Erroneous Injunctions

• Publication year: 2022

Erroneous Injunctions

Michael T. Morley

ERRONEOUS INJUNCTIONS

Michael T. Morley^*

Abstract

When a federal court concludes that a statute or regulation is unconstitutional or otherwise invalid, it will often enter an injunction prohibiting the government from enforcing that measure against the plaintiff in that case. But a court will dissolve a preliminary injunction after trial when it concludes that the plaintiff is not entitled to relief on the merits. It may likewise vacate a permanent injunction when subsequent developments in precedent reveal that it misconstrued the relevant legal provisions. And any type of injunction may be overturned on appeal.

Once an erroneously issued injunction has been reversed, vacated, or dissolved, the government may enforce the challenged legal provision against the plaintiff if it violates that provision in the future. It is less clear, however, whether the government may similarly prosecute that plaintiff or impose other punitive measures against it for violating the challenged provision while the injunction was in effect. Despite the centrality of injunctive relief in constitutional litigation, the Supreme Court expressly left this issue unresolved in Edgar v. MITE Corp., with various opinions defending different sides of the issue. Recent scholarship has vigorously advocated such retroactive prosecutions. The Supreme Court has exacerbated the confusion by construing many of the most seemingly applicable defenses—due process "fair notice" restrictions, prohibitions against ex post facto laws, and the mistake of law defense—too narrowly to completely bar retroactive punitive enforcement of previously enjoined legal provisions.

This Article offers a new approach. Drawing on traditional equitable practices, including the principles governing injunction bonds as well as

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criminal contempt proceedings under injunctions that have been overturned, this Article demonstrates that even injunctions that were issued erroneously and no longer remain in force can continue to affect litigants' rights. It further explains that federal courts have authority—as a component of both the Article III judicial power as well as their equitable powers—to prevent the federal government and states from taking punitive measures against people for actions performed under the protection of a federal injunction. This Article goes on to examine various ways in which courts may implement this restriction. Injunctions are critical tools for protecting constitutional rights. Courts may shield litigants from the possibility of civil penalties, statutory damages, and criminal prosecution for acts taken under injunctions that were issued erroneously.

Table of Contents

Introduction...........................................................................................1139

i. enforcement actions following erroneous injunctions .. 1147

A. Edgar v. MITE Corp............................................................... 1148
B. The Writ of Erasure Argument ............................................... 1153
C. Problematic Potential Defenses ............................................. 1155

1. Due Process and Ex Post Facto Limitations .................... 1155
2. Mistake of Law and Estoppel ........................................... 1160

II. Erroneous Injunctions in Private Litigation........................1162

A. Judicial Discretion and Injunction Bonds .............................. 1164

1. Mandating a Bond............................................................ 1165
2. Setting the Bond Amount .................................................. 1168
3. Recovering Under the Bond ............................................. 1170

B. Implications of Injunction Bonds............................................ 1171

III. Criminal Contempt of Erroneous Injunctions......................1172
IV. Protective Effects of Erroneous Injunctions ...................... 1175

A. The Judicial Power................................................................. 1176
B. The Federal Equity Power ...................................................... 1182
C. Methods of Implementation .................................................... 1185

1. Implied Injunctions........................................................... 1185
2. Collateral Injunctions ....................................................... 1189
3. Interpreting Injunctions .................................................... 1191

Conclusion...............................................................................................1193

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Introduction

When a court concludes that a law, regulation, executive order, or other legal provision is unconstitutional, it will decline to apply or enforce that provision in the case before it.¹ Courts generally treat unconstitutional legal provisions as void,² at least in most respects.³ Additionally, in civil cases,⁴ the court will often enter an injunction prohibiting the defendants—who are usually governmental officials or entities (though not always⁵ )—from enforcing that provision.⁶

But what happens if the court makes a mistake or later changes its mind? This can happen in a variety of ways. For example, an appellate court may

