Tuesday, October 18, 2011

Interlocutory Injunctions in Australia

Apple v Samsung Electronics [2011] FCA 1164 (Aus)

In my article Interlocutory Injunctions and Irreparable Harm in the Federal Courts, 88(3) Can Bar Rev 515, I argued that the threshold for irreparable harm imposed in the Federal Courts is too high. My review of the Chancery cases in which the concept developed showed that adequacy of damages did not have a distinct role: “[w]hen the courts of equity declined to provide a remedy to the plaintiff, they would often say that this was because the remedies at law were adequate, but this was in effect a statement of the conclusion on the balance of convenience, rather than a distinct condition precedent to taking jurisdiction.” Accordingly, it would be preferable to abandon the requirement of irreparable harm entirely.

Because my review was historical, I neglected comparative law. In particular, I am embarrassed to admit that I was entirely unaware of the extremely interesting approach long taken by the High Court of Australia, which was brought to my attention by the recent decision of the Australian Federal Court in Apple v Samsung Electronics [2011] FCA 1164, reported by IPKat here. The law applied in that case derives from the decision of the High Court in Beecham Group v Bristol Laboratories [1968] HCA 1, a patent case. Beecham established a two-part test for an interlocutory injunction, which considered the probability of success and the balance of convenience; irreparable harm is not a factor at all. It is notable that this test was based directly on an analysis of the original Chancery jurisprudence. In Australian Broadcasting Corporation v O’Neill [2006] HCA 46 Gummow and Hayne JJ at [65]-[72] affirmed this test. Their opinion explained further that the assessment of the merits did not require a showing that it was more likely than not that the plaintiff would succeed; in this the decision was consistent with Lord Diplock’s speech in Cyanamid [1975] A.C. 396. However, the High Court expressly rejected Lord Diplock’s holding that the court need only be satisfied that the plaintiff’s claim is not frivolous or vexatious, for the very good reason that Lord Diplock’s statements “obscure the governing consideration that the requisite strength of the probability of ultimate success depends upon the nature of the rights asserted and the practical consequences likely to flow from the interlocutory order sought.”

In my Irreparable Harm article I argued that the correct overarching principle is the “lower risk of injustice” stated by Hoffmann J in Films Rover International v Cannon Film Sales [1986] 3 All E.R. 772 at 780 (Ch.):

The principal dilemma about the grant of interlocutory injunctions. . . is that there is by definition a risk that the court may make the ‘wrong’ decision. . . . A fundamental principle is therefore that the court should take whichever course appears to carry the lower risk of injustice if it should turn out to have been ‘wrong.’

The general Australian approach, as I now understand it, is consistent with this principle, and seems entirely sound. The Beecham decision also had some very interesting specific guidelines regarding patent cases in particular. I regret that neglected this important jurisprudence when I wrote my article.

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