Restoring Injunctive Relief

By: Josh Sloat

Illustration: Declan Wrede

The Importance of Injunctions in Property Rights

Some significant new research has been released on the patent system and how it's currently functioning. This research focuses on the ability of patent owners to stop people from infringing on their patents. In legal terms, this is known as an injunction. The concept is straightforward: just as you can obtain an injunction to prevent someone from trespassing in your home or stealing your bicycle, patent owners should be able to get an injunction to stop someone from using their invention or technology without permission.

​An injunction is a court order that can compel the intruder to vacate the premises, return the property, or stop using it without permission. This legal mechanism is vital as it serves as a backstop to the ability of individuals to negotiate in the marketplace. Essentially, your ability to say "no" to someone using your property without permission enables you to demand fair compensation for its use, be it the sale of your home, your bicycle, or new technology protected by a patent.
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Supreme Court's 2006 Decision on Patent Injunctions

Unfortunately, a Supreme Court decision in 2006, known as the eBay decision, introduced a new test for receiving injunctions. ​Prior to eBay, injunctions were rightfully and practically a given if infringement was found. This new four-factor test has since had a significantly negative impact on the ability of patent owners to enforce their property rights. This claim has been hotly debated by those looking to further weaken the patent system, but new research has proven the devastating effects.

The Impact on Patent Owners: Statistical Evidence

Recent research by Dr. Kristina M.L. Acri née Lybecker of Colorado College offers concrete statistical evidence of this impact. According to her rigorous statistical analysis, since the eBay decision, patent owners who license their patents — such as universities, inventors, and small startups – have seen a 91.2% reduction in their ability to obtain injunctions. Even manufacturing companies have experienced a 66.7% reduction in their ability to receive injunctions when others use their patents without permission. 
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Since the eBay decision, patent owners who license their patents – such as universities, inventors, and small startups – have seen a 91.2% reduction in their ability to obtain injunctions to stop others use their patents without permission. 

​​Professor Adam Mossoff discussed this critical research in a recent Mossoff Minute:

The Broader Implications: Devaluation of Property Rights

This data is significant as it confirms a fundamental issue in the patent system today: patents are not being secured by courts as property rights. The inability to prevent others from stealing your property undermines and devalues that property.

Think of it this way: if someone started living in your bedroom and you couldn't kick them out, the value of your home would undoubtedly decrease. Similarly, in patent law, the fact that you cannot enforce your exclusive right against others leads to a devaluation of your patent in the marketplace.
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SCOTUS Got eBay Wrong: Statistical Evidence

The Supreme Court justified its eBay Inc. v. MercExchange, L.L.C. decision by claiming it was applying a long-standing historical test for granting injunctions to patent owners. However, Professor Mossoff conducted an extensive review of all 19th-century patent cases – amounting to approximately 899 cases – and discovered that courts applied this so-called historical test exactly zero times. Yes, zero out of 899 cases.

The zero instances of test application highlight a critical point: despite the Supreme Court's justification, there was no historical precedent for their four-factor test. This discovery confirms that the Supreme Court changed the law on injunctions in 2006 and did so based on a historically inaccurate premise. 

I took a look at all of the patent cases in the 19th century, approximately 899 of them. And I found that the number of times that the courts applied this test that the Supreme Court said in 2006 is a long-standing historical test, is zero. 
​– Professor Adam Mossoff

The Road Ahead: Reform Needed

This issue has destabilized and undermined the role of patents as property rights in our modern innovation economy. This research underscores the urgent necessity for evidence-based policymaking in rectifying this important system that has driven innovation for over 200 years. As Congress considers patent system reforms, or if the Supreme Court decides to revisit its 2006 ruling, this data will be crucial. The need for robust and fair protections for patent holders cannot be overstated. Ensuring that inventors can reliably protect their property rights is vital for encouraging ongoing innovation and maintaining the health of our innovation economy.
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The RESTORE Act

The RESTORE Act was recently introduced in Congress, with the stated goal of restoring the presumption that courts will issue an injunction to stop patent infringers. The Realizing Engineering, Science, and Technology Opportunities by Restoring Exclusive (RESTORE) Patent Rights Act of 2024 has been sponsored by Senator Christopher Coons, Senator Tom Cotton, Representative Nate Moran, and Representative Madeleine Dean.

We unpacked this exciting news with Professor Mossoff and also tackled some of the bigger questions and criticisms surrounding the bill.

You can read the very brief bill language, it's findings, and one-pager using the buttons below.

RESTORE Act Text

RESTORE Act One Pager

Going Deeper on Injunctive Relief

To learn more about injunctions and the damage that's been caused by the inability to get them, listen to our Patent Wars podcast episode where we discuss the biggest problems plaguing the patent industry (injunctions are among the big three), with the reformers looking to fix it. 
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The Mossoff Minute: Patent Shorts

This blog post is a summary created from several installments of the Mossoff Minute, where we explore crucial developments in the world of patent law and its broader implications for innovation. Stay tuned for more insights, updates, and short-form videos on Instagram Reels, YouTube Shorts, and TikTok.