Waste Management of New Jersey, Inc. v. Morris County Municipal Utilities Authority, 433 N.J. Super. 445

Background

Morris County MUA issued a public RFB for a five-year contract to operate county solid-waste transfer stations; the RFB required bidders to "Supply . . . the certified financial statement of the Bidder . . . for each of the three (3) recent fiscal years" but gave no definition of "certified financial statement."
Bids: Covanta (lowest), Mascaro (second), Waste Management (third). The Authority awarded the contract to Mascaro despite Mascaro submitting only two pages of uncertified "condensed financial information."
Waste Management and Covanta challenged the award and sought interlocutory injunctive relief to prevent contract performance; the trial judge denied injunctive relief, concluding plaintiffs had not clearly and convincingly shown a likelihood of success on the merits.
Trial court later granted and then partially reinstated portions of Covanta's complaint on reconsideration; meanwhile Mascaro began performance and moved for summary judgment on bid sufficiency.
This Court granted leave to appeal the denial of the interlocutory injunction, stayed further performance of the awarded contract, and directed that the status quo be preserved pending appeal; the appellate panel then evaluated whether the trial judge abused his discretion in denying injunctive relief.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiffs demonstrated likelihood of success on whether Mascaro met the RFB requirement for "certified financial statement"	The phrase required certified, complete financial statements for three fiscal years; Mascaro's two-page condensed uncertified materials were insufficient	Mascaro/Authority argued condensed uncertified statements satisfied the RFB as understood in the trade; factual dispute existed and experts supported Mascaro	Trial judge found plaintiffs unlikely to succeed after weighing expert testimony; appellate court deferred to that prediction for purposes of injunction review but did not treat it as final adjudication
Whether the trial judge could deny injunctive relief solely because plaintiffs lacked a clear likelihood of success	Plaintiffs argued other equitable factors (irreparable harm, impairment of subject matter, public interest) warranted injunction even if success was uncertain	Defendants relied on Crowe requirement that factors be shown clearly and convincingly, emphasizing likelihood-of-success threshold	Appellate court held it was error to deny relief solely on likelihood; courts may impose interlocutory restraints to preserve status quo even when likelihood is doubtful if other equitable factors strongly favor relief
Whether denial of injunction would destroy or substantially impair the subject matter and cause irreparable harm	Plaintiffs: awarding and allowing performance under contract could irreparably impair ability to vindicate bid challenge and public interest; equities favor preserving status quo	Defendants: Award should stand; plaintiffs' chances doubtful, delaying contract harms public service continuity	Appellate court found the record supported that denial would substantially impair the subject matter and that equities/public interest favored injunctive relief
Whether appellate court should maintain its prior stay and direct preservation of status quo pending final judgment	Plaintiffs asked to preserve status quo until merits resolved	Defendants opposed continued restraints and sought affirmation of trial court denial	Appellate court reversed trial court's denial and directed its prior stay/order preserving status quo remain in place (Mascaro may perform under emergency contract) pending final judgment

Key Cases Cited

Crowe v. De Gioia, 90 N.J. 126 (1982) (articulates factors for preliminary injunction analysis)
Waste Mgmt. of N.J., Inc. v. Union Cnty. Utils. Auth., 399 N.J. Super. 508 (App. Div. 2008) (applies Crowe factors and discusses standard of proof for interlocutory injunctions)
Meadowbrook Carting Co. v. Island Heights Borough, 138 N.J. 307 (1994) (public-contract bidding principles; bidders must meet material bid requirements)
Naylor v. Harkins, 11 N.J. 435 (1953) (interlocutory injunctions appropriate where subject matter would be destroyed or impaired)
Gen. Elec. Co. v. Gem Vacuum Stores, Inc., 36 N.J. Super. 234 (App. Div. 1955) (recognizes exceptions to strict preliminary-injunction standards to preserve status quo)
Christiansen v. Local 680 of Milk Drivers, 127 N.J. Eq. 215 (E. & A. 1940) (if subject matter would be substantially impaired pendente lite, courts may grant restraints)
Virginian R. Co. v. System Fed'n No. 40, 300 U.S. 515 (1937) (public interest can justify broader equitable relief)
Flagg v. Essex Cnty. Prosecutor, 171 N.J. 561 (2002) (abuse-of-discretion standard for appellate review of equitable rulings)
US Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449 (2012) (standards for judicial discretion and abuse review)