An Exercise In Restraint: Seeking And Combatting Injunctive Relief

• Published date: 24 August 2022
• Subject Matter: Intellectual Property, Patent
• Law Firm: Wolf, Greenfield & Sacks, P.C.
• Author: Ms Marie McKiernan

Prior to the Supreme Court's ruling in eBay v. MercExchange, when there was a finding of infringement, granting an injunction was almost automatic. See Richardson v. Suzuki Motor Co., Ltd., 868 F.2d 1226 (Fed. Cir. 1989). But eBay rejected this categorical grant of injunctions, raising the bar for obtaining such relief. The Court's decision in eBay sets forth the test used in United States district courts for establishing the necessity of a permanent injunction.

The four eBay factors represent four high hurdles for patentees to meet for the entry of this exceptional relief and four avenues for alleged infringers to attack such requests. After looking at the contemporary grant rates for injunctive relief, we outline just some of the ways in which patentees can meet these hurdles and ways in which alleged infringers may refine their attacks.

Trends in Injunctive Relief

When we examine the number of contested motions for permanent injunction in U.S. district courts from 2013 through 2017, as reported by Lex Machina, we see two things. First, the number of motions filed for permanent injunctions are generally low since this remedy is only available where the case is litigated all the way to the conclusion and a finding of infringement has been entered. Next, we see an overall increase in the number of motions for permanent injunctions filed by patentees over the course of five years. However, thereafter in 2018, we see a drop in both the number of motions filed and the grant rate of such motions.

Permanent Injunction Grant Rates

While it is not entirely clear why the number of motions for permanent injunctions dropped so significantly from 2017 to 2018, one potential reason for this is introduction of inter partes review with the passing of the America Invents Act (AIA) in 2011, which introduced substantial implications for parallel district court litigation. We saw the filings for IPRs substantially increase in 2013. The normal progression of a district court case is three to five years in the United States and so it is possible that the filings of IPRs impacted overall patent success rates, and in turn, the number of motions for permanent injunctions.

The additional decline seen in permanent injunctions after 2018 may be attributable to the decrease in overall patent case filings in 2018. Nearly 40% fewer patent cases were filed in 2018 as compared to those filed in 2015. This leads to fewer cases going to trial and in turn, fewer cases where the patent owner is successful and seeks permanent injunctive relief. Statistics also suggest that approximately 90% of high-tech litigation in 2018 was initiated by non-practicing entities (NPEs) which may have negatively impacted the number of injunctions sought at the end of a case years later. As we explore below, NPEs can experience heightened difficulty meeting several of the eBay factors.

In addition to seeking injunctive relief after a finding of infringement, patentees can seek preliminary injunctive relief at the outset of litigation. Such relief is extraordinary given the early stage of the case as compared to the end of litigation where a merits determination has been reached. We analyzed the grant rate for motions for preliminary injunctions filed between January 2, 2013, and December 31, 2020, in U.S. district courts as reported by Lex Machina. Of the 490 motions for preliminary injunctions filed, 41% (203 motions) were granted. You may note that there are significantly more motions for preliminary injunctions (490) than permanent injunctions detailed above (207). This may seem counterintuitive given that preliminary injunctions are harder to obtain, however, there are several reasons for the increased filings.

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