Third Circuit Clarifies Focus of Preliminary Injunction Standard

Describing its precedent as “confus[ing]” and “inconsistent,” the Third Circuit recently clarified the test for deciding whether to issue a preliminary injunction. Since the 1970’s, courts in the Third Circuit have decided preliminary injunction applications based upon the following factors: (1) the likelihood of success on the merits; (2) whether the movant will be irreparably harmed in the absence of relief; (3) the possibility of harm to others from grant or denial of the relief; and (4) the public interest. However, courts differed as to how these four factors should be applied. In Reilly v. City of Harrisburg, the Third Circuit shed light on how these factors are to be weighed and, at least in part, who bears the burden on each.

The Third Circuit held that a movant seeking a preliminary injunction bears the burden of “meet[ing] the threshold for the first two ‘most critical’ factors.” To satisfy the first prong, the movant “must demonstrate that it can win on the merits” by showing that its chances of success are “significantly better than negligible but not necessarily more likely than not.” To satisfy the second prong, however, the movant must show “that it is more likely than not to suffer irreparable harm in the absence of preliminary relief.” After a movant makes these showings, the court should then consider “the remaining two factors and determine[] . . . if all four factors, taken together, balance in favor of granting the requested preliminary relief.”

Reilly has declared the first two prongs aimed at the parties—success on the merits and likelihood of irreparable harm—as gateway factors to the analysis and as the threshold for the grant of preliminary injunctive relief. Deliberations relevant to the third parties—harm to others and the public’s interest—are now a secondary consideration.

While the Third Circuit’s guidance in this regard may not render the preliminary injunctive standard crystal clear, the panel could not overrule earlier Third Circuit precedent without an en banc hearing. This opinion represents the panel’s attempt to clarify the preliminary injunction standard within those constraints. Indeed, the court reasoned that its approach to the preliminary injunction analysis declared in Reilly predates the theory that a movant must prove all prongs of the standard in the case law and is therefore binding under the rule that later panels cannot overrule earlier panel decisions within the Circuit.

Kaitlyn E. Stone is an Associate in the Gibbons Business & Commercial Litigation Department.