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overturn a preliminary injunction⁷ in an interlocutory appeal⁸ or a permanent injunction after final judgment.⁹ A district court may decide to modify or revoke a preliminary injunction while a case remains pending¹⁰ or dissolve it at the end of the case by declining to enter a permanent injunction.¹¹ And a court may even vacate a permanent injunction long after a case has concluded¹² when the constitutional or statutory provisions involved are reinterpreted in subsequent cases.¹³ This Article will refer to all of these types of orders collectively as "erroneous injunctions."¹⁴

An injunction, judgment, or judicial opinion holding a legal provision unconstitutional neither nullifies that provision nor removes it from the law books. And once that judicial impediment is overturned, vacated, or otherwise dissolved, the government may resume enforcing the provision prospectively against future illegal conduct.¹⁵ For example, in 1923, Adkins v. Children's

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Hospital held that Washington, D.C.'s minimum wage law was unconstitutional.¹⁶ Over a decade later, the Court overruled Adkins in West Coast Hotel Co. v. Parrish, declaring that minimum wage laws are valid.¹⁷ The U.S. Attorney General issued a legal opinion to President Roosevelt concluding that Washington D.C.'s minimum wage law was accordingly "valid from the date it became effective."¹⁸ Relying on that opinion, the D.C. Court of Appeals ruled that the law was enforceable without any need for Congress to re-enact or otherwise resuscitate it.¹⁹

It is far less clear, however, whether a person is subject to liability, civil penalties, or even criminal prosecution for violating a legal provision while an injunction barred the government from enforcing it. At first blush, basic norms of fundamental fairness suggest that a person cannot be punished for actions taken under the protection of an injunction. The purpose of a pre-enforcement injunction, like a declaratory judgment, is to allow a litigant to safely navigate "between the Scylla of intentionally flouting state [or federal] law and the Charybdis of forgoing what he believes to be constitutionally protected activity."²⁰

But reality may be more complicated. In general, "a rule of federal law, once announced and applied to the parties to the controversy, must be given full retroactive effect by all courts adjudicating federal law."²¹ And in Edgar v. MITE Corp., various Supreme Court Justices reached sharply different conclusions about whether a plaintiff who won a preliminary injunction against a state law, and then violated that law while the injunction was in effect, could be prosecuted for those actions if the injunction were later reversed on appeal.²² The plurality acknowledged that this was a difficult question without resolving it.²³ And

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subsequent courts have grappled with the problem,²⁴ with several allowing defendants to be prosecuted for actions taken under the protection of injunctions that were later overturned.²⁵

The academic literature on equity is likewise sharply divided. Professor Jonathan Mitchell's recent Virginia Law Review article, The Writ-of-Erasure Fallacy, contends that when a court reverses, vacates, or dissolves an injunction against a legal provision, "the executive [is] free to enforce the [provision] again—both against those who will violate it in the future and against those who have violated it in the past."²⁶ Professor Douglas Laycock also recognized this possibility while touching upon a few potential counterarguments and noting that the "issue remains unresolved."²⁷

Professor Richard Fallon, in contrast, advocates a more selective approach, taking into account the type of remedy the government seeks to impose for acts taken while an erroneous injunction was in effect.²⁸ He contends that due process concerns about adequate notice prevent the government from retroactively prosecuting someone for violating a statute while its enforcement had been enjoined.²⁹ The government may, however, be able to impose civil penalties or similar sanctions for such conduct.³⁰ Other scholars have recognized the problem without reaching a solution.³¹ Academic works on the revival of

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previously invalidated statutory provisions³² and the retroactive application of judicial reinterpretations of the law more generally³³ have likewise touched on this issue.

The abortion statute that Texas enacted in 2021, S.B.8, purports to impose substantial civil liability based on conduct performed pursuant to court rulings that are later overturned.³⁴ The statute creates a private right of action allowing any person to sue someone who either performs an abortion or aids and abets a pregnant woman in obtaining an...