FEIT ELECTRIC COMPANY, INC. v. CREE, INC.
Filing
37
MEMORANDUM OPINION AND ORDER. Signed by CHIEF JUDGE WILLIAM L. OSTEEN, JR. on 3/14/2016, that Plaintiff's Motion for Preliminary Injunction (Doc. 12 ) is DENIED. (Daniel, J)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
FEIT ELECTRIC COMPANY, INC.,
Plaintiff,
v.
CREE, INC.,
Defendant.
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1:15CV535
MEMORANDUM OPINION AND ORDER
OSTEEN, JR., District Judge
Presently before this court is a Motion for Preliminary
Injunction filed by Plaintiff Feit Electric Company, Inc.
(“Plaintiff”).
(Doc. 12.)
Defendant Cree, Inc. (“Defendant”)
has responded, (Doc. 18), and Plaintiff has replied (Doc. 23.)
This matter is now ripe for resolution, and for the reasons
stated herein, Plaintiff’s Motion for Preliminary Injunction
will be denied.
I.
BACKGROUND
The relevant facts in this case are relatively
straightforward.
Plaintiff is a California-based company that
is in the business of buying specially manufactured LED light
bulbs and selling them to retailers. (Complaint (“Compl.”)
(Doc. 1) ¶¶ 2-3.)
Defendant is a North Carolina based
corporation that is in the business of developing and selling a
variety of lighting and semiconductor products. (Compl. (Doc. 1)
¶ 5; Answer (Doc. 17) ¶ 5.)
Plaintiff owns two relevant patents that cover LED light
bulbs: U.S. Patent No. 8,408,748 (“the ‘748 patent”), which
issued on April 2, 2013, and U.S. Patent No. 9,016,901 (“the
‘901 patent”), which issued on April 28, 2015. (See Compl.
(Doc. 1) at ¶¶ 9-10.) Plaintiff acquired these patents on June
15, 2015. (See Declaration of Aaron Feit (“Feit Decl.”) (Doc.
14) ¶ 12.) Plaintiff contends that Defendant began selling LED
bulbs that infringe these patents in or about October, 2014.
(See Pl.’s Br. in Supp. of Mot. for Prelim. Inj. (“Pl.’s Br.”)
(Doc. 13) at 3.) 1
Plaintiff filed the instant action on July 7,
2015, alleging two counts of patent infringement, one as to each
patent. (Id. at 4.)
Plaintiff requests that a preliminary
injunction issue that prevents Defendant from expanding the
retailers and distributers to which it sells the allegedly
infringing LED bulbs, but specifically notes that it does not
request that Defendant be barred from selling the allegedly
infringing bulbs to its current customers. (Id. at 2.)
1
All citations in this Memorandum Opinion and Order to
documents filed with the court refer to the page numbers located
at the bottom right-hand corner of the documents as they appear
on CM/ECF.
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II.
ANALYSIS
A plaintiff seeking a preliminary injunction must
establish: (1) that it is likely to succeed on the merits; (2)
that it is likely to suffer irreparable harm in the absence of
preliminary relief; (3) that the balance of equities tips in its
favor; and (4) that an injunction is in the public interest.
AstraZeneca LP v. Apotex, Inc., 633 F.3d 1042, 1049 (Fed. Cir.
2010).
The court must weigh the factors against each other and
against the form and magnitude of requested relief.
Tate Access
Floors, Inc. v. Interface Architectural Res., Inc., 279 F.3d
1357, 1365 (Fed. Cir. 2002).
Preliminary injunctions are
extraordinary remedies involving the exercise of a very farreaching power that should be granted only sparingly and in
limited circumstances.
Mylan Pharm., Inc. v. U.S. FDA, 23
F. Supp. 3d 631, 638-40 (N.D. W.Va. 2014)(rev’d on other
grounds).
A.
Likelihood of Success on the Merits
To show a likelihood of success on the merits, a patent
owner must show that success in establishing patent infringement
is more likely than not in light of the presumptions and burdens
at trial.
Revision Military Inc. v. Balboa Mfg. Co., 700 F.3d
524, 525-26 (Fed. Cir. 2012).
