## Facts

- Hughes owned two patents covering oil-and-gas “rock bits” with sealed journal/roller bearings and a pressure relief valve: U.S. Patent Nos. 3,397,928 (1968) and 3,476,195 (1969).
- Smith manufactured and sold “F-series solid journal bearing bits,” which Hughes asserted practiced the patented inventions.
- Smith admitted it infringed both patents and admitted it was continuing to infringe.
- Smith filed a declaratory judgment action in the Central District of California challenging the ’928 patent’s validity; Hughes counterclaimed for infringement of both patents, and Smith defended on invalidity.
- The district court held both patents invalid and dismissed Hughes’s infringement counterclaims.
- The Ninth Circuit reversed, held both patents valid, and reinstated Hughes’s infringement counterclaims.
- On remand, Hughes moved for a preliminary injunction to stop Smith’s ongoing infringement; the district court denied the motion, citing insufficient evidence of the extent of infringement and resulting harm.

## Issues

1. Whether the district court abused its discretion by denying a preliminary injunction against Smith’s admitted, ongoing infringement of patents already upheld as valid on appeal.
2. Whether, given adjudicated validity and admitted infringement, Hughes made a sufficient showing of irreparable harm, balance of hardships, and public interest to warrant preliminary injunctive relief.

## Decision

- The Federal Circuit reversed the order denying the preliminary injunction.
- The court held the denial was an abuse of discretion under the preliminary injunction factors.
- The case was remanded with instructions to issue a preliminary injunction barring further infringement of the ’928 and ’195 patents.

## Legal Principles

- A preliminary injunction in a patent case is assessed under four factors: (1) likelihood of success on the merits, (2) irreparable harm absent an injunction, (3) balance of hardships, and (4) public interest.
- When patent validity has been upheld and infringement is admitted, the patentee’s likelihood of success is exceptionally strong; the inquiry should not be diluted by requiring proof of the “extent” of infringement as a substitute for the established merits.
- Continued, unauthorized sales by a direct competitor of a product embodying the patent support a strong inference of irreparable harm, including loss of exclusivity, market share, and price effects not readily repaired by money damages.
- In balancing hardships, harm from being required to stop infringing generally carries little weight where the infringer elects to continue infringing after validity is established.
- The public interest generally favors enforcement of valid patents and protection of the right to exclude during ongoing litigation.

## Conclusion

The Federal Circuit required preliminary injunctive relief because the patents’ validity had already been sustained and Smith admitted ongoing infringement, making Hughes’s showing on likelihood of success and irreparable harm sufficiently strong to render denial of an injunction an abuse of discretion.


Smith Int’l, Inc. v. Hughes Tool Co., 718 F.2d 1573 (Fed. Cir. 1983)