Tuesday, April 17, 2007

Post-Ebay Decision in D. Del.: Plaintiff Must Show Why Monetary Damages Aren't Enough

Praxair Inc. v. ATMI Inc. (03-1158) District of Delaware, March 27, 2007

After Praxair successfully sued ATMI for patent infringement, Praxair moved for a permanent injunction on ATMI's infringing gas cylinder device. The two companies were in "direct and head-to-head competition" and are the two main mechanical-based systems for the controlled delivery of industrial gases on the market. Praxair argued that this relationship, and ATMI's sale of the infringing product, entitled Praxair to an injunction.

ATMI countered that an injunction would force customers to incur significant costs by shutting down operations to qualify an alternative gas source or to switch to alternate cylinders. While ATMI retained title to most of its cylinders, the customers own the gas stored in the cylinders.

After reviewing the eBay four-factor test, the district court ruled that Praxair has not provided sufficient evidence showing irreparable injury and the inadequacy of legal remedies:

Under eBay, a plaintiff must prove that it is entitled to its statutory right to exclude by demonstrating, inter alia, irreparable injury and the inadequacy of legal remedies. Though the quantum of evidence required is relatively unclear, the court finds that Praxair has not met its burden under eBav to put forward sufficient proof vis-a-vis the broad scope of the relief requested. Praxair generally argues that VAC's presence in the market will cause Praxair to "likely lose additional market share, profits, and goodwill," without further detail. Praxair has not provided or described any specific sales or market data to assist the court, nor has it identified precisely what market share, revenues, and customers Praxair has lost to ATMI . . . While money damages are generally considered inadequate to compensate for the violation of a patentee's right to exclude, Praxair nonetheless had a burden to iterate specific reasons why ATMl's infringement can not be compensated for with a money award.
The court stated that Praxair may renew its motion for injunctive relief following appellate review of the jury verdict.

Download opinion here

Hat Tip: Delaware IP Law Blog

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