Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-14-01675/USCOURTS-ca13-14-01675-0/pdf.json

Parties Involved:
Celgard, LLC
Appellee
LG Chem America, Inc.
Appellant
LG Chem, Ltd.
Appellant

Document Text:

NOTE: This disposition is nonprecedential.

United States Court of Appeals 

for the Federal Circuit ______________________ 

CELGARD, LLC,

Plaintiff-Appellee

v.

LG CHEM, LTD., LG CHEM AMERICA, INC.,

Defendants-Appellants

______________________ 

2014-1675

______________________ 

Appeal from the United States District Court for the 

Western District of North Carolina in No. 3:14-cv-00043-

MOC-DCK, Judge Max O. Cogburn, Jr.

______________________ 

Decided: August 12, 2015

______________________ 

MARTIN RICHARD LUECK, Robins, Kaplan, Miller & 

Ciresi, LLP, Minneapolis, MN, argued for plaintiffappellee. Also represented ANDREW DOUGLAS HEDDEN,

JAMIE R. KURTZ; BRYAN J. VOGEL, Robins Kaplan LLP, 

New York, NY. 

MICHAEL J. MCKEON, Fish & Richardson, P.C., Washington, DC, argued for defendants-appellants. Also represented by KEVIN WHEELER, LEAH A. EDELMAN; JOHN A.

DRAGSETH, Minneapolis, MN. 

Case: 14-1675 Document: 120-2 Page: 1 Filed: 08/12/2015
2 CELGARD, LLC v. LG CHEM, LTD. 

MARK S. DAVIES, Orrick, Herrington & Sutcliffe LLP, 

Washington, DC, for intervenor Apple Inc. 

MARK MICHAEL SUPKO, Crowell & Moring, LLP, 

Washington, DC, for amicus curiae General Motors LLC. 

DOMINIC FRANCIS PERELLA, Hogan Lovells US LLP, 

Washington, DC, for amicus curiae Ford Motor Company. 

______________________ 

Before O’MALLEY, WALLACH, and HUGHES, Circuit 

Judges.

O’MALLEY, Circuit Judge. 

Celgard, LLC (“Celgard”) brought suit against LG 

Chem, Ltd. and LG Chem America, Inc. (collectively, 

“LG”) in the United States District Court for the Western 

District of North Carolina, asserting infringement of 

certain claims of U.S. Patent No. 6,432,586 (“the ’586 

patent”) and several state law claims. LG appeals the 

district court’s entry of a preliminary injunction prohibiting LG from making, using, selling, or offering for sale its 

products that potentially infringe the asserted claims in 

the ’586 patent. For the reasons explained below, we 

reverse the preliminary injunction and remand. 

I. BACKGROUND

From 2005 through 2008, Celgard supplied LG with 

uncoated “base films” for use in LG’s batteries for consumer-electronic products (“CE products”). LG would coat 

the Celgard base films with ceramic for use as “separators” in the batteries. The separators are used to separate 

the anode from the cathode in a battery. In 2008, the 

parties entered into discussions regarding Celgard becoming LG’s exclusive supplier of base films for batteries to be 

used in electric vehicles (“EVs”). It is undisputed that LG 

Case: 14-1675 Document: 120-2 Page: 2 Filed: 08/12/2015
CELGARD, LLC v. LG CHEM, LTD. 3

executed this ceramic coating process on the base films 

supplied by Celgard for both the CE products and EVs. 

The parties began negotiating the terms of a potential 

agreement, and the parties eventually agreed to a Memorandum of Understanding (“MOU”) in anticipation of 

entering into a long term supply agreement. After the 

parties entered into the MOU, however, the relationship 

between the parties began to fall apart over disputes 

about the price of the base films. In June 2014, LG gave 

Celgard notice that it was being phased out as a supplier 

for its EV program beginning in September 2013. Celgard 

sent its final shipment of base film to LG in July of 2013 

and then filed this suit in January 2014. 

LG moved to dismiss for lack of personal jurisdiction 

and improper venue, and Celgard moved for a preliminary 

injunction. In the same order, on July 18, 2014, the 

district court addressed both motions. Regarding LG’s 

motion to dismiss, without ruling on the merits, the 

district court allowed Celgard’s motion for jurisdictional 

discovery into whether LG had minimum contacts in 

North Carolina. The district court referred the case to the 

magistrate judge for limited discovery and disposition on 

the issue of personal jurisdiction. 

