U.S. Bank National Association v. Li
- Katherine Menendez
- 0:26-cv-02774
- U.S. District Court · District of Minnesota
- 11
In U.S. Bank National Association v. Hao Li, Judge Menendez granted in part and denied in part U.S. Bank's motion, preliminarily enjoining former employee Hao Li from soliciting U.S. Bank employees to leave.
Former employees who sign non-solicitation agreements with their employers, particularly those who later attempt to recruit former colleagues to a new employer. Also relevant to employers seeking to enforce such agreements and companies that hire employees subject to restrictive covenants.
What happened
In U.S. Bank National Association v. Hao Li (No. 26-cv-2774), U.S. Bank sued its former employee Hao Li, alleging he violated a Confidentiality and Non-Solicitation Agreement (CNSA) he signed when he started working there in April 2020. The CNSA barred him from encouraging, inducing, or enticing any U.S. Bank employee to leave the company for one year after his own departure. After Mr. Li resigned in December 2025 and joined a new employer, U.S. Bank alleged he repeatedly reached out to former colleagues trying to recruit them away, including sending text messages asking coworkers to join him at his new job.
U.S. Bank moved for a temporary restraining order and preliminary injunction — court orders that would stop Mr. Li from continuing to solicit U.S. Bank employees while the lawsuit is pending. The court weighed four factors: the likelihood U.S. Bank would win the case, the threat of irreparable harm, the balance of harm to each side, and the public interest. The court found that text messages Mr. Li sent to former coworkers appeared to be clear violations of the agreement, that U.S. Bank faced real and hard-to-repair harm from losing specialized employees and straining client relationships, and that Mr. Li himself would suffer no real harm from being barred from conduct he was already contractually forbidden from doing.
Judge Katherine M. Menendez granted the motion in part and denied it in part. The court issued a preliminary injunction barring Mr. Li, for the duration of the lawsuit, from directly or indirectly encouraging, inducing, or enticing any current U.S. Bank employee to leave the company — but declined to grant the broader injunction U.S. Bank had sought, which would have enforced additional CNSA provisions and required Mr. Li to document his compliance. The court also waived the usual requirement that U.S. Bank post a financial bond, because Mr. Li did not object to that waiver.
The detailed version
- U.S. Bank National Association v. Li · No. 0:26-cv-02774
- Katherine Menendez
- July 9, 2026
Background
Hao Li began working for U.S. Bank National Association in April 2020. As a condition of employment, he signed a Confidentiality and Non-Solicitation Agreement (CNSA) containing a provision prohibiting him from directly or indirectly encouraging, inducing, or enticing any U.S. Bank employee to leave the company during his employment and for one year afterward. The CNSA also contained a clause in which Mr. Li acknowledged that any breach would cause substantial, irreparable injury to U.S. Bank and consented in advance to the issuance of a temporary restraining order or preliminary injunction to prevent such breach.
Mr. Li resigned from U.S. Bank on December 19, 2025, and subsequently joined Gen II Fund Services, LLC. The record reflects that both before and after his resignation, he communicated with former U.S. Bank colleagues Peter Chin and William Chow about leaving U.S. Bank. Specific communications cited by the court include: (1) in August 2025, while still employed, Mr. Li asked Mr. Chin to join him when he left; (2) days after resigning, Mr. Li texted Mr. Chin, "I do need [you] and your boys in q1" and "Exactly that's why I need you guys so I don't have to be a slave," conveying that he wanted Mr. Chin and colleagues to join him at Gen II in the first quarter of 2026; and (3) in early 2026, Mr. Li told Mr. Chow to let him know if he wanted to join Gen II in the next couple of months and that he would hire him. U.S. Bank alleges similar communications with other employees.
In January 2026 and again in April 2026, U.S. Bank sent Mr. Li letters reminding him of his CNSA obligations. In April 2026, U.S. Bank also sent a letter to Gen II notifying it of the non-solicitation provisions. U.S. Bank filed this lawsuit on May 27, 2026, and simultaneously moved for a temporary restraining order and preliminary injunction.
Legal Standard
A preliminary injunction is an extraordinary remedy. Courts in the Eighth Circuit evaluate four factors — commonly called the Dataphase factors after Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109 (8th Cir. 1981) — to decide whether to issue one: (1) the probability that the moving party will succeed on the merits; (2) the threat of irreparable harm to the moving party; (3) the balance between that harm and the injury the injunction would inflict on the opposing party; and (4) the public interest.
Analysis
Factor 1: Likelihood of Success on the Merits
The court found that U.S. Bank showed a "fair chance" of prevailing, which is the threshold required at this preliminary stage. The court identified the text messages to Mr. Chin as constituting apparent clear violations of the CNSA, and found that communications with Mr. Chow also supported an inference of prohibited solicitation.
On enforceability, the court noted that while post-employment restrictive agreements are generally disfavored in Minnesota, they are enforceable if they serve a legitimate employer interest and are not broader than necessary. The court found that the one-year non-solicitation restriction appeared reasonable and served U.S. Bank's legitimate interest in protecting client relationships, particularly given that Mr. Li's alleged solicitation targeted a specialized division servicing key clients. The court cited case law upholding one-year non-solicitation periods as reasonable.
The court rejected Mr. Li's argument that the CNSA was overbroad based on hypothetical extreme scenarios (such as a forwarded text message from a non-U.S. Bank friend to a U.S. Bank employee), finding those hypotheticals far removed from the conduct at issue. The court emphasized it was making only a preliminary determination, not a final ruling on breach or enforceability.
Factor 2: Threat of Irreparable Harm
The court found that U.S. Bank credibly alleged irreparable harm. Specifically, the record reflected that the team Mr. Li previously managed — which serviced a key franchise client — lost 8 of its 22 employees to Gen II, representing a 36% attrition rate compared to an expected 11% rate for that division. Gen II also hired the primary investor service, operations, and financial reporting contacts for the same client. The court recognized that loss of business relationships and goodwill constitutes irreparable harm not fully remedied by money damages.
The court rejected Mr. Li's argument that U.S. Bank's delay in seeking injunctive relief undermined its claim of urgency. The court found that U.S. Bank's decision to first attempt resolution through letters in January and April 2026, and to file suit less than two months after sending follow-up letters, was reasonable under the circumstances.
Factor 3: Balance of Harms
The court found this factor favored U.S. Bank. Because Mr. Li was already contractually obligated to comply with the CNSA's non-solicitation provisions, the injunction would not impose any additional burden on him. The narrow scope of the injunction — limited to the non-solicitation clause — further mitigated any potential harm to Mr. Li.
Factor 4: Public Interest
The court found the public interest also favored issuance of an injunction, citing the public interest in enforcing contracts.
Disposition
The court granted in part and denied in part U.S. Bank's Motion for Temporary Restraining Order and Preliminary Injunction. The court issued a preliminary injunction barring Mr. Li, for the duration of the litigation, from directly or indirectly encouraging, inducing, or enticing any current U.S. Bank employee to terminate their employment with U.S. Bank. The court declined to grant the broader injunction U.S. Bank sought, which would have enforced additional CNSA provisions and required Mr. Li to document compliance. The court noted that the ruling does not foreclose U.S. Bank from seeking additional injunctive relief if further CNSA violations arise.
Bond
Under Federal Rule of Civil Procedure 65(c), a court ordering a preliminary injunction ordinarily requires the moving party to post a security bond. The court waived this requirement because Mr. Li did not oppose U.S. Bank's request for a waiver.
Read the full 11-page opinion on CourtListener, the free public archive maintained by the Free Law Project.