Thus, Plaintiff must show both
that it will likely succeed on its infringement claim, and that
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its patents will withstand Defendant’s challenges to their
validity.
Id.
If Plaintiff cannot show that any challenges to
its patents’ validity “lack[] substantial merit,” then they have
not shown a likelihood of success on the merits.
Abbott Labs.
v. Andrx Pharm., Inc., 452 F.3d 1331, 1335 (Fed. Cir. 2006).
An infringement analysis involves two steps.
The court
must first construe the scope of the asserted claims, and then
compare the accused product to the properly construed claims of
the patent to determine whether each and every limitation of a
claim is present, either literally or equivalently, in the
accused product.
Tate Access Floors, 279 F.3d at 1365.
Claim construction is a legal issue for the court. Markman
v. Westview Instruments, Inc., 517 U.S. 370, 372 (1996).
Claim
construction begins with the language of the claims, and a court
must presume that the terms in the claim “mean what they say,
and, unless otherwise compelled, give full effect to the
ordinary and accustomed meanings of claim terms.”
See Johnson
Worldwide Assocs., Inc. v. Zebco Corp., 175 F.3d 985, 989 (Fed.
Cir. 1999).
This presumption in favor of the ordinary meaning
of the claim language can be overcome when either (1) the
patentee has clearly and explicitly defined the claim term, or
(2) the claim term would render the claim devoid of clarity such
that there is no means by which the scope of the claim may be
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ascertained from the language used.
Bell Atl. Network Servs.,
Inv. v. Covad Commc’ns Grp., Inc., 262 F.3d 1258, 1268 (Fed.
Cir. 2001).
In some cases, the ordinary meaning of claim language as
understood by a person of skill in the art may be readily
apparent even to lay judges, and claim construction in such
cases involves little more than the application of the widely
accepted meaning of commonly understood words. See Brown v. 3M,
265 F.3d 1349, 1352 (Fed. Cir. 2001) (holding that the claims
did “not require elaborate interpretation”). In such
circumstances, general purpose dictionaries may be helpful.
However, because the meaning of a claim term as understood by
persons of skill in the art is often not immediately apparent,
and because patentees frequently use terms idiosyncratically,
the court looks to “those sources available to the public that
show what a person of skill in the art would have understood
disputed claim language to mean.” Innova/Pure Water, Inc. v.
Safari Water Filtration Sys., Inc., 381 F.3d 1111, 1116 (Fed.
Cir. 2004). Those sources include “the words of the claims
themselves, the remainder of the specification, the prosecution
history, and extrinsic evidence concerning relevant scientific
principles, the meaning of technical terms, and the state of the
art.”
Id.
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1.
Patent No. 8,408,748 (the ‘748 Patent)
Plaintiff claims first that Defendant’s product, called a
“4Flow” LED bulb, infringes Plaintiff’s ‘748 patent because it
meets every limitation of Claim 1 of that patent, as well as the
limitations of dependent claims 2, 3, 4, 9, and 12.
Br. (Doc. 13) at 8-10.)
(See Pl.’s
Claim 1, an independent claim, claims
the following:
An LED lamp comprising:
a.
a base,
b.
an elevated light source, comprising
i.
a first plurality of LEDs connected in
series and mounted on one side of a
generally flat substrate, said substrate
being spaced from said base, and
ii.
a second plurality of LEDs, equal in number
to said first plurality of LEDs, connected
in series and mounted on an opposite side of
said generally flat substrate, said second
plurality of LEDs being located on opposite
sides of said generally flat substrate in
exactly the same position with said first
plurality of LEDs in a filament shape,
b.
a heat sink in said substrate, each LED of said
first and second plurality of LEDs being mounted
proximate said heat sink, and
c.
a drive circuit for said LEDs, said drive circuit
being located proximate and electrically
connected to said base.
(See Pl.’s Br., Ex. 2, ‘748 Patent (Doc. 13-2) at 23.)
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Although Claim 1 is comprised of several limitations, as
noted above, there appears to be only one that is actually in
dispute as to infringement: Defendant contends that its product
does not contain LEDs that are “in a filament shape” as claimed
by the ‘748 patent and as such, its product does not infringe
the patent. (See Def.’s Opp’n to Mot. for Prelim. Inj. (“Def.’s
Resp.”) (Doc. 18) at 8-12.)
