The continuing vitality of the presumption of irreparable harm in copyright cases.

• Author: Spillane, Andrew F.

INTRODUCTION I. REFINING SECTION 502(A)'S GRANT OF POWER INTO THE TRADITIONAL RULE A. Section 502(a) Creating the Ambiguity with Permissive Plain Language B. Legislative History Deepening the Ambiguity with Conflicts between Entitlement and Discretion 1. Suggesting Discretion by Rebutting Section 101's Entitlement Language with Court Practice 2. Pointing Toward Discretion in the Register's Report 3. Almost Confirming Discretion but Also Noting Entitlement in House Report 1476 C. Caselaw Replacing the Legislative Ambiguity with the Traditional Rule II. REINTRODUCING AMBIGUITY FASHIONED AS DISCRETION: EBAY V. MERCEXCHANGE AND SUBSEQUENT DECISIONS A. eBay v. MercExchange's Series of Multi-Factor Tests 1. The Battle of Presumptions on the Path to the Supreme Court 2. The Supreme Court's Oral Musings on Irreparable Harm 3. The Supreme Court's Decision in Favor of Discretion and Tradition 4. The District Court's Construing the eBay Holding as a Rejection of the Presumption of Irreparable Harm B. The Split of Authority Grappling with the Presumption after eBay v. MercExchange 1. Cases Rejecting the Presumption of Irreparable Harm 2. Cases Retaining the Presumption of Irreparable Harm III. USING THE TRADITIONAL RULE AS A BLUEPRINT: WHY THE COURTS SHOULD CONTINUE TO PRESUME IRREPARABLE HARM A. Protecting Copyright's Property Right to Exclude B. Judicial Distrust of Defendant's Assertions of Voluntary Cessation C. The Interdependent Relationship between Rights and Remedies D. Conserving Judicial Resources by Recognizing Trends E. Allowing General Rules while Prohibiting Categorical Rules F. Following the History and Tradition of Equity Practice . CONCLUSION INTRODUCTION

Permanent injunctions are powerful remedies. Compared to other forms of relief, they can even be called extraordinary. (1) When entered, they order defendants to cease the conduct that created their liability absolutely. Paired with the threat of contempt, parties who contravene them risk criminal condemnation. In a sense, a plaintiff requesting injunctive relief is effectively asking the court to draft a criminal statute for that single plaintiff's benefit and to that single defendant's detriment. (2) Given permanent injunctions' potency, it should come as no surprise that some believe that courts should reserve injunctions for only the most exceptional circumstances. (3)

Yet, judicial reluctance to grant permanent injunctions is not mandated by the Copyright Act. To the contrary, 17 U.S.C. [section] 502(a) confers upon the courts the authority to enjoin copyright infringement, (4) while largely failing to provide direction on how that authority should be exercised. More specifically, the statute's text lacks description of the scope of the power to order permanent injunctions and how frequently it should be invoked. (5) Absent further guidance from the statute's legislative history, (6) the only tools available to courts deciding whether to permanently enjoin copyright infringement are [section] 502(a)'s ambiguous text (7) and the history and traditions of equity. (8)

The task of articulating the principles guiding judicial discretion to order permanent injunctions has thus fallen on the courts. Following the 1976 Act's enactment, the courts have roundly held that liability for infringement plus a threat of future infringement entitled copyright owners to permanent relief, without any burden on the copyright owner to demonstrate irreparable harm. (9) This rule has been a boon for plaintiffs, with courts routinely entering permanent injunctions after finding defendants liable for copyright infringement. (10)

The traditional rule, however, no longer enjoys nearly universal acceptance (11) as courts begin to apply the Supreme Court's majority opinion in eBay v. MercExchange. (12) In that case, the Supreme Court unanimously held that plaintiffs in patent infringement suits "must satisfy a four-factor test before a court may grant" a permanent injunction, (13) the first factor being "that [the plaintiff] has suffered an irreparable injury." (14) Though the lower federal courts have split on how this decision affects the presumption of irreparable harm in copyright infringement suits, their approaches have largely turned on whether to reject or retain the presumption in its entirety. (15) As evinced by this split of authority, eBay has led the courts back to the ambiguity and inconsistencies left by [section] 502(a) and its legislative history, leaving plaintiffs and defendants in danger of potentially ad hoc decision making masquerading as equitable discretion.

