In the order granting any temporary restraining order or temporary injunction, the court shall fix the amount of security to be given by the applicant.
Tex. R. Civ. P. 684.
“The purpose of a temporary injunction bond is to secure payment to the party against whom the injunction is granted for the amount of damages sustained as a result of the injunction being erroneously granted.” Westside Airways, Inc. v. JR Aircraft Corp., 694 S.W.2d 100 (Tex. App.—Houston [14th Dist.] 1985, no writ) (italics added) (“bond is not issued to secure an alleged underlying debt”); see also Biodynamics, Inc. v. Guest, 817 S.W.2d 128, 130 (Tex. App.—Houston [14th Dist.] 1991, no writ). This is “to protect the defendant against whatever damages may result from the time of the issuance of the writ until the injunction is dissolved.” Bryant v. Lake Highlands Development Co. of Texas, 618 S.W.2d 921, 923 (Tex. Civ. App.—Fort Worth 1981, no writ) (italics added). Thus, the determinative inquiry as to the amount of a bond is not the cost or value of the matter in dispute but rather an estimate of “damages caused by the issuance of the injunction.” IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191, 203 (Tex. App.—Fort Worth 2005, no pet.) (inquiring into lost profits caused by inability to use information “for the duration of the injunction”); see also Miller v. K and M Partnership, 770 S.W.2d 84 (Tex. App.—Houston [1st Dist.] 1989, no writ) ($50,000 bond for injunction prohibiting transfer of 800,000 shares of stock valued in excess of $8 million).
The amount of the bond is within the discretion of the trial court. Biodynamics, Inc. v. Guest, 817 S.W.2d 128, 131 (Tex. App.—Houston [14th Dist.] 1991, writ dism’d by agr.) A bond amount that is too high may preclude a plaintiff from being able to bond the injunction at all. A bond amount that is too low may preclude a defendant from recovering just compensation for a wrongful injunction. Too often, however, the amount of the bond is an afterthought to attorneys seeking or opposing temporary injunctive relief and to trial courts granting it. Give the trial court something with which to work. A party seeking temporary injunctive relief should argue the bond in its application, stating why the relief sought will not harm the enjoined party, and be prepared to counter any evidence to the contrary. A party opposing injunctive relief must be prepared to present evidence of how the injunction will damage it, the amount of damage, and how it is calculated. Only then can the trial court make an informed decision about the appropriate amount of the bond. See Hsin-Chi-Su v. Vantage Drilling Co., 474 S.W.3d 284, 304 (Tex. App.—Houston [14th Dist.] 2015, pet. denied) (no abuse of discretion as to bond amount where defendant did not present nonconclusory evidence of damages).1