Court Opinion

ID: 8972242
Source: CourtListenerOpinion
Date Created: 2022-11-27 10:41:08.548363+00
Date Added: 2024-06-11T17:10:28.575505
License: Public Domain

SEITZ, Circuit Judge,
dissenting.
My essential difference with the majority is based on my view that the district court did not abuse its discretion in finding irreparable harm on this record.
On this appeal from an order granting a preliminary injunction, the first critical issue to be addressed here, as the majority notes, is whether Instant showed a reasonable probability of ultimate success on the merits of the legal issue presented.
It is certainly reasonable to interpret Article Eighth to mean that the Agreement would not necessarily terminate with the closing of the terminal. That reading is necessarily implied in the very language of Article Eighth. Since other provisions of the agreement and evidence of record can be read to support a conclusion that the closing would not terminate the agreement, I agree with the majority that the “probability of success” requirement was met.
If Article Eighth is inapplicable and there was a breach of other provisions of the contract, it must then be determined whether Instant has an adequate remedy at law for damages or whether it has shown irreparable harm cognizable in equity. See Fleischer v. James Drug Stores, 1 N.J. 138, 62 A.2d 383 (1948); First National State Bank v. Commonwealth Federal Savings and Loan Ass’n, 610 F.2d 164 (3d Cir.1979) (applying New Jersey law).
It is at this point that I part company with the majority. The majority states that Instant failed to make a showing of irreparable harm and thus limits plaintiff’s relief to damages. The district court found to the contrary and I believe its conclusion is supported by this record.
In an unchallenged affidavit of Instant’s president, it is stated:
15. The transportation and related services provided by Instant to CFAF pursuant to the Agreement accounts for approximately 80% of Instant’s entire business. In order to service the needs of CFAF under the Agreement, Instant employs approximately 70 workers, including 64 current full-time employees and more than 100 employees during the Christmas season. The great majority of Instant’s employees are skilled drivers, warehouseman and cargo handlers with many years of experience in the air freight industry. Instant’s employees work six days per week, 24 hours per day in three overlapping 10-hour shifts, *806in order to effectuate the transport of approximately 60,000 pounds of CFAF cargo per night, including emergency medical supplies and equipment. Instant owns and operates approximately 44 trucks and vans, as well as trailers, including recently acquired vehicles at substantial cost and purchased to service CFAF’s needs under the Agreement.
16. With approximately two years remaining to the term of the Agreement, and millions in revenues anticipated to be received from CFAF during that time, the loss of CFAF’s business would effectively destroy Instant and wreak havoc upon Instant’s employees and their families. Notwithstanding the express obligations of CFAF under the Agreement, including Instant’s right of first refusal, CFAF is attempting to terminate the Agreement by transferring all its business into the Emery system, thereby effectively putting Instant out of business virtually overnight.
The quoted historic facts and the reasonable inference to be drawn therefrom were relied on by the district court. They can only be overturned if they are clearly erroneous. F.R.Civ.P. 52(a). Since no countervailing facts were offered by defendant, Air Freight, I certainly am not left with the definite and firm conviction that a mistake was committed by the district court. United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 542, 92 L.Ed. 746 (1948). Nor, to the extent the finding of irreparable harm implicates a question of law based on the facts, do I find any error.
I therefore believe that the district court did not abuse its discretion in concluding that injunctive relief was warranted. Several provisions of the agreement quoted by the majority fully permit the conclusion that Instant was entitled to receive the agreed portions of Air Freight’s business regardless of the closing of the terminal. Certainly that is the understanding of Article Eighth of the agreement expressed in the affidavit of Instant’s President. Furthermore, Instant might well be able to look to other sources to try to save its business if reasonable time is available to permit it to carry on its enterprise elsewhere. On this record the district court was justified in concluding that money damages are not an adequate measurement of the potential loss of good will.
Finally, I address the majority’s alternative holding that the district court committed error when it failed to require the plaintiff to provide the appropriate security under Fed.R.Civ.P. 65(c). I agree with this conclusion insofar as it goes. The majority went on to note that it need not decide whether a remand would be appropriate in this case because it determined that the irreparable harm necessary for the grant of the preliminary injunction was lacking.
Since I find no legal infirmity with the preliminary injunction, I would reach the issue set aside by the majority and remand this case to the district court. The purpose of the remand would be to permit the district court to conduct an appropriate adversary hearing to determine what security should be fixed in light of the established requirements of Fed.R.Civ.P. 65(c).