Rethinking the four ‘factors’ of preliminary injunctive relief

Abbott Laboratories v. Sandoz, Inc., (Fed. Cir. 2008)(Newman, J.)

Preliminary injunctions decisions are blessed with their own four-factor equitable test. I like to think of the test as having two required elements (likelihood of success on the merits and potential irreparable harm) and two optional factors (balance of the equities and public interest). A preliminary injunction (PI) will only issue when (1) the first two elements are demonstrated by the patentee and (2) the combined result of all four elements/factors weighs in favor of a PI.

The district court granted a preliminary injunction to Abbott to stop Sandoz from making or selling a generic version of its extended release clarithromycin antibiotic. In 75 pages of split opinion, the Federal Circuit affirmed with Judge Newman writing the majority opinion; Senior Judge Archer signing-on except for the two juicy parts: I and VI; and Judge Gajarsa in vigorous dissent.

The dispute revolves around the meaning of the required PI element of ‘likelihood of success on the merits.’ To win on this element, the patentee typically needs to provide evidence of infringement of at least one valid claim. Often this element turns on the defendant’s rebuttal proof of invalidity. Here, the defendant provided some evidence of potential invalidity, but not conclusive evidence. Thus, while the defendant did raise a substantial question of the vulnerability of the patent, it did not provide any clear and convincing evidence of invalidity.

Judge Gajarsa argued that Federal Circuit precedent requires a PI be denied when substantial questions of validity are raised. This standard is exemplified in the Federal Circuit’s recent Erico decision – which found the threshold “substantial question” met by evidence which simply “cast[s] doubt on the validity” of the asserted claims.

Judge Gajarsa: “Under our precedent, the likelihood of success factor is properly analyzed by considering whether the alleged infringer raises a substantial question as to validity.”


On the other side, Judge Newman argues that a patentee may still be likely to succeed on the merits even when vulnerabilities and substantial invalidity questions are raised by the defense.

Judge Newman: “The question is not whether the patent is vulnerable; the question is who is likely to prevail in the end, considered with equitable factors that relate to whether the status quo should or should not be preserved while the trial is ongoing. The presentation of sufficient evidence to show the likelihood of prevailing on the merits is quite different from the presentation of substantial evidence to show vulnerability. “

Both sides are well supported by conflicting precedent, and this case may well be a good vehicle for an en banc discussion of preliminary injunctive relief.

22 thoughts on “Rethinking the four ‘factors’ of preliminary injunctive relief

  1. 22

    “…Judge Newman just doesn’t get it…”

    All the opinion stated the following: “we do not discern reversible error” [in the district court’s obviousness analysis], which I might add was rock solid.

    My, you really put the “boy” in groveboy1. Now drop and give me 20.

  2. 21

    “…has never seen a patent she didn’t like…”

    and, given the presumption of validity, that’s a problem WHY, exactly?

    And no discussion of irreparable harm is complete without a discussion of the corresponding “inadequacy of money damages,” which is where the standard factors for injunctive relief depart from the more traditional notions that, since money damages are speculative and difficult or impossible to quantify for patent rights, automatic injunctions have been favored. The unqualified right to exclude is the patentee’s only true adequate remedy.

  3. 20


    “The accused infringer has a substantial likelihood of prevailing on the merits where it raises a serious and colorable claim that the patent is invalid.”

    I don’t think you are applying the “likelihood of prevailing on the merits” element correctly. It is not the accused infringer who has to meet the element; rather, it is the party seeking the injunction (here, patentee).

    Also, I don’t see where the “likelihood” has to be “substantial.”

  4. 19

    Judge Newman’s opinion flagrantly ignores Supreme Court precedent, both as to the standard for preliminary injunctive relief and the standard for adjudicating obviousness. The accused infringer has a substantial likelihood of prevailing on the merits where it raises a serious and colorable claim that the patent is invalid. If there is a reasonable possibility that a trial court, after full discovery and trial on the merits, would find that the patent is invalid, then the patentee has not sustained its burden of establishing a “substantial likelihood of success on the merits.” This is far lower than the “clear and convincing” standard that is applied at trial; indeed the accused infringer need not even establish invalidity by the preponderance of the evidence at this stage in order show that the patent is vulnerable to a serious attack at trial.

