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Louisiana State Univ.

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Monday, May 3, 2010

Second Circuit Vacates, Remands Salinger Copyright Dispute

The Second Circuit, has remanded the Salinger copyright case, Salinger v. Colting, to the district court.

We hold that, although the District Court applied our Circuit's longstanding standard for preliminary injunctions in copyright cases, our Circuit's standard is inconsistent with the "test historically employed by courts of equity" and has, therefore, been abrogated by eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 390, 126 S. Ct. 1837, 164 L. Ed. 2d 641 (2006).

The Copyright Act of 1976 authorizes courts to "grant temporary and final injunctions on such terms as [they] may deem reasonable to prevent or restrain infringement of a copyright." ... And, as the District Court stated, this Court has long issued preliminary injunctions in copyright cases upon a finding of (a) irreparable harm and (b) either (1) likelihood of success on the merits or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting the preliminary relief.

...

Thus, once a plaintiff establishes a likelihood of success on the merits, the only additional requirement is a showing that the plaintiff will be irreparably harmed if the preliminary injunction does not issue. And traditionally, this Court has presumed that a plaintiff likely to prevail on the merits of a copyright claim is also likely to suffer irreparable harm if an injunction does not issue.
...

This Court has applied this presumption in several ways. Some decisions have interpreted the presumption to mean that a plaintiff likely to prevail on the merits does not need to make a detailed showing of irreparable harm. ...A few decisions, by contrast, have found the presumption rebuttable where the plaintiff delayed in bringing the action seeking an injunction.

...

Under any of these articulations, however, this Court has nearly always issued injunctions in copyright cases as a matter of course upon a finding of likelihood of success on the merits. ...

Defendants do not claim that the District Court failed to apply this Circuit's longstanding preliminary injunction standard. Rather, they argue both that this standard is an unconstitutional prior restraint on speech and that it is in conflict with the Supreme Court's decision in eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 126 S. Ct. 1837, 164 L. Ed. 2d 641 (2006). We agree that eBay abrogated parts of this Court's preliminary injunction standard in copyright cases, and accordingly, this case must be remanded to the District Court to reevaluate Salinger's preliminary injunction motion. In light of that holding, we need not decide whether the preliminary injunction issued by the District Court constituted an unconstitutional prior restraint on speech.
...

This Court has not directly addressed the scope of eBay. And district courts in our Circuit have split on eBay's reach. Compare, e.g., Lennon v. Premise Media Corp., 556 F. Supp. 2d 310, 319-20 n.1 (S.D.N.Y. 2008) (holding that eBay only applies to permanent injunctions in patent cases), with Microsoft Corp. v. AGA Solutions, Inc., 589 F. Supp. 2d 195, 204 (E.D.N.Y. 2008) (applying eBay in a permanent injunction trademark case). Two district court decisions have noted that the scope of eBay remains an open question in this Circuit and have decided the cases before them without determining whether the eBay or pre-eBay standard applied. See Gayle Martz, Inc. v. Sherpa Pet Group, L.L.C., 651 F. Supp. 2d 72, 85 (S.D.N.Y. 2009); Warner Bros. Entm't Inc. v. RDR Books, 575 F. Supp. 2d 513, 552 (S.D.N.Y. 2008).

...

This Court's pre-eBay standard for when preliminary injunctions may issue in copyright cases is inconsistent with the principles of equity set forth in eBay. The Supreme Court's decision in Winter tells us that, at minimum, we must consider whether "irreparable injury is likely in the absence of an injunction," we must "'balance the competing claims of injury,'" and we must "'pay particular regard for the public consequences in employing the extraordinary remedy of injunction .'" 129 S. Ct. at 375-77 (quoting Amoco, 480 U.S. at 542; Weinberger, 456 U.S. at 312. Therefore, in light of Winter and eBay, we hold that a district court must undertake the following inquiry in determining whether to grant a plaintiff's motion for a preliminary injunction in a copyright case. First, as in most other kinds of cases in our Circuit, a court may issue a preliminary injunction in a copyright case only if the plaintiff has demonstrated "either (a) a likelihood of success on the merits or (b) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly in the [plaintiff]'s favor." ... Second, the court may issue the injunction only if the plaintiff has demonstrated "that he is likely to suffer irreparable injury in the absence of an injunction." Winter, 129 S. Ct. at 374. The court must not adopt a "categorical" or "general" rule or presume that the plaintiff will suffer irreparable harm (unless such a "departure from the long tradition of equity practice" was intended by Congress). eBay, 547 U.S. at 391, 393-94. Instead, the court must actually consider the injury the plaintiff will suffer if he or she loses on the preliminary injunction but ultimately prevails on the merits, paying particular attention to whether the "remedies available at law, such as monetary damages, are inadequate to compensate for that injury." ... Finally, the court must ensure that the "public interest would not be disserved" by the issuance of a preliminary injunction. ...



 



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