NOTE: This disposition is nonprecedential. 

United States Court of Appeals for the Federal Circuit 

2006-1615 

CANON, INC., 

Plaintiff-Appellee, 

v. 

GCC INTERNATIONAL LIMITED, GCC MANAGEMENT LIMITED, 

GATEHILL INTERNATIONAL LIMITED, Q-IMAGING (USA), INC., 

and TALLYGENICOM LP, 

Defendants-Appellants. 

Nicholas M. Cannella, Fitzpatrick, Cella, Harper & Scinto, of New York, New 

York, argued for plaintiff-appellee. With him on the brief were Brian V. Slater, and 

Joseph B. Divinagracia. Of counsel on the brief was Edmund J. Haughey, of 

Washington, DC. 

Michael N. Rader, Wolf, Greenfield & Sacks, P.C., of Boston, Massachusetts, 

argued for defendants-appellants. With him on the brief were Michael A. Albert and 

James J. Foster. 

Appealed from: United States District Court for the Southern District of New York 

Judge P. Kevin Castel 
NOTE: This disposition is nonprecedential.

United States Court of Appeals for the Federal Circuit 

2006-1615 

CANON, INC., 

Plaintiff-Appellee, 

v. 

GCC INTERNATIONAL LIMITED, GCC MANAGEMENT LIMITED, 

GATEHILL INTERNATIONAL LIMITED, Q-IMAGING (USA) INC., and 

TALLYGENICOM LP, 

Defendants-Appellants. 

Appeal from the United States District Court for the Southern District of New York in 

case no. 06-CV-3324, Judge P. Kevin Castel. 

__________________________ 

DECIDED: January 25, 2008 

__________________________ 

Before MICHEL, Chief Judge, DYK, Circuit Judge, and GARBIS, District Judge.

*

GARBIS, District Judge. 

Plaintiff Canon, Inc. ("Canon") sued GCC International Limited, GCC 

Management Limited, Gatehill International Limited, Q-Imaging (USA) Inc., and 

TallyGenicom LP (collectively, "Defendants") for infringement of U.S. Patent No. 

6,336,018 ("the '018 Patent"), entitled "Electrophotographic Image Forming Apparatus, 

Process Cartridge, and Drive Mount for Photosensitive Drum." 

 *

 Honorable Marvin J. Garbis, Senior District Judge, United States District 

Court for the District of Maryland, sitting by designation. 
2006-1615 2 

On August 29, 2006, the district court issued its Memorandum and Order 

granting Canon a Preliminary Injunction enjoining Defendants from, among other things, 

"making, using, offering for sale, or selling in the United States, or importing into the 

United States, any product that falls within the scope of claim 58 of U.S. Patent No. 

6,336,018, including, without limitation, [certain identified] toner cartridges . . . ." Canon 

Inc. v. GCC Int'l Ltd., No. 06-3324 (S.D.N.Y. Aug. 29, 2006). 

Defendants appeal from the grant of a preliminary injunction.1

 For the reasons 

discussed herein, this court determines that the district court did not abuse its discretion 

and, therefore, affirms. 

I. BACKGROUND 

At all times relevant hereto, Canon has engaged in the business of producing 

and selling, inter alia, laser printers and laser fax machines with replaceable toner 

cartridges. A user purchasing a Canon printer receives the printer with a replaceable 

toner cartridge. When the toner in the cartridge is exhausted, the user can easily 

remove and replace the exhausted toner cartridge. The sale of replacement toner 

cartridges is a profitable aspect of Canon's business. 

At all times relevant hereto, Defendants have engaged in the business of selling 

(among many other products) toner cartridges that can be used as replacements in 

Canon laser printers and laser fax machines. 

Canon is the assignee of the '018 Patent. Claim 58 of the '018 Patent claims: 

A process cartridge detachably mountable to a main assembly of an 

electrophotographic image forming apparatus, wherein said main 

 1

 Defendants also seek reversal of the District Court's denial of their motion 

for summary judgment. However, the denial of summary judgment was not an 

appealable Order and will not be addressed herein. 
assembly includes a motor, a driving rotatable member for receiving 

driving force from said motor, and a hole defined by twisted surfaces, said 

hole being substantially coaxial with said driving rotatable member, said 

process cartridge comprising: 

a cartridge frame; 

an electrophotographic photosensitive drum; 

process means actable on said photosensitive drum, said process means 

including a developing roller for developing a latent image formed on said 

photosensitive drum, and a charging member for electrically charging said 

photosensitive drum; 

a projection provided at a longitudinal end of said photosensitive drum, 

wherein said projection has an engaging portion for engagement with the 

twisted surfaces and a supporting portion for supporting said engaging 

portion, wherein said end of said photosensitive drum is provided with a 

shaft for supporting said photosensitive drum on said cartridge frame, and 

said engaging portion is supported on said shaft by said supporting 

portion, and a cross section of said supporting portion in a direction 

crossing with a longitudinal direction of said photosensitive drum is smaller 

than a cross section of said engaging portion, and said supporting portion 

is capable of entering said hole, and wherein when said driving rotatable 

member rotates with said hole, and said engaging portion of said 

projection engaged with each other, rotational driving force is transmitted 

from said driving rotatable member to said photosensitive drum through 

engagement between said hole and said projection, and said projection is 

urged inwardly of said hole, wherein said engaging portion is contacted to 

said twisted surfaces at least three points, and wherein said end of said 

photosensitive drum is provided with a drum gear which is effective to 

transmit a driving force received by said engaging portion from the main 

assembly to said developing roller. 

