## In the



# U n ited S ta tes Co urt o f Ap p ea ls

F o rth eS e v e n th C ir cu it
N o. 09

- 2785 H ABI TAT E DUCA T I ON C ENTE R, e tal ., P laint if fs -App el lants , v. U NI T ED S TATE S F ORES T S ERVI CE , e tal ., D efend a nts-A pp ellees.

A pp eal from the United S t ates Di strictC our t fo r the E astern Di stricto f Wisc onsin
. No . 08- C- 627

—A aro n E . G oods tei n, Magis trate Judge
.
A RG UE D A PRI L 14, 2010

— D ECI DE D M AY 27, 2010

Befo re P OSNER, R IPPLE, a nd K ANN E , C ircu it Judges . P OSNER, Cir cu i tJudg e . H ab ita t E d u c at ion C en te r, a no npr o fi t en te r pr i se de di ca te d t o pr om o tinge nv i r o nm entalqua lity, sued the f or estse rv i ce t o obt ai n j ud i ci al r ev i ew o fthe se r vi ce ’ s de ci si o n to al l o w se ve r altho us an d acres of a n ational forest in W iscons in t o b e logged

. ( T he re ar e o th er par ti es o n bo th si des o f th e ca se , but, w ith one exceptio n m enti oned l ate r, theycan be i gnor ed. ) H abi tat ask ed f orand w as gr anted a prel i m i na ryi nj uncti on2 N o. 09

- 2785 aga i nst the i ssuance ofth e perm i t t o the c om pany that ha d b ee n the hi g h b i dderf o r the l o g g i ngc o nt r ac t. The j ud ge re quir ed H abi tatto pos t a $10, 000 i nj uncti on bond, pursuant to Rule 65( c) o fthe c ivilr ule s, wh i ch provi des that“the co urt m ay i ssue a pre l i m i nary i nj uncti o n o r a te m p o r ar y r es tr aini ngo r dero nl y i fthe mova nt gives secu rity in a n am ou nt that the cou rt cons iders pr o pert o pa y the c o st s an d da m ag es s us ta ined bya ny partyf ound to ha ve been w ro ngfull y enj oined o r re st r ained

. ” T he r e i s ane xc ept i o n i fthe a ppl i ca ntf o r the pr el i m i na r y i nj unc ti o n is a f ede r ala g en cyo r o ffi ce r b ut i t has no appli cati on t o thi s ca se. H abitat aske d the j ud ge to reco n s id er the bon d order. I t a rgu ed that a no nprofi t e nter pri se

— atl ea sto ne devote d t o so gr eat and g ener al a goo d a s th e p rotec ti on o fthe e nv i r o nm en t

— shoul d not hav e t o post an inju ncti o n b o nd. The j udg e dec l i ne d t o res ci nd o r modi fy the or der. N ei theri t n or the j ud ge’ s r efusalto r escind o r m od ify it was i m m edi ate l y a pp eal abl e. True, an o rder de nyi nga n i nj unc ti o n b o nd, a s upe r se dea s bo nd ( as s ec uri ty f ora sta y o fexe c u tio n of j ud gm ent) , o r any o ther re q u es t fo r se c u rit y t o p ro te c t a lit iga n t, is im m ed iat ely ap p ea lab le. E .g., C o hen v. B ene ficia l Ind ustria l Lo a n C o rp ., 33 7 U .S. 54 1, 54 6 (1 94 9); In reCar l s on , 22 4 F
. 3d 716, 7 1 8 (7 th C ir. 20 00 ); Ol y mp i a Eq u ip me n t L e a s i n g Co
. v. We s t e r n Unio n Te l egraph Co. , 786 F.2d 794 , 795 -9 6 ( 7th Cir. 19 86 ); In re UNR Indu st ri es, Inc. , 72 5 F
. 2d 1111 , 11 17 (7t h C ir. 19 84 ); Atl ant i c Fe r t i l ize r& C hem i ca l Corp. v. I t al mar e, S
. p. A. , 11 7 F
. 3d 266 ( 5th Ci r. 1997 )
. S uch an or der i s a cl ass i c “c ol l ate ra l o rder,” w hi ch i s t o sayan o rder b el ongi ng to “that s m al l cl ass [ ofo rder s] wh i ch fin allyN o. 09

- 2785 3 deter m i ne cl ai m s o fr i ght s eparabl e from , and col l ate ra l to, r i ghts ass er ted i n the acti on, to o i m port ant t o be d en ied rev iew an d t oo ind ep en d en t o f th e c au se its elf to req u ire th at ap p ella te co n si d e r a tio n be d efe rre d u n til the whol e ca se i s a dj ud i cate d.” C o hen v. Be ne f i ci al Ind ustria l Lo a n C o rp ., sup ra , 33 7 U.S
. at54 6. But ord er s to po sta n i nj unc ti o n b o nd

