It is a court order that compels a party to do (mandatory injunction) or refrain (prohibitory injunction) from specific acts. A party who fails to comply with an injunction faces criminal or civil penalties.
When might injunctions be required?
Injunctions are often required in urgent or under serious circumstances. In commercial law, Injunctions can be sought to;
- prevent infringement of copyright, trademarks or intellectual property rights;
- prevent the use of confidential information and trade secrets;
- prevent an ongoing breach of contract or the breach of a restrictive covenant; or
- prevent publication of false and defamatory information.
Draconian approach?
Due an injunction being somewhat harsh and severe course of action, the courts have to be satisfied that an injunction is necessary and the party seeking the injunction could not be compensated in damages only. The court will consider all circumstances in the case and are likely to make an order which will cause the least irremediable prejudice to one party or another.
Case study
American Cyanamid Co –v- Ethicon Ltd [1975] AC 296
A landmark dispute between two pharmaceutical companies over an intellectual property protected product clearly defines the tests that the court follows for injunction matters. The main principles in this particular case, include;
- Is there a serious question to be tried? If no, the injunction will not be granted. If yes, the court will consider the next stage of the test:
- Would damages be an adequate remedy for a party injured by the courts grant of, or its failure to grant an injunction? If yes the injunction will fail. If damages would not be adequate the court would then consider:
- Where the balance of convenience lies? The court will consider the merits of each party and what measures would be required to preserve the status quo. The court will caution granting an injunction without being certain that is absolutely necessary to protect the party seeking the injunction. Accordingly it is essential that legal advice is received before a party applies to the court for an injunction
The risks
Not only does the court have discretion to order that a party does/does not do something, it can also order that the successful party is paid its costs by the other party. Injunctions must therefore be treated with caution, both in bringing and defending them due to the serious ramifications and the costs risk for the parties. Furthermore, if a party breaches a term of an injunction it could be held in contempt of court and face a fine and or imprisonment.
How we can help
If you require a prohibitory or mandatory injunction against another party or you need to defend an injunction it is likely that you need to take urgent action as your dispute will be of a serious nature. Else have significant experience in dealing with injunctions.
If you would like more information regarding injunctions then please contact Amiee O’Toole directly for an informal chat on 01283 246221 or by email at amiee.otooole@elselaw.co.uk.