Summary: The CAFC reversed the finding of civil contempt and vacated the injunction.

Case: Energy Recovery, Inc. v. Hauge, No. 2013-1515, (Fed. Cir. Mar. 20, 2014) (precedential). On appeal from E.D. Va.  Before Rader, Reyna, and Wallach.

Procedural Posture: Defendant appealed a finding of civil contempt and the accompanying injunction. CAFC reversed and vacated.

  • Contempt: The district court abused its discretion in finding civil contempt of its order, which settled litigation and required Mr. Hauge to transfer ownership of certain patents and other existing intellectual property related to pressure exchange technology, and to not compete for a two year period. Mr. Hauge did not violate the court order by developing and commercializing technology and filing a patent application after the expiration of the non-compete period. The injunction based on the contempt order was also vacated.