A unique feature of copyright law (also found to varying degrees with patents and trademarks ), but one that in my opinion been misunderstood and misapplied is the judicially created principle of presuming irreparable harm automatically when the movant establishes a likelihood of success. The presumption is applied by all circuits, except the Fifth Circuit, which expressly does not apply the presumption. The Eleventh Circuit applies the presumption generally, but not where there is a bona fide fair use defense. It has not been approved by the District of Columbia Court of Appeals yet, although some trial judges in that circuit have applied it.
The presumption is of a relatively recent vintage, appearing as a discrete statement first in dictum in the American Metropolitan Enterprises of New York, Inc. v. Warner Bros. Records, 389 F.2d 903, 905 (2d Cir. 1968) and later in other circuits. The relevant passage from American Metropolitan is: “A copyright holder in the ordinary case may be presumed to suffer irreparable harm when his right to the exclusive use of the copyrighted material is invaded.” This dictum is all the more remarkable because the remedy at issue was strictly legal: the dispute was over mechanical compulsory license fees under the predecessor to current Section 115. Even more remarkable is the fact that the Second Circuit did not apply the presumption; instead, it affirmed the district court’s refusal to grant a preliminary injunction on the ground that an adequate legal remedy existed:
“[T]he usual rationale for granting a preliminary injunction upon the showing of a prima facie copyright infringement does not apply where the copyright covers musical compositions mechanically reproduced since the copyright holder does not have any exclusivity once he has permitted use. No irreparable injury may be presumed in such a situation. “
While this is correct regarding a compulsory license fact pattern, there was no supporting authority for the dictum that in the “ordinary case” irreparable harm may be presumed. The discussion immediately preceding the statement concerned a different proposition, i.e., a number of cases had held that “upon the showing of a prima facie case of infringement a copyright holder is entitled to a preliminary injunction without a detailed showing of irreparable harm.” The cases cited in support of this proposition state exactly that, but no more. Nor was there any guidance on what an “ordinary” copyright case is or how to apply the presumption: even in “ordinary cases” is the presumption a substitute for any obligation on plaintiff’s part to produce evidence of irreparable harm? What if defendant introduces some evidence showing there is no irreparable harm? Does the presumption vanish and does plaintiff then have to present evidence? A quick look at Federal Rule of Evidence 301 provides the answers.
“In all civil actions and proceedings not otherwise provided for by Act of Congress or by these rules, a presumption imposes on the party against whom it is directed the burden of going forward with evidence to rebut or meet the presumption, but does not shift to such party the burden of proof in the sense of nonpersuasion, which remains throughout the trial upon the party on whom it was originally cast.”
A presumption may be used, consistent with Rule 301, as a device to temporarily shift the burden of going forward with the contrary evidence. A presumption does not shift the ultimate burden of persuasion, which always remains on plaintiff. Thus, in the case of a motion for a preliminary injunction, the burden of establishing entitlement to that relief always remains on the movant regardless of whether a presumption may be applied for one or more factors, e.g., irreparable harm. A presumption merely affords the party for whose benefit it runs “the luxury of not having to produce specific evidence to establish the point at issue.” The luxury is short-lived and shallow, though: a presumption still involves an obligation to produce a minimum quantum of evidence sufficient to call into question the existence of the presumed fact, albeit “nothing more” When evidence contrary to the presumption is introduced, the presumption is not only rebutted, it vanishes. Or, as the Supreme Court put it:” The presumption, having fulfilled its role of forcing the defendant to come forward with some response, simply drops out of the picture.” At this point, plaintiff may still succeed (and perhaps quite easily in a given case) by presenting evidence of irreparable harm, but he is “now put to his factually-supported proof.”
There are two reasons why the presumption vanishes once a minimum quantum of evidence sufficient to call into question the existence of the presumed fact is introduced by the nonmoving party. First, a presumption is not evidence. The second reason is that Congress intended the presumption to vanish under the “bubble bursting” or “Thayer” theory. The legislative history on this point is definitive.
The debate about the status of a presumption once rebutted may be traced to two conflicting schools. The first is that of James Bradley Thayer, whose 1898 treatise, A Preliminary Treatise on Evidence, took the view that a presumption drops out from the case once rebutted. This approach is also called the “Thayer” or “bursting bubble” theory. The second school is that of Professor Edmund Morgan, who in 1933 proposed that a rebutted presumption should remain in the case to be given whatever weight the trier of fact wishes to give it, although rebuttal would still shift the burden of production back to plaintiff. These two schools battled it out like the ancient Talmudic schools of Hillel and Shammai during the 13 years of study that went into the development of the Federal Rules of Evidence, culminating in their enactment by Congress in 1974.