    Even more troubling is Judge Newman’s KSR analysis, which can only be described as directly at odds with the clear directives of the Supreme Court–she is essentially attempting to pretend that the unanimous KSR decision does not exist. Her requirement that the precise pharmacokenetic parameters be explicitly reported in the prior art is in clear conflict with KSR, which expressly admonished the Federal Circuit for having imposed such requirements as part of its TSM test. The Supreme Court made clear that the mere fact that the prior art does not explicitly recite the invention does not mean that the invention cannot be obvious. She fails to understand that the KSR decision requires a finding of obviousness whenever the invention would have likely been developed applying routine experimentation based on the knowledge in the art, taking into account the problem to be solved and market demand. In short, with the greatest respect, Judge Newman just doesn’t get it.

  5. 18

    I wonder how lucky the attorneys for Abbott and Sandoz felt when they drew a panel comprising of both Newman and Gajarsa.

  6. 17

    This is Round 2 of Newman v. Gajarsa. It’s dejavu all over again.

    Newman has previously rejected Gajarsa’s “substantial evidence as to invalidity” defense standard used for injunctions.

    link to

    It’s time for the Federal Circuit to go en banc to settle the fued between Newman and Gajarsa.

  7. 16

    Dear Just,

    No problem. There’s usually an odd man or two out (in the latter case, I guess it would be – odd even men out??).

  8. 15

    “And that is not a plausible interpretation of the Constitution’s specified terms in its Patent Clause:”

    I’m not going there. I understand your position. I don’t agree with it, but I don’t have any arguments that you haven’t heard before.

  9. 14

    It would seem illogical to have a lower standard for obtaining a preliminary injunction, putting a defendant out of business before any trial, than for obtaining a final injunction. Additionally there should be a sufficient bond posted to compensate for erroniously doing so. Especially after the Sup. Ct. eBay decision, which ought to apply to any patent infringement injunction, even though the CAFC has not clearly said so. So I think the facts of the case may be important, as the Court indicated in stating that:
    “..the legal and equitable factors may be of different weight when the patentee is itself engaged in commerce, as contrasted with a patentee that is seeking to license its patent to others. We need not resolve this aspect for all possible situations, for as between Abbott and Sandoz the district court objectively weighed the legal probabilities and the equities, and exercised its discretionary judgment as to the entirety of the cause. We have been shown no basis for believing that the district court abused its discretion.”

    “Sandoz also appeals the amount of the injunction bond, which the district court set at $40 million. Sandoz provides no substance for appellate review of the amount of the bond, simply stating in its brief that it ‘presented [to the district court] at least colorable evidence that its losses from the injunction and recall would be $200 million,’ but not describing the evidence or arguing its merits.”

  10. 12

    Not the spam filter —
    the software that prevents automated robots from posting comments.

  11. 11

    JAIO Said: Does your spam filter randomly make posters write a second set of fuzzy characters even if the poster got them right the first time?

    DDC Says: Yes, the data is used for psychological profiling.

  12. 10


    Does your spam filter randomly make posters write a second set of fuzzy characters even if the poster got them right the first time?

  13. 9

    Ooops, I “bundled” KSR with eBay – that’s a no-no. I must begrudgingly admit, while KSR really sucks, i.e., it is bad law like Festo, KSR at least is not in tension with the Constitution.

  14. 8

    Dear Just,

    Well, now anyone can see why eBay really sucks – any daamn judge can by whim alone allow an infringement to continue – which is tantamount to compulsory licensing at the discretion of the judge. If a particular judge doesn’t like patents, or a particular patent or litigant for any reason, he can tank it with KSR, or he can force the patent owner to license it to the farkin infringer with eBay.

