Denial of a Permanent Injucation Against Patent Infringement is Not a Compulsory License

Since the Supreme Court’s decision in eBay, Inc. v. MercExchange, L.L.C.,  U.S. courts have changed the process by which they determine the propriety of injunctive relief against an adjudicated infringer.  Before eBay, permanent injunctive relief was a standard remedy for a patentee and was awarded as a matter of course.  However, in eBay the Supreme Court instructed that in determining whether injunctive relief is an appropriate remedy for patent infringement, courts must use the same four-factor test that is used in considering injunctive relief in non-patent cases.  This paper examines the ways in which courts have undertaken the newly-required eBay test and the factors courts have considered in determining whether injunctive relief is appropriate.

After eBay, injunctive relief against infringers is no longer a virtual certainty.  Some commentators have asserted that when injunctive relief is denied, the court effectively issues a compulsory license to the adjudicated infringer.  The occasional denial of injunctive relief post-eBay is not, however, comparable from an economic or policy perspective to compulsory licenses that have been granted in other countries.    This paper explores some of those differences, which render untenable the contention that compulsory licenses akin to those issued by foreign governments are now issued routinely in the U.S. via denials of injunctive relief.  Indeed, the U.S. has never issued a compulsory license for a pharmaceutical product, and true compulsory licensing of patents in the U.S. is narrowly constrained to certain limited, extraordinary circumstances.

Please see the PDF below for the complete paper: