Indirect Competition Supports Finding of Irreparable Harm for Permanent Injunction

Following a jury trial, the court granted both plaintiffs' motion for a permanent injunction; both plaintiffs were irreparably harmed even though one did not practice the patent-in-suit. "[One plaintiff] directly competes with [defendant] for the same customers in the OEM market. . . . [A second plaintiff's] sales are bound at the hip to [the first plaintiff's] sales, such that when [the first's] sales to OEMs lag, [the second] feels the pain. Thus, even though [the second plaintiff] does not practice the [patent], its tire repair kits directly compete with [defendant's] infringing repair kits. The only significant dispute here is whether the patentee [the second plaintiff] can be irreparably harmed by infringing sales even though it competes with [defendant] through an intermediary ([the first plaintiff]). . . . [I]ndirect competition generally can support a finding of irreparable harm. Here, it is clear that [the second plaintiff] and [defendant] compete for the same market – even if indirectly. . . . [F]ewer sales for [the first plaintiff] mean fewer sales for [the second]. [The second plaintiff] thus has lost market share to [defendant], favoring a finding of irreparable injury."

Accessories Marketing, Inc. v. Tek Corporation, 5-11-cv-00774 (CAND March 7, 2014, Order) (Grewal, M.J.)