Notably, Defendant’s product dress advertises expressly
that the bulbs at issue are in a “filament design” that both
“looks and lights like a light bulb.” (See Pl.’s Br., Ex. 4,
‘748 Patent Claim Chart (Doc. 13-4) at 5.)
In this court’s
opinion, this cuts against Defendant’s current contention to the
contrary.
This is especially so when taken in conjunction with
the patent’s prosecution history, wherein Plaintiff explains
that the entire purpose of using a “filament shape or
arrangement” is for the LED bulb to resemble the lighting of a
traditional bulb. (See Pl.’s Br., Ex. 6, Patent Prosecution
History (Doc. 13-6) at 5.)
Defendant also contends that the term filament shape as
used in the patent should construed as limited to an arc shape,
and that such a construction is supported by both the
specification and the prosecution history.
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(Def.’s Resp. (Doc.
18) at 10-11.) This court declines to read such a limitation
into the claim on the current record.
First, Defendant ignores the fact that, while the
specification does discuss a filament that is in an arc shape
for the purposes of resembling what it refers to as a “classic
filament shape,” it does so in the context of describing a
single embodiment, the best mode of the invention, and the
specification does not state that the LEDs must be in the shape
of an arc in every embodiment of the claimed invention.
(See
Pl.’s Br., Ex. 2, ‘748 Patent (Doc. 13-2) at 22.)
Even if the specification did contain such a written
description, a court should not infer claim limitations from the
written description.
See Resonate, Inc. v. Alteon Websystems,
Inc., 338 F.3d 1360, 1364 (Fed. Cir. 2003).
As the Federal
Circuit explained in Teleflex, Inc., v. Ficosa North America
Corp., 299 F.3d 1313 (Fed. Cir. 2002), there is a “heavy
presumption” that a claim term takes on its ordinary and
accustomed meaning. Id. at 1327. A court may import a claim
limitation from the written description that differs from the
ordinary meaning only when the patentee has demonstrated an
“intent to deviate from the ordinary . . . meaning . . . by
redefining the term or by characterizing the invention in the
intrinsic record using words or expressions of manifest
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exclusion or restriction, representing a clear disavowal of
claim scope.”
Id. (emphasis added).
Here, Defendant has
pointed to no such clear disavowal, and this court finds none in
the ‘748 patent.
The prosecution history also provides no support for the
proposition that the term “filament shape” should be limited to
the shape of an arc.
Plaintiff’s response to the Patent Office
explains that the patent amendment clarifies that the LEDs are
placed in “exactly the same relative location on opposite sides
of the flat substrate,” in a filament shape or arrangement.
(See Pl.’s Br., Ex. 6 (Doc. 13-6) at 5 (emphasis added).)
The
response explains that this arrangement gives the impression of
transparency similar to an incandescent bulb, and that this
differs from prior art. (Id.)
There is no discussion of an arc
shape in the response.
Finally, as Plaintiff points out, to read the term
“filament shape” in Claim 1 to be limited only to an arc shape
would render Claim 10, which specifically claims an embodiment
of Claim 1 where the LEDs are oriented “generally in an arc,”
superfluous.
(Pl.’s Br. (Doc. 13) at 8-9.)
“[T]he presence of
a dependent claim that adds a particular limitation gives rise
to a presumption that the limitation in question is not present
in the independent claim.”
Phillips v. AWH Corp., 415 F.3d
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1303, 1315 (Fed. Cir. 2005); see also Trebro Mfg., Inc. v.
Firefly Equip., LLC, 748 F.3d 1159, 1166 (Fed. Cir. 2014)
(holding that reading a limitation from a dependent claim into
an independent claim would improperly render the dependent claim
redundant.)
Plaintiff contends that Defendant’s product infringes
because it contains LEDs that are in the shape of C-6 and C-9
filaments.
Plaintiff contends that the LEDs on the main circuit board,
shown above, are in the shape of a C-6 filament. (See Pl.’s Br.,
Ex. 4 (Doc. 13-4) at 5.)
