S. Ct. Civ. No. 2013-0040

In a dispute relating to the alleged partnership of two families operating supermarkets in the Virgin Islands, in which a receiver was appointed and substantial funds are held under order of the United States District Court after tax evasion charges were brought, the Superior Court did not err in granting a preliminary injunction to prevent interference with operation of the supermarkets, ordering the families to maintain joint management of the stores, and requiring that any distribution of funds be approved by a representative for both sides. The evidence was sufficient to support the Superior Court's conclusions that the movant has shown a reasonable probability of success on the merits on partnership theories, and would be irreparably injured by denial of injunctive relief due to steps taken in the management of the businesses presently being co-managed, and that granting this preliminary relief will not result in even greater harm to the nonmoving party or harm the public interest. Thus the Superior Court's April 25, 2013 Order granting a preliminary injunction is affirmed. However, Federal Rule of Civil Procedure 65(c) provides that a court may issue a preliminary injunction only if the movant gives security in an amount that the court considers proper to pay the costs and damages sustained by any party later found to have been wrongfully enjoined or restrained. The Superior Court abused its discretion in ordering the posting of a $25,000 injunction bond in this case, treating the moving party's interest in some $43 million of profits held at a financial institution as additional security. The amount of those funds that may be available is uncertain and they are outside of the control of both the moving party and the Superior Court, since access requires an order of the United States District Court available only under limited circumstances. The case is remanded for the Superior Court to reconsider the sufficiency of the injunction bond to be required in this case.