to unfair competition through the use of trade secrets, or alternatively, through a breach of contract (confidentiality clauses). The undertaking issues will be discussed separately (part III, post ). In pursuing this analysis, we note that defendants are claiming on appeal that much of plaintiff's argument in support of the injunction goes to “collateral issues” and/or the ultimate merits of the case, such as the causes of action for trade libel, breach of fiduciary duty (Moore only) or breach of contract. In evaluating this record, we are mindful that “an order granting or denying interlocutory relief reflects nothing more than the superior court's evaluation of the controversy on the record before it at the time of its ruling; it is not an adjudication of the ultimate merits of the dispute. [Citations.]” (Gallo, supra, 14 Cal.App.4th at p. 1109.) We are also well aware that the trial court sustained a number of evidentiary objections by both sides to portions of the declarations before it. However, in their briefs, the parties have discussed the evidence that was properly before the trial court, in light of that order, and we must do likewise.[10] Where the evidence before the trial court was in conflict, we do not reweigh it nor evaluate the credibility of the witnesses. (Hilb, supra, 33 Cal.App.4th at p. 1820.) On appeal of the injunctive orders, we interpret the facts in the light most favorable to the prevailing party and apply all reasonable inferences in support of the trial court's orders. (Ibid.) It is therefore not enough on appeal for defendants to rely on their own declarations containing denials of wrongdoing and to characterize those declarations as “uncontradicted evidence” that would require reversal of the orders. Rather, we look to the evidence submitted by both sides and seek to determine if the injunctive orders were within the discretion of the trial court, with respect to both its evaluations of the likelihood that the plaintiff will prevail on the merits at trial, and the balancing of the interim harm to the respective parties in connection with the injunctive orders. B Showing of Access to and/or Use of Confidential Information *8 “While it has been legally recognized that a former employee may use general knowledge, skill, and experience acquired in his or her former employment in competition with a former employer, the former employee may not use confidential information or trade secrets in doing so.” (Morlife, Inc. v. Perry (1997) 56 Cal.App.4th 1514, 1519 (Morlife ).). Civil Code section 3426.2, subdivision (a) provides for injunctive relief in the trade secret context (“[a]ctual or threatened misappropriation may be enjoined....”). Here, plaintiff pursued both the trade secret argument and also its claims about defendants' breach of their employment agreements' confidentiality provisions, regarding customer lists. Contractual provisions that are reasonably limited restrictions tending to promote trade and business do not violate the provisions of Business and Professions Code section 16600. (Loral Corp. v. Moyes (1985) 174 Cal.App.3d 268, 276.) Such provisions may include an employee's agreement not to disclose his former employer's confidential customer lists or other trade secrets or not to solicit those customers. (Ibid.) Misuse of protected information for competitive purposes may alternatively constitute a breach of a duty of loyalty owed by certain employees. (Bancroft-Whitney Co. v. Glen (1966) 64 Cal.2d 327, 346-348, 352-354; Hilb, supra, 33 Cal.App.4th at pp. 1822-1823.) The basic principle to be applied here is that competitors may conduct business and pursue their livelihoods as long as they do not use unlawful means or engage in acts of unfair competition, such as the misuse of confidential information or trade secrets. (Metro Traffic, supra, 22 Cal.App.4th 853, 859; Bancroft-Whitney Co. v. Glen, supra, 64 Cal.2d 327, 346-347, 352-354 [the employee-defendant's competition for customers using confidential information was deemed unlawful and a breach of fiduciary duty, because he was still employed at the time as the executive director of the plaintiff employer].) Courts will protect customer lists that do not merely represent “information which is ‘readily ascertainable’ through public sources, such as business directories. [Citation.]” (Morlife, supra, 56 Cal.App.4th 1514, 1521.) “On the other hand, where the employer has expended time and effort identifying customers with particular needs or characteristics, courts will prohibit former employees from using this information to capture a share of the market.” (Ibid.) In our case, the trial court had before it declarations stating that plaintiff's investigation into the activity logs for the GoBase database for January through early February disclosed that the individual defendants (except Deysher) had examined the calendars of various San Diego employees, which included a summary of client names and cities for each, which was confidential information. Plaintiff argued that this activity went beyond the defendants' normal job duties in servicing their own assigned customers, and this was a reasonable inference from the evidence. The declarations also stated that the defendants' company computers were not set up to automatically back up data in compliance with company policy, which could result in loss or concealment of customer lists or other data. Also, several of the defendants had