Turning to Celgard’s motion for a preliminary injunction, the district court performed the four-factor test for 

evaluating a motion for a preliminary injunction. Regarding the likelihood of success on the merits, the district 

court stated only that, “[h]aving reviewed [the] description of the claims detailed in the claim charts, it appears 

likely that the SRS sold, offered for sale, used, and imported into this country by defendant infringes at least 

claim 1 of the ’586 patent.” Celgard, LLC v. LG Chem, 

Ltd., No. 3:14-cv-43, 2014 WL 3699999, at *4 (W.D.N.C. 

July 18, 2014) (“Preliminary Injunction Order”). As to the 

second factor, the district court “concluded that if the 

alleged infringing activity were allowed to continue, it is 

Case: 14-1675 Document: 120-2 Page: 3 Filed: 08/12/2015
4 CELGARD, LLC v. LG CHEM, LTD. 

very likely that plaintiff will suffer irreparable harm in 

the absence of preliminary relief. This harm includes 

plaintiff losing goodwill, laying off employees, and loss of 

market share to at least some competitors who appear to 

be engaged in infringing activity.” Id. at *5. In balancing 

the equities for the third factor, the court considered LG’s 

right to source materials from the supplier with the 

lowest price and Celgard’s right to protect misappropriation of its patented technology. The district court found 

that, absent injunction, “plaintiff is likely to be shut out of 

[the] automotive marketplace,” whereas LG can simply 

pay a slightly higher cost to source its materials from 

Celgard with the injunction. Id. at *5.

With respect to the public interest, the district court 

explained that, although the public is interested “in being 

able to buy products at the lowest possible price through a 

free and robust market,” Celgard’s patent was “for a very 

important technological development that ultimately 

benefits consumers by allowing for the delivery of safe 

electric power to mobile devices by reducing the risk of 

fire posed by dendrite growth.” Id. The district court 

reasoned that an injunction that prevents an infringer 

from profiting from theft of protected technology is not a 

hardship because the law already prohibits his actions. 

Furthermore, the district court stated that it “has no 

reason to believe that defendant’s ability to produce goods 

will be in any way impacted as it appears that plaintiff is 

able to provide the products necessary for production.” Id. 

Because it concluded that all four factors weighed in favor 

of granting Celgard’s request for a preliminary injunction, 

the district court granted the motion. The court then 

stayed the injunction pending appeal. 

LG appeals the district court’s grant of Celgard’s motion for a preliminary injunction. We have jurisdiction 

over this interlocutory appeal under 28 U.S.C. 

§§ 1292(c)(1) and 1295(a)(1) (2012). 

Case: 14-1675 Document: 120-2 Page: 4 Filed: 08/12/2015
CELGARD, LLC v. LG CHEM, LTD. 5

II. DISCUSSION

We apply regional circuit law—here, Fourth Circuit

law—when reviewing a district court’s decision to grant a 

preliminary injunction. Abbott Labs. v. Sandoz, Inc., 544 

F.3d 1341, 1367 (Fed. Cir. 2008). The Fourth Circuit

reviews the district court’s decision for abuse of discretion. 

Pashby v. Delia, 709 F.3d 307, 319 (4th Cir. 2013). “Pursuant to this standard, we review the district court’s 

factual findings for clear error and review its legal conclusions de novo.” Id. As explained below, in this case, the 

district court abused its discretion granting Celgard’s 

motion for a preliminary injunction. 

A. Jurisdiction

LG argues that the district court legally erred by failing to consider whether it had personal jurisdiction over 

LG before granting the preliminary injunction. We agree. 

Although we subsumed the issue of a district court’s 

jurisdiction in the likelihood of success prong of the preliminary injunction test in the past, we also explained 

that “[f]ailing to consider [the district court’s jurisdiction] 

was legal error.” U.S. Ass’n of Importers & Textiles & 

Apparel v. U.S. Dep’t of Commerce (“USA-ITA”), 413 F.3d 

1344, 1348 (Fed. Cir. 2005). This is for good reason. A 

district court cannot enjoin a party if it does not have 

jurisdiction over that party. See, e.g., Enterprise Int’l, Inc. 

v. Corporacion Estatal Petrolera Ecuatoriana, 762 F.2d 

464, 471 (5th Cir. 1985) (“We hold, therefore, that the 

district court should not have issued the preliminary 

injunction against [the defendant] without determining 

whether it had jurisdiction over the party enjoined.”); cf. 

Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 711 n.1 (1982) (Powell, J., concurring) 

(“A district court must have personal jurisdiction over a 

party before it can enjoin its actions”). At a minimum, the 

district court must determine that there is a “substantial 

probability” that it has jurisdiction over the claim that 

Case: 14-1675 Document: 120-2 Page: 5 Filed: 08/12/2015
6 CELGARD, LLC v. LG CHEM, LTD. 

requires preliminary injunctive relief. United States v. 

