Preliminary Injunction Denied Because Money Damages Do Not Establish Irreparable Harm

Posted: November 3, 2025 / Written by: Jeffrey M. Eilender, Joshua Wurtzel, Samuel L. Butt, Channing J. Turner, Thomas A. Kissane / Categories Commercial, Preliminary Injunction

Preliminary Injunction Denied Because Money Damages Do Not Establish Irreparable Harm

On October 3, 2025, in Lego Summit Co. Ltd. v. YWA-Amsterdam LLC, Index No. 654004/2025, Justice Andrea Masley denied plaintiffs’ motion for a preliminary injunction prohibiting defendants from dissipating certain funds as defined in the first-named defendant’s LLC agreement. The Court explained:

Further, Lego cannot establish irreparable harm. This is a case for money damages. Where the "ultimate objective is attaining an enforceable money judgment," there is no entitlement to a preliminary injunction restraining a defendant's assets because there is no irreparable harm. (Credit Agricole lndosuez v Rossiyskiy Kredit Bank, 94 NY2d 541, 545, 548 [2000].) Lego asserts an exception to this rule "where the monies at issue are identifiable proceeds that are supposed to be held for the party seeking injunctive relief." (AQ Asset Mgt. LLC v Levine, 111 AD3d 245,259 [1st Dept 2013].) To constitute "identifiable proceeds," there must be a "specific, identifiable fund and an obligation to return or otherwise treat in a particular manner the specific fund in question." (Manufacturers Hanover Trust Co. v Chemical Bank, 160 AD2d 113, 124 [1^st Dept 1990].) The Refund Amount to which Lego is entitled does not fit this exception; it is fungible and not an identifiable discrete amount. While the Brownfield tax credits allocated to the Member Taxpayers may satisfy the exception because they are discrete and identifiable, those credits are monetized, after a deduction for taxes, when they are paid in cash, not credits, to the Company and before they are paid to Lego. There is no specific, identifiable fund here. (See e.g. Amity Loans, Inc. v Sterling Natl. Bank & Trust Co., 177 AD2d 277,279 [1st Dept 1991] [accounts receivable are identifiable]; Punwaney v Punwaney, 148 AD3d 489, 490 [1st Dept 2017] [foreign bank accounts sufficiently discrete].) ·Rather, Lego makes the mistake of confusing "funds that can be identified ... with identifiable funds that carry with them some requirement to be treated in a certain manner." (Seeking Valhalla Trust v Deane, 2018 NY Slip Op 31920[U], *6 [Sup Ct, NY County 2018] [proceeds from the sale not exceptional].) A sum certain is not sufficient. (Benefit St. Partners Realty Operating Partnership, L.P. v Zhang, 2022 NY Slip Op 34466[U], *5 [Sup Ct, NY County 2023] [exception inapplicable to sum certain of $5 million because funds were "not specifically segregated" but held in personal accounts and "commingled multiple times."].) Finally, contrary to cases Lego relies upon, Lego does not have a security interest in the Refund Amounts. Therefore, Lego has not established irreparable harm.

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning preliminary injunctions.