Preliminary Injunctions
in Patent Cases
FRCP 65(a)
- There is a rule, but is
there a way?
Preliminary Injunction
1.
2.
3.
4.
Likelihood of success on the merits
Irreparable Harm
Balance of Hardships*
Public Interest*
eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388
(U.S. 2006)
No Presumption of Irreparable Harm
• eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (U.S. 2006) (rejecting
broad classifications and categorical rules for injunctions)
– “[T]he decision whether to grant or deny injunctive relief rests within
the equitable discretion of the district courts . . . in patent disputes no
less than in other cases governed by such standards.”
– Winter v. Natural Resources Defense Council, 555 U.S. 7 (2008):
Expressly extending eBay’s rearticulation of the injunction factors to
preliminary injunctions
• Robert Bosch LLC v. Pylon Mfg. Corp., 659 F.3d 1142, 1148 (Fed. Cir. 2011)
– “We take this opportunity to put the question to rest and confirm that
eBay jettisoned the presumption of irreparable harm as it applies to
determining the appropriateness of injunctive relief.”
Presumption?
• Douglas Dynamics, LLC v. Buyers Prods. Co.,
717 F.3d 1336, 1344 (Fed. Cir. 2013)
– “Exclusivity is closely related to the fundamental nature of patents as
property rights. It is an intangible asset that is part of a company's
reputation, and here, Douglas's exclusive right to make, use, and sell
the patented inventions is under attack by Buyers's infringement. .”
– “Where two companies are in competition against one another, the
patentee suffers the harm--often irreparable--of being forced to
compete against products that incorporate and infringe its own
patented inventions.”
Likelihood of Success on the Merits
Likelihood of Success on the Merits Requires
Only One Claim of the Asserted Patent[s]
• To establish a likelihood of infringement, [Plaintiff]
must make a clear showing that each and every
limitation of at least one claim of the Asserted
Patents is infringed by [Defendant].
– Abbott Laboratories v. Andrx Pharmaceuticals, Inc., 473
F.3d 1196, 1201 (Fed. Cir. 2007).
• Strategic Considerations
– Dependent claims
– Validity concerns
Presumption of Validity
• A patent is presumed valid and enjoys the same
presumption of validity during preliminary injunction
proceedings as at other stages of litigation.
– Titan Tire Corp. v. Case New Holland, Inc., 566 F.3d 1372,
1377 (Fed. Cir. 2009).
• To defeat a preliminary injunction based on invalidity,
[Defendant] must show that it is “more likely than not
that [it] will be able to prove at trial, by clear and
convincing evidence, that the patent is invalid.”
– Id. at 1379.
Validity Challenges
• 101: subject matter eligibility
– Myriad, Prometheus, Alice
• 102: Anticipation
• 103: Obviousness
• 112:
– (1) Written Description, Enablement
– (2) Indefiniteness (Clarity)
The Obviousness Inquiry Looks
at the Invention As A Whole
• 35 U.S.C. 103(a) (pre-AIA)
– A patent for a claimed invention may not be obtained. . .if
the differences between the claimed invention and the prior
art are such that the claimed invention as a whole would
have been obvious . . . .
• “[A] patent composed of several elements is not proved
obvious merely by demonstrating that each of its elements
was, independently, known in the prior art. . .This is so
because inventions in most, if not all, instances rely upon
building blocks long since uncovered, and claimed
discoveries almost of necessity will be combinations of
what, in some sense, is already known.
– KSR Int’l Co. v. Teleflex Inc., 127 S. Ct. 1727, 1741 (2007)
Merely Throwing Multiple References At The
Asserted Patents Is Not Enough
• In addition, there must be “an apparent reason to
combine the known elements in the fashion claimed by
the patent at issue.”
– KSR, 127 S. Ct. at 1741.
• "Although the incentive to combine may be inferred from
the nature of the problem, there must be some articulated
reasoning with some rational underpinning to support the
legal conclusion of obviousness.” Won-Door Corp. v.
Cornell Iron Works, Inc., 2013 U.S. Dist. LEXIS 143488
(D. Utah Oct. 3, 2013), *2 (citing K-Tec, Inc. v. Vita-Mix
Corp., 729 F. Supp. 2d 1312, 1325 (D. Utah 2010).
103 Challenges After KSR
• “Mere recitation of the words ‘common sense’
without any support adds nothing to the obviousness
inquiry.”
– Plantronics, Inc. v. Aliph, Inc., 2013 U.S. App. Lexis 15615
(Fed. Cir. July 31, 2013)
• Objective indicia “can be the most probative
evidence of nonobviousness in the record, and
enables the court to avert the trap of hindsight.”
– Leo Pharm. Prods., Ltd. v. Rea, 2013 U.S. App. LEXIS 16610,
* 30-31 (Fed. Cir. Aug. 12, 2013)
Irreparable Harm
Demonstrating Irreparable Harm
1.
2.
3.
4.
5.
6.
Direct (esp. two-party) competition
Loss in market share and market opportunities
Price erosion
Patented product at core of plaintiff’s business
Damage to reputation or goodwill
Defendant’s inability to satisfy judgment*
References:
Robert Bosch, 659 F.3d at 1151
• Douglas Dynamics, LLC v. Buyers Prods. Co.,
717 F.3d 1336, 1344 (Fed. Cir. 2013)
– “Exclusivity is closely related to the fundamental nature of patents as
property rights. It is an intangible asset that is part of a company's
reputation, and here, Douglas's exclusive right to make, use, and sell
the patented inventions is under attack by Buyers's infringement. .”
– “Where two companies are in competition against one another, the
patentee suffers the harm--often irreparable--of being forced to
compete against products that incorporate and infringe its own
patented inventions.”