    And that is not a plausible interpretation of the Constitution’s specified terms in its Patent Clause:

    A) The Constitution, Article I, §8, Clause 8: The Congress shall have Power … “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”

    And, of course, the Supreme Court eBay opinion is also in tension with at least the following:

    B) 35 U.S.C. 154 Contents and term of patent; provisional rights: “(1) CONTENTS.-Every patent shall contain a short title of the invention and a grant to the patentee, his heirs or assigns, of the right to exclude others from making, using, offering for sale, or selling the invention throughout the United States …”

    C) 35 U.S.C. 271 Infringement of patent: “… (d) No patent owner … shall be denied relief … by reason of his having … refused to license or use any rights to the patent;…”.

    D) The official red ribbon copy of American patents, as issued by the Director of the PTO:
    “Therefore, this United States Patent
    Grants to the person(s) having title to this patent THE RIGHT TO EXCLUDE OTHERS FROM MAKING, USING, OFFERING FOR SALE, or selling the invention throughout the United States of America or importing the invention into the United States of America for the term set forth below, subject to the payment of maintenance fees as provided by law.” (emphasis added)

  15. 7

    I’m sure both sides are argued. But, it does seem that the public interests relating to fear of losing their blackberry, fear of not being able to bid on useless stuff on eBay, fear of having to pay a pharm company’s overhead are overemphasized compared to the interest of patent protection. When in all likelihood it was patent protection that brought these technologies/invention into this dispute.

    I guess I still just have a hard time seeing how the 4th factor could ever be held against a patentee (regardless of the technology or the actual practice of patentee). To find any other way just dilutes the potential of the patent system. It does seem unfair, but I think the “understood” public interest toward the protection of patents by the CAFC was right on.

  16. 6

    “In this instance it would be hard to argue that the public would not benefit from increased competition, low-priced alternatives, etc.”

    Not an impossible task.

    The competing public interests are competition and low priced drugs versus preserving an incentive for creating new drugs. In a given case you might disagree that the court did not weigh the competing public interests properly, but the court did consider each side of the argument.

  17. 5

    The public interest lies in having a patent system that reliably invalidates bad claims and rapidly enforces good claims. Getting speedily to trial of infringement and validity is key. Rapid justice is good justice. Interlocutory injunctions are, generally speaking, a BAD THING because they slow down progress to final injunction. But sometimes they are the “lesser evil”, especially in trademark cases. The English courts only seldom grant interlocutory injunctive relief in patent cases but, then again, 95% of English patent cases settle before trial, first instance judgements in patent cases seldom have a dog’s chance on appeal, and most first instance patent judgements on infringement and validity issue within 14 months of issuing proceedings (even with discovery and technical expert reports in between). Can’t you get to something like that? Ah, I guess not. You don’t have the Dutch and German civil law (as opposed to common law) litigator community competing for the same business, do you?

  18. 4

    I have a question for anyone that may know the answer. Can anyone tell me how the courts look at the 4th element in this PI evaluation? i.e. from what perspective? This has bugged me ever since the eBay case.

    Where does the public interest come into play? Is it ONLY with regard to the matters or substance at issue in the conflict? Or can it encompass general ideas such as the overall value of patent protection?

    Pre-eBay I would have guessed that the emphasis was that patent protection (no matter who had the patent) was more beneficial to the “public interest.” Therefore, injunctions were a bit easier to come by. Now it seems that the emphasis has switched to the particulars of the case. In this instance it would be hard to argue that the public would not benefit from increased competition, low-priced alternatives, etc. Thus, injunctions are not so readily granted.

    I haven’t looked around that much so I may have missed any discussion on this point. Most discussion seemed to involve improper application or practice by the CAFC in injunctive matters (probably the understood emphasis on patent protection as more beneficial to the public).

  19. 3

    I’m sorry, but a “substantial question as to validity” for me equates almost evenly with a “low likelihood of prevailing on the merits.” I don’t understand why Newman goes to such lengths to distinguish the two terms without explaining the difference between them. Maybe she should have simply focused on how “substantial” the question must be?

  20. 1

    I’ve said it before and I’ll say it again:

    Newman has never seen a patent she doesn’t like.

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