An employer may find itself in a position where, without immediate relief, it may suffer a loss that cannot be made whole by monetary damages alone. For example, a party may feel that a breach of contract or impending breach of contract requires immediate action to protect its interests and prevent further harm. Under these circumstances, the employer may seek injunctive relief in the form of either a preliminary injunction or a temporary restraining order. Preliminary injunctions restrain a party from going ahead with a course of conduct or compel a party to continue with a course of conduct until the case has been decided. A temporary restraining order or a TRO is generally used to prevent irreparable harm and to preserve the status quo until the court decides whether or not to issue a preliminary injunction.
Injunctive relief is a unique remedy with difficult standards and potentially expensive consequences if the employer fails to make its case. New Jersey Courts are to exercise great “caution, deliberation and sound discretion” when considering a party’s request for injunctive relief. Sherman v. Sherman, 330 N.J.Super. 638 (Ch. Div. 1999). When determining whether to pursue this extraordinary remedy, it is recommended that employers seek the advice of counsel to assist in evaluating the likelihood of obtaining the relief sought against the costs associated with seeking such relief.
SOLUTION: Analyze the Likelihood of Obtaining Injunctive Relief Before Making a Determination.
To obtain injunctive relief, an employer needs to demonstrate the following five factors by clear and convincing evidence:
Irreparable Harm
Perhaps the most important factor courts will look to in determining whether injunctive relief is warranted is whether the party will suffer irreparable harm in the absence of the relief being sought. Irreparable harm is generally defined as harm that cannot be adequately redressed by monetary damages, such that the employer has no adequate remedy at law. Irreparable harm must be substantial and imminent; it cannot be remote or speculative.
Balance of Hardships
Courts will also take into consideration what hardship the adverse party will suffer, if any, in the event injunctive relief is granted. It will then weigh that hardship against that which the moving party would suffer if relief is not granted. In making this determination, courts often take into consideration whether the injunction would cause the adverse party to suffer serious financial harm, lose business relationships, or impair an individual’s ability to earn a livelihood.
Success on the Merits and Settled Legal Right
This factor simply means that there is a valid basis on which the moving party may be successful at the conclusion of the litigation. While this element does not require the plaintiff to prove its case at this early stage, the court will take into account whether there are material facts in question when determining whether or not to award injunctive relief.
Public Interest Factor
Courts will also take into account the impact the injunctive relief may have on the public interest. While this factor isn’t always weighed as heavily as the others, if the moving party can demonstrate that the relief sought may advance the public interest, courts may be more inclined to grant injunctive relief. Conversely, if the relief sought is detrimental to an issue of public importance, injunctive relief is less likely to be awarded.
If, after reviewing these factors, an employer has determined that it will likely meet the standard for obtaining injunctive relief, the costs associated with obtaining such relief should also be evaluated prior to moving forward with any formal application to the court. These costs include the expense associated with filing the appropriate paperwork to seek the relief sought, including a possible application for a TRO, the risk of being countersued and the cost of defending against any potential counterclaims, as well as any future legal fees involved in trying the underlying claims to completion.
If you have any specific questions about whether or not to seek injunctive relief, please contact our office directly.