What is an 'Injunction'

An injunction is a court order requiring a person or entity to either cease doing or do a specific action. There are three types: temporary restraining orders, preliminary injunctions and permanent injunctions. Restraining orders and preliminary injunctions are typically issued early in a legal action when the court agrees that doing so may prevent harmful actions by a defendant. Restraining orders are often used to prevent a defendant from having contact with a plaintiff. Preliminary and permanent injunctions are issued based on evidence presented by a plaintiff in a civil case.

BREAKING DOWN 'Injunction'

An example of a preliminary injunction might be when a married couple owns a business, is going through a divorce, and there is a dispute as to who owns or controls the business. If the husband tried to make unilateral business decisions, the wife might file for a temporary injunction to prevent certain business activities until the court decided the ownership issue.

Injunctions are also used by a court when monetary restitution isn't sufficient to remedy the harm. For example, in addition to making a financial judgment against a defendant, a court might issue a permanent injunction ordering that the defendant not participate in a certain activity or business.

Obtaining an Injunction

In order to be granted a temporary injunction, a plaintiff typically needs to show the court that they have a likelihood of prevailing on the merits of their case, can show potential injury if the injunction is not granted, can demonstrate that the potential injury outweighs whatever damage the injunction may cause the opposing party, and that the benefit or harm to the parties is equitable.

In order to be granted a permanent injunction, the plaintiff will need to demonstrate having suffered an irreparable injury, that monetary damages alone are not adequate, that the order is warranted considering that balance of hardships between the parties, and the order would not harm the public interest.

RELATED TERMS
  1. Default Judgment

    A binding judgment issued by a court in favor of the plaintiff ...
  2. Stare Decisis

    Stare decisis is a legal principle which dictates that courts ...
  3. Collateral Source Rule

    A common law rule of evidence pertaining to punitive or other ...
  4. Bankruptcy Court

    What is bankruptcy court?
  5. De Novo Judicial Review

    A standard of review that does not place weight on the previous ...
  6. Reasonableness Standard

    Reasonableness standard has several applications in finance that ...
Related Articles
  1. Investing

    Make Money Fast From The New 'Sharing Economy'

    The sharing economy has introduced a whole new way to earn a few extra dollars each month.
  2. Financial Advisor

    Lawsuits Aim to Overturn DOL's Fiduciary Rule

    Five lawsuits have aimed to overturn the DOL fiduciary rule introduced in 2016.
  3. Personal Finance

    Get Through Divorce With Your Finances Intact

    Find out how to split your finances without coming up short.
  4. Small Business

    How Major League Baseball Makes Money

    Major League Baseball is big business. Let's take a look at where the money comes from.
  5. Investing

    Joint Tenancy: Benefits and Pitfalls

    This arrangement allows beneficiaries to access your account without having to go to court. Learn about the benefits and pitfalls to joint tenants with rights of survivorship (JTWROS).
  6. Retirement

    4 Reasons Estate Planning Is So Important

    Estate planning isn't fun, but without it, there can be devastating consequences.
  7. Managing Wealth

    Why You Should Draft A Will

    Don't trust the courts to follow your wishes - plan the distribution of your own assets.
  8. Small Business

    4 Reasons Pro Sports Teams File For Bankruptcy

    We look at the history of sports bankruptcies, and try to understand what makes them fail.
  9. Insights

    Heartbreaking Pro Sports Team Relocations

    A look at four sports teams that have gone through chaotic divorces with the cities that loved them.
  10. Personal Finance

    The Best And Worst Times (Financially) To Get Divorced

    Divorce is rarely financially advantageous to either party. There are times, however, when it can have an even deeper impact on your personal economic situation.
Hot Definitions
  1. Price-Earnings Ratio - P/E Ratio

    The Price-to-Earnings Ratio or P/E ratio is a ratio for valuing a company that measures its current share price relative ...
  2. Internal Rate of Return - IRR

    Internal Rate of Return (IRR) is a metric used in capital budgeting to estimate the profitability of potential investments.
  3. Limit Order

    An order placed with a brokerage to buy or sell a set number of shares at a specified price or better.
  4. Current Ratio

    The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term obligations.
  5. Return on Investment (ROI)

    Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency ...
  6. Interest Coverage Ratio

    The interest coverage ratio is a debt ratio and profitability ratio used to determine how easily a company can pay interest ...
Trading Center