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Plaintiff also contends that the LEDs on the main and
daughter circuit board, shown above, are in the shape of a C-9
ring filament. (Id.)
This court finds that Defendant’s arguments to limit the
scope of the ‘748 patent are inadequate on the current record.
However, while there is some logic to Plaintiff’s arguments in
favor of infringement, on this limited record, the court is not
able to interpret the meaning of the term “filament shape” as
one skilled in the art, and as such, cannot find that Plaintiff
has met its burden of showing that Defendant’s product infringes
the ‘748 patent.
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2.
Patent No. 9,016,901 (the ‘901 Patent)
Plaintiff also claims that Defendant’s product infringes on
the ‘901 patent, a continuation of the ‘748 patent, because it
meets every limitation of Claim 16 of that patent. (See Pl.’s
Br. (Doc. 13) at 10.)
Claim 16 reads:
An LED lamp comprising:
a base;
an elevated light source, comprising
i.
a first plurality of LEDs connected in
series and mounted on one side of a
generally flat substrate, said substrate
being spaced from said base, and being
oriented perpendicular to a line extending
from said base
ii.
a second plurality of LEDs, equal in number
to said first plurality of LEDs, connected
in series and mounted on an opposite side of
said generally flat substrate, said second
plurality of LEDs being located on said
opposite side of said generally flat
substrate generally in alignment with said
first plurality of LEDs;
a heat sink in said substrate, each LED of said first
and second plurality of LEDs being mounted proximate
said heat sink; and
a drive circuit for said LEDs, said drive circuit
being located proximate and electrically connected to
said base.
(See id., Ex. 3, ‘901 Patent (Doc. 13-3) at 25.)
The dispute surrounding this claim is over the phrase
“being oriented perpendicular to a line extending from said
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base” and whether it is the plurality of LEDs or the substrate
that must be perpendicular to a line extending from the base.
Defendant contends that the phrase at issue relates to the
substrate, and points to both expert testimony and the patent
specification in support.
Defendant argues that Claim 16 should be read as requiring
the substrate to be perpendicular to a line extending from the
base, because the ‘901 patent specification explains that one
embodiment of the invention includes the substrate being
oriented perpendicular to the base, and another embodiment
includes the substrate being oriented parallel to the base. (See
Def.’s Resp. (Doc. 18) at 12; Pl.’s Br., Ex. 3, ‘901 Patent
(Doc. 13-3) at 21.)
Further, Defendant points out that Claims
11 and 12 of the ‘901 patent recite express embodiments of the
invention with the substrate being oriented parallel and
perpendicular to the base. (See Def.’s Resp. (Doc. 18) at 13;
Pl.’s Br., Ex. 3, ‘901 Patent (Doc. 13-3) at 24.)
Defendant’s
argument is perplexing, since taking these two points into
consideration together militates against their preferred
interpretation of the claim limitation.
Claim 11 would directly
conflict with Claim 1 if read in Defendant’s preferred way, and
further, when comparing the language of Claim 16, which is an
independent claim, to the language of Claim 1, the independent
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claim upon which claims 11 and 12 depend, it is impossible to
read Claim 16 in a way that requires the substrate, rather than
the LEDs, to be perpendicular to the base without rendering
claim 12 entirely superfluous.
Further, the only difference between claims 1 and 16 in the
‘901 patent is addition of the language “and being oriented
perpendicular to a line extending from said base.”
Although the
claim could perhaps be phrased more clearly, under a plain
reading of the claim, the phrase at issue appears to modify the
phrase “a first plurality of LEDs.”
To read this phrase as
relating to the substrate and not to the LEDs would render the
second comma in the limitation superfluous.
As such, Plaintiff
has shown, at least at this stage, some likelihood of success as
to infringement of the ‘901 patent. 2
3.
Invalidity
Even if a patentee shows the likelihood of infringement,
the accused infringer can defeat a finding of likelihood of
success on the merits by raising a “substantial question as to
the validity of the patent in suit.”
2
Trebro, 748 F.3d at 1169.
This court notes that all of these findings are made at
this preliminary stage without the benefit of claim construction
or a full record. As such, these findings do not establish the
law of the case nor are they preclusive of a later, contrary
finding.
