Patent Reform — Injunctions…victory for small entities?

June 8, 2005 on 12:45 pm | In Legislation/Regulation |

Current 35 U.S.C. §283 reads:

35 U.S.C. 283 Injunction.
The several courts having jurisdiction of cases under this title may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.

The Draft bill read:

SEC. 7. INJUNCTIONS.
Section 283 is amended-
(1) by striking ”The several” and inserting ”(a) IN GENERAL.-The several”; and
(2) by adding at the end the following:
”(b) GROUNDS FOR GRANTING INJUNCTION.-A court shall not grant an `injunction under this section unless it finds that the patentee is likely to suffer irreparable harm that cannot be remedied by the payment of money damages.  In making such a finding, the court shall not presume the existence of irreparable harm, but shall consider and weigh evidence that establishes or negates any equitable factor relevant to a determination of the existence of irreparable harm, including the extent to which the patentee makes use of the invention.”

The actual Bill reads:

SEC. 7. INJUNCTIONS.
Section 283 is amended by adding at the end the following:

‘In determining equity, the court shall consider the fairness of the remedy in light of all the facts and the relevant interests of the parties associated with the invention. Unless the injunction is entered pursuant to a nonappealable judgment of infringement, a court shall stay the injunction pending an appeal upon an affirmative showing that the stay would not result in irreparable harm to the owner of the patent and that the balance of hardships from the stay does not favor the owner of the patent.”.

The controversial passages (“likely to suffer irreparable harm that cannot be remedied by the payment of money damages” and including the extent to which the patentee makes use of the invention") are not present in the actual bill. 

We’ll have to see what others are saying, but that appears to be a victory for those opposing the injunctive relief portion of the reform movement.

[UPDATE:  Upon further review, maybe Buchanan is right…"But there’s more to the story.  As introduced, the injunctive relief provision includes language requiring a stay upon a satisfactory showing."  I’m going to have to think about the consequences of that and post additional insight in the coming days.  Maybe it is only a partial win.]

[Copyright 2005 Stephen M. Nipper.  Originally published at http://www.inventblog.com]

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2 Comments

  1. Patent Act of 2005 - Change to injunctive relief provision in, but softened

    One of the major questions surrounding the Patent Act of 2005 was how the injunctive relief provision would be handled. Well, know we know. It’s in.  But it’s in a form that is vastly different than that presented in the…

    Trackback by Promote the Progress — June 8, 2005 #

  2. First, thanks for having this blog. I’ve been following this blog, as well as Patently-O, PHOSITA, Promote the Progress and Rethink(ip). These are really interesting reads for me, and I appreciate the work you guys put in, and the perpectives you offer.

    On the injunction provision:

    Overall the language of the introduced bill appears to be a victory to those fearful of the injunction provisions as proposed. As introduced, this is LESS change from the status quo.

    However, I’m having a REALLY hard time wrapping my brain around the “balance of hardships” part:
    “a court shall stay the injunction pending an appeal upon an affirmative showing that the stay would not result in irreparable harm to the owner of the patent and that the balance of hardships from the stay does not favor the owner of the patent.”

    So by default injunctions are stayed pending appeal, if two conditions are satisfied:
    (1) stay does not irreparably harm patent owner - fair enough
    (2) balance of hardships from the stay does not favor the patent owner

    What the heck does (2) mean?

    The injunction puts hardship on the infringer, so the STAY puts hardship on the patent owner in the ordinary circumstance. So ordinarily the patent owner would have more hardships from the stay, or “the balance of the hardships”. But does “does not favor” mean “less” as in fewer hardships (in the balance of hardships) for the patent owner? or does “does not favor” mean “what the patent owner would not want”, as in more hardships for the patent owner?

    Presumably, the balance of hardships is a “softened” way to say that injunctions should be harder to get for the patent owner who is not commercializing the invention, has no desire for cross-licensing, and essentially doesn’t have anything to lose (the so-called troll), but I am having a really hard time translating “balance of hardships from the stay does not favor the owner of the patent” into that meaning.

    Am I crazy or is this provision unnecessarily confusing?

    I’d appreciate some feedback on what this provision is meant to mean in layman’s terms.

    Comment by Chris — June 8, 2005 #

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