CRP/Extell Parcel I, L.P. v. Andrew CuomoCRP/Extell Parcel I, L.P. v. Andrew Cuomo
Edward Normand, Boies, Schiller & Flexner LLP, for Appellant.
Present: ROSEMARY S. POOLER, PETER W. HALL, Circuit Judges, MARK R. KRAVITZ,** District Judge.
**
Plaintiff-Appellant CRP/Extell Parcel I, L.P., appeals from the May 19, 2010 order of the United States District Court for the Southern District of New York (Daniels, J.), denying preliminary injunctive relief prohibiting the release of approximately $16 million currently held in escrow.1 We assume the parties’ familiarity with the underlying facts, the procedural history of the case and the issues presented for review.
As a threshold matter, according to
We review the decision denying injunctive relief for abuse of discretion. SEC v. Dorozhko, 574 F.3d 42, 45 (2d Cir.2009). Generally, a party seeking a preliminary
In determining whether the district court abused its discretion, we first address the issue of irreparable harm. We have long held that an injury compensable by money damages is insufficient to establish irreparable harm. Jackson Dairy, Inc. v. H.P. Hood & Sons, Inc., 596 F.2d 70, 72 (2d Cir.1979). This does not mean that a party at risk of suffering a monetary loss may never receive injunctive relief, but it does mean that, notwithstanding any compensable losses, a movant must provide evidence that it is likely to suffer damage that cannot be rectified by financial compensation before a district court may providently exercise its equitable power to grant injunctive relief. See id.
Plaintiff-Appellant argues that it will suffer irreparable harm absent injunctive relief for two reasons. First, plaintiff-appellant states that it will be “unquantifiably difficult” to recover the escrow payments at a later date, since a significant number of enforcement actions would be required to obtain and enforce judgments against the recipients of these funds. Second, plaintiff-appellant makes the conclusory assertion that the recipients of the escrow monies will “spend” whatever payments they receive, and could subsequently become insolvent, rendering any ultimate victory Pyrrhic. Neither contention is sufficient to establish irreparable harm in this case.
That damages are difficult to measure does not necessarily make otherwise compensable harm irreparable. Thus, we have upheld an award of injunctive relief where a movant claimed money damages that were hard to measure plus irreparable harm, including loss of reputation, goodwill and business opportunities. See, e.g., Register.com, Inc. v. Verio, Inc., 356 F.3d 393, 404 (2d Cir.2004) (Lanham Act violations). Similarly, we have found irreparable harm in the context of money damages plus a breach of a covenant not to compete where a movant established that a former employee offered unique services, and absent injunctive relief, the company would likely lose a client relationship that would otherwise have produced “an indeterminate amount of business in years to come.” Ticor Title Ins. Co. v. Cohen, 173 F.3d 63, 68-69 (2d Cir.1999). However, we have not held that a mere “difficulty” in calculating damages is sufficient to establish irreparable harm.
Nor have we ever held that the fact that recovery would involve a multiplicity of actions is sufficient—standing alone—to make otherwise compensable harm irreparable. Rather, we have upheld a finding of irreparable harm based in part upon the fact that a multiplicity of damage actions would have been required to assert a movant’s rights where the evidence also showed recurrent invasions of the movant’s rights, an imminent threat of continued emotional and physical trauma, and a difficulty of evaluating injuries in monetary terms. See Galella v. Onassis, 353 F.Supp. 196, 235 (S.D.N.Y.1972) (citations omitted), aff‘d in part and rev’d in part on other grounds, 487 F.2d 986 (2d Cir.1973).
Finally, we have held that a finding of irreparable harm may lie in connection with an action for money damages where the claim involves an obligation owed by an insolvent or a party on the brink of insol
Here, plaintiff-appellant has failed to make the required showing because it has adduced nothing more than conclusory assertions in support of its claim that one or more defendant-appellees might “spend” the escrow monies and later become insolvent. To award relief based upon these purely speculative allegations would push the standard for injunctive relief beyond its reasonable limit. In order to show a likelihood of irreparable harm, the plaintiff must provide some substantiation for its claims—the harm must be imminent before a court may issue injunctive relief. Because plaintiff-appellant has failed to establish that the harm at issue in this case is anything more than a possibility, we cannot say that the district court abused its discretion in denying preliminary injunctive relief. Absent a finding of error regarding the district court’s conclusion on irreparable harm, we do not reach plaintiff-appellant’s likelihood of success on the merits.
Accordingly, the judgment of the district court hereby is AFFIRMED, and the stay in effect by order of this Court dated May 19, 2010, is hereby vacated.