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However, patents are to be presumed valid unless proven
otherwise.
35 U.S.C. § 282. As such, the burden is on Defendant
to first show invalidity.
Defendant argues that: (1) if Plaintiff’s construction of
the term “filament shape” is accepted, it will render the claim
indefinite, and thus invalid; and (2) the claims of the ‘748
patent are invalidated by prior art. (See Def.’s Resp. (Doc. 18)
at 14.)
As to the first contention, this court agrees with
Plaintiff that Defendant confuses indefiniteness with breadth.
SmithKline Beecham Corp. v. Apotex Corp., 403 F.3d 1331, 1341
(Fed. Cir. 2005) (“[B]readth is not indefiniteness.”).
Although
Defendant argues that the term “filament shape,” if not limited
to an arc shape, will encompass essentially “every shape
possible.” (See Declaration of Dr. Richard Shealy (“Shealy
Decl.”) (Doc. 19) at ¶¶ 82-83.)
While it is true that there may
well be a variety of different shapes included in the scope of
such a claim (as illustrated by the variety of possible filament
shapes put forth by Plaintiff), given the presumption of
validity, this court cannot find on the current record that the
term “filament shape” is indefinite such that it renders the
patent invalid.
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Defendant also contends that the ‘748 patent is invalid
because it is anticipated by U.S. Patent No. 7,396,142 B2 (the
“Laizure patent”) and is rendered obvious by the Laizure patent
in combination with U.S. Patent Application Publication
2004/0008525 A1 (“Shibata”). (See Def.’s Resp. (Doc. 18) at 14.)
A determination that a patent is invalid as being
anticipated under 35 U.S.C. § 102 requires a finding that “each
and every limitation is found either expressly or inherently in
a single prior art reference.” Celeritas Techs., Ltd. v.
Rockwell Int'l Corp., 150 F.3d 1354, 1361 (Fed. Cir. 1998). The
burden of establishing invalidity is “especially difficult when
. . . the infringer attempts to rely on prior art that was
before the patent examiner during prosecution.”
Glaxo Grp. Ltd.
V. Apotex, Inc., 376 F.3d 1339, 1348 (Fed. Cir. 2004).
Here, because the disclosure from the approved Laizure
patent was before the Patent Examiner during prosecution,
Defendant’s burden is especially difficult in proving
anticipation. 3
Plaintiff contends that the ‘748 patent’s
requirement that a plurality of LEDs be in “exactly the same
position” on opposite sides of a substrate is a limitation that
3
WO 2006/104553 was the publication before the Patent
Examiner, but contains the exact same disclosure as the later
approved Laizure patent. (See Pl.’s Reply (Doc. 23) at 5.)
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is not disclosed in the Laizure patent, either explicitly or
inherently, and that thus Laizure does not anticipate the ‘748
patent. (See Pl.’s Reply (Doc. 23) at 5.)
Although there is no
explicit disclosure in Laizure of this limitation, Defendant
points to several diagrams in Laizure that it contends show LEDs
on either side of a substrate that are mounted “in the same
position or generally in alignment with the first plurality of
LEDs,” and thus, Laizure implicitly anticipates this limitation.
(Def.’s Resp. (Doc. 18) at 14.)
The court notes, however, that
the implied limitation pointed out by Defendant in the Laizure
patent is not the same as the limitation contained in the ‘748
patent.
The ‘748 patent specification explains that the reason
the LED groups should be exactly opposite each other is to
create the impression of transparency by imitating a filament
shape. (See Pl.’s Br., Ex. 2, ‘748 Patent (Doc. 13-2) at 22.)
Laizure contains no discussion of transparency, or of where or
how the LEDs are required to be oriented. As such, this court
will not read such a specific limitation into a diagram without
more explanation.
Further, during prosecution, the Patent Examiner apparently
rejected the ‘748 patent on the basis of anticipation by U.S.
Patent No. 7,938,562 B2 (the “Ivey patent”).
(See id., Ex. 6,
‘748 Patent Prosecution History Excerpts (Doc. 13-6) at 5.)
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Ivey discloses the following figure that demonstrates LED
placement:
(See Pl.’s Br., Ex. 7, Ivey Patent (Doc. 13-7) at 14, Fig. 4.)