— an d tha t i s th e or der c hal l enged bythi s a pp eal

— or other sec urity gen erally are n ot ap p ea lab le im m ed iat ely , In r eCar l s on , sup ra ; Cari b b e an Trad i ng & Fi de l i ty Corp. v. N iger i an N at i onal Pe t r o l e u m Corp
. , 94 8 F .2d 11 1, 11 4 (2 d C ir. 19 91 ); H i t ac hi Z osen C le arin g, I nc. v. Tek-M atik, Inc. , 84 6 F
. 2d 27, 28

- 29 (6t h C ir. 19 88 ); Tru s t e e s of Hos pi t al M or tgage G r oup v. C o mp a n i a A s eg u r a do r a In t e r a me r i c a n a S
. A
. P a n a ma , 67 2 F. 2d 250 ( 1stC i r. 19 82) ( per curi am ) , bec ause they ar e l ess like ly to inflic t irr ep ar a b le h ar m . Swi f t& Co. Packe rs v. C om pania D el Ca ri be, 33 9 U .S. 68 4, 68 9 (1 95 0); In reCar l s on , sup ra , 2 24 F
. 3d at7 18
. I nde ed, “ when se tt i ngthe a m o unt of s ec u rit y, d ist ric t c ou rt s s h ou ld err on th e h igh sid e. If the di str ict j ud ge had set the b ond at $50 m i l l i on, as A bbot t r equeste d, thi s would n ot have e nt i t l e d A bbot t to that sum ; A bbot t sti l l w oul d hav e had t o prove its l oss , co nver ti ng the ‘ soft’ num ber s t o hard o nes. A n er ro r i n set ti ng the bo nd too hi gh thus i s no t s er i ous. ( The fee f o r a s o l ve nt firm s ucha s M ea d J o hns o n o r i ts pa r en t Bri sto l

- M yer s S quibb Co. to posta b on d , a st andby l ett er of c redit, o r equi val ent s ecuri ty i s a ve rysm al l fra cti on ofthe s um i nv o l v e d. )
. . . [ A] n e r r o r i n the o the r di re cti on produces i rr eparabl e inj ury, bec ause the dam age s f or an er ro neous prel i m i naryi njun cti on ca nnot e xceed th e a m ount o fthe bond. ” M e ad Joh n s on & Co
. v. Abbott4 N o. 09

- 2785 La bo rato ries , 201 F.3d 88 3, 88 8 (7 th C ir. 20 0 0 ) (em p h as is in ori ginal). The r e i s ho wev er a n ex cept i o n f o r a c as e i n whi chthe bo nd i s bo thhi g he r tha n nec es sa r y and be y o nd the pl aintiff’ s finan cial cap acity, an d th us i nfli cts irrepa rable harm w i thout j usti fi cati on. S ee Fr i e nds of t heEar t h, Inc . v. Br i negar, 51 8 F .2d 32 2 (9 th C ir. 19 75 ); SaveO urSo noran, Inc . v. Flo w ers , 4 08 F
. 3d 11 13 , 1 12 6 ( 9th Ci r . 2 00 5)
. I n s ucha case the bond or der m ee ts the cri ter i a f ora col l ate ra l or der. But not i n thi s ca se. Eventual l y the j ud ge dis sol ved the prel i m i naryi nj uncti on that he had g ra nted to H abi tat, gr anted the f or est ser vi ce’ s m oti on forsum m ar y j ud gm ent, and dis m i sse d the s uit
. H abi tatappeal ed the dism i ssa l

— i t i s th e appe al be f o r e us

— and gener al l y w hen a fi nal j ud gm ent o r othe r or der i s a pp eal ed, the appell ant c an chal l enge an y in te rloc u to ry ru lin g t h at ad ve rs ely affe c ts h im
. In re Sa lem , 46 5 F
. 3d 767, 77 3- 75 ( 7th Ci r. 20 06) ; K uro w s kiv. Kraje wski, 848 F.2d 76 7, 77 2-7 3 ( 7 th C ir. 19 88 ); Jacksonvill e P o r t A u t h o r i tyv . A d a ms , 5 56 F.2d 52, 57 and n. 15 (D
. C
. Cir. 1977 ); 11A C ha rles A lan W right, A rthu r R. M il ler & M ary K ay K an e, Fed eral P rac tice an d P roc edu re§ 2962 , pp. 433- 34 ( 2d ed. 19 95)
. T h e or der t o post an i nj uncti on bo nd ( or re fuse t o re sci nd the or der) was such a rul i ng. E ve n w h en an int er loc u to ry o r d er is im m ed iat ely ap p ea lab le, t h e p ar ty ad ve rs ely affe c te d by it ca n w ait and chal l enge i t l ate r, o n appeal from t h e fi nal j ud gme n t, p r o v i d e d o fco u r s e th a tth e o r d e rh a s n ’ tb e c o me m oo t in th e m ea n tim e. Kur owsk iv. Kr aj e wski, sup ra , 84 8 F. 2d at 772- 73. Fa r f ro m becom i ng m oo t, the or derN o. 09

