On December 27, 2020, as part of stimulus package approved by Congress, the Trademark Modernization Act (TMA) was signed into law. This law revived the presumption of irreparable harm for trademark owners against trademark infringers.

Prior to 2006, trademark owners enjoyed a presumption of irreparable harm when infringement was proven. Then the U.S. Supreme Court decided eBay, Inc. v. MercExchange, which was not a trademark case, but rather a case involving patent infringement. In eBay, the Court changed the historical presumption of irreparable harm for patent owners who proved infringement, which normally entitled the patent owner to a permanent injunction, to a burden of proof for the patent owner before an injunction could issue.

Following eBay, a split developed among the Circuit Courts as to whether irreparable harm was a presumption or a proof issue in trademark infringement cases. The 3rd, 9th, and 11th Circuits held that there was no such presumption. The 5th and 8th Circuits allowed the presumption. The 1st and 2nd Circuits questioned the presumption, without ruling whether it was alive or dead. So injunctions for trademark owners often depended on where the suit was filed, due to the inconsistencies between the Circuits.

The TMA resolved the dispute by codifying the presumption of irreparable harm to trademark owners. This presumption, set forth in the Lanham Act, 15 U.S.C. Section 1116(a), clarifies that a rebuttable presumption of harm applies upon a finding of infringement for purposes of a permanent injunction. Section 1116(a) also allows the rebuttable presumption upon a finding of likelihood of success on the merits for purposes of a preliminary injunction.

Thus, the TMA should make it easier for trademark owners to obtain preliminary and permanent injunctions when infringement is established or is likely to be established.