Opinion ID: 2176374
Heading Depth: 1
Heading Rank: 4

Heading: was gia entitled to a preliminary injunction?

Text: Thus far we have considered only the trial court's general authority to issue a preliminary injunction to a disappointed bidder on a District contract pending the completion of the bidder's protest to the CAB. We now consider the more particular question whether, on the facts of this case, GIA was entitled to such relief. [17]
The decision to grant or deny preliminary injunctive relief is committed to the sound discretion of the trial court. Stamenich v. Markovic, 462 A.2d 452, 456 (D.C.1983). In exercising its discretion, however, the trial court must consider the following criteria: A preliminary injunction is an extraordinary remedy, and the trial court's power to issue it should be exercised only after careful deliberation has persuaded it of the necessity for the relief. A proper exercise of discretion requires the trial court to consider whether the moving party has clearly demonstrated (1) that there is a substantial likelihood he [or she] will prevail on the merits; (2) that he [or she] is in danger of suffering irreparable harm during the pendency of the action; (3) that more harm will result to him [or her] from the denial of the injunction than will result to the defendant from its grant; and, in appropriate cases, (4) that the public interest will not be disserved by the issuance of the requested order. Wieck, 350 A.2d at 387. The trial court must be especially careful where, as here, the requested relief would enjoin agency action pending the outcome of administrative review. The circumstances that will justify ... interference with nonfinal agency action must be truly extraordinary.... Public Util. Comm'r of Or. v. Bonneville Power Admin., 767 F.2d 622, 630 (9th Cir.1985). In such a case the trial court must bear in mind that it is acting in a field that is normally confided to the agency's expertise and must give serious weight to the obviously disruptive effect which the grant of the temporary relief ... [is] likely to have on the administrative process. Sampson v. Murray, 415 U.S. 61, 83, 94 S.Ct. 937, 949, 39 L.Ed.2d 166 (1974). Moreover, as the United States Court of Appeals for the District of Columbia Circuit has observed, In the field of government procurement the courts must be sedulous to heed the admonition that their authority to vacate and enjoin action that is illegal must be exercised with restraint les[t] the courts fall into the error of supposing that they may revise action simply because [they] happen to think it ill-considered, or to represent the less appealing alternative solution available. M. Steinthal & Co. v. Seamans, 147 U.S.App. D.C. 221, 230-31, 455 F.2d 1289, 1298-99 (1971) (quoting Calcutta E. Coast of India & E. Pakistan/U.S.A. Conference v. Federal Maritime Comm'n, 130 U.S.App.D.C. 261, 264, 399 F.2d 994, 997 (1968)); see Sea-Land Serv., Inc. v. Brown, 600 F.2d 429, 434-35 (3d Cir.1979).
In reviewing the trial court's exercise of discretion, our role ... is not to resolve the merits of the underlying dispute between the litigants, except insofar as the action of the trial court turns on a question of law or statutory interpretation. Don't Tear It Down, Inc. v. District of Columbia, 395 A.2d 388, 390, 391 (D.C.1978). In undertaking our review, we must (1) examine the trial court's findings and conclusions to see if they are sufficiently supported by the record; (2) assure that the trial court's analysis reflects a resolution of all the issues which necessarily underlie the issuance of an injunction; and (3) inquire into any other claims of an abuse of discretion by the trial court. Id. at 390-91 (quoting Wieck, 350 A.2d at 387) (brackets omitted). In this case, we conclude that the trial court's analysis was flawed in several respects.
