Sunday, June 2, 2013

Comparison of U.K. and U.S. Practice Regarding Permanent Injunctions for Patent Infringement

The April 2013 issue of the Journal of Intellectual Property Law and Practice has an interesting article, also appearing in the April 2013 issue of GRUR Int. (a German publication; the acronym stands for "Gewerblicher Rechtsschutz und Urheberrecht," or "Industrial Rights Protection and Copyright"), by Robert Lundie-Smith and Gary Moss, titled "Bard v. Gore:  To Injunct, or Not to Injunct, What Is the Question?  Is It Right to Reward an Infringer for Successfully Exploiting a Patent?", that compares U.K. and U.S. standards for denying permanent injunctions for patent infringement.  

I recommend the article to anyone interested in the subject.  As the authors point out, there is authority within the U.K. for denying injunctions, but (in contrast to U.S. practice post-eBay) injunctions still remain the presumptive remedy, with the burden for overcoming the presumption resting on the defendant.  (I also discuss the standards applied in the U.K., Canada, and Australia in my book at pp. 179-84.)   The authors are critical of the direction that U.S. law relating to permanent injunctions has taken post-eBay--more critical than I am, though I too think that a (rebuttable) presumption in favor of injunctive relief would be preferable to the standard articulated in eBay.

One of the U.S. cases with which the authors take issue is Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs., Inc., 670 F.3d 1171 (Fed. Cir. 2012), cert. denied, 133 S. Ct. 932 (2013), in which the court affirmed a judgment to deny a permanent injunction, which judgment was based in part on the district judge's conclusion that a permanent injunction relating to the infringing products (prosthetic vascular skin grafts) threatened "potentially devastating public health consequences"--despite also affirming the district judge's conclusion that the infringement was willful and awarding compensatory damages, enhanced damages, and attorneys' fees totaling nearly $400 million.  (The willfulness finding and the judgment for enhanced damages were thereafter vacated and remanded following a petition for rehearing; I may blog on the changing law of willfulness and enhanced damages at a later time.)  I'm not sure that's the wrong decision, if indeed the public interest in not taking Gore's product off the market is substantial--but I do share the authors' apprehension that perhaps the U.S. courts may be denying permanent injunctions too often.  And as I mentioned in another recent post, some of the Federal Circuit's opinions seem a bit difficult to reconcile, with cases like Bard and ActiveVideo Networks, Inc. v. Verizon Communications, Inc., 694 F.3d 1312 (Fed. Cir. 2012), affirming denials of injunctions despite a lack of evidence of patent holdup as I understand that phenomenon, while others like Edwards Lifesciences AG v. CoreValve, Inc., 699 F.3d 1305 (Fed. Cir. 2012), and Douglas Dynamics, LLC v. Buyers Products Co., __ F.3d __ (Fed. Cir. May 21, 2013), have focused on the importance to the patentee of exclusivity in reversing denials of permanent injunctions.  (The latter two cases also elicited strong dissenting opinions from Judges Prost and Mayer, respectively.)  Perhaps an en banc or Supreme Court review of the proper understanding of eBay would be desirable, though of course that would not necessarily guarantee any greater certainty or consistency . . . .     



  1. I haven't read Bard v Gore, but I suggest that courts should keep in mind that granting a permanent injunction does not necessarily mean the defendant's product will be kept of the market - it may just provide the leverage for licensing negotiations. The bar for obtaining an interlocutory injunction is very high in Canada as a result of a case in which a patentee sought an injunction against the Red Cross using patented blood collection technology. If enforced, that would no doubt have led to devastating public health consequences, but I expect the patentee was more interested in getting a major user to licence. If the patentee makes its own product, it will be more likely to enforce, but then the patentee's product will normally be a reasonably close substitute.

    1. I think courts sometimes do lose sight of the possibility that an injunction will lead to bargaining, rather than the removal of the defendant's products from the market. John Golden also has some interesting observations about injunctions in his article Injunctions as More (or Less) than “Off Switches”: Patent Infringement Injunctions’ Scope, 90 Tex. L. Rev. 1399 (2012), where he argues, among other things, that injunctions are “only as powerful as the [contempt] sanctions, often monetary, that back” them up, so that “[i]n many situations, an injunction operates essentially as a mere gateway to higher-than-normal monetary sanctions delivered with higher-than-normal speed.”