- 2785 5

m aki ng H abi tatposta bond i s l i kel y t o bi te harderthan whe n i t wa s e nt e r e d. W he n the s e c ur i t y t a k e s the f o rm o f a su r ety b o nd , the i ni ti alc o sti s th e su r ety ’ s f ee . The bondi ng co m pany pro m i ses to pay any dam age s f or l oss es caused bythe i nj uncti on s houl d the par ty w ho g ot the inj uncti on a nd thu s caused the l oss ( i n thi s ca se, H abi tat ) f ai l to pay the da m ages

— i n s uc h a c a s e , i nd e e d, the inj ured party c an pro ceed a gai nst the sur etydi re ctl y. Fe d

. R. Civ. P. 65. 1. H abi tat didn’t use a sure ty ; i t deposi ted $1 0, 000 w ith t he co urt. The co st to H abi tat w as th u s t h e t im e v alu e o f th at am ou n t
. H ad th e p re lim inaryi nj uncti on notbee n vaca ted, thatw ou ld h ave been the o nl y c ostto H abi tat
. But now it fa ces the pos sibi l i ty ofhavi ng to pay dam age s t o t h e f or estse rv i ce, tho ugh on ly u p to th e b on d lim it o f$1 0,0 00
. Coyne

- D e l any Co. v. C a pit a l D evelo pm ent B o a rd, 717 F.2d 385 , 390 -9 4 ( 7 th Cir. 19 83 ); G lobal N aps, Inc. v. Verizon N ew E ngland, Inc. , 48 9 F.3 d 13 , 20-2 1 (1s t C ir. 20 07 ); S p r i n tC o mmun i c a t i o n s C o . L
. P. v. CA TCo m m unicati ons Int’l, Inc. , 33 5 F
. 3d 235, 239

- 40 ( 3 d C ir. 20 03 ); Ni n t e n d o o f A me r i c a, In c . v . L e wi s G a l oob Toy s, Inc. , 16 F .3d 10 32 , 103 6-3 7 (9 th C ir. 19 94 ); N at i onal Kidn ey Pat i e nt s As s ’ n v . Su l l i van , 95 8 F
. 2d 1127, 11 34- 35 (D.C
. Cir. 1992). I t cou ld be argu ed that un less and un til d a m a g es are ass ess ed, H abi tathas i ncurr ed no lo ss and ther ef or e l acks sta nd i ng to appeal

. But i t has i ncurr ed a l oss

— a l oss o f th e u se of $1 0 ,0 0 0 . E ve ry d ay th at a su m of m on ey is wr o n g fu l l y wi th h e l d , i t s r i g h t fu l o wn e r l o s e s th e t i me val ue o fthe m oney . S upp ose no dam age s a re ev er asses sed against H abitat an d so even tu all y the cou rt r e t u r n s th e $ 1 0 , 0 0 0 th a t i t i s h o l d i n g ; th e r e wo ul d b e no6 N o. 09

- 2785 proce du ra l ve hi cl e t o enabl e Habit at t o re cove r the l oss of th e t i m e va l ue o fi ts mone y . The r efo r e i t ha d s ta ndi ng to chal l enge the b ond o rdero n appeal fro m the fi nal j ud gm ent. S ee S pr i n tCo mm u n i c at i on s Co
. L
. P. v . CAT C om m unicati ons Int’l, Inc. , sup ra , 33 5 F
. 3d at 239. A genui ne oddity about the appeal i s that i t is fr om a j udg m en t

