The Truth About the “Exceptional” Remedy
April 1 2014
By Charles Post
It is a truism that preliminary injunctions are “rare” and “exceptional” remedies. But rarity is context specific. As a percentage of cars made, Cobra GTs are rare. If you are standing in the plant where they are made, however, they are anything but rare. So, while it may well be true that preliminary injunctions, as a percentage of all cases filed are “rarely granted,” that does not mean that most preliminary injunctions are denied. Although I have no numbers, my experience is that most preliminary injunctions that are brought before a court are likely granted. That is because attorneys who prepare such applications go through a fairly rigorous self-selection.
Attorneys do not like to lose and they rarely try to bring a preliminary injunction if they don’t think they can satisfy a court that the facts necessitate its issuance. The same is true of temporary restraining orders which, after all, are only a short term preliminary injunction which can be acquired on shortened (and sometimes no) notice. When an attorney runs into court with a stack of papers screaming that his client’s hair is on fire and that the defendant is lighting the matches, most judges will, just out of caution and prudence, be inclined to order the defendant to stop playing with matches. This is especially so in trade secret misappropriation and unfair competition cases. A plaintiff company runs into court essentially asserting that it will be destroyed or irreparably injured unless the court issues an injunction. It claims that its customer lists or information associated with customer lists known by former employees is being used to destroy or injure it. On those facts, many judges will issue a preliminary injunction. The truth in trade secret and business unfair competition cases is that preliminary injunctions are common.
It may also be less of a big deal than everybody thinks. Such orders will typically say something like: “don’t use your former employer’s trade secrets.” Orders in excess of that injunction, or that prohibit contact with particular customers, may be subject to a writ of supersedeas or expedited appellate court review. While some trade secret and unfair competition cases settle after the preliminary injunction issues, increasingly we see cases where the preliminary injunction is put into place will proceed to trial or disposition by later motion. On motions for preliminary injunction or application for TRO, the defendant has all the disadvantages. Plaintiff has had substantial time (or at least more time than defendant) to develop evidence, prepare declarations, obtain computer forensics and the like in advance of filing the motion. Defendant is on, well, the defense and must hurriedly prepare declarations, computer forensics. This rush often puts defendants at an extreme disadvantage.
Cautionary note: Many defendants will rush to prepare declarations which commits them to statements that they may later regret. Very few individuals remember with any accuracy the content of email communications, or what stored documents or computer forensics will actually show when they are examined. It is all too common an experience that a party will assert that they have never had any contact with X, Y or Z only to find several emails contradicting that assertion in later discovery. Counsel must take great care not to let defendants overcommit factually in declarations filed in response to a preliminary injunction in advance of electronic communications and documents being collected and reviewed.