utilized company e-mail for Xonicwave business. *9 From this evidence of defendants' access to confidential customer lists, a reasonable inference could be drawn that this access went beyond the scope of what was normally expected in defendants' duties, and a logical inference was that this access was linked to actual use of some of the accessed information. Accordingly, the trial court had a reasonable basis to conclude that the defendants' acts in concealing this activity and in altering their company computers before returning them, to delete evidence of these activities, amounted to evidence of actual misappropriation and use of confidential information. Additional inferences of conduct going beyond mere authorized access to confidential information can be drawn from the evidence of codefendant Calderon's e-mail account to her correspondent, describing her plans to participate with her anticipated future boss, Moore, in creating and servicing the new company and to use contacts with plaintiff's existing customers to further the new company's interests. Defendants have made it difficult for themselves to rebut these inferences of misappropriation, by essentially making unavailable further evidence of their own activities concerning the confidential information. Although defendants contended that the plaintiff's customer lists did not meet the definition of a trade secret under Civil Code section 3426.1, subdivision (d), because plaintiff had placed that information in the “guidebooks” and had thus failed to maintain sufficient reasonable efforts to maintain their secrecy, plaintiff rebutted this showing by providing a declaration of its chief financial officer and vice president, stating that customers were not routinely given copies of their “guidebooks.” When that occurred, the customers' confidentiality agreements regarding this customer information would apply. Moreover, although defendants argued that they returned the customer lists that several of them had, there was conflicting evidence suggesting that they may have retained that information in another form, such as through their previous downloading of data and e-mail activities. Other than citing to the language of Business and Professions Code section 16600, defendants have not shown how this preliminary injunction amounted to a “judicially imposed covenant not to compete” in a legitimate manner. On the whole, the trial court had an adequate basis in the evidence to conclude that more than mere authorized access to confidential customer information had been shown, and the balancing of equities showed the greater potential harm was to plaintiff from potential or actual usage by defendants of that information. C Extent of Solicitation of Existing or Prospective Customers We next inquire whether the record supports the trial court's conclusions that defendants made more than neutral “announcements” of their departures from plaintiff's employ, and instead were shown to have crossed a line into soliciting business from plaintiff's existing customers. Also, plaintiff's lists included a large number of prospective customers (“any entity or person which was actively solicited for business” by plaintiff), for whom they had made individualized sales calls or held sales meetings. Defendants argue that the trial court could not reasonably have concluded that injunctive relief was appropriate to prevent defendants from “engaging in business or performing services” regarding such actual or prospective customers of plaintiff, when that was such a broad class of persons and businesses. (There were 3,534 actual customer names on the lists provided by plaintiff, and 10,229 prospective customers listed.) *10 The appropriate inquiry in determining whether confidential information was wrongfully utilized in competition is to examine the scope and character of the former employees' contacts with customers of the former employer, to determine whether they went beyond merely announcing a new affiliation, and instead actively solicited business for the new company. (Morlife, supra, 56 Cal.App.4th at pp. 1524-1527.) The trial court had to determine on a preliminary basis whether the terms of the statute defining “misappropriation” of trade secrets were met here.[11] (Civ.Code, § 3426.1, subd. (b)(2)(B)(i)-(iii).) It was required to ask whether the customer list was a trade secret that was disclosed or used without express or implied consent by defendants, as persons who: “(B) At the time of disclosure or use, knew or had reason to know that his or her knowledge of the trade secret was: [¶] (i) Derived from or through a person who had utilized improper means to acquire it; [¶] (ii) Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or [¶] (iii) Derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use ....