Licensing or Commercial Activities May Be Sufficient to Award a Permanent Injunction to a Non-Practicing Patent Owner

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Since the Supreme Court's watershed decision in eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006), trial courts have become less likely to issue a permanent injunction after finding validity and infringement when that patent owner did not manufacture products covered by its patents. Typically, courts have found that such patent owners cannot establish the first prong of eBay's four-factor test: "that [the patent owner] has suffered irreparable injury" because these patent owners do not manufacture or practice the patent themselves and therefore will not be irreparably harmed in the absence of an injunction.

Some non-practicing patent owners have attempted to overcome this deficiency by licensing the patent, often to competitors in the accused infringer's field. This strategy has been met with only marginal success, particularly when the plaintiff merely grants boilerplate licenses to any interested party. In such cases, permitting the licensed infringer holding a compulsory license or otherwise—to remain in the market would not irreparably harm the plaintiff. In contrast, Harris Corp. v. Federal Express Corp., No. 6:07-cv-1819 (M.D. Fla. Feb. 28, 2011) presents licensing activities of a non-manufacturing patent owner that supported a finding of irreparable injury and an award of a permanent injunction.

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