Opinion ID: 62392
Heading Depth: 2
Heading Rank: 3

Heading: Whether the Threatened Injury Outweighs any Damage the Injunction might cause the Defendant

Text: Moreover, we hold that the district court properly determined that the threatened injury to the Retirees would not outweigh any damage the injunction might cause AUSA. AUSA has stated that it would face significant administrative hurdles and considerable costs if the injunction were issued and the company was required to reverse all the changes that have been implemented since 2003. However, the Retirees have only offered to post a modest bond. Not only would such a bond violate the Federal Rules of Civil Procedure, but it would also be insufficient to compensate AUSA for any damages it has suffered if AUSA ultimately prevails in this case, the likely outcome given the above discussion regarding the Retirees' likelihood of success on the merits of their claims. Federal Rule of Civil Procedure 65(c) states: Security. The court may issue a preliminary injunction or a temporary restraining order only if the movant gives security in an amount that the court considers proper to pay the costs and damages sustained by any party found to have been wrongfully enjoined or restrained. We have previously highlighted the importance of the bond requirement. It assures the enjoined party that it may readily collect damages ... in the event that it was wrongfully enjoined, without further litigation and without regard to the possible insolvency of the applicant, and it provides the plaintiff with notice of the maximum extent of its potential liability.... Because of the importance of the bond requirement, failure to require the posting of a bond or other security constitutes grounds for reversal of an injunction. Phillips v. Chas. Schreiner Bank, 894 F.2d 127, 131 (5th Cir.1990) (internal quotation marks and citations omitted). Since the Retirees appear unable to meet the bond requirement of Rule 65(c), we hold that the damage the preliminary injunction might cause AUSA greatly outweighs any threatened injury to the Retirees.