“ (§ 3426.1, subd. (b)(2)(B)(i)-(iii); see Morlife, supra, 56 Cal.App .4th 1514, 1523.) Here, the circumstances surrounding the defendants' access to the computerized customer list, for more than their assigned work related to their own clients, and the apparent efforts by the defendants to conceal this access, all support the trial court's conclusion that the defendants' conduct went beyond mere announcements of reaffiliation, into solicitation of existing plaintiff customers, through the misuse of confidential information. Even though defendants and four of their customers (formerly customers of plaintiff) declared that no solicitation of existing plaintiff customers had occurred, this was only part of the picture. The trial court could also properly consider the evidence produced by plaintiff to show that about one-third of the San Diego office's customers left when defendants left. The trial court could also take note that there were many more than four of the former clients who did not provide any such declarations denying solicitation by the defendants (at least eight other former customers). For example, plaintiff provided a declaration by an independent contractor for one of its clients, who stated that defendant Fields, while employed by plaintiff, had asked him to refer other clients to Xonicwave, and Fields had suggested to the client that it should switch companies because Fields was already so familiar with the client's setup. There was also evidence that defendants had used company e-mail and company time on their new company's business, which could also support an inference of solicitation of business. The e-mail produced by Calderon could properly be considered as background evidence giving additional meaning to the other circumstantial evidence. *11 With respect to the broad scope of the injunction regarding those customers who had been “actively solicited for business” by plaintiff, the trial court made a conscientious effort to exercise its discretion appropriately, by hearing the defendants' ex parte motion for relief on a telephonic basis, in particular to redefine the prospective customers whom plaintiff had contacted in an individualized manner (as opposed to telemarketing). The numbers from plaintiff's original lists (in particular, over 27,000 prospective customers) were reduced. This represented an appropriate exercise of discretion to order only such relief as would protect plaintiff pending trial, while not imposing unduly harsh restrictions on defendants' ability to pursue their livelihoods with respect to any prospective customers, such as those who had not somehow already been contacted by plaintiff. Plaintiffs made a sufficient showing of their efforts to keep their customer lists confidential. Moreover, defendants have not shown any alternative method for protecting this confidential information pending trial.[12] In conclusion, when all of the admissible evidence is taken into account, the record fully supports the trial court's exercise of discretion in granting and in clarifying the terms of the injunction in paragraphs 4(a) and 4(b). III UNDERTAKING In applying section 529, “the trial court's function is to estimate the harmful effect which the injunction is likely to have on the restrained party, and to set the undertaking at that sum. [Citations.]” (ABBA Rubber Co. v. Seaquist (1991) 235 Cal.App .3d 1, 14 (ABBA Rubber ).) “That estimation is an exercise of the trial court's sound discretion, and will not be disturbed on appeal unless it clearly appears that the trial court abused its discretion by arriving at an estimate that is arbitrary or capricious, or is beyond the bounds of reason. [Citation.]” (Ibid.) In its order after hearing, the trial court increased the amount of the undertaking required as to defendants Moore, Schlieff and Fields only, to $35,000 each. The motion was denied as to the other moving defendants. The bond thus totaled $135,000, when the amounts for the remaining four defendants were included ($7,500). Defendants argue this was error or an abuse of discretion, based on the showing they made to the trial court about their potential damages, in addition to attorney fees. In defendants' original papers, they showed that their new company, Xonicwave, had taken in $4,125 in income during the first months of its existence, from one particular client. In connection with the application to increase the undertaking, Moore provided a declaration estimating that its revenue for the next year would be approximately $763,119. Plaintiffs objected to the trial court that this figure was speculative and did not sufficiently reflect any adjustments for the costs of doing business. The trial court found no basis had been shown to increase the undertaking except as noted, because it would be sufficient to cover defendants' projected attorney fees if they ultimately prevailed. *12 “When an injunction restrains the operation of a business, foreseeable damages include ‘the profits which [the operator] would have made had he not been prevented by the injunction from carrying on his business.’ [Citation.] (ABBA Rubber, supra, 235 Cal.App.3d at p. 14.) Here, Defendants did not provide anything other than a speculative showing of prospective damages, which was insufficient to support their application for relief from the undertaking, except as ordered by the trial court. Under all the circumstances, the record does not demonstrate that the trial court abused its discretion in determining that the preliminary injunction should issue and in setting the undertaking in the amount specified. DISPOSITION The orders are affirmed. Costs are awarded to plaintiff and respondent. WE CONCUR: AARON and IRION, JJ. Footnotes 1 All further statutory references are to the Code of Civil Procedure unless noted. [2] Regarding the defendants' new company, Xonicwave, LLC (Xonicwave), the record indicates that only the individual appellants Chad M. Moore, Mike Fields, and Josh Schlieff remain in its employ as partners and/or employees. The other individual defendants, Anthony Deysher and Jeff