Last week, the Federal Circuit heard oral argument in Telefonaktiebolaget LM Ericsson v. Lenovo (United States) Inc., a patent case that attracted an amicus brief. In this case the Federal Circuit is reviewing a district court’s order denying an anti-suit injunction. Judges Lourie, Prost, and Reyna heard the argument. This is our argument recap.
John C. O’Quinn argued for Lenovo (United States) Inc., Motorola Mobility LLC, Lenovo (Shanghai) Electronics Technology Co. Ltd., Lenovo Beijing, Ltd., Lenovo Group Limited, and Motorola (Wuhan) Mobility Technologies Communication Co., Ltd. He began by arguing that the district court misunderstood the threshold legal requirement for granting an anti-suit injunction, which he said “merely requires that the domestic action be capable of disposing of the issue in the foreign action.” O’Quinn suggested the foreign action would be disposed if a royalty rate were determined as well as if it were determined that Ericsson had breached its duty to negotiate in good faith. A judge asked if there would be any impediment to Ericsson seeking foreign injunctions if Ericsson had not breached its duty. O’Quinn responded that Ericsson would also need to prove that Lenovo was not negotiating in good faith.
Jeffrey Lamken argued for Telefonaktiebolaget LM Ericsson, Ericsson AB, and Ericsson, Inc. He argued the relevant rule is that “parallel proceedings between different sovereigns proceed in parallel, without interference . . . except in the most extreme circumstances.” Lamken suggested the district court was within its discretion not to grant an anti-suit injunction that “would have rendered unenforceable in Brazil a Brazilian decree enforcing Brazilian patents” regarding “sales to customers in Brazil.” Lamken contended that, “in normal injunctive cases, you only need to show probability of success, but anti-suit injunctions have a higher standard because of the comity considerations, meaning that the case must be necessarily dispositive.”
In his rebuttal time, O’Quinn maintained that the standard requires only that the domestic action have the capability of being dispositive. He said it need not necessarily be dispositive. He maintained that the current domestic action meets that standard.
We will continue monitoring this case and report on any developments.