Although the Supreme Court promulgated the rules on November 20, 1972, to take effect on July 1, 1973, questions were raised about the Court’s authority, and thus on February 5, 1973, after Congress blocked their implementation, Chief Justice Burger transmitted the proposed rules to Congress, which extensively revised them. The amendments made by Congress to Rule 301 are highly relevant. The Supreme Court’s version of Rule 301 provided that in all cases a presumption imposes on the nonmoving party the burden of proving that the nonexistence of the presumed fact is more probably than its existence. This approach is well beyond that advocated by Professor Morgan. Indeed, the Advisory Committee on Rules of Evidence of the Judicial Conference took the position that the Court went to far by permanently altering the burden of persuasion. The committee therefore proposed the approach advocated by Professor Morgan in the following language: “[A] presumption imposes on the party against whom it is directed the burden of going forward with the evidence, and, even though met with contradicting evidence, is sufficient proof of the fact presumed to be considered by the trier of fact.
The House passed the Advisory Committee version. In the Senate, the Advisory Committee and the Judicial Conference’s Standing Committee on Practice and Procedure agued for adoption of the House approach. The Senate Judiciary Committee rejected the proposal, describing the Advisory Committee/House version as “ill-advised.” The Senate’s rejection was based on its view that “[p]resumptions are not evidence, but ways of dealing with evidence,” and that treating presumptions as evidence requires deeming “as evidence” facts for which there is no evidence. The Committee therefore amended the proposed rule to its current form. The purpose of the amendment was “to make clear that while evidence of facts giving rise to a presumption shifts the burden of coming forward with evidence to rebut or meet the presumption, it does not shift the burden of persuasion on the existence of the presumed facts. The burden of persuasion remains on the party to whom it is allocated under the rule governing the allocation in the first instance.” As this passage makes clear, Rule 301 contemplates a situation where some actual evidence is initially introduced, which in turn gives rise to a legal presumption regarding a difference fact. The Senate’s explanation of Rule 301 does not contemplate a situation where no evidence is presented, yet a presumption still arises and for the obvious reason that a presumption is not evidence and therefore no legal conclusion can be dram from the utter absence of evidence.
Undaunted, the Advisory Committee and the Judicial Conference lobbied the conference committee, telling the committee that “basically the choice to be made in treating the effect of given presumptions lies between giving them only the effect of a “bursting bubble” and giving them the greater effect of imposing a burden of disproof once evidence has established the conditions that call the presumption into operation.” The conference committee recommended adoption of the Senate version, and that was the version that passed Congress and was enacted. Rule 301 thus adopts the Thayer/bursting bubble approach to presumptions.
The reason for the Senate (and ultimately Congress’s) rejection of the Morgan/Advisory Committee/House approach is easy to understand. That view correctly noted that rebuttal “does not eliminate from the case the evidence itself that gave rise to the presumptions.” And there should be no bar to such predicate evidence going to the trier of fact. But the Morgan/Advisory Committee advocates wanted more: once the predicate evidence was introduced but was rebutted, the presumption was nevertheless to remain, with its weight to be determined by the trier of fact.
A proper understanding of Rule 301 renders the per se presumption of irreparable harm in copyright cases seemingly utilized in the Ninth Circuit highly suspect since in copyright cases the presumption of irreparable harm is used in lieu of evidence and no as a gap-filler once predicate evidence is first established. In copyright cases, if there were evidence of irreparable harm, there would be no need for the presumption. Moreover, the presumption of irreparable harm in copyright arises from an unconventional source, a showing of likelihood of success on the merits. That showing, though, has nothing inherently to do with irreparable harm from an evidentiary standpoint. A plaintiff could have a virtual certainty of prevailing on the merits, but the loss be entirely compensable by monetary damages, as where plaintiff proves there is one-to-one displacement of sales, or where plaintiff elects statutory damages. Perhaps as important, the threshold showing for any grant of interim injunctive relief is, irreparable harm, not a likelihood of success on the merits (although such success is also required). To permit a showing of likelihood of success on the merits to establish irreparable harm is not only to collapse two factors into one; it collapses the dog into the tail.
Finally, compelling plaintiff to establish actual evidence of irreparable harm is consistent with the general rule that where facts relating to a disputed issue lie peculiarly within the knowledge of one party, placing the burden of proof on his or her adversary is unfair. Nowhere is this principle more appropriately applied than where on party claims irreparable harm. Such harm is entirely within the knowledge of the party asserting its existence.
In sum, the presumption of irreparable harm cannot be justified on a blanket basis, and if applied at all, is a mere burden-shifting device, not evidence. Once some contradictory evidence is introduced by the nonmoving party, the presumption vanishes. If plaintiff fails to introduce convincing evidence of actual irreparable harm, the request for injunctive relief must be denied.