Narrowing v. Denying Permanent Injunctive Relief

In Union Pacific Railroad Co. v. Illinois Mine Subsidence Insurance Fund, the Seventh Circuit held that it lacked jurisdiction to immediately review an order that narrowed the potential injunctive relief in an action.

The plaintiff in Union Pacific sought to permanently enjoin the defendant from bringing certain claims against the plaintiff. The district court rejected some of a plaintiff’s theories of relief, which limited the scope of any possible permanent injunction. The plaintiff then tried to appeal under 28 U.S.C. § 1292(a)(1).

Although the Seventh Circuit generally allows appeals from interlocutory orders denying permanent injunctions, the court of appeals held that the district court’s order had not denied an injunction. The order had instead only narrowed the possible injunction. And the issues that remained pending in the district court overlapped significantly with those in the appeal. The Seventh Circuit accordingly dismissed the appeal.

The Seventh Circuit ended by noting that it might one day need to reconsider its rule allowing appeals from the denial of permanent injunctions. But Union Pacific was not the case to do so.

The Multiple Proceedings in Union Pacific

Simplifying as much as possible, Union Pacific stemmed from claims against a railroad for collapses of land caused by coal mining. The claims were brought by the Illinois Mine Subsidence Insurance Fund, a state entity that acted as a re-insurer for primary insurers that offer mine-collapse coverage. The Fund had the authority to pay out claims to injured parties. Then, subrogated to those claims, the Fund would sue the party responsible for the collapse to recover what the Fund had paid.

The Predecessor Responsible for the Collapses

The collapses at issue in Union Pacific had been caused by a coal-mining company that had been dissolved in 1957. The Fund contended that a railroad—who was the eventual plaintiff in Union Pacific—was a successor to the dissolved mining company and thus responsible for its liabilities. So the Fund sought to recover from the railroad for amounts it paid to a number of parties injured by mine collapses.

The fund and the railroad disputed this successor-liability issue in a series of lawsuits. In one of those cases, a state court held that the railroad was responsible only for liabilities that existed at the coal-mining company’s dissolution in 1957. In another case, a federal district court ruled that the mining company was not an alter ego of the railroad, nor had the mining company and the railroad merged.

The Federal lawsuit

The railroad eventually sued the Fund in federal court and sought a declaration that the just-mentioned suits barred the Fund from re-litigating the just-discussed successor-liability theories. The railroad also sought to enjoin any future claims.

On the Fund’s motion to dismiss, the district court determined that the railroad could seek a declaration and injunction regarding only claims the Fund had acquired at the time of the decisions on successor liability. Because the Fund possessed those claims at the time of the prior suits, it was precluded from re-litigating those issues.

But the Fund was not barred from re-litigating successor liability in any subsequent claims. The district court reasoned that the injured parties—not the Fund—were the real parties in interest. And the Fund exercised a new assignment of rights with each new claim. So the Fund could not be barred via preclusion from exercising the rights of claimants who could themselves have sued the railroad.

The district court thus allowed the case to proceed only on claims the Fund had acquired at the time of the decisions on successor liability. The railroad then appealed, arguing that the district court’s order was an appealable interlocutory denial of an injunction under 28 U.S.C. § 1292(a)(1).

A Non-Appealable Narrowing of Injunctive Relief

The Seventh Circuit held that it lacked jurisdiction over the appeal.

To be sure, the district court’s decision had rejected some of the injunctive relief that the railroad ultimately sought. The decision was also interlocutory, as the action was still pending regarding preclusion of some of the Fund’s claims. And the Seventh Circuit allows litigants to appeal from an interlocutory denial of a permanent injunction.

But the district court had only narrowed—not denied—the potential injunctive relief. The district court had determined that preclusion might apply to some of the claims the Fund had against the railroad but not others. So the railroad could still obtain some of the injunctive relief it sought in the action. The Seventh Circuit also noted that the issues the railroad sought to appeal overlapped significantly with those still pending in the district court.

The Seventh Circuit went on to reject the railroad’s argument that it had sought two different kinds of injunctive relief, one of which the district court had definitively rejected. The injunctive relief remaining in the district court was both substantial—a favorable decision would allow the railroad to preclude future litigation—and similar to the relief the district court had rejected. After all, the issues on appeal and still pending in the district court involved identical facts and broad overlap in the legal theories.

The Seventh Circuit ended its opinion by noting that the court might one day need to reconsider its caselaw allowing appeals from denials of permanent injunctions. But Union Pacific was not the case to do so.

Union Pacific Railroad Co. v. Illinois Mine Subsidence Insurance Fund, 2025 WL 1554415 (7th Cir. June 2, 2025), available at the Seventh Circuit and Westlaw