Sandra J. Douglas, for Herself and as Representative of a Class v. Beneficial Finance Co. Of Anchorage

Douglas, the appellee, brought a class action in the District Court for the District of Alaska against seven Alaska Beneficial Finance Companies (collectively referred to as Beneficial), alleging that they had violated the Federal Truth-in-Lending Act (the Act), 15 U.S.C. §§ 1601-1665 , by failing to disclose as security interests certain confession of judgment clauses in their promissory notes. On April 20, 1971, the district court entered a preliminary injunction restraining Beneficial from collecting on the notes pending the outcome of the action. That injunction is the subject of this appeal. We reverse.

Ordinarily, the grant or denial of a preliminary injunction is a matter within the discretion of the district court, and it will not be reversed absent an abuse of that discretion. See King v. Saddleback Junior College District, 9 Cir., 1970, 425 F.2d 426, 429 . An exception to this rule applies when such grant or denial is based upon an erroneous legal premise; the order is then reviewable as is any other conclusion of law. Delaware & Hudson Railway Co. v. United Transportation Union, 146 U.S.App.D.C. 142 , 1971, 450 F.2d 603, 619-623 ; Ring v. Spina, 2 Cir., 1945, 148 F.2d…