To regain the traditional rule's clarity and predictability while faithfully adhering to the Supreme Court's ruling in eBay, the courts should graft a rebuttable presumption of irreparable harm onto the first eBay factor. Given copyright's nature as a property-esque right to exclude, (16) forcing a plaintiff to prove irreparable harm would carve out an exception to Anglo-American law's traditional stance that interference with property usually calls for injunctive relief. (17) Without an order imposing criminal sanctions, a mere damage award would effectively license the infringing behavior, allowing copyright defendants to infringe a copyright owner's exclusive rights as long as those defendants are willing and able to pay the consequential and statutory damages. (18) Such judicial licensing would shoulder owners with the constant burden of policing their copyrights, despite prior adjudication of infringement. (19) Moreover, if copyright plaintiffs bear the burden of proof, defendants would only need to rebut the plaintiff's case to prevail, (20) thereby failing to address the courts' general distrust that defendants will follow through on their promises to stop infringing. (21) In addition to conserving judicial resources by presuming that the facts of any specific case are much like other run-of-the-mill copyright suits until proven otherwise, (22) this rule comports with the history and traditions of equity practice (23) that eBay pushes the courts to follow. (24)

This Comment will begin with Part I examining the legislative sources of the courts' power to issue permanent injunctions in copyright cases and will lay out the traditional rule on permanent injunctions predating eBay. Part II will trace eBay v. MercExchange's progression through the federal courts, the rules adopted throughout the eBay litigation, and how the lower federal courts have split in applying the Supreme Court's holding in eBay to copyright infringement suits. Against this background, Part III will propose that courts adopt a rebuttable presumption of irreparable harm to copyright cases, after critiquing arguments against the presumption of irreparable harm and explaining the traditional rule's theoretical, prudential, and historical justifications.

1. REFINING SECTION 502(A)'S GRANT OF POWER INTO THE TRADITIONAL RULE

   1. Section 502(a) Creating the Ambiguity with Permissive Plain Language

      According to 17 U.S.C. [section] 502(a), "[a]ny court having jurisdiction of a civil action arising under this title may, subject to the provisions of section 1498 of title 28, grant temporary and final injunctions on such terms as it may deem reasonable to prevent or restrain infringement of a copyright." (25)

      The Supreme Court has treated this statute as the source of federal court power to issue injunctive relief. (26) The courts' power to do so is demonstrated, from a textual reading, by the word "may." (27) Not only does this word show that courts have the raw power to issue injunctions, but that same word also implies judicial discretion. (28) Conversely, the statute's text does not mandate that courts issue injunctions after finding infringement. Ascribing that meaning to the statute would replace the first "may" with the word "shall." (29) Language placed after this first "may" further confirms this discretion in that the words allow courts to issue injunctions on terms that they "may deem reasonable." (30)

      Though [section] 502(a) has left this discretion's scope largely unspecified, the statute does outline two instances in which injunctive relief would be available: "to prevent or restrain infringement." (31) The word "prevent" by necessity is limited to future infringement: one cannot "prevent" a past or a present act. (32) The word "restrain," by contrast, has broader definitional range. To be sure, to "restrain" someone would incapacitate them from performing future acts, (33) but restraint also results in a present inhibition--an inability to do something contemporaneous to the initial restraint itself. (34) In any event, one cannot restrain in the present a completed past act. Therefore, [section] 502(a)'s text appears to exclude past infringement with no threat of recurrence from this judicial remedial power's coverage. (35) Beyond this language, however, the statute does not define the courts' authority to order permanent relief any further. (36)

   2. Legislative History Deepening the Ambiguity with Conflicts between Entitlement and Discretion

      1. Suggesting Discretion by Rebutting Section 101's Entitlement Language with Court Practice

         Where [section] 502(a)'s text leaves off, the 1976 Copyright Act's legislative history does more to cloud than to clarify how readily attainable injunctive relief ought to be. For example, [section] 101 of the Copyright Act of 1909 states that "[i]f any person shall infringe the copyright in any work protected under the copyright laws of the United States such person shall be liable ... [t]o an injunction restraining such infringement." (37) This statute creates confusion with its use of the word "shall." As noted above, the word "shall" typically signifies a legislative mandate; that is, the subject of the sentence containing "shall" must perform the action described by whatever that word precedes. (38) On this reading, a court would theoretically be bound by the 1909 Act to order...