eBay v. MercExchange: A Brief Analysis
I am not sure that one can ever describe a 10-page, unanimous opinion for the Supreme Court as badly fractured, but eBay v. MercExchange might be that case.
The simple version is that the Court unanimously holds, in an opinion by Justice Thomas, that the “well-established principles of equity” for granting a permanent injunction apply to disputes arising under the Patent Act. The Court won’t “lightly” imply exceptions to general equitable practice, and after wrestling briefly with a couple of sections in the Patent Act, concludes that the standard off-the-rack rules for permanent injunctions should apply to patent cases. Neither lower court did that, so reversed and remanded to the district court for a first crack at the problem.
Now for the fracturing.
The Chief Justice, joined by Justices Scalia and Ginsburg (can I put an exclamation point there?), wrote a concurring opinion. The Chief Justice notes that the historical practice has been to grant injunctive relief on a finding of patent infringement “in the vast majority of patent cases.” Why? The “difficulty of protecting a right to exclude through monetary remedies.”
Justice Kennedy wrote a separate concurring opinion, joined by Justices Stevens, Souter and Breyer. The opinion briefly suggests that we need to treat like cases alike: “the lesson of the historical practice, therefore, is most helpful and instructive when the circumstances of a case bear substantial parallels to litigation the courts have confronted before.”
But, says Justice Kennedy, this isn’t your father’s patent system (well, he doesn’t exactly that: “the nature of the patent being enforced and the economic function of the patent holder present considerations quite unlike other cases”). Justice Kennedy points to patent trolls (not using that phrase)—people who acquire patents to assert them—and to the rise of business method patents, which he criticizes for their “potential vagueness and suspect validity.”
So a unanimous opinion, but a 2-3-4 division (only Justice Alito didn’t join a concurring opinion). Gosh, we haven’t seen anything like that at least since ... since Grokster, which, as you will recall, was also a unanimous opinion on finding inducement liability but a 3-3-3 split on how Sony’s contributory infringement analysis should apply.
It appears that the Court is resolving IP cases before it—unanimously even for “hard” cases—but it is struggling to find agreement on the underlying issues.