First Nat’l City Bank, 379 U.S. 378, 390 (1965) (“It is 

basic to traditional notions of equity that[,] to justify the 

issuance of a protective temporary injunction[,] there 

must exist a substantial probability that jurisdiction, 

judgment, and enforcement will be obtained with respect 

to the person sought to be affected.” (emphasis added)).

In this case, the district court addressed LG’s motion 

to dismiss for lack of personal jurisdiction and Celgard’s 

motion for a preliminary injunction in the same order. 

Rather than resolve LG’s motion to dismiss, however, the 

district court allowed jurisdictional discovery and referred 

the case to the magistrate judge. Preliminary Injunction 

Order, 2014 WL 3699999, at *3–4. In other words, the 

district court did not determine whether it had personal 

jurisdiction over LG for the patent infringement claim 

before it issued the preliminary injunction. Nor did the 

district court determine whether there was a substantial 

probability that it had personal jurisdiction over LG for 

the patent infringement claim. See First Nat’l City Bank, 

379 U.S. at 390. Accordingly, because LG contested the 

district court’s jurisdiction, it was legal error for the 

district court to issue this injunction without making any 

findings with respect to its jurisdiction over LG. See 

USA-ITA, 413 F.3d at 1348. This alone requires that we 

at least vacate the preliminary injunction.1 

1 After briefing for this case was completed, on May 

21, 2015, the district court found that it had personal 

jurisdiction over LG for all of Celgard’s claims, including 

the patent infringement claim. Celgard, LLC v. LG 

Chem, Ltd., No. 3:14-cv-43, 2015 WL 2412467 (W.D.N.C. 

May 21, 2015). Although Celgard argued at oral argument that we should take judicial notice of this order and 

reach the merits of the district court’s personal jurisdiction order without further briefing from the parties, we 

 

Case: 14-1675 Document: 120-2 Page: 6 Filed: 08/12/2015
CELGARD, LLC v. LG CHEM, LTD. 7

B. The Preliminary Injunction

“A preliminary injunction is an extraordinary remedy 

never awarded as of right.” Winter v. Natural Res. Def. 

Council, Inc., 555 U.S. 7, 24 (2008). The party seeking a 

preliminary injunction must establish that “[1] he is likely 

to succeed on the merits, [2] that he is likely to suffer 

irreparable harm in the absence of preliminary relief, [3] 

that the balance of equities tips in his favor, and [4] that 

an injunction is in the public interest.” Id. at 20.

1. Likelihood of Success on the Merits

In discussing the likelihood of success of Celgard’s 

patent infringement claim, the district court only stated 

that, “[h]aving reviewed description of the claims detailed 

in the claim charts, it appears likely that the SRS sold, 

offered for sale, used, and imported into this country by 

defendant infringes at least claim 1 of the ’586 patent.” 

Preliminary Injunction Order, 2014 WL 3699999, at *3–4. 

This single sentence fails to construe the claims or make 

any findings of fact regarding infringement or invalidity. 

See Titan Tire Corp. v. Case New Holland, Inc., 566 F.3d 

1372, 1379 (Fed. Cir. 2009) (“Thus the trial court first 

must weigh the evidence both for and against validity 

that is available at this preliminary stage in the proceedings.”); Chamberlain Grp., Inc. v. Lear Corp., 516 F.3d 

1331, 1340 (Fed. Cir. 2008) (“Therefore, a correct claim 

construction is almost always a prerequisite for imposition of a preliminary injunction.”); Nutrition 21 v. United 

States, 930 F.2d 867, 869 (Fed. Cir. 1991) (“Sufficient 

factual findings on the material issues are necessary to 

allow this court to have a basis for meaningful review.”).

decline to do so. Oral Arg. at 23:17, Celgard, LLC v. LG 

Chem, Ltd., 2014-1675, available at, http://oralarguments.

cafc.uscourts.gov/default.aspx?/fl=2014-1675.mp3.

 

Case: 14-1675 Document: 120-2 Page: 7 Filed: 08/12/2015
8 CELGARD, LLC v. LG CHEM, LTD. 

We express no opinion regarding the likelihood of 

success of Celgard’s patent infringement claims. We 

merely hold that the district court’s single conclusory

sentence was insufficient to support its conclusion that 

Celgard was likely to succeed on the merits of its patent 

infringement claim. Like the district court’s failure to 

address its own jurisdiction prior to granting the preliminary injunction, the district court’s lack of findings on the 

likelihood of success prong also requires that we at least 

vacate the injunction.

