[Ip-health] Compulsory licensing of patents under ebay decision

Wed Mar 21 12:25:07 2007

Collateral Estoppel bars relitigation of any issue that was essential to
the original judgment, and Res Judicata bars claims that arise out of
the same event from the original claim. For a claim to be barred under
Res Judicata it must arise from a common nucleus of operative fact as
the original claim (related to original claim in time, space origin,
motivation ect=E2=80=A6), the original claim must have been decided on the
merits in its final judgment, and the parties must either be the same as
in the original action or must be in privity, with a mutuality of
interest, and a significant degree of control over the first case.

In Ebay Inc. v. MercExchange, L.L.C., 126 S. Ct. 1837 (2006), the
Supreme Court upheld the district courts finding of infringement and
affirmed the awarded damages. The main question presented to the
district court was whether or not the District court was justified in
not ordering permanent injunctive to the plaintiff. The Supreme Court
upheld the district courts decision that the following four part test of
general equitable principles must be met before a permanent injunction
can be granted; (1) irreparable injury, (2) inadequacy of remedies at
law, (3) balance of hardships favoring party seeking injunction, and (4)
public interest. This is a generally applicable test for permanent
injunctive relief that applies to all disputes arising under the patent
act. Furthermore, the Supreme Court held that even in successful
infringement actions, =E2=80=9Ca patent holder=E2=80=99s willingness to lic=
ense its
patents and lack of commercial activity in practicing patents do not
preclude permanent injunction=E2=80=9D. Id.

To answer your question, although this is a =E2=80=9Cpermanent flow of
infringing acts by the same infringing defendant=E2=80=9D, the plaintiff wo=
uld
be barred from bringing any new claim of patent infringement against the
defendant because the claim of infringement was already decided on its
merits. However, if the claim arose out of a new form of infringement,
on a different patent, ect=E2=80=A6, then they would have to argue against =
a
common nucleus of operative fact test to bring the new claim. In other
words, because the infringing actions are likely to have been related to
the original infringement in method and motivation, it is unlikely that
the new claim will pass the test for Res Judicata. Furthermore, even if
the test was passed and a new claim was brought, plaintiff would be
barred by Collateral Estoppel from relitigating any issue that was
finally decided and essential to the original judgment.

However, I am still in law school so I could very well be wrong in my
analysis, so I would recommend consulting a licensed attorney.

Anne

Franklin Pierce Law Center
J.D./M.I.P. Candidate 2009

>>> "Luis Villarroel Villalon" <luis.villarroel@mineduc.cl> 03/21/07
12:08 PM >>>

Interestingly, this principle of equity as a requirement for permanent
injunctions also applies to copyright cases, therefore this indirect
granting of compulsory licensing  apply to cases of copyright
infringement. But, because the application of statutory damages to
copyright infringement, the price for this type of  "compulsory license"
might get  really high.

My related  question is, whether on US law, the plaintif could sue again
and again, based on the permanent flow of infringing acts by the same
infringing defendant

LUIS VILLARROEL

-----Mensaje original-----
De: ip-health-admin@lists.essential.org
[mailto:ip-health-admin@lists.essential.org] En nombre de James Packard
Love
Enviado el: Mi=C3=A9rcoles, 21 de Marzo de 2007 11:46
Para: Ip-health
Asunto: [Ip-health] Compulsory licensing of patents under ebay decision

--
[ Picked text/plain from multipart/alternative ]
This is one current list of cases where courts have denied Permanent
Injunctions, under the recent eBay Supreme Court decision.

http://www.thefireofgenius.com/injunctions

On May 15, 2006, the Supreme Court issued its decision in eBay Inc.
v. MercExchange, LLC, 126 S. Ct. 1837. In eBay, the Supreme Courests within=
 the equitable discretion of the district courts, and
that such discretion must be exercised consistent with traditional
principles of equity, in patent disputes no less than in other cases
governed by such standards."

Permanent Injunctions denied:
----
     * z4 Techs. v. Microsoft Corp., 434 F.Supp.2d 437 (E.D. Tex.
June 14, 2006) (Davis, J.)

     * Finisar Corp. v. DirecTV Group, No. 1:05-CV-264 (E.D. Tex.
July 6, 2006) (Clark, J.) (described on Michael Smith's blog about
E.D. Texas proceedings).

     * Paice LLC v. Toyota Motor Corp., No. 2:04-CV-211, 2006 WL
2385139 (E.D. Tex. Aug. 16, 2006) (Folsom, J.)

     * Voda v. Cordis Corp., No. CIV-03-1512, 2006 WL 2570614 (W.D.
Okla. Sept. 5, 2006)

     * Monsanto Co. v. Scruggs, 459 F.3d 1328 (Fed. Cir. 2006) (trial
court's permanent injunction order vacated, and the case remanded,
for complete analysis under the eBay test)

     * Sundance, Inc. v. DeMonte Fabricating Ltd., No. 02-73543, 2007
WL 37742 (E.D. Mich. Jan. 4, 2007)

     * IMX, Inc. v. LendingTree, LLC, No. 03-1067, 2007 WL 62697 (D.
Del. Jan. 10, 2007) (due in part to patentee's failure to supplement
the record after eBay, motion for permanent injunction "denied
without prejudice to renew subsequent to any appeal by the parties
relating to issue of infringement, validity, or wilfulness")

----------------------------------------------
James Packard Love
Knowledge Ecology International
http://www.keionline.org
james.love@keionline.org
Washington, DC +1.202.332.2670

"If everyone thinks the same: No one thinks." Bill Walton"

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