The early English chancery courts, operating under the 1710 Statute of Anne, but without express authorization in that Act, regularly issued temporary injunctions against the distribution of books and plays alleged to be infringing, including on ex parte application. The chancery courts exercised their equitable powers purportedly with a view to effectuating the legal right granted by the Statute of Anne, and only under circumstances where at-law remedies could not provide adequate relief. The need for intervention by the chancery courts was stated in the United States by Justice Story: “[I]f no other remedy could be given in cases of patents and copyrights than an action at law for damages, the inventor or author might be ruined by the necessity of perpetual litigation, without ever being able to have a final establishment of his rights.” Joseph Story, 2 Commentaries on Equity Jurisprudence as Administered in England and the United States 931 (1836).
Justice Story's remarks were based upon earlier pronouncements made by English chancery courts, such as this one in Hogg v. Kirby, 8 Ves. 215, 225 (1803)
The principle of granting the injunction … is that damages, do not give adequate relief; and that the sale of copies by the defendant is, in each instance, not only taking away the profit of the individual book, which the plaintiff probably would have sold, but may injure him to an incalculable extent which no inquiry for the purpose of damages can ascertain.
And this one by Lord Eldon in Lawrence v. Smith, Jacob's Rep. 472 (1822) “Our jurisdiction, unless I mistake, is founded on this: that the law does not give a complete remedy to those whose literary property is invaded.” These sentiments are, however, entirely abstract, for in Lawrence, plaintiff did not present any evidence of an inadequate remedy at law.
Yet, in the U.S., the Supreme Court has repeatedly held that "The sine qua non of any grant of temporary injunctive relief is proof of immediate irreparable harm." Weinberger v. Romero-Barcelo, 456 U.S. 305, 312, 102 S. Ct. 1798, 72 L. Ed. 2d 91 (1982) (“The basis for injunctive relief in the federal courts has always been irreparable injury and the inadequacy of legal remedies”); Sampson v. Murray, 415 U.S. 61, 88, 94 S. Ct. 937, 39 L. Ed. 2d 166 (1974) (“This Court has stated that ‘(t)he basis of injunctive relief in the federal courts has always been irreparable harm and inadequacy of legal remedies,’ Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 506–507, 79 S. Ct. 948, 3 L. Ed. 2d 988 (1959).” As Judge Posner put the matter in a copyright case, Ty, Inc. v. GMA Accessories, Inc., Ty, Inc. v. GMA Accessories, Inc., 132 F.3d 1167 (7th Cir. 1997).
[A] plaintiff who cannot show any irreparable harm at all from the withholding of a preliminary injunction is not entitled to the injunction however strong his case on the merits, for he has no need for preliminary relief in such a case, no need therefore to short-circuit the ordinary processes of the law.
Although historically the requirement may have originated in the 17th century as a way to make clear the jurisdictional authority of the law and chancery courts, by the 19th century the focus had shifted toward the current role of serving as the way to distinguish between appropriate interim relief and relief available at a final hearing. See John Leubsdorf, The Standard for Preliminary Injunctions, 91 Harv. L. Rev. 525, 533–534 (1978). How that burden is met is less clear. Judge Friendly once wryly observed that the phrase irreparable harm “generally produces more dust than light.” Studebaker Corp. v. Gittlin, 360 F.2d 692, 698 (2d Cir. 1966). In the Ninth Circuit, the requirement has effectively been eliminated by a seemingly presumption of irreparable harm arising from a (very slight) showing of probable success on the merits. See Cadence Design Systems, Inc. v. Avant! Corp., 125 F.3d 824, 827 (9th Cir. 1997),. See also 3DO Co. v. Poptop Software Inc., 1998 WL 962202 (N.D. Cal. 1998).
I mention all of this because of a draft article by Professor Tomas Gomez-Arostegu entitled available at ssrn here called “What History Teaches Us About Copyright Injunctions and the Inadequate-Remedy-at-Law Requirement." Here is his abstract:
Our Supreme Court has held that as a general matter an injunction cannot issue if there is an adequate remedy at law. This follows, according to the Court, because the standard for when injunctions may issue derives directly from the practice of the English Court of Chancery around 1789, which followed the same principle. This Article argues that the Supreme Court’s reading of general Chancery custom is inapposite in copyright cases, and that, as a matter of historical practice, the Chancery never inquired into whether a copyright plaintiff had an adequate remedy at law. The remedies at law were deemed categorically inadequate. The Supreme Court could thus hold today, without running afoul of traditional equitable principles, that a copyright injunction can issue without regard to the adequacy of money damages. This Article reaches its conclusion only after undertaking the most comprehensive treatment of the subject to date. It relies primarily on the original manuscript records of 215 infringement suits brought in the Court of Chancery from 1660 to 1800, which are stored at the National Archives in Kew, England, and a further review of earlier copyright-infringement suits circa 1557 to 1660 in antecedent tribunals, many of which are also only available in manuscript form. The topic of this Article is particularly timely given the Supreme Court’s recent decision in eBay Inc. v. MercExchange, L.L.C. (2006), where it discussed the standard for issuing injunctions in patent cases, and where Chief Justice Roberts stated in a concurring opinion that lower courts should consider the inadequacy requirement in light of historical practices.
Professor Gomez-Arostegu has done great historical work; while I don’t think that any of the Stationers’ Company or Star Chamber proceedings have any relevance because (1) the rights at issue were not copyright rights, and, (2) the proceedings were not chancery court proceedings, the historical discussion is nevertheless interesting, and his general thesis is provocative.
To connect the obvious dots, "why isn't a court imposed royalty or damges remedy that estimates future income, a better choice than an injunction in many copyright and patent cases?"
ReplyDeleteProperty rights theorists argue that the reason to prefer an injunction is that this gives us a market established, rather than a court imposed price. But, in the area of published works, there is often a well defined market priced royalty observed as a matter of custom in the lion's share of case. Simlarly, in the classic "patent troll" scenario where a non-inventor patent owner sues a good producer, the plaintiff actually wants a royalty anyway and an injunction caused by a failure to reach agreement is highly disruptive and promotes bargaining in a flawed economic rent seeking environment.