More on eBay v. MercExchange
on May 15, 2006 at 8:49 pm
Earlier today, Kathleen Sullivan and Justin Nelson weighed in on the Court’s opinion in eBay v. MercExchange, which was handed down this morning. We also have these thoughts from Daniel Walfish, with Robbins, Russell, Englert, Orseck & Untereiner, which prepared one of the amicus briefs in support of MercExchange:
I agree with most of what Justin wrote. It is essential to remember that the Supreme Court sent the case back to the district court for a do-over. (“[W]e vacate the judgment of the Court of Appeals, so that the District Court may apply that framework in the first instance.”) In effect standing in the shoes of the court of appeals, the Supreme Court reminded us that the district courts have discretion but held that the district court in this case did abuse that discretion when it ruled for eBay. Since the district court was driven more than anything by a (largely mistaken) belief that an intention to license rather than practice disqualified the patent owner from an injunction, and the opinion for a unanimous court rejected that principle, the court’s opinion is hardly a victory for eBay or a defeat for independent patent-owners.
Moreover, as my one of my colleagues has pointed out, not one justice questioned the United States’ application of the four-factor test, which, according to the United States, required an injunction in this case.
On an unrelated note, I was surprised to see Justice Kennedy not only joining, but authoring, the opinion more skeptical of injunctions. Justice Kennedy made it fairly clear at oral argument that aside from concerns about business method patents, he was not convinced by the other arguments for denying an injunction in this case. Justice Kennedy appeared to be acknowledging that equity traditionally awards an injunction to remedy infringement, regardless of whether and how the plaintiff uses the invention. But he seems to have had a change of heart, since he eventually joined Justice Breyer, who at argument made his sympathy to the position of the amicus software companies quite clear, and Justice Stevens, who a week earlier conveyed his own dim view of subject-matter patentability standards at the argument in LabCorp v. Metabolite Laboratories. Of course, Justice Kennedy’s concurrence does reflect his initial skepticism about business method patents, but whether or not such skepticism is justified, the courts should not be in the business of changing the remedy for infringement based on the subject matter of the patent. If that is a job for anyone, it is Congress.
