By Lauren Valkenaar and Saul Perloff (United States)
The success of intellectual property litigation often turns on whether the plaintiff obtains meaningful injunctive relief.
At the same time, the court’s determination whether to grant such relief frequently turns on the question of irreparable harm.
For decades, courts recognized a presumption of irreparable harm in trademark, patent, copyright and trade secret cases.
The presumption generally arose from the premise that injury caused by infringement is intangible in nature.
Thus, for example, McCarthy states that trademark infringement warrants a presumption of irreparable harm because “once a probability of proving likelihood of confusion at trial is shown, the trademark owner’s business goodwill and reputation are at risk.” 5 MCCARTHY at § 30:47.
Ebay and Winter decisions set the bar
The Supreme Court’s decisions in Ebay and Winter changed the landscape. See Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7 (2008); eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006).
In both cases, the Supreme Court affirmed the traditional four-factor test in determining whether injunctive relief is warranted. Thus, in order to obtain a preliminary injunction, a plaintiff “must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.” Winter at 20.
In Winter, the Supreme Court explicitly rejected the Ninth Circuit’s articulation of a “sliding scale” approach under which a plaintiff who demonstrated a strong likelihood of prevailing on the merits could be granted a preliminary injunction based only on a “possibility” of irreparable harm.
“Issuing a preliminary injunction based only on a possibility of irreparable harm is inconsistent with [the] characterization of injunctive relief as an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter at 22 (citing Mazurek v. Armstrong, 520 U.S. 968, 972 (1997) (per curiam)).
Ebay and Winter thus cast considerable doubt on the continued validity on the principal that irreparable harm could be presumed in any case, including those involving trademark infringement.
Ninth Circuit expands Ebay and Winter to preliminary injunctions
The Ninth Circuit responded to the Ebay and Winter precedent on Monday by expanding its application to trademark infringement cases seeking preliminary injunctive relief. Herb Reed Enters., LLC v. Fla. Entm’t Mgmt. centers around a nearly forty-year dispute over use of the legendary mark “The Platters”— one of the top vocal groups of the Fifties.
Herb Reed, the founder of The Platters, sued Larry Marshak and his company Florida Entertainment Management, Inc., seeking preliminary injunctive relief and alleging trademark infringement, to stop Marshak’s use of “The Platters” mark. Herb Reed at 8.
Prior Ninth Circuit precedent generally allowed a court to presume irreparable harm if the plaintiff established a likelihood of success on the merits. See, e.g., Brookfield Comm., Inc. v. W. Coast Entm’t Corp., 174 F.3d 1036, 1066 (9th Cir. 1999).
The district court followed this precedent, presuming the likelihood of irreparable harm existed after Reed established the likelihood of succeeding on his underlying trademark dispute. Accordingly, after the district court rejected Marshak’s res judicata and laches defenses, it granted Reed’s request for a preliminary injunction. Herb Reed at 10-13.
Marshak appealed to the Ninth Circuit, claiming the district court abused its discretion in finding irreparable harm when Reed provided no evidence of irreparable harm. Herb Reed at 19. The Ninth Circuit agreed. Id. at 19.
After discussing the holdings of Ebay and Winters, the Ninth Circuit noted it had already held that irreparable harm must be demonstrated to obtain a preliminary injunction in a copyright infringement case and that actual irreparable harm must be demonstrated to obtain a permanent injunction in a trademark infringement action. Flexible Lifeline Sys. v. Precision Lift, Inc., 654 F.3d 989, 998 (9th Cir. 2011); Reno Air Racing Ass’n Inc. v. McCord, 452 F.3d 1126 (9th Cir. 2006).
Thus—following the Sixth and Eleventh Circuits—the Ninth Circuit held the principle that “plaintiffs must show irreparable harm” should be applied to trademark infringement cases where a preliminary injunction is requested. Herb Reed at 18.
While the court did not detail what evidence would be necessary to prove irreparable harm, it did make clear that “unsupported and conclusory statements regarding harm [a plaintiff] might suffer” are unsatisfactory. Herb Reed at 19. (emphasis in original).
The only evidence on record in Herb Reed was a customer email indicating he wanted “Herb Reed’s band rather than another tribute band.” Id. at 20.
The Ninth Circuit found this evidence insufficient because it merely showed a confused customer, rather than an affirmative harm to Reed. Id. at 20.
Herb Reed adds to the growing body of case law requiring plaintiffs to offer a greater degree of proof to obtain injunctive relief.
This article was prepared by Lauren Valkenaar (firstname.lastname@example.org / + 1 210 270 7190) and Saul Perloff (saul.perloff@nortonrosefulbright / + 1 210 270 7166) of Norton Rose Fulbright’s U.S. Intellectual property group.