David H. Schwartz
When to Pursue Injunctive Relief vs. Monetary Damages
When your company gets tied up in a legal dispute, dealing with the ramifications can be overwhelming. The complicated processes of navigating the court system when it comes to your business can be detrimental to your assets and future as a company.
Instead of leaving the outcome of a lawsuit to chance, having trusted legal counsel in your corner can bring peace of mind that you are doing everything you can to ensure the best possible results. And when it comes to protecting your business reputation, assets, and career future, you have more options available to you than just recovering monetary damages.
Types of Compensation for Business Torts
In business law, “torts” refer to the economic harm inflicted — purposely or accidentally — to a company. Usually, business torts stem either from fraud or actions that illegally sabotage a competing business. Sometimes, even if the harm caused was unintentional, the damages suffered may still provide grounds for the harmed party (also known as the “plaintiff”) to seek relief against the perpetrator (also known as the “defendant”).
Types of relief that may be obtained for business torts include:
- Compensatory damages - the amount of money the plaintiff lost where the defendant’s tort was the “legal” cause of the loss
- Punitive damages - additional financial award to the plaintiff to deter the defendant from repeat offenses where the defendant acted with “malice”
- Injunctive relief - a court order prohibiting the defendant from continuing or repeating the tortious behavior
For example, if your business’s reputation has been hurt by defamation, libel, or slander, you may be able to recover monetary damages by filing a business tort claim. With a business tort claim, the monetary damages to you may be compensatory and/or punitive depending on the nature of the violation. But, if you suspected that an employee or business partner had been sharing trade secrets with a competitor, causing you to lose profits, you might want to pursue injunctive relief to protect future earnings.
So, What Is Injunctive Relief?
An Injunction (also known as “equitable relief”) is a legal remedy that can be sought in a civil lawsuit in addition to, or in place of, monetary damages. Basically, injunctive relief means a court will issue an order for the defendant to stop committing one or more specified actions. In appropriate cases, injunctive relief can be sought at trial in addition to money damages. But injunctive relief also can be sought at the outset of a lawsuit, months or years before the matter will ever be tried. This early injunctive relief is referred to as a “temporary restraining order” and a “preliminary injunction.”
If seeking a preliminary injunction, a plaintiff is responsible for demonstrating that irreparable harm will occur during the period while the lawsuit will be pending unless the defendant’s behavior is stopped, and that the type of harm that will occur can’t be easily quantified in monetary damages. The plaintiff must also establish it is likely to prevail at trial.
When Is It Best to Pursue?
Preliminary injunctions can be a very powerful weapon in cases where your business is going to suffer ongoing injury throughout the lawsuit unless the defendant stops its offending behavior. A very common example is when the defendant is subject to violating a non-disclosure agreement by sharing your trade secret information with a competitor.
For instance, imagine a situation where you’ve got some tech guys working for your company. Then one day, they decide to split off from your venture and start their own competing company using your trade secrets. A carefully presented motion for a preliminary injunction may result in an order effectively stopping the defendants from using your trade secrets to compete with you.
Pursuing Injunctive Relief in San Francisco
With over four decades of experience in commercial and business law, the Law Offices of David H. Schwartz, Inc. offers a breadth of experience and a solid record of success. Principal attorney David H. Schwartz has a full understanding of the claims and litigation landscape and is prepared to tackle even the toughest cases. Mr. Schwartz has previously represented clients on both sides of injunctive relief cases in courts throughout the San Francisco Bay Area and surrounding counties. Allow his rare legal background to benefit your unique case. Contact the Law Offices of David H. Schwartz, Inc. to schedule your consultation today.