Apple Nexus Requirement
• Apple Inc. v. Samsung Elecs. Co., 735 F.3d
1352, 1360 (Fed. Cir. November 18, 2013)
(affirming denial of PI based on lack of
irreparable harm)
– “We hold that the district court was correct to
require a showing of some causal nexus between
Samsung's infringement and the alleged harm to
Apple as part of the showing of irreparable harm."
More Presumptions?
• Balance of Hardships
• Public Interest
– Abbott Labs. v. Andrx Pharms., Inc., 452 F.3d 1331, 1348
(Fed. Cir. 2006) ("Although the public interest inquiry is not
necessarily or always bound to the likelihood of success on
the merits . . . we agree . . . that the public interest is best
served by enforcing patents that are likely valid and
infringed."); EcoNova, Inc. v. DPS Utah, 2012 U.S. Dist.
LEXIS 169479 (D. Utah 2013)
Other Considerations
• Advancing the Trial Date
– Before or after beginning the hearing on a motion for a
preliminary injunction, the court may advance the trial on
the merits and consolidate it with the hearing. Fed. R. Civ.
P. 65 (a)(2)
• PI hearing has priority over scheduling other
trials
– Fed. R. Civ. P. 65 (a)(2)
• TRO?
Other Considerations
• Bond (Fed. R. Civ. P. 65(c))
– Movant must provide “security in an amount that the court
considers proper to pay the costs and damages sustained by any
party found to have been wrongfully enjoined or restrained.”
– Celcis in Vitro, Inc. v. CellzDirect, Inc., 664 F.3d 922, 931 (Fed.
Cir. 2012) (amount of a bond is at discretion of the trial court)
– GoTo.com, Inc. v. Walt Disney Co. (9th Cir. 2000) (“Disney would
have us increase the bond 800 times to at least $20,000,000.
We decline to do so, and look to Rule 65(c), which places within
the discretion of the district court the amount of the
bond…Were we to grant Disney’s request, we would risk
denying GoTo access to judicial review since the preliminary
injunction would not take effect until GoTo posted the bond.
We decline to do so.”)
Defending the Patent Preliminary
Injunction
• Raising Question of Validity or Noninfringement
• Unexplained Delay
– High Tech Med. Instrumentation, Inc. v. New Image Indus.,
Inc., 49 F.3d 1551, 1557 (Fed. Cir. 1995) (Unexplained delay
"militates against the issuance of a preliminary injunction
by demonstrating that there is no apparent urgency to the
request for injunctive relief.”)
• Public Interest
– Only in unusual circumstance (medically important…)
• No nexus between infringing product/element
and harm
Contempt of Injunction Order
• Fed. R. Civ. P. 65(d)(2) Persons Bound. The
order binds only the following who receive
actual notice of it by personal service or
otherwise:
– (A) the parties;
– (B) the parties’ officers, agents, servants,
employees, and attorneys; and
– (C) other persons who are in active concert or
participation with anyone described
Contempt
• Redesigned product
– Not more than colorably different from enjoined
product?
– Orders received before injunction, but fulfilled
after?
– Hiding behind distributors?
Other Considerations
• Advancing the Trial Date
– Before or after beginning the hearing on a motion for a
preliminary injunction, the court may advance the trial on
the merits and consolidate it with the hearing. Fed. R. Civ.
P. 65 (a)(2)
• Priority over other matters
– Fed. R. Civ. P. 65 (a)(2)
Other Considerations (cont.)
• Bond (Fed. R. Civ. P. 65(c))
– The court may issue a preliminary injunction or a temporary
restraining order only if the movant gives security in an amount that
the court considers proper to pay the costs and damages sustained by
any party found to have been wrongfully enjoined or restrained.
– Celcis in Vitro, Inc. v. CellzDirect, Inc., 664 F.3d 922, 931 (Fed. Cir. 2012) (“The
amount of a bond is a determination that rests within the sound discretion of
the trial court.”)
– Continental Oil Co. v. Frontier Refining Co., 338 F.2d 780, 782-783 (10th Cir.
Utah 1964) (“Under this rule the trial judge has wide discretion in the matter
of requiring security and if there is an absence of proof showing a likelihood of
harm, certainly no bond is necessary.”)
– GoTo.com, Inc. v. Walt Disney Co. (9th Cir. 2000) (“Disney would have us
increase the bond 800 times to at least $20,000,000. We decline to do so, and
look to Rule 65(c), which places within the discretion of the district court the
amount of the bond…Were we to grant Disney’s request, we would risk
denying GoTo access to judicial review since the preliminary injunction would
not take effect until GoTo posted the bond. We decline to do so.”)
A few additional thoughts . . .
Plan Before Filing Complaint
- Line Up Experts and Other Witnesses
- Consider Claim Construction Issues
- Prepare for Bond (prepare client)
Make Order As Appeal-Proof
as Possible
– Findings of Fact, conclusions of law
– Reasons for bond amount
Effect of PI on the Case
(Pros and Cons)
• Pros
–
–
–
–
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Early decision on merits
Removes infringing device from market quickly
Pressure for early settlement
Costs and time front-loaded
Overall $$$ lower
• Cons
–
–
–
–
Showing cards (e.g., claim construction/prior art)
Bond
Costs and time front-loaded
Big early $$$
Case Law Updates
• Teva Pharmaceuticals USA, Inc. v. Sandoz Inc.,
No. 13-854, slip op. at 1-2 (U.S. Jan. 20, 2015)
– Claim Construction Deference
– District court claim construction rulings involving factual
findings (e.g., extrinsic evidence outside patent) should be
reviewed on appeal for clear error, rather than de novo.
– Cited FED. R. CIV. P. 52(a) (findings of fact must not be set
aside on appeal unless they are clearly erroneous).