An injunction is a court order that requires someone to do something or to refrain from doing something, either temporarily or permanently.\u00a0 Interlocutory (temporary) injunctions are often utilized to maintain the status quo between parties to a lawsuit until a final determination can be made at trial by a judge or jury.\u00a0 They can be powerful remedies in hotly contested business disputes where there is a real and severe threat to a company\u2019s operations.\u00a0 A recent Georgia Appeals decision provides some insight into the application of a temporary injunction to a business dispute in this e-commerce era.<\/p>\n
In Grossi Consulting, LLC v. Sterling Currency Group, LLC, Sterling hired Grossi to build a website, dinarbanker.com, through which Sterling could market and sell Iraqi dinars (currency).\u00a0 Sterling\u2019s business volume was impressive right out of the gate.\u00a0 Internet traffic far exceeded that which the website could handle.\u00a0 At Sterling\u2019s request, Grossi upgraded the website and established a call center.\u00a0 Despite these enhancements, the site crashed several times, severely disrupting Sterling\u2019s business. Around this time, disputes arose between Sterling and Grossi concerning Grossi\u2019s unpaid invoices and the manner in which Grossi would be compensated.\u00a0 Grossi\u2019s principal threatened to take over or destroy the website unless Grossi\u2019s outstanding invoices (totaling in excess of one million dollars) were paid.\u00a0 Although Sterling paid the invoices the next day, Grossi intimated that it would seek a new \u201cfulfillment company\u201d to service Sterling\u2019s customers unless Grossi was paid on the terms it dictated going forward.<\/p>\n
Sterling filed suit against Grossi, seeking an injunction to prevent Grossi from disabling the website or otherwise interfering with Sterling\u2019s business operations. For its part, Grossi countered that Grossi and Sterling were joint venturers (basically partners) and that Grossi owned an interest in the dinarbanker.com website.\u00a0 Grossi argued that a preliminary injunction would not maintain the status quo, but would instead provide an unfair advantage to Sterling with respect to the hotly contested issue of ownership and control of the website.\u00a0 After a series of expedited hearings, the trial court entered an interlocutory injunction that required:\u00a0 (a) Grossi to immediately transfer to Sterling all assets and information relating to dinarbanker.com; (b) Grossi to refrain from manipulating or interfering with any information associated with or generated by the website; and (c) Sterling to pay Grossi monthly for maintaining the website while the injunction was in place.\u00a0 By its terms, the Order was to remain in place until final disposition of the case or further order of the court.<\/p>\n
Grossi appealed, arguing that the injunction went beyond the mere maintenance of the status quo and effectively amounted to a final resolution on the merits.\u00a0 In analyzing the appeal, the Court of Appeals outlined the following factors for determining whether injunctive relief was appropriate:<\/p>\n
Because of the discretionary nature of these factors, the Court of Appeals typically gives wide deference to a trial judge\u2019s decision absent a \u201cmanifest abuse of discretion\u201d.\u00a0 After reviewing these factors and finding no abuse by the trial court, the Court of Appeals affirmed the trial court\u2019s ruling, finding that the injunctive relief was an appropriate remedy.<\/p>\n
What we can learn from this case?\u00a0 The outcome of a preliminary injunction hearing can have lasting implications that may be determinative at trial.\u00a0 Litigants would do well to prepare for a preliminary injunction hearing as if it were the final trial in the case.\u00a0 In practical effect, it may well be.<\/p>\n
Tags: injunction, injunction and trial, injunctive relief, interlocutory injunction, maintain status quo, permanent injunction, preliminary injunction hearing, status quo.<\/p>\n","protected":false},"excerpt":{"rendered":"
An injunction is a court order that requires someone to do something or to refrain from doing something, either temporarily or permanently.\u00a0 Interlocutory (temporary) injunctions are often utilized to maintain the status quo between parties to a lawsuit until a final determination can be made at trial by a judge or jury.\u00a0 They can be […]<\/p>\n","protected":false},"author":21,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_mo_disable_npp":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[4,8],"tags":[45,27,32,38],"acf":[],"yoast_head":"\n