Background
Big Iron Auction Company engaged Harder Capital, LLC, and Ryan M. Harder as an independent sales representative under an agreement containing restrictive covenants and an arbitration provision. After Harder ended the relationship and began selling auction services through another platform, Big Iron sued for breach of contract, injunctive relief, and tortious interference. The district court sent the parties’ claims and defenses—apart from Big Iron’s injunction claim—to arbitration and temporarily enjoined Harder from violating the restrictive covenants. Big Iron deposited $300,000 as security for the injunction.
In December 2024, the arbitrator found the restrictive covenants unenforceable, awarded Harder $19,405.91 in unpaid commissions, and concluded that no other recoverable damages based on invalidation of the covenants could be awarded because they were too speculative. In early December, Harder filed both a motion to vacate the injunction and a motion seeking damages, costs, and fees for the wrongful injunction. The district court immediately vacated the injunction, confirmed the arbitral award in March 2025, and denied the wrongful-injunction damages motion in May 2025, reasoning that the confirmed award foreclosed additional recovery.
The Court’s Holding
The Nebraska Supreme Court held that the confirmed arbitral award became the law of the case and foreclosed Harder’s claimed business-loss damages from the wrongful injunction. Those damages were substantially similar to the damages arising from invalidation of the restrictive covenants that the arbitrator had rejected as speculative. Harder used the same 1099-based theory for both and did not seek to vacate, modify, or correct the award before requesting its confirmation.
The award did not, however, resolve Harder’s attorney fees and expenses incurred in resisting the temporary injunction and obtaining its dissolution and confirmation of the award. Those costs were recoverable as damages under Nebraska’s injunction-undertaking law. Reviewing the equity proceeding de novo, the court modified the judgment to award Harder an additional $11,000, with interest from May 28, 2025, and affirmed the judgment as modified.
Key Takeaways
- A confirmed arbitral award may become law of the case and bar later litigation of substantially similar damages within the same lawsuit.
- A party that believes an arbitrator exceeded the scope of the arbitration agreement must timely seek vacatur, modification, or correction rather than confirm the award and later challenge its effect.
- Reasonable attorney fees and expenses incurred in resisting and dissolving a wrongful injunction may be recoverable even when the arbitral award forecloses the underlying business-loss damages.
Why It Matters
The decision shows that the wording and confirmation of an arbitral award can sharply limit a later claim for wrongful-injunction damages, even when the arbitrator did not expressly decide entitlement to damages under the injunction undertaking. Courts may treat substantially similar damage theories as settled under the law-of-the-case doctrine.
The opinion also preserves a distinct avenue for recovering fees and expenses attributable to the auxiliary injunction proceeding. Attorneys should separate those costs from fees incurred litigating the principal arbitrated dispute and should timely challenge any portion of an award believed to exceed the arbitrator’s authority.