The ‘748 Patent was amended to add the language regarding
placement of the LED groups exactly across from one another
specifically to avoid anticipation by Ivey, and was granted by
the patent office after this amendment.
Defendant has failed to
offer any argument regarding the disclosures in Laizure that
would render those figures materially different from the ones in
Ivey, and, given the high burden, has thus failed to show
anticipation of the ‘748 patent on this basis.
Defendant also argues that Laizure anticipates the ‘901
patent.
Plaintiff responds that the ‘901 patent is not
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anticipated because the Laizure patent does not disclose the
limitation that the LED groups are connected “in series.” (See
Pl.’s Reply (Doc. 23) at 6.)
The ‘901 patent explains that LEDs
are connected in a series in order to obtain a high voltage DC
LED, the advantage of which is “the ability to add a smoothing
capacitor to reduce current ripple and attain a steady light
source with no flicker.” (Pl.’s Br., Ex. 3, ‘901 Patent (Doc.
13-3) at 22.)
Defendant points to no language in Laizure that
expressly discusses such a series of LEDs or their purpose, but
rather to diagrams that Defendant argues implicitly disclose
LEDs in a series.
(See Shealy Decl., Ex. B (Doc. 19-2) at 18
(“The LEDs are mounted on a generally flat substrate 18 and are
connected in series as illustrated by the LEDs in a row.”)
(citing Laizure Figure 1).) Given the apparently technical
nature of this limitation, as well as the fact that Laizure was
before the Patent Office when it approved the ‘901 patent,
Defendant has failed, at this stage of the proceedings, to meet
its burden of demonstrating that the ‘901 patent is anticipated.
Finally, Defendant argues that the combination of Laizure
and Shibata render the claims of the ‘748 patent obvious.
However, even assuming, as Defendant claims, each claim
limitation found in the ‘748 patent is present in the prior art,
that alone is not enough to render the patent obvious.
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See
Fromson v. Advance Offset Plate, Inc., 755 F.2d 1549, 1556 (Fed.
Cir. 1985) (explaining that “[t]here is no basis in the
law . . . for treating combinations of old elements differently
in determining patentability”).
“The critical inquiry is
whether ‘there is something in the prior art as a whole to
suggest the desirability, and thus the obviousness, of making
the combination.’” Id. (internal citations omitted).
Here,
Defendant provides no explanation or citation, either in the
patents or to knowledge in the art at the time, to show why a
person of ordinary skill in the art would have been motivated to
combine Shibata and Laizure in a way that renders the ‘748
patent obvious.
As the ‘748 patent is to be presumed valid, Defendant must
offer something more than conclusory statements from its expert
to show clear and convincing evidence of obviousness.
It has
failed to meet that burden, and this court will not find the
patents invalid on the current record.
4.
Irreparable Harm
The inquiry into irreparable harm seeks to measure harms
that “no damages payment, however great, could address.”
Celsis
in Vitro, Inc. v. CellzDirect, Inc., 664 F.3d 922, 930 (Fed.
Cir. 2012).
The simple fact that one could, if pressed, compute
a money damages award does not always preclude a finding of
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irreparable harm.
Id.
“The key word in this consideration is
irreparable. Mere injuries, however substantial, in terms of
money, time and energy necessarily expended in the absence of a
stay, are not enough.”
(1974).
Sampson v. Murray, 415 U.S. 61, 90
Contrary to Plaintiff’s contention, a finding of
infringement no longer creates a presumption of irreparable
harm.
See Robert Bosch LLC v. Pylon Mfg. Corp., 659 F.3d 1142,
1149 (Fed. Cir. 2011) (“eBay jettisoned the presumption of
irreparable harm” after a finding of infringement).
Further,
the irreparable harm must be either currently present or
imminent.
Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139,
162 (2010) (emphasis added).
Price erosion, loss of goodwill, damage to reputation, and
loss of business opportunities all can be valid grounds for
finding irreparable harm.
Abbott Labs. v. Sandoz, Inc., 544
F.3d 1341, 1362 (Fed. Cir. 2008); Sanofi–Synthelabo v. Apotex,
Inc., 470 F.3d 1368, 1382–83 (Fed. Cir. 2006); but see Martin v.
