A non-party must be sufficiently “legally identified” with the an enjoined party to be enjoined for conduct other than abetting a new violation
At trial, the patentee received a judgment of infringement and no invalidity—as well as a damages award. Along with its rulings on post-trial motions, the district court entered a permanent injunction against the alleged infringer. However, the injunction was entered against not only the exclusive distributor that participated in the trial, but also against the supplier that had been dismissed by stipulation prior to trial and that had not been adjudicated liable for infringement. The supplier intervened and both appealed the injunction and the district court’s post-trial rulings. After the Federal Circuit ruled, a petition for rehearing was granted, and the original opinion was corrected.
The Federal Circuit affirmed the post-trial rulings as to infringement, obviousness, and damages. As to the injunction, the Federal Circuit addressed two arguments. The court first found that there was no error in applying the injunction to the supplier even though the claims against it had been dismissed with prejudice. The Federal Circuit held that the injunction addressed future conduct, which is not the same “claim” as that which had been dismissed and, thus, is not barred by claim preclusion principles. As to the second argument, however, the Federal Circuit remanded the case to address the proper scope of the injunction because it reached conduct by the supplier that does not abet a new violation by the party distributor. The Federal Circuit held that, because the supplier had not been held liable for infringement, further proceedings were warranted to determine whether the supplier could be “legally identified” with the party distributor such that it should be subject to the injunction for conduct other than abetting a new violation. Examples of situations in which a non-party is “legally identified” with the party infringer include where the party’s litigation is sufficiently controlled by the non-party, or where the non-party can be said to be a “successor” to the party.