— n am ely th e d ism iss al of t h e s u it

— that th e ap p ell an t is not cha ll en gin g , bu t only fr om an interl ocuto ryo rder . A c leanerapproa ch w oul d have be en f o r H abitatt o de si g na te i ts a ppea l a s ana ppea l fr o m the b on d ord er . For itbe c am e fin al a n d t h e re for e a p p ea lab le when th e su i t was di smi ss ed, s i nc e attha t po i ntthe or der was no lon ge r i nter l ocuto ry . But the oddityo f H abi tat ’ s a pp ro ach has no j uri sdic ti onalsi gni fi cance. On t o the mer i ts o fHab i ta t’ s ch al l en g e to th e bo nd. The w i nning bi dd erhad bi d $55, 000. T h e prel i m i naryi nj uncti on, wh i ch w as enter ed on J anuary 13, 20 09, pre vente d th e loggi ng from being u nd ertaken f or at l east a yea r, bec au se loggi ng i n th is forest is d one only i n w inter, w hen the gr ound is har d. The i nj un c tion w as diss ol ved on M ay 12, 2 009, but w e a re to l d w i thout contr adic ti on th atthe r ul es o fthe f o r est servi ce r equi r e th atthe proj e c tb e r e b i d. An a ffi da v i ts ub mi t t e d b y the f o re st se rv ice in th e d ist ric t c ou rtst at ed th at th e p roj ec t w ou ld b e re b i d i n “ ea rly O c to b er 20 09 ,” b u t a s fa r as w e’r e a b le to d et er m i ne, as o fthe date o fo ra l ar gum ent ( A pri l 14 o fthi s y e a r ) i th a d n o ty e tb e e n r e b i d. W e a re notper suaded by H ab itat’ s a rgum ent that no np r o fi te nt i t i e s , a tl e a s ttho s e de v o t e d t o p ubl i c g o o ds o fg r ea t soc i alv al ue , s ucha s th e pr o te ct i o n o fthe e n-N o. 09

- 2785 7 vi ro nm ent, sho uld be exem pted f ro m havi ng to post inj u ncti on bonds. The ar gum ent fl i es i n the f ace ofR u le 65( c) , wh i ch not onl y c ontains no such excepti on but al so state s fl atly th at “th e cou rt m ay issue a p r e li m inary i nj u n c t i o n o r a t e mpo r a r y r e s t r a i n i n g o r d e r o n l y i ft he m o va ntg i ve s se cur i tyin an amoun t th atthe c o ur t co nsi ders properto p ay the c ost s a nd dam age s s ustai ned by any party f ound to ha ve been w ro ngfull y e nj oi ned or restrained

. ” Th e langu age of Ru le 65(c) w as even m ore emphat ic bef o r e ch an g ed i n 2 00 7; i t r ea d: “ no r es tr aini ng o r de r o r p r e l i mi na r y i nj un c t i o n s ha l l i s s ue e xc e ptu po n the g i vi ng o fse cu rit y b y the appli cant, i n such sum as the c ourtdeem s pro per, f orthe pa ym ent o fsuch co sts an d da m ag es a s m ayb e i nc ur r ed o r s uff er ed bya ny par t y who i s f o un d t o ha v e b e e n wr o ng ful l y e nj o i ned or re st r a i ne d. ” T he c o mm i t t e e n o t e s t o the 2 0 0 7r e v i si on mak e c l e a r tha tn o s ub s t a nt i v e c ha ng e wa s i nt e nd ed

— on ly c lar ifica tio n, an d co n sis te n c y in st y l e a n d te rm in ology . In s eem i ng co ntra dict i on o fthe rul e, a num bero fcas es al low a di str i ct c ourtto waive the re quir em ent o fan i nj un c t i o n b o nd

. I n s o me o f the s e c a s e s the c o ur t i s s ati sfied th at t h e r e ’s n o d an ge r th at th e o p p os in g p ar ty w ill i n c u r a n y d a ma g e s f r o m th e i nj u n c t i o n . T h e r e i s no re as on to r equi re a bond i n such a case

— a nd c e s s an te rati o ne leg i s c e s s a t ipsa lex ( w hen the re aso n f ora l aw lea ve s o ff, th e la w lea ve s o ff). See , e.g., Conne ct i cu t Ge n e r alL i

f eIn s . Co
. v . Ne w Image s o f Be ve r l y Hil ls , 321 F.3 d 8 7 8 , 882 -83 (9t h C ir. 20 03 ); D oc t or ’s As s oc i at e s , Inc . v. Stu a rt, 85 F .3d 97 5, 98 5 (2 d C ir. 19 96 ); H o xw o rth v . B l i n d e r, Robi ns on & Co. , 90 3 F
. 2d 18 6, 21 0 ( 3d Ci r . 1 99 0) ; 1 1A W r i g ht8 N o. 09

