The Evolving IP Marketplace: Aligning Patent Notice and Remedies ...

21Irreparable harm/inadequacy of money damages. Much discussion concerninginjunction law post-eBay has focused on whether the patentee and infringer compete in a productmarket. Conventional wisdom assumes that patentees that do not compete in a product marketcannot obtain injunctions because money damages will adequately compensate any harm theymay suffer from infringement. Conventional wisdom also assumes that a patent owner practicingthe patent can and should be granted an injunction.The class of non-practicing patent owners is too diverse to be subject to a simple rule.Patentees that license as part of a technology transfer program can suffer harm from infringementakin to that suffered by manufacturing patentees. These patentees compete in a technologymarket to have their technology purchased for incorporation into new products. The availabilityof an injunction is important to such patentees, who rely on the threat to deter infringement andencourage ex ante licensing. The harm suffered by these patentees as a result of infringement canbe analogous to that suffered by manufacturing patentees, including loss of a customer base andharm to reputation as an innovator. However, denial of an injunction may not prevent a patentassertion entity (PAE) from receiving the full value of the invention. That patentee will not havethe same concerns about deterring future infringement and protecting its reputation as aninnovator that other patentees may have.This is not to say, however, that courts should assume all manufacturing patentees willsuffer irreparable harm from infringement. While that might often be the case, the analysis mustconsider other facts. The patent may cover a minor component of the infringing product.Competing products may include non-infringing alternatives that are acceptable to customers,making it less likely that the infringement (as opposed to competition generally) is harming thepatentee. The variety and complexity of different factual scenarios caution against creating anyassumptions of irreparable harm based on a finding of infringement, a patentee’s use of thepatent, or its willingness to license.Recommendation. Courts should not presume irreparable harm based on afinding of infringement or the patentee’s use of the patent. Conversely, courtsshould recognize that infringement can irreparably harm the ability of patenteesthat primarily engage in technology transfer through licensing to compete in atechnology market.Balance of the equities and hardships between the parties. Under this factor, courtsmust consider the effect of an injunction on an infringer and balance it against the harm thatinfringement imposes on the patentee. This factor allows courts to weigh the expense and harmto an infringer facing hold-up against the harm to the patentee by considering whether theinvention is a minor component for which acceptable alternatives are available, and howinfringement affects the patentee’s ability to compete in a goods or technology market. Courtscan also consider whether the infringer copied the technology.21Courts and commentators often analyze these two factors as one. Appendix B, Section III.A.27