This Note proposes a new framework for the Federal Circuit to use when deciding whether to stay an injunction pending appeal in patent cases. The new framework would allow the court to clearly and quickly articulate the reasons for its decision while still taking into account the interests of all parties and the public. More important, even if the court continues to issue brief, conclusory orders like the one in the i4i case, the new framework would be structured so that the legal community could infer fairly easily how the court came to its conclusion. Further, the new framework would rely on recent changes in the law as well as the current state of the patent landscape to create a more workable solution.
The proposed framework requires the Federal Circuit to stay an injunction pending appeal according to one of two distinct standards. Under the first standard, a court must grant a stay pending appeal whenever the stay applicant demonstrates (1) a high likelihood that the district court erred with respect to a close or complex question of claim construction, and (2) that the applicant will succeed on appeal once that error is resolved. If the stay applicant cannot satisfy the first standard, the second standard requires a court to grant a stay pending appeal when the stay applicant demonstrates (1) a high likelihood that the district court erred with respect to any other close or complex question of law (other than claim construction), (2) that the applicant will succeed on appeal once the error is resolved, and (3) that a balancing of the interests of all parties overcomes a rebuttable presumption that the stay should not be granted.
Part I of this Note provides a background of the tests used for granting and staying injunctions in patent law and describes how the test for staying an injunction is duplicative of the test for granting the injunction in the first place. Part II discusses the current patent landscape, including two issues of importance: (1) the relationship between claim construction errors and the high reversal rate of patent infringement cases at the Federal Circuit, and (2) the increasing number of nonpracticing entities—companies that own patents but do not manufacture any actual products. Part II also discusses the importance of these two issues when determining whether the court should stay an injunction pending appeal. Part III discusses previously proposed changes to the law governing stays of injunctions and describes the shortcomings of these proposals. Part IV proposes a new framework for staying injunctions pending appeal in patent cases, applies the framework to the i4i case, and addresses possible criticisms of the framework.