No Presumption of Irreparable Harm in Lanham Act Injunction Cases

Ferring Pharmaceuticals, Inc. v. Watson Pharmaceuticals,, Inc., 765 F.3d 205 (3d Cir. 2014). Plaintiff Ferring and defendant Watson (now known as Actavis, Inc.) are competing pharmaceutical companies. Each company markets a prescription progesterone product. Watson presented a webcast for medical professionals to promote Watson’s product, in the course of which statements were made about Ferring’s competing product. Ferring sued under the Lanham Act, 15 U.S.C. §1125(a), the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1 et seq., and common law, asserting that the statements made about Ferring’s product were false. Ferring sought a preliminary injunction to prevent Watson from making any more false statements about Ferring’s product and to compel Watson to present corrective advertising.

The district court denied the injunction, finding that Ferring was not entitled to a presumption of irreparable harm, one of the key elements for an injunction, and that without the presumption, Ferring had failed to show irreparable harm. Ferring appealed, and the Third Circuit affirmed in an opinion by Judge Chagares. The panel reviewed the denial of an injunction under the abuse of discretion standard, the district court’s findings of fact for clear error, and its conclusions of law under a plenary standard of review.

Prior to the decisions of the Supreme Court of the United States in eBay Inc. v. MercExchange, LLC, 547 U.S. 388 (2006), a patent case, and Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008), other Circuit Courts of Appeal had “applied a presumption of irreparable harm upon a showing of likelihood of success on the merits where a plaintiff seeks a preliminary injunction in a comparative false advertising case.” The Third Circuit itself had “repeatedly held, prior to eBay and Winter, that a plaintiff alleging a Lanham Act trademark infringement claim is entitled to a presumption of harm when she demonstrates a likelihood of success on the merits. See Kos Pharm., Inc. v. Andrx Corp., 369 F.3d 700, 726 (3d Cir. 2004).” [Disclosure: My firm, Lite DePalma Greenberg, LLC, represented the appellees in Kos].

But Judge Chagares concluded, in line with other cases, that eBay and Winter, which stated that “[i]ssuing a preliminary injunction based only on a possibility of irreparable harm is inconsitent with our characterization of injunctive relief as an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief,” changed the landscape. Those cases emphasized the need to apply “traditional equitable considerations” in evaluating injunction requests. “Because a presumption of irreparable harm deviates from the traditional principles of equity, which require a movant to demonstrate irreparable harm, we hold that there is no presumption of irreparable harm afforded to parties seeking injunctive relief in Lanham Act cases.” Judge Chagares rejected Ferring’s efforts to argue that Lanham Act case differ materially, for this purpose, from the patent context of eBay. He cited opinions from other Courts of Appeal that had reached the same conclusion.

Finally, the panel affirmed the district court’s conclusion that Ferring had not proven irreparable harm. The doctor who had made a misstatement about Ferring’s product in Watson’s webcast had removed the statement during a second webcast that same day, and had certified that he would never repeat the statement again. There was no evidence that the allegedly false statement from the first webcast was still available online. “Ferring has adduced no evidence that there is any risk that any Watson representative will make such statements, especially in light of the fact that Watson has conceded that certain of these statements were inaccurate, and that all of the statements at issue here were made by [the one doctor who had certified that he would not do so again].”