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Walgreen Co. v. Sara Creek Property Co.

(1992)

United States Court of Appeals for the Seventh Circuit - 966 F.2d 273

tl;dr:

This case illustrates an example of evaluating whether an injunction or damages is the more appropriate remedy.

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Case Summary

In the 1992 case Walgreen Co. v. Sara Creek Property Co., the Seventh Circuit Court of Appeals supported the district court's decision to give Walgreen Co., a pharmacy, a permanent injunction against the shopping center owner, Sara Creek Property Co. The case centered around Sara Creek breaching a contract by trying to rent space to Phar-Mor, a competing pharmacy, which went against an exclusivity agreement that prevented Sara Creek from leasing to another pharmacy in the same shopping center.

This case is important because it demonstrates how courts determine whether to grant an injunction or damages as a remedy for contract breaches. The court used a cost-benefit analysis and decided that an injunction was a better solution for Walgreen, as figuring out damages would be difficult and expensive. An injunction, on the other hand, would avoid a lengthy trial and preserve the contract.

The court also mentioned that if the injunction caused more harm to Sara Creek than benefit to Walgreen, the parties could work out a lease buyout or modify the exclusivity agreement. Additionally, the case shows that appellate courts often defer to trial courts in reviewing injunction decisions. The court found that the trial court had made a reasonable judgment and did not abuse its discretion in granting the injunction.

ICRAIssue, Conclusion, Rule, Analysis for Walgreen Co. v. Sara Creek Property Co.

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Facts & HoldingWalgreen Co. v. Sara Creek Property Co. case brief facts & holding

Facts:Walgreen leased space from Sara Creek.Sara agreed not to lease...

Holding:An injunction is permissible in this context. The appellate court...

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Walgreen Co. v. Sara Creek Property Co. | Case Brief DeepDive
Majority opinion, author: POSNER, Circuit Judge.
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Walgreen filed a breach of contract suit against Sara Creek and Phar-Mor for violating an exclusivity clause in their lease by planning to open a discount store with a pharmacy. The court found a breach of the lease and granted a permanent injunction against Sara Creek from leasing the anchor premises to Phar-Mor until Walgreen's lease expires. The defendants argued that damages should be the only remedy, but Walgreen argued that damages would be difficult to compute, including intangibles such as loss of goodwill. The court emphasized that the choice between remedies requires a balancing of costs and benefits, and the burden is on the plaintiff to show that damages are inadequate when seeking a permanent injunction. The use of "irreparable harm" as a synonym for inadequate remedy at law is confusing and should be avoided.

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Opinion (Concurrence), author: HARLINGTON WOOD, Jr., Senior Circuit Judge
Level 1
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I agree with Judge Posner's ruling in this case and am pleased to endorse it.

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