Vogt, have left Xonicwave, but remain subject to the preliminary injunction and are also parties to this appeal [3] Another named defendant, Suzanne Cole Calderon, worked at plaintiff's Orange County office as its client operations representative. She participated in the startup activities involving the defendant's new company and a separate injunction was ordered against her. She is not a party to this appeal. [4] As defined in Civil Code section 3426.1, subdivision (d), “ ‘Trade secret’ means information, including a formula, pattern, compilation ... or process, that: (1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” [5] Plaintiff originally lodged lists setting forth the names of about 3,500 “actual customers” and a list of over 27,000 prospective customers. At the hearing on the request for relief from the injunction, plaintiff's attorney stated that the customer lists which the defendants formerly had in their possession contained 8,670 names. [6] Defendant's original papers showed that their new company, Xonicwave, had $4,125 in income during the first months of its existence, from one particular client. In connection with the application to increase the undertaking, Moore provided a declaration estimating that its revenue for the next year would be approximately $763,119. Plaintiffs objected to the trial court that this figure was speculative and did not sufficiently reflect the cost of doing business. [7] At the hearing on the preliminary injunction and the request to clarify its terms, the trial court had pending before it a petition by some defendants to compel arbitration. The record does not indicate whether any ruling has been issued regarding arbitration, and the issues before us do not concern it. [8] Civil Code section 3426.2, subdivision (a) provides for injunctive relief in the trade secret context: “Actual or threatened misappropriation may be enjoined. Upon application to the court, an injunction shall be terminated when the trade secret has ceased to exist, but the injunction may be continued for an additional period of time in order to eliminate commercial advantage that otherwise would be derived from the misappropriation.” [9] See, e.g., Metro Traffic Control, Inc. v. Shadow Traffic Network (1994) 22 Cal.App.4th 853, 861 (Metro Traffic ): “ ‘Any attempt to restrict competition by the former employee by contract appears likely to be doomed under section 16600 of the Business and Professions Code, unless the restriction is carefully limited and the agreement protects merely a proprietary or property right of the employer recognized as entitled to protection under the general principles of unfair competition.’ “ [10] The trial court's evidentiary ruling sustained a number of defendants' evidentiary objections to conclusory or hearsay statements in the declarations by the plaintiff's own managerial employees. However, it overruled objections to declarations from the forensic computer consultant and plaintiff's own network engineer (Curtis and Villatore). Similarly, it granted in part and denied in part the plaintiff's requests for exclusion of evidence. We need not outline these rulings in detail, since the parties have properly focused on the remaining admissible evidence. [11] Civil Code section 3426.1 provides in part: “(b) ‘Misappropriation’ means: [¶] (1) Acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or [¶] (2) Disclosure or use of a trade secret of another without express or implied consent by a person who: [¶] (A) Used improper means to acquire knowledge of the trade secret; or [¶] (B) At the time of disclosure or use, knew or had reason to know that his or her knowledge of the trade secret was: [¶] (i) Derived from or through a person who had utilized improper means to acquire it; [¶] (ii) Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or [¶] (iii) Derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use....” [12] At oral argument, counsel responded to a letter of inquiry this court sent regarding the basis in the record for a finding that defendants had access to and made use of confidential information about the group of entities or persons who were “actively solicited for business” by plaintiff, as identified in paragraph 4(b) of the injunction. Appellants' counsel clarified that appellants are not challenging paragraph 5 of the injunction, dealing with solicitation of known plaintiff customers. However, as to paragraph 4, the argument included spirited exchanges between the court and counsel about potential overbreadth of the injunctive language with respect to prohibiting defendants from engaging in business or performing services in competition with plaintiff, concerning the two classes of actual customers or potential customers who had previously been solicited for business by plaintiff, as named in the injunctive order. We are mindful that our review of the order seeks to determine if the trial court abused its discretion in issuing this provisional remedy, and we have analyzed the record with those limitations in mind. We emphasize that our determination is made upon the record and authorities provided to us by counsel. At a later point in the proceedings, the parties will not be precluded from seeking modification of the injunction in the trial court, should a factual or legal basis exist to support such an application. (See 6 Witkin, Cal. Procedure (4th ed. 1997) Provisional Remedies, § 396 et seq., pp. 322-323.)