eBay Inc. v. MercExchange, L.L.C. - Oral Argument - March 29, 2006

eBay Inc. v. MercExchange, L.L.C.

Media for eBay Inc. v. MercExchange, L.L.C.

Audio Transcription for Opinion Announcement - May 15, 2006 in eBay Inc. v. MercExchange, L.L.C.

Audio Transcription for Oral Argument - March 29, 2006 in eBay Inc. v. MercExchange, L.L.C.

John G. Roberts, Jr.:

We'll hear argument next in eBay v. MercExchange.

Mr. Phillips.

Carter G. Phillips:

Thank you, Mr. Chief Justice, and may it please the Court.

The fundamental question that's posed in this particular case is whether or not the court of appeals by adopting a rule that declares categorically that three out of the four traditional factors for deciding whether or not to grant permanent injunctive relief will be irrebuttably presumed to be satisfied whenever a jury has found that a patent is valid and has been infringed.

The rule in the Federal Circuit for at least 20 years has been that if you have validity and infringement decided by the jury, that then there is irrebuttable finding of -- of irreparable injury, of inadequate remedy at law, and that the balance of harms decidedly favors the plaintiff, and that the only issue that remains available to the defendant in that circumstance is a heightened scrutiny on the standard of whether or not the -- the public interest commands that an injunction be denied in a particular case.

And even in that context, the Federal Circuit's rule is extraordinarily stringent because not just any public interest can -- will satisfy, but instead, it has to be a public interest that endangers the public health.

Ruth Bader Ginsburg:

Is that all in Judge Bryson's decision?

I certainly didn't see it there.

Carter G. Phillips:

That -- that is precise -- I think it's the only way to read Judge Bryson's decision, Justice Ginsburg, where the court says, at page 26a, that a permanent injunction will issue once infringement and validity have been adjudged, and then say, to be sure, it will not be so to protect the public interest.

And we all know the traditional rule with respect to the grant of injunctive relief is that it's a four-factor test.

Ruth Bader Ginsburg:

I didn't see anything about irrebuttable presumption.

Carter G. Phillips:

Well, the point is that if an injunction follows with a finding of -- of validity and infringement, then that means that there has to be --there has to be irreparable injury, inadequate remedy at law, and that the balance of hardships has to tilt in -- in favor of the plaintiff.

And then the only issue that remains is whether or not the public interest justifies not granting an injunction under the circumstances of this case.

It seems to me there's no other way to read that.

And if you read it in the context of the --of the previous 20 years of decisions from the Federal Circuit, it is absolutely clear.

We don't have the opportunity to come back as a defendant in an infringement action and say, Your Honor, in the specific facts of this case, this is someone for whom money damages is a completely adequate remedy.

And -- and it seems to me quite clear that section 283 is designed to be exactly the opposite of the way the Federal Circuit has interpreted this --this scheme.

Section 283 says explicitly -- and this is at page 1 of the blue brief -- district courts, quote, may -- not shall -- grant injunctions in accordance with principles of equity.

And principles of equity, as Justice Story said almost 200 years ago, systematically reject the idea that you will act on a categorical basis in deciding whether or not to grant or withdraw the injunctive relief in -- in particular circumstances.

And to the contrary, you have to look at each specific issue.

And in that regard --

Antonin Scalia:

Is -- is that so with -- with respect to someone else's use of -- of your property?

It seems to me very rare where -- where someone takes your property, that the court wouldn't --wouldn't give you the property back and -- and simply say, you know -- I can think of a few extraordinary examples.

If somebody makes a statue out of stolen gold, you know, the -- the old classic, I guess you'd get the money back.

But ordinarily we're talking about a property right here, and -- and the property right is -- is explicitly the right to exclude others from --from use of that.

That's what the patent right is.

And all he's asking for is give me my property back.

Carter G. Phillips:

Right.

And -- and Congress already made the -- the balance, Justice Scalia, with respect to that because Congress obviously identified the property right as the right to exclude.

And then Congress did not confer upon the district courts no discretion to act in -- in a situation where the property right has been violated.