2. Irreparable Harm

LG argues that Celgard failed to demonstrate a causal 

nexus between Celgard’s alleged harms and infringement 

of the ’586 patent. LG contends that it has been doing the 

same coating process for the batteries for its CE products

for years without any complaint by Celgard. We agree 

with LG that the district court improperly found that 

Celgard would suffer irreparable harm because of the 

alleged infringement. In addition to establishing that it 

will be at risk of irreparable harm, “the patentee must 

also establish that the harm is sufficiently related to the 

infringement.” Apple Inc. v. Samsung Elecs. Co. (“Apple 

II”), 695 F.3d 1370, 1373 (Fed. Cir. 2012). In other words, 

“[t]o show irreparable harm, it is necessary to show that 

the infringement caused harm in the first place.” Apple 

Inc. v. Samsung Elecs. Co. (“Apple I”), 678 F.3d 1314, 

1324 (Fed. Cir. 2012) (emphasis added).

In this case, even accepting the district court’s finding 

that Celgard will suffer irreparable harm, that harm is 

not caused by LG’s infringement of the patent. It is 

undisputed that the base film that Celgard sold to LG 

does not practice the ’586 patent. Indeed, Celgard does 

not sell any products that embody the claims in the ’586 

patent. See Oral Arg. at 20:38. LG creates the allegedly 

infringing separators using a coating method that it has 

used for years and that Celgard has known about since 

Case: 14-1675 Document: 120-2 Page: 8 Filed: 08/12/2015
CELGARD, LLC v. LG CHEM, LTD. 9

Celgard was LG’s base film supplier. Celgard does not 

claim it was harmed by those activities during that time 

frame. It is clear, accordingly, that all of the harm Celgard asserts it is now suffering stems, not from LG’s 

process of coating the base films to create the allegedly 

infringing separator, but from LG’s decision not to purchase base films from Celgard. 

In other words, Celgard is attempting to use the ’586 

patent, not to prevent LG from competing against its own 

product, but to mandate that LG purchase an unpatented 

component from Celgard. In its brief, Celgard makes 

clear that it is really trying to obtain the injunction to 

force LG to purchase base film from it. See Appellee’s Br. 

52–53 (“That success, in a separate market (A1427–34), 

does not remedy Celgard’s exclusion from [LG’s] 56% 

market share for ceramic-coated plug-in EV battery 

separators.”). Although a patent gives the patentee the 

legal right to exclude others from practicing his invention, 

it does not allow him to create a monopoly over an unclaimed component of that invention—here, the base film. 

See Abbott Labs. v. Sandoz, Inc., 566 F.3d 1282, 1298–98 

(Fed. Cir. 2009) (affirming the denial of a preliminary 

injunction because the claims did not cover the accused 

product). We understand Celgard’s assertions that LG 

has a large share of the EV battery field, and that some of 

LG’s batteries include separators that allegedly infringe 

claims of the ’586 patent, but Celgard’s alleged irreparable harm—“losing goodwill, laying off employees, and loss 

of market share,” Preliminary Injunction Order, 2014 WL 

3699999, at *5—is not caused by LG’s manufacture or 

sale of those allegedly infringing separators. All of these 

alleged harms are caused by LG’s decision not to use 

Celgard as its supplier for the unpatented base films.2

2 This, of course, does not preclude Celgard from obtaining a royalty if LG is found to infringe any of the 

 

Case: 14-1675 Document: 120-2 Page: 9 Filed: 08/12/2015
10 CELGARD, LLC v. LG CHEM, LTD. 

Celgard’s admission that LG has been creating infringing separators ever since Celgard began to supply 

base film to LG indicates that monetary damages are 

adequate. At oral argument, Celgard asserted that LG 

had an “implied license” to practice the ’586 patent when 

it purchased the base film from Celgard. Oral Arg. at 

15:16. In other words, Celgard’s position is that, in the 

past, it licensed LG to perform the same coating process 

that it now accuses of infringement. Celgard’s arguments 

that it will be irreparably harmed by LG’s continued use 

of that coating process—even though Celgard had impliedly licensed that activity in the past—are unpersuasive. Celgard insists that the past license was tied to LG’s 

purchase of Celgard’s base film, but Celgard acknowledged at oral argument that it cannot get a positive 

injunction to force LG to buy Celgard’s base film. See

Oral Arg. at 20:25. And, as mentioned earlier, Celgard 

cannot use the ’586 patent to redress alleged irreparable 

harm stemming from LG’s decision to purchase unpatented base film elsewhere. Accordingly, Celgard can be 

adequately compensated for LG’s use of the coating process to create allegedly infringing separators by money 

damages if the district court finds infringement.