Bimbo Foods Bakeries Distribution, Inc., No. 5:14-CV-17-BR, 2014
WL 2439954, at *6 (E.D.N.C. May 30, 2014) (“[G]oodwill can often
be valued in monetary terms.”). The burden is on the plaintiff
to prove that irreparable harm will occur if these events take
place, and the mere possibility that it may is not enough.
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Automated Merch. Sys., Inc. v. Crane Co., 357 F. App’x 297, 301
(Fed. Cir. 2009). 4
A plaintiff must demonstrate more than the mere possibility
of irreparable harm, rather, the plaintiff must “demonstrate
that irreparable injury is likely in the absence of an
injunction.”
Winter v. Nat. Res. Def. Council, Inc., 555 U.S.
4
The court notes that Defendant alleges that in order to
show irreparable harm, Plaintiff is required to show a
“sufficiently strong causal nexus” between the alleged harm and
the alleged infringement. See Apple Inc. v. Samsung Elecs. Co.,
695 F.3d 1370, 1374 (Fed. Cir. 2012) (“Apple II”); Apple Inc. v.
Samsung Elecs. Co., 809 F.3d 633, 639-640 (Fed. Cir. 2015). The
Federal Circuit has elaborated on this requirement in a series
of cases between Apple, Inc. and Samsung Electronics, Ltd. In
Apple II, the court explained that, when the accused product
includes many features of which only one (or a small minority)
infringe, the patentee must show that the harm it will suffer is
related to the actual infringement. 695 F.3d. at 1374. This is
because, as the court explained, “it may very well be that the
accused product would sell almost as well without incorporating
the patented feature. And in that case, even if the competitive
injury that results from selling the accused device is
substantial, the harm that flows from the alleged infringement
(the only harm that should count) is not.” Id. at 1374-75.
However, the Federal Circuit later noted that a patentee need
not show the patented feature is “the one and only reason for
consumer demand.” Apple Inc. v. Samsung Elecs. Co., 735 F.3d
1352, 1364 (Fed. Cir. 2013.) Plaintiff contests this, arguing
that because it alleges infringement of the entire product
rather than a component part, it need not show a causal nexus.
While the Federal Circuit has recently held that causal nexus
must be shown regardless of whether an injunction is sought for
an entire product or merely a feature, see Apple Inc., 809 F.3d
at 639-40, because the court finds that Plaintiff fails to show
a likelihood irreparable harm at all, it will not reach this
issue.
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7, 22 (2008).
Here, Plaintiff alleges that it will be
irreparably harmed if an injunction is not issued due to the
loss of business relationships, the loss of the advantages
provided by greater sales volume, and the loss of customer
goodwill. (See Pl.’s Br. (Doc. 13) at 12-18.)
This court first
notes that Plaintiff does not actually sell the product
contained in the ‘748 or ‘901 patents, nor does Defendant
currently sell its allegedly infringing product to any of
Plaintiff’s customers.
Rather, Plaintiff’s complaint is that it
“believes [Defendant] is attempting to expand the retailers and
distributors to which it sells [its infringing product]” and
that “if retailers and distributors begin to buy [Defendant’s
infringing product], it is likely that those retailers and
distributors will also buy other of [Defendant’s products.]”
(See Feit Decl. (Doc. 14) ¶ 11 (emphasis added).)
Simply put, the alleged harm is tenuous at best, and
entirely hypothetical, both in whether it will actually occur
and, if it does occur, whether it would be related in any way to
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the infringement of the patents at issue. 5
Plaintiff’s theory of
harm is essentially a double hypothetical, and one that
Plaintiff has provided little evidence for.
Further, given the alleged possible harms, it appears that
money damages will be both calculable and available if Plaintiff
prevails. Plaintiff has not shown any evidence that any of these
alleged harms are imminent, much less likely, and Plaintiff has
thus failed to meet its burden of showing irreparable harm.
5.
Balance of Equities
Next in the analysis, the court must balance the harm that
will occur to the moving party from the denial of the injunction
with the harm that the nonmoving party will incur if the
injunction is granted.
