State Immunity – Preliminary Injunction Bond

Ex parte Cooper; Cooper v. Baldwin County Bridge Company, LLC; Scott Bridge Company, LLC v. Baldwin County Bridge Company, LLC, [Ms. SC-2023-0056 SC-2023-0354; SC-2023-0364, Aug. 25, 2023] __ So. 3d __ (Ala. 2023). The Court (Mitchell, J.;Shaw, Wise, Sellers, Mendheim, and Stewart, JJ., concur. Parker, C.J., concurs specially, with opinion. Cook, J., recuses himself) reverses the Montgomery Circuit Court’s preliminary injunction enjoining construction of a third bridge over the Intracoastal Waterway between the BEX [Baldwin Beach Express] Bridge and Holmes Bridge and directs the trial court to dismiss the bad faith claim upon which the preliminary injunction was based. Baldwin County Bridge Company, LLC (“BCBC”), the owner of the BEX bridge, filed suit against John R. Cooper, in his official capacity as Director of the Alabama Department of Transportation (“ALDOT”), alleging that the building of the third bridge resulted from Cooper’s resentment over the State having granted BCBC the right to collect tolls over the BEX in perpetuity. Ms. *12. BCBC also alleged an inverse condemnation claim seeking compensation for the value of the BEX Bridge.

“The theory underlying both claims was that Cooper wanted to construct the third bridge – not to alleviate traffic congestion in Baldwin County – but to intentionally harm BCBC and to destroy the value of the BEX Bridge.” Ms. **6-7. While “§ 14 typically does not bar claims against a State official alleging that the official acted in an ultra vires, fraudulent, or bad-faith fashion because such claims almost always seek to control only the unlawful conduct of the official; they do not seek to control the rights or property of the State itself. Still, that logic does not hold when a claim is styled as a ‘bad-faith’ claim yet seeks in substance to enjoin the State from exercising its contractual rights. As always, it is the substance of the claim that matters, not its label.” Ms. **13-14. Because the “order entering a preliminary injunction enjoining construction of the third bridge is predicated on the bad-faith claim, that order is void.” Ms. *19.

The Court rejects Cooper’s argument that BCBC’s inverse-condemnation claim is not ripe and explains “BCBC has alleged that it faces an imminent injury (the total loss of the value of its property) caused by a government action (the building of the third bridge) that is redressable by the payment of compensation for the value of that property. That is sufficient to assert a ripe claim appropriate for judicial review regardless of whether the claim is ultimately determined to have any merit.” Ms. *19, n. 10.

Finally, the Court holds

Because the trial court did not have subject-matter jurisdiction to enter the preliminary injunction against Cooper, it follows that Cooper was “wrongfully enjoined” from continuing construction on the third bridge. In fact, he “‘had the right all along to do what [he] was enjoined from doing.’” Ex parte Waterjet Sys., Inc., 758 So. 2d 505, 512 (Ala. 1999) (citation omitted). Cooper is therefore entitled to “recover those damages that are ‘the actual, natural and proximate result of the [wrongful] injunction.’” Id. at 511 (citation omitted). Notably, however, his recovery of damages is limited to the amount of the preliminary-injunction bond; BCBC cannot be held liable for any amount in excess of that bond unless it is determined that the injunction was pursued in bad faith. Id. at 513.

Ms. *20.

The Court rejects Cooper’s request to increase the $100,000 preliminary injunction bond and explains “such requests can be entertained only while the injunction is still in place; once the injunction is determined to be unwarranted, any request to increase the bond is moot.” Ms. **23-24. Finally, the Court rejects Scott Bridge’s request to alter the bond to permit it to recover under the bond, as such an order “would effectively increase the exposure of BCBC – which agreed only to be liable for expenses incurred by Cooper (and by extension ALDOT) – beyond what it agreed to when the injunction was entered.” Ms. *25.

Related Documents