- 2785 et al., sup ra , § 2954, pp. 292- 93. A nd i n another cl ass o f case s a b o nd tha two ul d g i v e the o pp o s i ngpart y ab so l ut e se cur i tya gai ns t i nc ur r i nga ny l o ss fr o m the i nj uncti on would exce ed the appli can t’ s abi l i ty to pay an d th e di st r i ctc o ur t ba l an ce s ( o fte n i m pl i ci tl y ) the re l ati ve cos t t o the o pp onent ofa sm al l erbo nd ag ai nst the c ostto the appli cant of havi ng to do without a pre l i m i naryi njun c tio n that he m ay need despera tel y. S ee, e.g ., WayneC he m i ca l, Inc
. v. C ol um b us A ge ncy S e r vi ceCorp. , 56 7 F.2 d 6 92 , 7 01 (7 th C ir. 19 77 ); Tem ple U niversi ty v. W hite, 94 1 F .2d 20 1, 22 0 (3 d C ir. 19 91 ); P e o p l eex re l
. V a n DeKa mp v. Taho e R egional Planning A gency, 76 6 F
. 2d 1319 , 13 25- 26 (9t h C ir. 19 85 ); C ity of At la nta v. M et ropolit an A tl anta R apid Transi t A uthority, 636 F.2d 108 4, 10 94 (5th C ir. 1981 )
. Thi s ca se fi ts nei thercat ego ry . The f or estse rv i ce m ay lose m on ey as a re su lt of t h e n ow -d iss olv ed p re lim inaryi nj uncti on ( i n fac t it’s bo und to l ose atl eas t a l i ttl e, as w e ’ l l s e e ) , a nd Ha b i t a ta dmi t s tha tp o s t i ngthe $ 1 0 , 000 bond caused i t no har dship, l et al one d et er red i t fro m ask i ng f orthe i nj uncti on

— i t m i g hthave b ee n abl e to b uy a s urety b ond f oras l i ttl e as $300

. S ee CourtBondN et,
“ B o n d s fo rJu d i c i a lP r o c e e d in g s , ” w w w . c o u r tb o n d n e t
. c o m/ j ud i ci al

. htm l ( vi si ted M ay 3, 20 10)
. A nd wh i l e Habit at h as n’tto l d us w hat i ts tot alas set s o r re venues ar e, o ne o f i ts c o pl aint i ff s ha s an nua l r ev en ue s o fs o m e $7mil l i o n. E n vir on m en ta l L aw & P olic y C en te r, “E L P C Is Fin an c ially S o und a nd W el l

- M an ag ed, ” el pc. o r g/ el pcs - fi n a n c i a l

- s t a tus (visi ted M ay 3, 2010 ). Tur ni ng to H ab i ta t’ s al te r na ti ve g r o und f or c an ce l i ng or r e d u c in g t h e b on d , w e a sk w h et h er $1 0,0 00 is excess i ve i n re l ati on t o the for estse rv i ce’s l i kel y l ossN o. 09

- 2785 9 f ro m a l ogg i ng del ay of a y ea r. M oneyhas ti m e v al ue, as w e’ ve sai d. I f you part w i th m oney, you lose liqu id ity (th e in st an t a b ilit y t o d ep loy ca sh ) an d in a d d ition incu r a ri sk of ne ver getting y ou r m one y back

. So y o u de m an d c o m pen sa ti o n fo r pa rting wi thmone y, a nd that com p en sat i on nor m al l y t ake s the f or m o fi nter estat a s peci fi ed ra te, tho ugh other f acto rs bes i des l oss o f l i quidi ty and ri sk ofdef aul t m ay i nfl uence the r ate , such as expected i nfl ati on. Busi nesse s, i nd i vi du al s, and doubtl es s ev enfede r ala g en ci es ( co ns i der i ngthe s ta g g er i ng fed er al b u d ge t d efic it

— $1. 4 t ri l l i on i n 200 9 a nd l i kel y t o be a s g re at orgr eat erthi s y ear ) val ue havi ng ca sh now rather th an a prom ise, how ever reli able, of cash later. H ab i t a ta r g u e s th a ta o n e - y e a r d e l a y i n r e c e i v i ng $5 5, 00 0 i s co st l es s to the f o r es t se r vi ce b ec au se the in flat ion ra te w as ze ro (or c los e to it) in 20 09 an d is likely to re m a in v e ry l ow this year (r em em ber th at w e d on’t k no w whe th er th e f o r es t se r vi ce ha s r eb id th e l o g g i ng c on tr ac t y e t )
. B u t t h e in flat ion rat e is n ot th e o n ly i nfl uence o n i nter estr ate s. The Feder alRese rv e has pu shed shor t- ter m i nter estr ate s down ve ryl ow ofl ate by fl oo ding banks and other len ders w i th tr i l l i ons of d olla rs to len d an d inv es t, bu t h as n ot b y d o i n g so elim inated the ti m e v al ue o fm oney . $5 5, 000 w oul d be worth m or e to da y tha n a y e a r a g o o nl y i fthe r e we r e de f l ati on

