LEVENTHAL, Circuit Judge:
The District Court granted the Washington Metropolitan Area Transit Commission a permanent injunction restraining Holiday Tours from operating a motor coach sightseeing service without a certificate of public convenience and necessity. Then, on motion of Holiday Tours, the District Court stayed its injunction pending appeal. We deny the Commission's motion to vacate the District Court's stay, and in doing so find it necessary to refine the discussion in Virginia Petroleum Jobbers Association v. FPC, 104 U.S.App.D.C. 106, 259 F.2d 921 (1958).
On the merits, this appeal turns on the proper interpretation of Holiday Tours, Inc. v. Washington Metropolitan Area Transit Commission, 125 U.S.App.D.C. 336, 372 F.2d 401 (1967), in which we affirmed the Commission's ruling that Holiday Tours was not entitled to a certificate of public convenience and necessity under the "grandfather clause" of the pertinent statute. In our concluding paragraph of that opinion, we stated (at 402):
This language is central to the current dispute because Holiday Tours, which was primarily a limousine tour service when our earlier opinion was rendered, has recently transformed itself into primarily a bus tour service. Holiday Tours contends that this conversion is authorized by the quoted language so long as the buses are rented from licensed operators rather than owned by Holiday Tours itself. The Commission, however, argues that the language is merely the court's observation that no certificate is required if Holiday Tours occasionally rents buses to accommodate additional customers as an adjunct to its primary business of providing limousine tours. The Commission emphatically rejects an interpretation which sanctions Holiday Tours' conversion from a limousine to a bus tour service.
The District Court adopted the Commission's interpretation but stayed the permanent injunction pending appeal. Although the District Court did not make detailed findings, it recited that all four of the Virginia Petroleum Jobbers factors favored a stay.
These factors are by now familiar to both the bench and bar in this Circuit.
Virginia Petroleum Jobbers Ass'n, supra, at 925.
Despite the Commission's protestations to the contrary, the final three factors enumerated above clearly favored the District Court's grant of a stay. The harm to Holiday Tours in the absence of a stay would be its destruction in its current form as a provider of bus tours.
In this context, Holiday Tours was undoubtedly not entitled to a stay on a showing "that it is likely to prevail on the merits of its appeal."
Although this approach adopts a linguistically permissible interpretation of Virginia Petroleum Jobbers, it is mandated only if one assumes that the Court was using language in an exceedingly precise, technical sense. In light of the unnecessarily harsh results sometimes engendered by this approach, we decline to entertain this assumption. Instead, we hold that under Virginia Petroleum Jobbers a court, when confronted with a case in which the other three factors strongly favor interim relief may exercise its discretion to grant a stay if the movant has made a substantial case on the merits. The court is not required to find that ultimate success by the movant is a mathematical probability, and indeed, as in this case, may grant a stay even though its own approach may be contrary to movant's view of the merits. The necessary "level" or "degree" of possibility of success will vary according to the court's assessment of the other factors.
The view that a 50% plus probability is required by that opinion, although frequently encountered, is thus contrary to both the language and spirit of that opinion.
Our holding is generally in accord with the movement in other courts away from a standard incorporating a wooden "probability" requirement and toward an analysis under which the necessary showing on the merits is governed by the balance of equities as revealed through an examination of the other three factors.
Hamilton Watch Co. v. Benrus Watch Co., 206 F.2d 738, 740 (2d Cir. 1953) (footnote omitted). More recently, the same court declared:
We believe that this approach is entirely consistent with the purpose of granting interim injunctive relief, whether by preliminary injunction or by stay pending appeal. Generally, such relief is preventative, or protective; it seeks to maintain the status quo pending a final determination of the merits of the suit. An order maintaining the status quo is appropriate when a serious legal question is presented, when little if any harm will befall other interested persons or the public and when denial of the order would inflict irreparable injury on the movant. There is substantial equity, and need for judicial protection, whether or not movant has shown a mathematical probability of success.
Another weakness of adherence to a strict "probability" requirement is that it leads to an exaggeratedly refined analysis of the merits at an early stage in the litigation. If, to use Judge Frank's phrase, there exists "a fair ground for litigation and thus for more deliberative investigation," a court should not be required at an early stage to draw the fine line between a mathematical probability and a substantial possibility of success. The endeavor may be necessary in some circumstances — when interim relief would cause substantial harm to another party or person, or when the balance of equities may come to require a more careful heft of the merits. However, it is not required in all cases.
The doctrine thus stated is congruent with Rules 8 and 18 of the Federal Rules of Appellate Procedure, which state that motions for stay "must ordinarily be made in the first instance" to the district court or agency which issued the challenged order. Prior recourse to the initial decision-maker would hardly be required as a general matter if it could properly grant interim relief only on a prediction that it has rendered an erroneous decision. What is fairly contemplated is that tribunals may properly stay their own orders when they have ruled on an admittedly difficult legal question
Applying this standard to the instant motion, we cannot say that the District Court abused its discretion in staying its permanent injunction. Although a more searching inquiry into the merits might compel the tentative conclusion that Holiday Tours is less likely than not to prevail on the merits, we have satisfied ourselves that the case is a difficult one warranting plenary review. In light of the balance of equities in this case, that suffices to sustain the stay.
The Commission's motion to vacate the District Court's order staying its permanent injunction is denied.