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The Court originally scheduled this matter for hearing. Upon review of the

parties’ papers, however, the Court finds that oral argument is not necessary. See E.D.

Mich. LR 7.1(e)(2).

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

SUNDANCE, INC. and 

MERLOT TARPAULIN AND

SIDEKIT MANUFACTURING CO., INC.,

Plaintiffs,

vs. Case No. 02-73543

DEMONTE FABRICATING LTD. and HON. AVERN COHN

QUICK DRAW TARPAULIN SYSTEMS, INC.,

Defendants.

_______________________________________/

MEMORANDUM AND ORDER

DENYING PLAINTIFFS’ MOTION FOR PERMANENT INJUNCTION1

I. Introduction

This is a patent case. Plaintiffs Sundance, Inc. and Merlot Tarpaulin and Sidekit

Manufacturing Company, Inc. (collectively, Sundance), holder of U.S. Patent No.

5,026,109 (the ‘109 patent) covering a Segmented Cover System, sued DeMonte

Fabricating, Ltd. and Quick Draw Tarpaulin Systems Inc. (collectively, DeMonte) for

infringement of the ‘109 patent. 

The case was tried to a jury. The jury found the patent invalid and infringed. The

Court set aside the jury’s verdict on invalidity. Before the Court is Sundance’s Motion

for Permanent Injunction. For the reasons that follow, the motion is DENIED.

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II. Background

The background of the patent and the case is well known to the parties and will

not be repeated. See Decision on Claim Construction, filed November 18, 2003, Joint

Pretrial Statement, filed April 4, 2006, Memorandum and Order Granting Plaintiffs’

Motion for Judgment as a Matter of Law or For a New Trial, filed September 20, 2006.

Background facts relevant to the instant motion follow.

The ‘109 patent issued in 1991. Also in 1991, DeMonte began manufacturing

and marketing rolling tarp systems for use on flatbed trailers which used a one-piece

tarp. In 1993, DeMonte switched to a segmented tarp systems. In 1997, DeMonte

began manufacturing and marketing the Quick Draw system.

In 2001, Sundance filed suit against DeMonte claiming that the Quick Draw

system infringes the ‘109 patent. 

Sundance seeks a permanent injunction against DeMonte which prevents it, and

all persons in active concert with it, from:

1. making, using, selling, offering for sale, and/or importing retractable

segmented cover systems used with a truck trailer, defined as: (1) the

Quick Draw system found infringing by the jury in Verdict Question 1;

and/or (2) insubstantially different retractable segmented cover systems

used with a truck trailer; or

2. otherwise infringing, inducing infringement of, or contributorily infringing

U.S. Patent No. 5,026,109.

The ‘109 patent expires in three years.

Sundance has licensed the ‘109 patent to companies that compete with

DeMonte.

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III. Analysis

A. Legal Standard

The Supreme Court recently made clear that when considering whether to award

permanent injunctive relief to a prevailing plaintiff in a patent infringement dispute,

courts should apply the traditional four-factor test used by courts of equity. See eBay,

Inc. v. MercExchange, LLC, --- U.S. ----, ----, 126 S.Ct. 1837, 1839, 164 L.Ed.2d 641

(2006). The prevailing plaintiff must demonstrate: “(1) that it has suffered an irreparable

injury; (2) that remedies available at law, such as monetary damages, are inadequate to

compensate for that injury; (3) that, considering the balance of hardships between the

plaintiff and defendant, a remedy in equity is warranted; and (4) that the public interest

would not be disserved by a permanent injunction.” Id. The Supreme Court held “the

decision whether to grant or deny injunctive relief rests within the equitable discretion of

the district courts, and that such discretion must be exercised consistent with traditional

principles of equity, in patent disputes no less than in other cases governed by such

standards.” Id. at 1841. For a further discussion of eBay, see Wendy R. Stein, The

Supreme Court eBay Decision: Eliminating Special Rules in Patent Cases, 13 Intell.

Prop. Today 18 (Oct. 2006).

B. Application

1. Irreparable harm

Sundance says that it will suffer irreparable harm in the absence of issuance of

an injunction because DeMonte competes with Sundance’s licensees who have been

placed at a competitive disadvantage due to DeMonte’s infringing sales. Essentially,

Sundance says that the nature of the marketplace for tarp systems for trucks is such

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The question of DeMonte’s infringement is still open. First, damages have yet to

be determined and are the subject of another trial and cross motions for partial

summary judgment on the issue of laches Second, DeMonte has filed a motion for

judgment as a matter of law seeking to set aside the jury’s verdict. Although Sundance

has yet to file a response, it appears that the motion is not without its difficulties.

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that an injunction is required. This argument is not persuasive. Not only did Sundance

delay in filing suit and seeking injunctive relief, the market for tarp systems contains

many other competitors and non-segmented cover systems have a larger percentage

over segmented systems. Moreover, as DeMonte points out, the segmented cover is

but one feature of its Quick Draw system. Thus, it cannot be said that Sundance’s

licensees are losing sales to DeMonte expressly because of its infringement of the

segmented cover. It is possible that lost sales are due to a desire for other features of

the Quick Draw system or are sales lost to other competitors in the marketplace. 

Sundance simply cannot tie alleged lost sales to the nature of DeMonte’s infringement.2

2. Adequacy of Remedies Available at Law

Sundance says that money damages are not adequate again because of the

nature of the competition between DeMonte and Sundance’s licensees. This fact does

not establish an inadequate remedy at law. Indeed, Sundance licenses the ‘109 patent

to others, and offered to license it to DeMonte prior to filing suit against it, thus

demonstrating that money damages are adequate. Their conduct against DeMonte and

others (Aero) indicates an interest only in obtaining money damages against accused

infringers.

3. Balance of Hardships

Sundance says that the hardships weigh in its favor because it has endured a

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trial and protracted reexamination proceedings and now has a verdict in their favor. 

DeMonte, however, says that it will suffer hardship if an injunction is entered, which

would affect it ability to compete with other tarp manufacturers and could force it out of

business. Under these circumstances, the balance of harms favors DeMonte.

4. Public Interest

Although the public has an interest in redressing infringement, due to the fact that

a injunction would harm third parties (DeMonte’s employees and customers) and given

the nature of the marketplace, this factor does not weigh in Sundance’s favor. 

SO ORDERED.

 s/Avern Cohn 

AVERN COHN

UNITED STATES DISTRICT JUDGE

Dated: January 4, 2007

I hereby certify that a copy of the foregoing document was mailed to the parties of

record on this date, January 4, 2007, by electronic and/or ordinary mail.

 s/Julie Owens 

Case Manager, (313) 234-5160

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