Liqwd v. L’Oreal is a nonprecedential opinion decided on January 16, 2018 on appeal from the District of Delaware. The asserted patent described a method of bleaching hair by applying to the hair a particular mixture. The district court denied Liqwd’s motion for a preliminary injunction after claim construction. Because the adopted construction excluded defendant L’Oreal’s products, the court concluded that Liqwd’s had failed to show a likelihood of success on the merits of its infringement claims, but found in plaintiffs’ favor on irreparable harm and balance of the equities. Both sides appealed.
The Federal Circuit vacated the denial of a preliminary injunction and remanded.
“It is the patent holder’s burden, when moving for a preliminary injunction, to establish a likelihood of success on the merits. If the alleged infringer presents a substantial question of invalidity, and the patent holder does not establish the likely lack of merit of the invalidity contention, the preliminary injunction should not issue.”
The district court clearly erred in finding no likelihood of success on direct infringement by relying on a flawed claim construction. If a “court’s decision to grant or deny a preliminary injunction hinges on questions of law,” the Federal Circuit’s review is “de novo.” The denial of the preliminary injunction was thus vacated as to direct infringement.
The Federal Circuit also vacated the denial of the preliminary injunction as to induced infringement. “[T]he point of a preliminary injunction is to provide prospective relief by stopping the ongoing conduct, whose wrongfulness depends on the facts at the time it would occur unless enjoined.” Thus, to obtain a preliminary injunction, plaintiffs needn’t show that it is reasonably likely to succeed in proving that L’Oreal knew, before the suit began, that its instruction for use would induce infringement. Rather, plaintiffs must only show that they are “reasonably likely to succeed in proving that the instructions for use induce infringement and that L’Oreal knows, at the time a preliminary injunction is to take effect, that the instructions for use will induce infringement.” On remand, the district court will reconsider the knowledge element for inducement in light of the new claim construction.
The Federal Circuit found that L’Oreal had not shown a substantial question as to invalidity for indefiniteness or obviousness.
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The district court didn’t err when it determined that plaintiffs would likely suffer irreparable harm, or in finding that the balance of the hardships favored plaintiffs. The district court found that the relevant market was a “two-player national market” and that plaintiffs would likely suffer irreparable harm from “L’Oreal’s direct competition in its primary market.” The district court didn’t clearly err in crediting plaintiffs’ expert over L’Oreal’s expert.
The Federal Circuit gave no weight to the district court determination that “the public interest is not served by protecting valid patents as against noninfringing uses” because the determination rested “on the district court’s erroneous claim-construction and noninfringement analysis.”
Liqwd, Inc. v. L’Oréal USA, Inc., 720 F. App’x 623 (Fed. Cir. 2018)