Monday, March 4, 2024

Federal Circuit Vacates Preliminary Injunction

I am a little late reporting on this one.  The case is UATP IP, LLC v. Kangaroo, LLC, decided on February 16, nonprecedential opinion authored by Judge Chen, joined by Judges Reyna and Taranto.  According to the opinion, the parties “are operators of ‘adventure parks’—indoor play facilities that includes trampolines, ziplines, ropes courses, and other attractions” (p.2).  UATP filed suit against Kangaroo for infringing U.S. Patent No. 10,702,729 (“Multi-level Play Equipment”) and also for infringing its trade dress; it moved for a preliminary injunction some ten months later.  The district court granted the preliminary injunction, “on the grounds that UATP was likely to succeed on the merits of both its patent and trade dress infringement claims, and that UATP was entitled to a rebuttable presumption of irreparable harm that Kangaroo failed to rebut” (p.3).      

The Federal Circuit reverses the order preliminarily enjoining patent infringement:

We find that UATP’s showing was legally insufficient to demonstrate likelihood of success on the merits of its patent infringement claim. “[W]hether performed at the preliminary injunction stage or at some later stage in the course of a particular case, infringement and validity analyses must be performed on a claim-by-claim basis.”, Inc. v., Inc., 239 F.3d 1343, 1351 (Fed. Cir. 2001). But neither UATP’s motion for preliminary injunction nor the Order ever identified any claim of the ’729 patent that Kangaroo allegedly infringes. Instead of comparing Kangaroo’s allegedly infringing equipment to any of the claims of the ’729 patent, UATP and the district court appear to have assumed that Kangaroo’s equipment infringes the patent because it was previously used in an Urban Air Adventure Park. But the district court never determined that Urban Air Adventure Parks practice a specific claim of the ’729 patent. By assuming that similarities between Kangaroo’s equipment and the equipment in an Urban Air Adventure Park constitute infringement without any discussion of the claims, the district court erred in finding a likelihood of success on the merits.


The district court likewise erred in failing to make any findings on irreparable harm, balance of the equities, or the public interest in its analysis relating to UATP’s patent infringement claim. See Fed. R. Civ. P. 52(a)(2) (“In granting or refusing an interlocutory injunction, the court must [] state the findings and conclusions that support its action.”) (pp. 4-5).

On the trade dress claim, “the district court failed to make any findings on whether UATP’s alleged trade dress was nonfunctional, inherently distinctive, or had acquired secondary meaning. Instead, the district court found that UATP’s “trade dress claim against Kangaroo is likely to succeed on the merits, because it has shown that Kangaroo substantially imitated Urban Air’s total image by using the same colors, attraction structures, and park layout.” . . .  The district court’s failure to explain how it arrived at this finding in view of the relevant trade dress likelihood of confusion factors . . . and failure to address the non-functionality or distinctiveness of UATP’s alleged trade dress, render its analysis too conclusory to permit meaningful appellate review” (p.6).  Further:

The district court’s findings relating to irreparable harm are also deficient. First, the district court erred in failing to address UATP’s ten-month delay in moving for a preliminary injunction. . . . Second, the district court erred in finding that UATP was entitled to a rebuttable presumption of irreparable harm under 15 U.S.C. § 1116(a). Section 1116(a) entitles a plaintiff seeking a preliminary injunction under 15 U.S.C. § 1125 to a rebuttable presumption of irreparable harm “upon a finding of likelihood of success on the merits for a violation.” Because the district court’s analysis was premised on a flawed likelihood of success finding, the court’s application of the presumption cannot stand. . . .


Finally, as with its analysis relating to the patent infringement claim, the district court’s analysis relating to the trade dress infringement claim failed to make sufficient findings on the balance of the equities or the public interest (p.7)

The court vacates and remands as to the trade dress claim.

As readers may recall from some of my previous posts, a ten-month delay in moving for a preliminary injunction would strongly weigh against granting the injunction under German law, which emphasizes Dringlichkeit (“urgency”).

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