The Role of Injunctions in Commercial Disputes
An injunction is a court order requiring a party to do or refrain from doing specific acts. In commercial disputes, they serve a vital role in maintaining the status quo, preventing irreparable harm, and ensuring that justice can be done when the case is ultimately resolved.
In business disputes, a party may seek injunctive relief if monetary damages are not adequate to address the harm at issue.
For example, if a former employee is disclosing trade secrets or soliciting clients in violation of an agreement, or a business partner is taking actions that you think will harm your business, you may want to seek injunctive relief. An injunction is a court order requiring a party to do or refrain from doing specific acts.
Types of Injunctions in Commercial Cases
There are several forms of injunctions used in commercial disputes. In New York, these are:
Permanent Injunction: Issued as part of the final judgment, these permanently restrain or compel certain conduct based on the court’s findings.
Preliminary injunctions: These are temporary measures granted at an early stage in litigation to preserve the status quo until the final resolution of the case. They are particularly useful when one party alleges immediate harm that cannot be undone.
Temporary Restraining Order (TRO): This is an instantaneous freeze issued while the court decides whether to order a preliminary injunction. That is, even before the court decides whether to stop someone from doing something, it stops that person from doing it, at least temporarily.
The Legal Threshold for Granting Injunctions
Courts do not grant injunctions lightly, as they are a powerful remedy. Courts in New York consider facts such as risk of irreparable harm, likelihood of success on the merits, whether monetary damages are inadequate, and the balancing of potential prejudice to both parties. Securing an injunction typically involves a fast-paced legal process, including filing affidavits and having your attorney appear before a judge on short notice.
If you are involved in a dispute and plan to seek this type of relief, it is important to seek legal counsel early on, as courts will also consider any delay in asking for injunctive relief when deciding whether or not to grant the request.