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Nonprofit Enviro Group Can’t Shake $10K Bond

(CN) - A nonprofit environmental group cannot escape the requirement that it post a $10,000 bond to pay for costs and damages incurred by a now-dissolved order blocking logging on several thousand acres of national forest in Wisconsin, the 7th Circuit ruled.

Habitat Education Center won an injunction in January 2009 barring the U.S. Forest Service from logging that winter.

The judge required the center to post a $10,000 injunction bond to pay any costs or damages incurred if the injunction was later invalidated.

And that's exactly what happened. The judge eventually dissolved the preliminary injunction he had granted to Habitat and dismissed the lawsuit.

Habitat did not appeal this dismissal, except to challenge the bond order. It argued that it should have been exempt from posting bond as a nonprofit group devoted to the common good of protecting the environment.

But this claim fell flat with Judge Richard Posner.

"We are not persuaded by Habitat's argument that nonprofit entities, at least those devoted to public goods of great social value, such as the protection of the environment, should be exempted from having to post injunction bonds," Posner wrote for the three-judge panel.

"The forest service may lose money as a result of the now-dissolved preliminary injunction, and Habitat admits that posting the $10,000 bond caused it no hardship, let alone deterred it from asking for the injunction," he wrote.

"Obviously, dissolving this injunction bond would not materially affect the budget of the forest service," Posner added. "But the principle that nonprofit entities should pay their way, reimbursing the losses incurred by entities whose operations the nonprofits impede by obtaining preliminary injunctions later dissolved, is general."

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