Wednesday, July 13, 2022

Federal Circuit Affirms Denial of Preliminary Injunction in Phillips v. Thales

The opinion is here.  Thales had sought a preliminary injunction prohibiting Phillips from seeking an exclusion order from the ITC.  The Federal Circuit affirms the order of the District of Delaware (where a FRAND trial is pending) denying a preliminary injunction, stating:


“A party seeking a preliminary injunction must establish that it is likely to suffer irreparable harm without an injunction.  .  .  .  The mere possibility or speculation of harm is insufficient.  .  .  .  Evidence of speculative harms, such as customers merely expressing concern that a potential future ITC exclusion order could affect Thales’ ability to deliver products down  the road, is insufficient to show a likelihood of irreparable harm. .  . .


“. . . Thales did not present any evidence that it lost customers, had customers delay purchases, or struggled to acquire new business because of the ongoing ITC proceedings. . . . Instead, it presented affidavits stating only that the threat of an ITC exclusion order caused several customers to ‘voice concerns’ and express doubt regarding Thales’ ability to deliver products. . . . And during oral argument, it characterized its alleged harm as living under the ‘cloud on the business’ of a potential exclusion order and the potential loss of business that may occur if it loses at the ITC. . . . This type of speculative harm does not justify the rare and extraordinary relief of a preliminary injunction” (pp. 4-5).


Not exactly a big surprise, given that the ITC last week issued its Initial Determination terminating the ITC investigation, as discussed on FOSS Patents, though the Federal Circuit doesn’t mention this.  A reversal on appeal is always a possibility, I suppose, but at this point the alleged harm does seem rather speculative. 

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