Celgard has, therefore, failed to establish that it will 

suffer any irreparable harm caused by infringement of the 

claims in the ’586 patent. Indeed, the undisputed evidence shows that money damages are adequate to compensate Celgard for LG’s alleged infringement of the 

claims in the patent. Thus, the district court abused its 

discretion in determining that the irreparable harm factor 

favored granting the preliminary injunction. Because 

there is no irreparable harm attributable to infringement, 

which either Celgard or the district court has identified, 

claims in the ’586 patent. Nor does it limit the damages 

for any of Celgard’s state law claims.

 

Case: 14-1675 Document: 120-2 Page: 10 Filed: 08/12/2015
CELGARD, LLC v. LG CHEM, LTD. 11

this factor weighs strongly against the grant of a preliminary injunction.

3. Balance of the Equities

The district court also abused its discretion in balancing the equities. As explained above, Celgard’s harm that 

is caused by LG’s alleged infringement of the claims in 

the ’586 patent is adequately compensable by money 

damages. Furthermore, because Celgard does not sell any 

products that embody the claims in the ’586 patent, it will 

not be forced to compete against its own product. See

Robert Bosch LLC v. Pylon Mfg. Corp., 659 F.3d 1142, 

1156 (Fed. Cir. 2011) (“[R]equiring [the patentee] to 

compete against its own patented invention, with the 

resultant harms described above, places a substantial 

hardship on [the patentee].”). Celgard will, therefore, not 

be harmed if the district court does not enter the preliminary injunction because it can recoup adequate money 

damages if it successfully proves infringement. If, on the 

other hand, the district court were to enter a preliminary

injunction, LG may have to stop production or sales, 

which could affect its relationships with its customers. 

Accordingly, the balance of equities weighs against the 

entry of an injunction.

4. Public Interest

Additionally, the district court abused its discretion in 

finding that the public interest weighs in favor of granting 

the injunction. The public has a very strong interest in 

guaranteeing that innovative products are available in 

the market. As discussed above, Celgard does not produce any products that embody the claims in the ’586 

patent. If LG were enjoined, the public may be completely 

denied the availability of any products that practice this 

invention, which the district court characterized as “a 

very important technological development that ultimately 

benefits consumers.” Preliminary Injunction Order, 2014 

WL 3699999, at *5. For this reason, most injunctions 

Case: 14-1675 Document: 120-2 Page: 11 Filed: 08/12/2015
12 CELGARD, LLC v. LG CHEM, LTD. 

granted for patent infringement claims involve situations

where the patentee also practices the invention, so that 

the public will still have access to the patented technology. E.g., Tebro Mfg. v. Firefly Equip. LLC, 748 F.3d 1159 

(Fed. Cir. 2014); Douglas Dynamics, LLC v. Buyers Prods. 

Co., 717 F.3d 1336 (Fed. Cir. 2013). In this case, moreover, third party EV manufactures may also be negatively 

affected if LG is enjoined. See Br. of Amici Curiae General Motors LLC & Ford Motor Co., at 6–15; see also 

Broadcom Corp. v. Qualcomm Inc., 543 F.3d 683, 704 

(Fed. Cir. 2008) (considering the adverse effect on third 

party network carriers and manufacturers).

We therefore conclude that the public interest factor 

counsels against a preliminary injunction in this case.

* * * 

In sum, three of the four factors weigh against entering a preliminary injunction, including the irreparable 

harm factor, which weighs strongly against granting an 

injunction because Celgard has failed to claim any irreparable harm caused by the alleged infringement. No 

matter how the district court was to resolve the likelihood 

of success prong, our determinations on the other three 

factors precludes entry of a preliminary injunction. 

Accordingly, even though the district court failed to 

consider its jurisdiction over LG with respect to the 

patent infringement claim, and even though the district 

court did not adequately make findings regarding the 

likelihood of success, we hold that the district court erred 

in granting Celgard’s motion for a preliminary injunction

based on a proper analysis of the other three preliminary 

injunction factors. 

III. CONCLUSION

For the foregoing reasons, we reverse the district 

court’s entry of the preliminary injunction and remand for 

proceedings consistent with this opinion.

Case: 14-1675 Document: 120-2 Page: 12 Filed: 08/12/2015
CELGARD, LLC v. LG CHEM, LTD. 13

REVERSED AND REMANDED

Case: 14-1675 Document: 120-2 Page: 13 Filed: 08/12/2015