Most strikingly, the trial court failed to make any finding that GIA would suffer irreparable harm absent an injunction. This is a serious omission. [18] In determining whether to grant a motion for a preliminary injunction, the most important inquiry is that concerning irreparable injury ... because the primary justification for the issuance of a preliminary injunction `is always to prevent irreparable injury so as to preserve the court's ability to render a meaningful decision on the merits.' Wieck, 350 A.2d at 387-88 (quoting Canal Auth. v. Callaway, 489 F.2d 567, 576 (5th Cir.1974)). The necessity for specific and extensive findings on this point becomes all the greater where, as here, the trial court is being asked to interfere with government action pending agency review. In the course of discussing the comparative harm to GIA and to QDP, the trial judge did mention that GIA faced a loss of 50 percent of its revenue and might be forced to lay off as many as four employees. But the trial court did not determine whether such a loss would be irreparable. Nor can we say on this record, as a matter of law, that GIA necessarily faced irreparable harm. First, it is not clear that the potential loss in revenue faced by GIA would translate into an equally serious loss in profits. See Big Country Foods v. Board of Educ. of Anchorage Sch. Dist., 868 F.2d 1085, 1088 (9th Cir. 1989) (loss of income, without any demonstration of lost profits, insufficient to show irreparable harm). Second, assuming that the loss of the benefits administration contract would reduce GIA's profits, that alone would not have been sufficient to show irreparable harm. [E]conomic loss does not, in and of itself, constitute irreparable harm, unless the loss threatens the very existence of the movant's business. Wisconsin Gas Co. v. FERC, 244 U.S.App.D.C. 349, 354, 758 F.2d 669, 674 (1985); see also Sampson, 415 U.S. at 91-92, 94 S.Ct. at 953-54 (loss of income and damaged reputation fall far short of showing of irreparable injury required to justify temporary injunction reinstating employee). Thus, courts have denied injunctive relief to bid protestors who cannot show any potential injury more serious than mere pecuniary loss. See Cunningham v. Adams, 808 F.2d 815, 822 (11th Cir.1987) (lost profits and loss of airport concession insufficient to show irreparable harm); Vikonics, Inc. v. United States, 749 F.Supp. 315, 319 (D.D.C.1990) (drop in stock value, alleged difficulty in raising capital, and potential drop in bond rating insufficient to show irreparable harm); M.C. Thomas Const. Co. v. St. Louis, 679 F.Supp. 908, 909 (E.D.Mo.1988) (fact that contract would improve company's financial position insufficient to show irreparable harm). In this case, while the trial judge stated that GIA might be forced to lay off employees, he never suggested that GIA's existence was endangered. [19] Third, while the trial judge stated generally that GIA had no adequate legal or administrative remedies, he did not specifically consider whether the remedies that the CAB could have ordered might have provided adequate compensation for GIA's harms. For example, counsel for the District suggested that, although the CAB could not award interim relief, once it had made its findings the CAB could require the District to restart the entire contract, including the base year.
As we noted above, before awarding injunctive relief the trial court must determine that more harm will result to the movant from the denial of the injunction than will result to the nonmoving parties from its grant. That was not the case here, however. Comparing the possible effects of an injunction on QDP with the harm that GIA might suffer in the absence of an injunction, the trial court found only that neither party will be harmed appreciably more than the other by the court's decision. Furthermore, the trial court should have added into this calculus not only the extra time and effort that would be expended by the District in rebidding the contract, but also the substantial confusion and claim-processing delays that the District's employees would suffer as a result of this process. See Amalgamated Transit Union v. Donovan, 554 F.Supp. 589, 599 (D.D.C.1982) (court must consider harm not only to party opposing injunctive relief but also to those parties not before court who may be interested in proceedings). The trial court acknowledged these problems in considering the public interest test but failed to consider them in balancing the equities between the parties. When one adds these factors to what was, in the trial court's view, a fairly even situation, it becomes apparent that in reality the harm the injunction was likely to impose upon QDP, the District, and the District's employees in processing their claims significantly outweighed the potential harm faced by GIA in the absence of an injunction.
The trial court concluded that there was a substantial likelihood that GIA would succeed in its protest before the CAB. In the end, however, the CAB rejected GIA's bid protest. Of course, we will not judge the trial court's determination by hindsight. Nor do we assume that the CAB's decision was necessarily correct, since GIA's appeal of that decision is still pending. We note the contrasting results, however, because they highlight the difficulty that a court faces in predicting a party's likelihood of success on the merits in an administrative forum, where the issues are often technical and the standards for judgment specialized. In this case, for instance, it is apparent that the trial court gave little weight to the contracting officer's determination, after reviewing Parnham's convictions, that QDP was still a responsible contractor. By contrast, the CAB, applying its own established precedents, gave that determination considerable deference: This Board will not reverse an affirmative determination of responsibility, which is largely a business judgment, unless the protestor shows possible fraud or bad faith on the part of procurement officials, or that the solicitation contains definitive responsibility criteria which have not been met. 40 D.C.Reg. at 4518. Where a trial court is attempting to predict the outcome of an administrative review, it is incumbent upon the court to familiarize itself with the applicable criteria used by the review board. The parties also have a responsibility to aid the court in this task. While we do not suggest that the court is absolutely obliged to adhere to those criteria if it truly believes them to be wrong, it should generally defer to an administrative review board's expertise in developing agency review procedures and standards, leaving challenges to those procedures and standards to be dealt with on direct appeal.
The trial court concluded that the public interest overwhelmingly favored issuing an injunction, in order to send a message to all companies that seek to contract with the District of Columbia that they can not profit from their misrepresentationsthat any contract won through those methods is as fragile and ephemeral as the cherry blossoms of April. We appreciate the trial court's efforts to do justice and its strong concern that QDP may have profited from deceit. But the court must also bear in mind that a preliminary injunction is an extraordinary remedy, especially where, as here, it interferes in a case that is already before another tribunal. In such circumstances the trial court must exercise restraint and should generally refrain from granting emergency relief unless the potential harm to the movant is great and the likelihood of success on the merits particularly strong. As we noted above, the primary goal of a preliminary injunction is to prevent irreparable harm to the movant. A preliminary injunction is illsuited to serve punitive ends. Accordingly, we conclude that the trial court abused its discretion in issuing the injunction in this case.