The parties in AttorneyFirst, LLC v. Ascension Entertainment, Inc., 2005 WL 1349535 (4th Cir. 2005), conducted a preliminary injunction hearing in a case involving alleged breach of a confidentiality agreement and trade secret misappropriation. The Court determined that a preliminary injunction was not warranted, and, pursuant to Civil Rule 65(a)(2), consolidated the hearing with trial on the merits and entered judgment for defendant. The Court claimed in its opinion that it had provided notice to the parties based on some ambiguous comments during the hearing.
The Fourth Circuit reversed the decision, finding that the parties must be given clear and unambigous notice in a manner that would allow them to adjust their presentation to account for all of the merits issues. That standard was not met by the Court's comments at the hearing.