— th at is , o n l y if a giv en n u m b er of d olla rs w ou ld buy m or e g oo ds and ser vi ces today t h an a ye arag o

— an d a l th o ug h i nfl at i o n h as b ee n v er y mild sinc e th e eco nom i c cr i si s hi t, i t has notbee n nega ti ve. St i l l, H ab itathas a poi nt wh en i t s ays that$1 0, 000 i s a n ex travag an t estim ate of the loss i n tim e value from de fer-10 N o. 09

- 2785 ri ng the recei pt of $55, 000 f orone ye ar ; i t i m pli es an annual in teres t r ate o f18
. 2 per cent ( $10, 000 ÷ $ 55, 000)
. But an inj u n c tio n bo n d is in te n d ed to se c u re ag ain st p os sib le as w el l as cer tai n cos ts

— re cal l the passag e we quoted f r o m the o pi ni o n i n M ead Johns on . There i s s om e r i sk th at t h e r e b i d d in g of t h e log gin g c on tr ac t w ill no t y ield $55, 000. M aybe nota bi g r i sk; f orJanuar y 2 009 w as near the nadir of the eco nom i c cri si s; housin g constr ucti on was gr eat l y depre sse d; si nce then l um berpri ces have ri sen. Tony C. Dreibus, “Lum berRi ses to H i ghest Pri ce S i nce 2 006 on Econom i c Outl oo k, ” B lo o m berg B usin ess Week( A pr. 16, 2010) , ww w . busi nessweek. com /ne w s/2010

- 04

- 16 / l um be r - j um ps- to
- hi g he s t
- p r i ce - si nc e- 20 06

- o noutl oo k- f or -d em and.ht m l ( vi si ted A pr. 27, 20 10) ; Li am P leve n and LesterA l ri ch, “High Lu m berPri ces Threat en H ousi ng M ar ket, ” Wal l St r e e tJour nal (Feb. 1 6 2 010), onl i ne . wsj
. c o m/ a r t i c l e / S B1 0 0014 2405 2748 7035 6240 4575 06 77 50 81 54 90 31 6.h tm l (v isit ed A p r. 27, 201 0). B u t a risk is a r i s k ; a l l t ha t w e c a n kn o w wi th c e r t a i n t y a tth i s t i me i s that the j ud ge m ayde ci de no t t o a war d da m ag es . Act ual l y that’ s unl i kel y, bec ause the b i dd i ng pro cess is not cos tl ess , al though the f orest se rv i ce r ecko ns the co st of r eb i ddi ngthe l o g g i ngc o nt r ac t ata mode st$ 2, 35 0. The service ha s already asked the m agist r a t e j ud ge to aw ard thi s a mou nti n da mag e s wi tho uta wa i t i ngthe o ut c o me of th e a p p ea l or th e d et e r m i n at ion of th e o th er d am ag es , i f any, i n flict ed by the inj uncti on bo nd

. H e deci ded to w ai t unti l the app ea l w as re sol ved and any add i ti onal dam age s dete rm i ned. Thi s del ay und er sco re s o ur e ar l i er re m ar ks abou t H abi tat ’ s l oss o fthe ti m e v al ue o fi ts $10, 000, and thi s i s furtherev i dence f orthe ti m elines s o fN o. 09

