Reversing decades of precedent, the Ninth Circuit Court of Appeals recently eliminated the presumption of irreparable harm for trademark owners seeking a preliminary injunction. The presumption of irreparable harm had been in doubt for several years following Supreme Court precedent in the patent context. In Herb Reed Enterprises, LLC v. Florida Entertainment Management, Inc., 736 F.3d 1239 (9th Cir. 2013), the Ninth Circuit finally confronted whether that precedent applied in the trademark context, holding: "Those seeking injunctive relief must proffer evidence sufficient to establish a likelihood of irreparable harm."
Although plaintiffs seeking preliminary injunctions must normally prove irreparable harm, for decades trademark owners could presume such harm once they had shown a likelihood of success on their infringement claims. Two Supreme Court decisions in 2006 and 2008 threw that presumption into question. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) jettisoned presumption in patent cases. Then Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008) required parties in a non-patent case to show that irreparable harm was "likely," not merely "possible."
The Ninth Circuit did not immediately extend eBay and Winter to trademark cases. In fact, three years after eBay, the Ninth Circuit invoked the presumption in affirming a preliminary trademark injunction. Marlyn Nutraceuticals, Inc. v. Mucos Pharma GmbH & Co., 571 F.3d 873 (9th Cir. 2009). But shortly after, Flexible Lifeline Systems, Inc. v. Precision Lift, Inc., 654 F.3d 989 (9th Cir. 2011), a copyright case, criticized, but did not reverse, Marlyn Nutraceuticals' "summary treatment of the presumption." With the Herb Reed decision, the presumption is officially dead.
The underlying dispute in Herb Reed Enterprises concerned trademark rights to "The Platters," the name of the successful 1950s vocal group. On appeal from the district court's grant of a preliminary injunction, the Ninth Circuit reversed the district court's finding of irreparable harm.
Addressing the crux of the matter, the Ninth Circuit clarified its new rule: "We now join other circuits in holding that the eBay principle—that a plaintiff must establish irreparable harm—applies to a preliminary injunction in a trademark infringement case." Although the district court had not presumed irreparable harm, it erred in relying on plaintiff's "unsupported and conclusory statements regarding harm [plaintiff] might suffer." The Ninth Circuit found that plaintiff's platitudes about "loss of control over business reputation" and "damage to goodwill" were inadequate absent actual proof. In an important footnote, however, the court noted that the rules of evidence do not bind district courts during preliminary injunction hearings, and hearsay may support a claim of irreparable harm.
Following the "Platters" decision, district courts will likely be on heightened alert when addressing injunctions in trademark cases. Defendants opposing preliminary trademark injunctions should highlight evidentiary deficiencies in the plaintiff's case, and criticize platitudes about plaintiffs' asserted harm. Trademark plaintiffs, in contrast, should emphasize unique facts showing the risk of continued use of an allegedly infringing mark, such as irate customers, frayed vendor relationships, or threats to market share during critical periods of a company's growth. By focusing on the unique consequences of infringement, a plaintiff with a strong trademark case will be more likely to obtain an injunction, supported by a record that can survive on appeal.
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