Ebay v. MercExchange: EBay's Reply Brief

eBay v. MercExchange (on writ of certiorari 2006).

EBay has filed its reply brief, and the stage is now set for a March 29, 2006 hearing before the Supreme Court in this important case. In the reply, eBay essentially argues injunctive relief at least requires that the plaintiff suffer “irreparable injury [without] an adequate remedy at law,” and that MercExchange has no such injury.

At its base, eBay’s argument is that by licensing its patent, MercExchange has shown that it is willing to take money in exchange for allowing would-be infringement.  Consequently, MercExchange cannot now argue that monetary damages are “inadequate.”

• eBay Reply Brief


• Read all the briefs: eBay v. MercExchange.

Comments

[Paul Cole]

An Englishman's view of Ebay v. MercExchange (and by definition I am a non-expert) is that the defendants should succeed on the issue of principle.

The word "may" implies discretion, requiring the court to exercise that discretion based on the facts in the case and not merely to apply an inflexible rule. This principle governs the English courts, and I presume it applies also to the US courts since our legal systems have a common origin and many similarities.

For example in the recent Blackberry case, an injunction would have shut down a service on which millions of people had come to depend. It cannot be in the public interest to grant an injunction in these circumstances: the obligation must be on the parties to compromise their dispute without imposing such inconvenience on the public. Similarly if the plaintiff had a generic patent and the defendant was manufacturing a species which was a life-saving drug of which the defendant was the only source.

In the present case, I think you have to study the facts to see whether an injunction is warranted. For example, if the defendant was willing to take a licence, then the court should not grant an immediate injunction, but give the plaintiff liberty to apply if negotiations were not concluded within e.g. 3 months. Similarly for a design-around situation. But if the defendant contumeliously refused to negotiate, or to change its design within a short period, and planned to continue infringing to the detriment of the plaintiff and its existing licensees without limit of time, an injunction might well be proper. I don't think a court should short-circuit these enquiries by application of an inflexible rule.

So if I were a betting man, my money would be for the defendants. It will be fascinating to see the outcome.

Best regards

Paul Cole

[Ginnie]

Re: Comments by Paul Cole (excerpt below):
"For example in the recent Blackberry case, an injunction would have shut down a service on which millions of people had come to depend. It cannot be in the public interest to grant an injunction in these circumstances: the obligation must be on the parties to compromise their dispute without imposing such inconvenience on the public. Similarly if the plaintiff had a generic patent and the defendant was manufacturing a species which was a life-saving drug of which the defendant was the only source."
I am not an expert either (not even close), but:
As MercExchange expressed in their brief - the patent is the right to stop others from making, using, & selling your invention. Without an injunction on these actions - you essentially have NO PATENT. Will the public be inconvenienced - maybe, similar to RIM case, but inconvenienced is the key word here. Will anyone die (life-saving drug analogy) - NO. The injunction appears to be pretty standard in patent litigation - RIM was an exception. Patents need to be enforcable, or they have little/no value, injunctions are a large part of the enforcement.