- 2785 11 i ts r eque sttha t we o r derthe mone y r efunde d t o i t f o r th

wi th

. Bu t we w on’ t do that because we thi nk the bond w as pr o per . And we e spe cial l y wi sht o e m pha si ze o ur rej ec tio n of th e ru le p ro p os ed by H ab ita t t h a t n on p ro fit en tit ies shoul d be e xem pt fro m havi ng to posti nj uncti on bo nds , o r a s l i g ht l y na r r o wer r ul e th at woul d pi cka nd choos e a m ong them o n th e basi s o fl i kel y c ontr ibuti on to the o verall pu bl i c welf ar e. Pre l i m i naryi nj uncti ons, bec ause i ss ue d b efo r e a ful l a dj udi ca ti o n, o fte n tur n o ut to ha ve b ee n i ss ue d i n e r r o r, a nd whe n tha t ha ppen s the cos ts i m posed on t he par ty aga i nst whom the i nj uncti on r an ar e co sts i ncurr ed by an i nnocent perso n ( at l east i nno ce nti n the pr el i m i na r y - i nj unc ti o n ph as e o fthe l i ti gat i on)
. The inn oc en t m ay be a pri vate fi rm o r a g over nm ent a gencyo r a h apl ess i nd i vi du al( orev en anothe r nonprofi t) , but that doesn ’ t m ake i t o r hi m o r her unw or thy o fth e l aw ’ s pro tect i on. The co sts o fgo ver nm ent a re bo rne ul ti m ate l y b y t axpayer s ( orby vic tim s o f infla t ion w h en gov er n m en t fin d s itinfe as ible o r po l i ti ca l l y unde si r ab l e to r ai se r ev en ue s byo ut r i g ht ta xa ti o n a nd i ns te ad r edu ce s its e xpe ns es b y pa y i ng th em i n e ve r - ch ea permone y ) , a nd the g r ea te r the expenses ofthe f or estse rv ice the hi gherthe tax bur den i s l i kel y t o be. Obvi ousl y, di sso l vi ng t hi s i nj uncti on bo nd woul d no t m at er i al l y a ff ec t th e budg eto fthe f or estse rv i ce. But the prin ci ple thatnonpro fi t e nti ti es should p ay thei r w ay, r ei m bursing the l oss es i ncurr ed b y e nt i t i e s wh o s e o pe r a t i o ns the n o np r o fi ts i mpe de b y ob ta in in g p re lim i n a ry inju n c tio n s la te r d iss olv ed , i s gener al

. A nd r em em berthatH abi tat ’ s a pp eal d oes not12 N o. 09

- 2785 ch all en ge th e j ud ge’s d is s o lution of the p reli m inary i nj un c t i o n tha th e h a d i s s ue d. N onprofi t enti ti es such as H abi tathave the benefi t o f exem pti on fro m federa l incom e tax , a nd o ften fro m l o c a l p r o pe r ty t a xe s , a s we l l a s the i nd i re c tt a x s ub s i dy provi ded to nonpro fi ts by the c hari tabl e deducti on fro m pers on ali ncom e t ax. N eed the co urts gr ant them an ex em p tio n from R u le 6 5(c ) as w ell? A nd so m e r es p ec t shoul d be pai d to the l anguage o f th e ru le, es p ec ially w h en w e c on sid er t h at a ru le of c ivil pr o ce dur e ca n b e amende d m uchmor e ea si l y tha n a statu te. T he l an gu age of Ru le 65(c) prov ides no su p p ort for a b lan ke t e x em p tio n of n o n p ro fit e n tit ies ; an d in th i s r eg ar d no ti ce a l so the e xpress exe m pti o n o fthe f ederal go ver nm ent fro m havi ng to posta bond, wh i ch sugge sts

— whati s an yw ay o bv i o us

— that the fra m er s o f th e r ul es kno w ho w to make e xc ept i o ns t o the m . And c a us e l i t i g a t i o n b y n o np r o fi t s i s n o ta n e w ph e no m enon ofwh i ch the f ra m er s o fthe rul e a nd o fi ts am endm ents w oul d have be en unaw ar e. In d eference to the wri tte n w or d, H abi tatsugg est ed th at it w ou ld n ot ha ve obj ec t e d t o the d istri ct cou rt’s im posi ng a nom i nal bo nd , sa y $ 200

—b ut i n r e s po nse t o som e pesky quest i onin g fro m the bench i nd i cate d that by nomi n a l i tme a n ta n y a mo u n tmo r e th a n z e r o a nd l ess than si gni fi cant, so a bond of $1 w oul d in i ts view com plywith the st at u te . O fco urse the bond w oul d cost m u c h m or e t o a d m in is te r th an $1 ; an d w h at w ou ld that expend i ture pro cure? A bso l utel y no thi ng.N o. 09

- 2785 13 I ti s t r ue tha tn o mi na l da mag e s a r e s o met i mes a wa r de d, se e, e.g ., Carey v . Pip hus , 4 35 U. S
. 2 47, 2 66

- 67( 19 78 ) ( due p ro c es s v iola tio n ); C olum bia Wire C o. v. K oko m o Ste el & Wi r eCo. , 194 F. 108 ( 7th C ir. 1911 ) (pat en t in fr in gem en t); B o ule v. H ut t on , 3 2 8 F
. 3 d 8 4 , 9 4

- 9 5 ( 2 d C i r . 2 0 0 3 ) ( de f a mat i o n ) , a n d o ft e n wh e n th a th a ppen s

