USPTO and DOJ Advocate for Permanent Injunctions for Non-Practising Entities in Samsung Patent Dispute

It has been two decades since the Supreme Court’s landmark decision in eBay Inc. v. MercExchange, L.L.C., which established that a patentee seeking a permanent injunction must prove both irreparable harm and the absence of an adequate remedy at law. Since then, courts have generally held that non-practising entities (NPEs)—entities that do not manufacture or use the patented invention—fail to meet these requirements, often denying them injunctive relief.

Recently, the United States Patent and Trademark Office (USPTO) joined forces with the Department of Justice (DOJ) to challenge this prevailing judicial approach. They filed a joint statement of interest in the case Collision Communications v. Samsung Electronics, currently before Judge Gilstrap. Collision Communications, an NPE, secured a $445.5 million verdict for willful infringement against Samsung, and the court is now considering whether to grant a permanent injunction.

In their joint statement, the USPTO and DOJ contend that NPEs can establish irreparable harm and the inadequacy of monetary damages if they demonstrate that their patents are difficult to value and that calculating infringement damages is complex. The USPTO’s press release accompanying the filing emphasized that “non-practising patentees should not be categorically denied the opportunity for injunctive relief.”

This filing is significant given the USPTO’s historical reticence to intervene in litigation through statements of interest. Over the past year alone, the USPTO has filed three joint statements with the DOJ advocating for injunctive relief, including two focused specifically on NPEs in district court cases. These actions coincide with the USPTO’s recent trend of increasing discretionary denials and reducing the institution of petitions at the Patent Trial and Appeal Board (PTAB), signaling a broader intent to preserve and enforce patent rights robustly, including those held by NPEs.

Despite the USPTO’s assertive position, legal experts caution that the joint statement may have limited influence on courts’ established frameworks for assessing irreparable harm and remedies at law. Notably, the USPTO’s argument that an NPE lacks an adequate remedy due to uncertain patent valuation lacks citation to Federal Circuit precedent or patent infringement case law. Furthermore, the USPTO’s reliance on the difficulty of calculating monetary damages as a basis for irreparable harm draws from cases involving plaintiffs who competed directly with alleged infringers—circumstances that differ materially from those of NPEs.

For example, the USPTO cited Broadcom Corp. v. Qualcomm Inc., where the Federal Circuit upheld a permanent injunction. However, in that case, both parties competed in the chipset market, even though Broadcom did not currently practice the patented inventions. This competitive relationship is a key factor in courts’ irreparable harm analysis, which NPEs typically cannot replicate.

Scholars have noted that the irreparable harm requirement remains a significant hurdle for NPEs, as they rarely demonstrate the type of competition-related harm that courts recognize as irreparable injury. Christopher B. Seaman’s empirical study in the Iowa Law Review highlights this challenge, underscoring the difficulty NPEs face in meeting the eBay standard.

Practitioners and observers should closely monitor Judge Gilstrap’s handling of the USPTO and DOJ’s joint statement in Collision Communications v. Samsung. The court’s response will provide valuable insight into the evolving legal landscape surrounding injunctive relief for NPEs and the practical weight of USPTO advocacy in patent litigation.