Hybritech Inc. v. Abbott Labs., 849 F.2d
1446, 1457 (Fed. Cir. 1988).
An injunction should not be
granted if the impact on the nonmoving party would be more
5
Plaintiff contends that even a threatened loss of customer
goodwill supports a finding of irreparable harm. Plaintiff’s
cited cases for this proposition are distinguishable. For
example, in Celsis, the plaintiff offered both uncontroverted
expert testimony about irreparable harm, as well as
substantiated its claims with “fact and expert testimony as well
as specific financial records.” 664 F.3d at 930. Here, Plaintiff
has offered nothing of the sort. Several of Plaintiff’s other
cases came down before eBay, and relied upon presumption of harm
that is no longer valid. See, e.g., Bio-Technology Gen. Corp.
v. Genentech, Inc., 80 F.3d 1553, 1566 (Fed. Cir. 1996); SanofiSynthelabo v. Apotex, Inc., 470 F.3d 1368, 1383 (Fed. Cir.
2006).
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harmful than the injury the moving party will suffer if the
injunction is not granted.
Litton Systems, Inc. v. Sundstrand
Corp., 750 F.2d 952, 959 (Fed. Cir. 1984).
Important
considerations in weighing the balance of hardship include, but
are not limited to, whether the hardship to the alleged
infringer would be merely temporary in duration, and whether the
infringer had yet entered the market.
Ortho Pharm. Corp. v.
Smith, CIV. A. No. 90-0242, 1990 WL 18681 (E.D. Pa. Feb. 23,
1990).
As stated above, Plaintiff has failed to provide any
evidence that the harms it will suffer absent an injunction are
anything more than conjecture. Plaintiff alternatively contends
that the equities tip in its favor because Defendant will suffer
little harm from the injunction it requests because it seeks
merely to preserve the current status quo. (See Pl.’s Reply
(Doc. 23) at 9-10.) However, Plaintiff’s requested relief would
not preserve the status quo so much as it would simply freeze
Defendant’s ability to expand its market presence.
In contrast,
the status quo prior to this suit being brought was one of free
market competition, where Defendant was free to expand its
customer base and maneuver in the market at will.
Although the injunction Plaintiff seeks is limited, the
harm to Defendant in preventing it from operating normally or
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taking advantage of possible business opportunities is still
greater than the entirely hypothetical harm alleged by
Plaintiff, and as such, the balance of equities tips in
Defendants favor.
6.
Public Interest
“[T]he public is best served by enforcing patents that are
likely valid and infringed.”
Abbot Labs., 452 F.3d at 1348. The
focus of the district court's public interest analysis should be
whether there exists some critical public interest that would be
injured by the grant of preliminary relief.
See Hybritech, 849
F.2d at 1458. The public’s interest in enforcing patent rights
must also be weighed with other aspects of the public interest.
ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc., 694 F.3d
1312, 1341 (Fed. Cir. 2012).
Here, as the court must at this stage presume patents are
valid, there is at least some public interest in enforcing them.
However, Plaintiff does not practice these patents, and the
public has an interest in access to innovative products in the
marketplace.
See Celgard, LLC v. LG Chem, Ltd., 624 F. App’x
748 (Fed. Cir. 2015). Further, the public benefits from the
lower prices that result from free market competition.
Cannon,
Inc. v. GCC Int’l Ltd., No. 2006-1615, 2008 WL 213883 (Fed. Cir.
- 26 -
2008).
Given the competing public interests at stake, the court
finds that this factor favors neither side.
In sum, Plaintiff has failed to show that three of the four
factors to be considered weigh in favor of a preliminary
injunction. Most notably, Plaintiff has failed to sufficiently
show that irreparable harm is either imminent or likely. A
preliminary injunction, regardless of its scope, is an
extraordinary remedy, and not one to be granted lightly.
Accordingly, this court declines to enter a preliminary
injunction, regardless of its findings on the likelihood of
success on the merits.
III. CONCLUSION
For the reasons stated herein, IT IS HEREBY ORDERED that
Plaintiff’s Motion for Preliminary Injunction (Doc. 12) is
DENIED.
This the 14th day of March, 2016.
______________________________________
United States District Judge
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