— b ec au se th ey rea lly ar e no m i nal

— the pla i nti ff doesn’ t bother to col l ect them

. They m ay be l i ttl e be tte r than a f oss i l r em nant o f an ea rl i erle ga l s ystem , wh en i t was tho ught that t o say such thi ngs a s that “ f ro m m y e ar l i estr eadi ng, Ihave co ns i der ed i t l ai d up am ong the v er y e l ement s o fthe c om m on law , th at, w h er ev er th er e is a w ro n g, th er e is a r em edy to r edres s i t; and that eve ryi njury i m port s dam age i n the nature o fi t; an d, i fno othe r dam age i s e stabl i shed, the partyi nj ured i s e nti tl ed to a ver dict f ornom i nal dam age s, ” We b b v. Por t l and M f g. Co. , 29 F. Cas. 506, 50 7 ( C.C. M e. 1838 ) ( St or y, J
. ) , was to sa y s om ethi ng, ra therthan to tal k in a c i rcl e. I t i s t rue that aw ar ding nom i nal dam age s i s a way of com m unica ti ng an i m port ant r esul t in m any ca se s: that the pl ai nti ffpro ved a vio l ati on o fhi s r i ghts but was unabl e t o prove dam age s a s a co nsequence of th e v i ol ati o n. Buti n l i eu o fa war ding nom i na l da m ag es ( an d pu zzl i ng l ayper sons by doi ng s o), the cour t co uld j ust sa y : the pl aint i ffpr o ve d a v i o l at i o n o fhi s r i g ht s, b ut th e vi o l at i o n c au sed n o mone ti zabl e i nj ur y . W e r ea d i n a m o dern ca se th at “n o m i na l damag es ca n be a pr ac ti ca l a nd eff ecti ve re m edy, bo th i n const i tuti onaland i n other ci vi l cas es, wh er e there i s a ge nuine case o r contr ove rs y b etw een the p arties bu t the i njury to the p lai nt iff is not m one ta r y a nd there is no bas is for com p en satory da mag e s . ” U tah An im al Rights C oaliti on v. Salt Lake C ity14 N o. 09

- 2785 Corp
. , 3 71 F
. 3d 12 48 , 1 26 4 ( 10 th Ci r . 2 00 4) ( co nc ur r i ng o pi ni o n)
. Bu twh y i s tha tmo r e “ pr a c t i c a l a nd e ff e c t i ve” than j ust decl ar i n g th at the pl ai nti ffpro ved a vi ol ati on but co uld notes tabl i sh dam age s? The aw ar d ofnom in al d am age s i s e speci al l y c om m on in br e a c h o f co n tr ac t c as es , see , e.g., Shepar d v
. St at eAut om ob i l eM ut ual Ins . Co. , 463 F.3d 742 , 748-49 (7th C ir. 20 06 ); M ovi tz v. Fi rst Nati onal Bank, 14 8 F
. 3d 760, 76 5 ( 7th C ir. 19 98 ); Hydr i t eChe m i ca l Co. v. C a lum e tLu b r i ca nt s Co. , 47F
. 3d 887, 8 90

- 91 ( 7th Ci r . 1 99 5) ; E. Al l anF arns wor th, C ontracts § 12. 8, p . 757 (4th ed

. 2004), w h e r e t he aw ard si gni fi es that ther e was i nd eed a bre ach. That dete rm i nati on m ay be si gni fi cant i n future deal in gs betw een th e par ti es . A gai n, the c o ur t co ul d j us t sa y, a s i n a decl ar ato ry -j ud gm ent pr oce ed ing, thatthe pla i nti ffhad pr o ve d a b r ea ch

. Butho w ever thatmay be , o r der i ngthe p o s t i n go fa no mi n a l i nj u n c t i o n b o n d h a s l e s s t o r e c o mm end i t than awarding nom i nal dam age s, bec ause an or der t o post a no m i nal bo nd has no com m unica ti ve val ue. W e no t e fi na l l y tha t i f a nd whe n Ha b i t a t i s o r de r ed to p ay d am ages b a sed on th e inj un ction bon d , that aw ard w i l l be separ at ely appeal abl e s i nce there i s no l onge r an appeal abl e j ud gm en t to w hi ch such an or der would be in te rloc u to ry . O r i on Sal e s , Inc . v. Em e rson R adi o Corp. , 14 8 F. 3d 840, 84 2- 43 ( 7th Ci r. 19 98); H enco, In c . v . Brown , 90 4 F
. 2 d 1 1 , 1 3 ( 7 th Ci r . 19 90) ; se e B ud dy Sy stem s, Inc . v. E xerG eni e, Inc. , 545 F.2d 116 4, 1169 ( 9th Cir. 1976). A FFI RMED .

5- 27- 10