Thursday, April 30, 2015

Price Erosion, Loss of Market Share, and Difficulty Collecting Damages Establish Irreparable Harm Supporting Preliminary Injunction

The court granted plaintiff's motion for a preliminary injunction prohibiting the sale of two defendants' accused LED fixtures because plaintiff established irreparable harm through price erosion, loss of market share/position, and difficulty in collecting damages from foreign defendants. "After [defendants] entered the market, Home Depot demanded price reductions, which lowered [plaintiff's] wholesale price [by] approximately 22 percent. . . . Home Depot specifically requested that [plaintiff] lower its price so that Home Depot could lower its retail price point in response to the accused products being sold through Lowe’s. . . . [Plaintiff] also explains that it is difficult for manufacturers in the industry to raise prices once customers have received lower prices. . . . [Defendant] is a foreign corporation, presumably with most of its assets located overseas. Therefore, it is likely that [plaintiff] would face significant difficulty in collecting damages even if it prevailed at trial. The potential difficulty inherent in collecting damages from a foreign defendant with limited assets in the United States supports a finding of irreparable harm."

Cordelia Lighting, Inc. v. Zhejiang Yankon Group Co., Ltd et al, 5-14-cv-00881 (CACD April 27, 2015, Order) (Bernal, J.)

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