The Injunction Function: How and Why Courts Secure Property Rights in Patents

This Essay addresses one aspect of this legal and policy debate concerning remedies in patent law: how and why courts presumptively secured patent owners with injunctions against ongoing or willful infringements of their property rights. Prompted by the United States Supreme Court’s 2006 decision in eBay v. MercExchange, which created a new four-factor test for issuing injunctions on a finding of ongoing infringement of a valid patent, there is a growing body of scholarly commentary on the role of injunctive remedies in securing property rights in new technological innovations. Much of this commentary focuses on how eBay has resulted in a significant reduction in availability of injunctive remedies for patent infringements, especially in the context of patents on standardized technologies, such as standard essential patents covering WiFi or 5G telecommunications technologies in mobile devices. This Essay builds upon this scholarly work by addressing more generally the legal and policy function of injunctive remedies in patent law, detailing newly identified primary sources in historical caselaw that courts presumptively secured to patent owners an injunction to redress ongoing or willful infringements of their property.

The Essay proceeds as follows. First, it summarizes the 2006 eBay decision and how it led to courts significantly reducing injunctions as a remedy for ongoing or willful infringement of valid patents. It describes how eBay changed the legal doctrine for issuing injunctions from a presumptive remedy to a four-factor test and why this change matters. Second, it discusses the nature and function of injunctions as a presumptive remedy in securing property rights, both for landowners and for owners of new and useful inventions.

Historical patent decisions confirm the legal doctrine, and, even more importantly, the policy and commercial function of injunctions as essential backstops in the efficient functioning of markets. Of course, an essay cannot address every legal and policy issue in the historical cases and in the economic and philosophical literature. The contribution here is narrow but important: it confirms that eBay indeed changed remedies doctrine in patent law, and that the resulting reduction in injunctions undermines the function of these property rights in spurring economic activities in the U.S. innovation economy.