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Genband US LLC v. Metaswitch Networks Corp.

Remand Needed to Ensure that Trial Court Did Not Apply Too Rigorous a “Causal Nexus” Standard

Genband US LLC v. Metaswitch Networks Corp., (Fed. Cir. July 10, 2017) (Lourie, TARANTO, Chen) (E.D. Tex.: Gilstrap) (3 of 5 stars)

Fed Cir vacates order denying permanent injunction and remands. The district court’s analysis of irreparable harm, and specifically its determination that Genband had failed to show that the patented features drive demand for the infringing product, was unclear as to whether it was properly applying the “causal nexus” standard. Per Apple III, 735 F.3d 1352 (Fed. Cir. 2013), and Apple IV, 809 F.3d 633 (Fed. Cir. 2015), Genband’s burden was to show that the patented features were “‘a driver’ [for demand] as opposed to ‘the driver,’ applied in the multi-consumer, multi-feature context[.]” Op. at 7. The opinion recites some of the Fed Cir’s recent caselaw (notably the various Apple-Samsung cases) to support this statement of the proper standard. Because the district court’s opinion was unclear as to whether it had properly applied this standard, or had improperly applied a more rigorous standard, remand is necessary. “We are not in a position to conclude that applying the Apple III/Apple IV standards would make no difference to the district court’s finding of no causal nexus and, hence, no irreparable injury.” Op. at 12. The opinion declines to affirm based on the district court’s determination of no irreparable harm due to Genband’s delay in filing suit. That issue is included in the remand, because the assessment of whether and how the patented features drive demand might affect how the district court views the timing of Genband’s suit.

KEYWORDS: PERMANENT INJUNCTION; IRREPARABLE HARM; CAUSAL NEXUS