Terrance A. Prout PROUT LAW FIRM 4490 Franklin Avenue New Orleans, LA 70122 COUNSEL FOR PLAINTIFF/APPELLANT Nathan M. Chiantella Edwin Mark Shorty, Jr. EDWIN M. SHORTY, JR. & ASSOCIATES A PROFESSIONAL LAW CORPORATION 650 Poydras Street, Suite 2515 New Orleans, LA 70130 COUNSEL FOR DEFENDANT/APPELLEE
NOT DESIGNATED FOR PUBLICATION APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2014-11850, DIVISION "N-8"
Honorable Ethel Simms Julien, Judge Judge Roland L. Belsome (Court composed of Judge Max N. Tobias, Jr., Judge Roland L. Belsome, Judge Daniel L. Dysart) TOBIAS, J., CONCURS Terrance A. Prout
PROUT LAW FIRM
4490 Franklin Avenue
New Orleans, LA 70122
COUNSEL FOR PLAINTIFF/APPELLANT Nathan M. Chiantella
Edwin Mark Shorty, Jr.
EDWIN M. SHORTY, JR. & ASSOCIATES
A PROFESSIONAL LAW CORPORATION
650 Poydras Street, Suite 2515
New Orleans, LA 70130
COUNSEL FOR DEFENDANT/APPELLEE
This matter was originally presented to this Court as a writ application. Because the denial of a request for a preliminary injunction is appealable, this Court remanded the case for the trial court to grant a motion for appeal. See La.C.C.P. art. 3612 B. --------
In May of 2013, Eugene Lawrence, Jr. entered into an operating agreement with Anthony Boswell. The operating agreement conveyed forty percent (40%) interest in Mr. Lawrence's company, E-1 Entergize, LLC (Entergize) to Mr. Boswell. Mr. Boswell claims that Mr. Lawrence has removed and misused money from Entergize's operating accounts in violation of the operating agreement. He filed a Petition for Temporary Restraining Order and Petition for Breach of Contract seeking injunctive relief and damages for Mr. Lawrence's actions. A temporary restraining order was issued by the court and a preliminary injunction hearing was set.
After oral argument, the parties were granted leave to file supplemental affidavits to support their positions. Subsequently, the trial court issued its judgment denying the preliminary injunction because the plaintiff failed to prove irreparable harm.
On appeal, Mr. Boswell argues that he is entitled to a preliminary injunction without a showing of irreparable harm because the conduct he seeks to enjoin is unlawful.
"A preliminary injunction is an interlocutory procedural device designed to preserve the status quo as it exists between the parties pending trial on the merits." Sessions, Fishman & Nathan, L.L.P. v. Salas, 2004-1790 (La.App. 4 Cir. 5/25/05), 905 So.2d 373, 377. A trial court has vast discretion in deciding whether to grant or to deny a preliminary injunction; thus, a trial court's denial of a preliminary injunction should not be reversed on appeal absent a clear abuse of that discretion. Yokum v. Pat O'Brien's Bar, Inc., 12-0217p. 6 (La.App. 4 Cir. 8/15/12), 99 So.3d 74, 80.
Ordinarily, a preliminary injunction will not be issued unless, the petitioner shows that he will suffer irreparable injury; that he is entitled to the relief sought; and that he will prevail on the merits. C. Napco, Inc. v. City of New Orleans, 06-0603, p. 6 (La.App. 4 Cir. 3/7/07), 955 So.2d 155, 160 (citing Kruger v. Garden District Ass'n, 00-1135, pp. 4-5 (La.App. 4 Cir. 1/17/01), 779 So.2d 986, 990). Further, this Court has recognized that "[a]n injunction is a harsh, drastic remedy that should only issue where the petitioner is threatened with irreparable harm and has no adequate remedy at law." Id. However, "[a] showing of irreparable harm is not required in cases where the conduct sought to be restrained is unlawful, such as when the conduct constitutes a direct violation of a prohibitory law." Asaro v. City of New Orleans, 2010-0572, p. 3 (La.App. 4 Cir. 12/22/10), 54 So.3d 1214, 1217, writ denied, 2011-0353 (La.4/1/11), 60 So.3d 1257.
The substance of Mr. Boswell's petition is a breach of contract claim. The contract in question is an operating agreement that provides for the division of ownership interest in Entergize. The evidence indicates that the only assets maintained by Entergize are two banking accounts, an operating account and a payroll account. Mr. Boswell's petition states that "[a]s manager of the company, [Mr. Lawrence] has implied authority to transfer and liquidate all assets of the company, thereby causing irreparable harm and loss to Plaintiff."
Although Mr. Boswell alleges that Mr. Lawrence is misusing his authority and that he is breaching his fiduciary duties, Mr. Lawrence is nonetheless authorized to conduct the transactions in question. This is simply not a case where Mr. Lawrence's conduct is in direct violation of a prohibitory law. Therefore, irreparable harm remains a necessary requirement for Mr. Boswell to obtain a preliminary injunction. A petitioner can establish irreparable harm by demonstrating that without the issuance of a preliminary injunction, he will sustain injuries that cannot be adequately compensated by money damages. Smith v. Brumfield, 13-1171, p.7 (La.App. 4 Cir. 1/15/14), 133 So.3d at 75. However, the record in this case does not evidence any injury to Mr. Boswell that cannot be adequately compensated by money damages.
Based on this record, there are no grounds for questioning the broad discretion of the trial court in denying the request for a preliminary injunction. Accordingly, the trial court's judgment is affirmed.