MIA: Preliminary Injunctions Part II

Posted on | April 28, 2008 | No Comments

In Part I we suggested that preliminary injunctions are one of the issues ripe for clarification by the Federal Circuit.  In Part II we offer brief summaries of the different CAFC decisions since January 2007 analyzing preliminary injunctions in patent infringement cases.  Because of the length of these summaries, we will break this Part into two posts.

Abbott Labs v. Andrx Pharma, 473 F.3d 1196 (Fed. Cir., Jan. 5, 2007) [Michel, Prost, Ellis (ED/VA)].  CAFC affirmed the grant of PI.  Abbott filed three suits, against Teva, Ranbaxy, and Andrx, alleging infringement of their respective ANDAs for generic versions of Biaxon XL®.  Abbott sought, and lost, preliminary injunctions against Teva and Ranbaxy, in both cases substantial questions of invalidity and unenforceability were raised.  The district court in fact issued a joint order with respect to Ranbaxy and Andryx, finding that Ranbaxy had raised a substantial question of unenforceability but that Andryx had not.  Three interesting points about the CAFC’s decision:

• The court put the burden of proof of establishing a substantial question completely on Andryx;

• The court never discussed the substance of the invalidity or unenforceability arguments;

• The opinion is dominated by a discussion of the collateral effect of the CAFC’s earlier decision in Teva I (which found substantial questions of validity and vacated Abbott’s PI against Teva on the same patents) and the district court’s decision vis-a-vis Ranbaxy.

Entegris v. Pall Corp., 490 F.3d 1340 (Fed. Cir. June 13, 2007) [Gajarsa, Linn, Moore].  The district court granted a PI, but then dissolved it based on a newly asserted invalidity challenge.  The CAFC followed the Genentech and Amazon.com line of decisions, focusing on the plaintiff’s burden of proving that the invalidity challenge "lacks substantial merit."  The CAFC affirmed the dissolution, noting that the district court’s conclusions are necessarily "preliminary" and subject to change at trial, and concluding that plaintiff "failed to establish that the district court’s analysis regarding the issue of invalidity included a clear legal error or clearly erroneous factual determinations."

GP Indus. v. Eran Indus., 500 F.3d 1369 (Fed. Cir. Sept. 20, 2007) [Newman, Lourie, Prost].  The odd case as the CAFC vacated an PI against the plaintiff prohibiting it from contacting customers about infringement.  The CAFC found that defendant failed to show a likelihood of success on its state law claims that the communications constituted deceptive trade practice or tortuous interference.

Outside Box Innov. v. Travel Caddy, 2007-1253 unreported (Fed. Cir. Jan. 15, 2008) [Bryson, Archer, Dyk].  CAFC affirmed the district court’s denial of a PI,  finding that plaintiff cannot show a substantial likelihood of success for proving infringement.

Canon, Inc. v. GCC Intern., 2006-1615 unreported (Fed. Cir. Jan. 28, 2008) [Michael, Dyk, Garbis (D/MD)].  Validity and enforceability were not issues as the CAFC affirmed the grant of a preliminary injunction in favor of Canon.  The case involved replacement toner cartridges, and infringement turned on whether the asserted claim covered only the cartridges (and thus infringed) or a combination machine (printer, fax, etc.) with cartridge, in which case no infringement.  The CAFC agreed with the district court’s construction with favored Canon.

After quickly reviewing the other PI factors, an interesting conclusion to the opinion:

A request for preliminary injunction is evaluated in accordance with a "sliding scale" approach: the more the balance of irreparable harm inclines in the plaintiff’s favor, the smaller the likelihood of prevailing on the merits he need show in order to get the injunction. (citing 7th Circuit law).

This sliding scale language or approach does not appear in other recent Federal Circuit decisions and (1) may be the product of Judge Garbis, sitting by designation,  authoring the opinion and (2) highlights a split among circuits in analyzing preliminary injunctions.  The CAFC  typically follows the approach that a failure to show a "substantial likelihood of success on the merits" is fatal to a PI request regardless of the other factors.  PHG Tech., LLC v. St. John Cos., Inc., 469 F.3d 1361, 1365 (Fed. Cir. 2006) ("[a] movant cannot be granted a preliminary injunction unless it established both of the first two factors, i.e., likelihood of success on the merits and irreparable harm.").  There is no sliding scale at the CAFC.

Chamberlain Group v. Lear Corp., 516 F.3d 1331 (Fed. Cir. Feb. 19, 2008) [Rader, Clevenger, Dyk].  CAFC reversed the grant of a PI, finding that it was based on incorrect claim construction: "a correct claim construction is almost always a prerequisite for imposition of a preliminary injunction."  The CAFC remanded, inviting the district court to revisit the PI issue with the correct claim construction.

Continued in next post . . .

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