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Dimock Stratton’s Intellectual Property Law Newsletter | Causal nexus

In Apple v. Samsung the United States Court of Appeals clarified and applied the causal nexus requirement in a situation involving irreparable harm.

Dimock Stratton’s Intellectual Property Law Newsletter

By: Dimock Stratton

II.2 — U.S. Federal Circuit Court of Appeals— injunction in Apple v Samsung

On September 17, 2015, the United States Court of Appeals for the Federal Circuit

issued its latest decision in the Apple v. Samsung patent dispute. In a split decision considering, among other things, the USSC’s eBay decision and the requirement of a “causal nexus” between the alleged irreparable harm and the alleged infringement, the Court vacated the lower court’s decision not to award a permanent injunction and remanded.

The proceeding was an appeal from a decision of the United States District Court for the Northern District of California (Judge Koh) that refused to award a permanent injunction after finding Samsung had infringed two of Apple’s patents. The lead appeal opinion was by Judge Moore of the Court of Appeal, with a concurring opinion by Judge Reyna and a dissenting opinion by Chief Judge Prost.

Judge Moore confirmed that, “The causal nexus requirement ensures that an injunction is only entered against a defendant on account of a harm resulting from the defendant’s wrongful conduct, not some other reason. For example, it ensures that an injunction is not entered on account of ‘irreparable harm caused by otherwise lawful competition.’” (page 8)

Judge Moore identified the error of the lower court (page 12):

The district court thus erred when it required Apple to prove that the infringing features were the exclusive or predominant reason why consumers bought Samsung’s products to find irreparable harm. . . Instead, the district court should have considered whether there is “some connection” between the patented features and the demand for Samsung’s products.

Judge Reyna, in the concurring decision, wrote regarding eBay and recent decisions applying eBay (citations removed) (page 2):

The court today correctly concludes that Apple, Inc. is entitled to a narrow, feature-based injunction against Samsung because Samsung’s infringement will likely cause Apple to lose downstream sales. I agree with this decision and note that it leaves open the door for obtaining an injunction in a case involving infringement of a multi-patented device, a door that appears near shut under current law.

. . .

Though we read eBay to overrule our presumption of irreparable injury, we cautioned that courts should not necessarily “ignore the fundamental nature of patents as property rights granting the owner the right to exclude.” Yet our recent cases have done precisely that, ignoring the right to exclude in determining whether to issue an injunction. Indeed, our opinions in the most recent cases between Apple and Samsung do not even mention the right to exclude as a possible basis for injunctive relief. I believe that this recent trend extends eBay too far. Infringement on the right to exclude is, in my view, an “injury” that is sometimes irreparable. An “injury” is not limited to tangible violations but rather encompasses “violation[s] of another’s legal right, for which the law provides a remedy; a wrong or injustice.”

Writing in dissent, Chief Judge Prost writes in the introduction (pages 1-2):

This is not a close case. One of the Apple patents at issue covers a spelling correction feature not used by Apple. Two other patents relate to minor features (two out of many thousands) in Apple’s iPhone—linking a phone number in a document to a dialer, and unlocking the screen. Apple alleged that it would suffer irreparable harm from lost sales because of Samsung’s patent infringement. For support, Apple relied on a consumer survey as direct evidence, and its allegations of “copying” as circumstantial evidence. The district court rejected both evidentiary bases. On the record of this case, showing clear error in the district court’s factual findings is daunting, if not impossible. Not surprisingly, Apple principally presses a novel legal theory in this appeal: that the narrowness of its injunction request eliminated its burden to show nexus between its alleged irreparable harm and Samsung’s patent infringement. The majority correctly rejects this theory and the case should have ended there.

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