Courts May Not Increase Amount Of Preliminary Injunction Bond Retroactively

The Third Circuit has reversed a district court’s amendment of an injunction bond to almost 20 times the original amount after the defendants’ costs of compliance appeared to escalate. In Sprint Communications Company L.P. v. CAT Communications Int’l Inc., 335 F.3d 235 (3rd Cir. July 11, 2003), the court held that an injunction bond constitutes the “price” to the movant of an injunction and limits its total exposure in the event the injunction is found to have been wrongfully entered. The court sets the amount after hearing evidence of the harm that the injunction will cause to the non-movant. Retroactive increases impermissibly alter the bargain after the fact.