The Preliminary Injunction Standard in Diversity: A Typical Unguided Erie Choice
60 Pages Posted: 12 Aug 2016
Date Written: August 8, 2016
The standard for granting preliminary injunctions in some states is not the same as the preliminary injunction standard that is followed in the federal district courts in the federal circuit where the state is located. For example, the interlocutory injunction standard in Georgia’s superior courts is not as demanding as the preliminary injunction standard in Georgia’s federal courts. Although state and federal courts in Georgia consider four similar factors in deciding whether to grant or deny provisional injunctive relief, a balancing or sliding scale approach can be used in Georgia’s courts; the moving party need not prove all four of the factors. In contrast, the Eleventh Circuit insists that the plaintiff must clearly establish the burden of persuasion on each of the four elements.
This difference between the preliminary injunction standards followed in a state’s courts and the federal courts in that state implicates the principles announced in Erie Railroad Company v. Tompkins and that venerable decision’s progeny. Specifically, should a federal district court in Georgia apply the Eleventh Circuit’s standard in a diversity case or does the Erie doctrine require it to apply Georgia’s standard for interlocutory injunctions. It is reasonable to assume that a plaintiff seeking to enjoin particular conduct by a diverse defendant would prefer the Georgia standard and forum shop by filing his or her claim in a Georgia superior court, and that the diverse defendant would, in turn, remove the case to federal district court if possible. Also, it is conceivable, given the discrepancy between the standards, that there could be a difference in outcome on the grant or denial of provisional injunctive relief depending on which standard is applied, with the plaintiff favoring Georgia’s interlocutory injunction standard because it is not as demanding as the Eleventh Circuit’s standard.
Notwithstanding the possibility of forum shopping and different outcomes on the grant or denial of a preliminary injunction, this article concludes that a federal district court should apply its circuit’s standard, not the forum state’s standard. This conclusion is not justified by saying Federal Rule 65(a) is on point and controls, or because the choice of the appropriate standard is simply a matter of procedure. Rather, it is justified by analyzing and weighing the several factors that were announced by the U.S. Supreme Court in Hanna v. Plumer and Byrd v. Blue Ridge Electric Cooperative for the typical unguided Erie choice. Of the these factors the most important are that the differences between the standards do not cause litigant inequality, that the forum state’s and the federal circuit’s interests in the grant or denial of equitable relief are not at odds but congruent, and that the grant or denial of this interim equitable relief is provisional and not a final adjudication on the merits of the plaintiff’s claim. Moreover, given the similarity of the four criteria weighed by the respective courts, there is a good chance that the state court and a federal district court in the forum state would, on the same set of facts, enter substantially similar orders on a plaintiff’s motion for a preliminary injunction.
Keywords: Erie Railroad Co. v. Tompkins, civil procedure, jurisdiction, choice of law, preliminary injunction, Federal Rule 65, interlocutory injunctions, forum shopping
JEL Classification: K29, K39
Suggested Citation: Suggested Citation