CAFC Vacates Preliminary Injunction, Reiterates That eBay Abolished Presumption of Irreparable Harm

The U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential decision on Tuesday, authored by CAFC Chief Judge Moore, vacating a district court’s grant of a preliminary injunction (PI) for Socket Solutions, LLC that had barred Import Global from manufacturing, using, selling, offering to sell, or importing into the United States its Neat Socket® product. Moore’s opinion also emphasized that the district court should not apply a presumption of irreparable harm on remand, as that presumption was abolished following the eBay decision.

Socket Solutions own U.S. Patent No. 9,509,080, which covers “an indoor electrical wall outlet cover that permits use of a wall outlet while concealing the outlet contact openings,” according to the opinion. Socket Solutions sued Import Global for infringement, alleging its Neat Socket product infringed claim 19 of the ‘080 patent and moved for a PI. The U.S. District Court for the Southern District of Florida referred the motion to a magistrate judge, who issued a Report and Recommendation (R&R) on claim construction as well as a R&R that the court grant the PI motion. The district court ultimately adopted both and granted the motion for a PI, which enjoins Import Global “from manufacturing, using, selling, offering to sell, or importing into the United States its accused Neat Socket product and other products ‘not more than colorably different from’ the accused products in the context of the ’080 patent” or inducing others to do the same.

Import Global appealed, arguing that the district court erred in analyzing the likelihood of success and irreparable harm. With respect to likelihood of success, Import Global argued the district court based its analysis on incorrect constructions of the terms “backplate” and pin.”

The district court construed the term “backplate” to mean “the component of the cover, opposing the front[]plate, that includes at least one set of electrical prongs,” while Import Global argued the correct construction should be the “portion of the apparatus closest to the wall outlet when the apparatus is plugged into the wall outlet.”

The CAFC agreed with Import Global that the court erred in its construction of the term, but disagreed that it should be defined in relation to the wall outlet. Instead of a construction that relies on spatial references, which the CAFC said is not required by the specification, the opinion said that “a construction that focuses on ‘cover’ thickness most naturally aligns with the specification.” The CAFC thus construed “backplate” to mean “the component forming the cover with the frontplate, such that the maximum thickness of the cover is the distance, at the central portion of the cover, between the frontplate and the component.”

Turning to the district court’s construction of “pin,” the CAFC agreed with Import Global that the court’s definition (“a means for making an electrical connection between the [hot/neutral] wire and the [hot/neutral] prong”) “improperly converts ‘pin’ into a means-plus-function term under 35 U.S.C. § 112(f).” The claim does not use the word “means” and the written description defines “pin” in structural terms, thus the presumption is that Section 112(f) does not apply, said the CAFC.

Socket Solutions argued that the CAFC has “previously construed claimed structures in purely functional terms without triggering § 112(f) when the structural element is best defined by its function.” Socket Solutions said “pin” is best defined as “a structure that physically and electrically connects the electrical wires to the corresponding electrical prongs,” but the CAFC did not agree. While the opinion also rejected Import Global’s suggestion that “pin” be construed as a “mechanical system for making an electrical connection between the [hot/neutral] wire and the [hot/neutral] prong,” explaining that there was no support in the specification to construe the term as a “mechanical system,” it concluded that it should be given its plain and ordinary meaning as understood by a skilled artisan, and the parties did not dispute that “pin” in the context of the ’080 patent is understood by skilled artisans to be a structure.

Because the CAFC remanded to the district court on the likelihood of success factor, it did not reach the irreparable harm arguments except to hold that the district court erred to the extent it relied on a presumption of irreparable harm where a clear showing of patent validity and infringement has been made. “We note that this presumption cannot be justified after eBay Inc. v. MercExchange, L.L.C….” said the opinion.

The CAFC noted that it confirmed the presumption of irreparable harm was abolished in Robert Bosch LLC v. Pylon Mfg. Corp., 659 F.3d 1142, 1149 (Fed. Cir. 2011), and while both eBay and Bosche involved permanent injunctions, “we see no reason to depart from their holdings in the preliminary injunction context,” the opinion added.

The opinion noted, however, that it was not clear whether the district court actually applied the presumption, or if it merely noted there is such a presumption, so just directed the court on remand to “analyze irreparable harm in a manner that does not rely on the presumption, if it reaches this issue…”

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