 Canon asserts that Defendants' toner cartridges ("the Accused Products"), 

usable in Canon laser printers and laser fax machines, infringe Claim 58 of the '018 

Patent. 

 Defendants sought an early claim construction holding that Claim 58 covers the 

combination of a "main assembly" consisting, according to Defendants, of the entire 

printer or fax machine with a toner cartridge. Defendants contend that if Claim 58 is so 

2006-1615 3 
construed, they would not infringe Claim 58 because they sell only the cartridge, not the 

combination. Accordingly, Defendants assert that their production and sale of the 

accused toner cartridges would not infringe Claim 58 by virtue of the doctrine of 

permissible repair. Under the doctrine of permissible repair, the owner of patented 

property has a lawful right to repair or replace his property. See Aro Mfg. Co. v. 

Convertible Top Co., 365 U.S. 336 (1961); see also Everpure, Inc. v. Cuno, Inc., 875 

F.2d 300, 302 (Fed. Cir. 1989), cert. denied, 493 U.S. 853 (1989). Defendants 

alternatively advance a theory of implied license, relying upon Hewlett-Packard Co. v. 

Repeat-O-Type Stencil Mfg. Corp., 123 F.3d 1445, 1455 (Fed. Cir. 1997), cert. denied, 

523 U.S. 1022 (1998) ("[W]hen a patentee sells a device without condition, it parts with 

the right to enforce any patent that the parties might reasonably have contemplated 

would interfere with the use of the purchased device."). 

 The district court held that Claim 58 claimed the cartridge alone and not as part 

of a combination. Therefore, the doctrine of permissible repair was not applicable. The 

district court further held that Canon's sale of a printer or fax machine with a toner 

cartridge therein did not constitute an implied license to manufacture and sell the toner 

cartridge. Thus, the district court concluded that Canon had a likelihood of success on 

its infringement claim. Upon further finding that a balance of the hardships and 

consideration of the public interest favored Canon, the district court issued the 

preliminary injunction at issue. 

2006-1615 4 
II. DISCUSSION 

In patent cases, traditional rules of equity apply to requests for injunctive relief. 

eBay, Inc. v. MercExchange, L.L.C., ____ U.S. ____, ____, 126 S.Ct. 1837, 1839 

(2006). As stated in Pfizer, Inc. v. Teva Pharms. USA, Inc.: 

 [District courts] have the power to grant injunctions to prevent the 

violation of patent rights. See 35 U.S.C. § 283 (2000). In considering 

whether to grant a preliminary injunction, a court must consider whether 

the patent owner has shown: (1) a reasonable likelihood of success on the 

merits; (2) the prospect of irreparable harm to the patent owner in the 

absence of the injunction; (3) that this harm would exceed harm to the 

alleged infringer when subject to the injunction; and (4) that granting the 

injunction is in the public interest. Jeneric/Pentron, Inc. v. Dillon Co., 205 

F.3d 1377, 1380 (Fed. Cir. 2000); Nutrition 21 v. United States, 930 F.2d 

867, 869 (Fed. Cir. 1991). 

 We review the grant of a preliminary injunction for abuse of 

discretion. Novo Nordisk of N. Am., Inc. v. Genentech, Inc., 77 F.3d 1364, 

1367 (Fed. Cir. 1996). To overturn the grant of a preliminary injunction, 

we must find that the district court made a clear error of judgment in 

weighing the relevant factors or based on its exercise of discretion on an 

error of law or on clearly erroneous factual findings. Id.

429 F.3d 1364, 1372 (Fed. Cir. 2005). 

A. Likelihood of Success on the Merits 

This court does not encourage interlocutory appeals from claim construction 

decisions. Moreover, it is not always appropriate for trial courts to single out particular 

terms in a claim for "early" construction outside of the contextual setting provided by 

consideration of all disputed claim terms. Nevertheless, it can be necessary to consider 

the construction of some claim terms in the process of resolving a request for a 

preliminary injunction. 

 In its preliminary injunction decision, the district court construed Claim 58 to 

cover the toner cartridge alone and not as part of a combination. If Claim 58 is so 

2006-1615 5 
construed, the doctrine of permissible repair would be inapplicable altogether. See Fuji 

Photo Film Co., LTD v. Int'l Trade Comm'n, 474 F.3d 1281, 1296 (Fed. Cir. 2007). 

On the present record, there is a reasonably debatable question of whether 

Claim 58 should be construed to cover the cartridge alone or the cartridge as part of a 

combination. Therefore, this court is not now reaching its final conclusion as to the 

matter. However, even if Claim 58 were construed to cover the cartridge as part of a 

combination, Canon would still have a substantial likelihood of success. 

 If Claim 58 were construed as covering a combination, it is unlikely that the 

covered combination would include the toner cartridge and the entirety of the printer or 

fax machine since most of the components of such machines are not claimed. On the 

contrary, as appears from the claims, the most likely combination would be one 

consisting of the toner cartridge and the claimed "hole defined by twisted surfaces." 

'018 Patent cl.58. 

 In respect to such a combination, it is likely that the replacement of the toner 

cartridge part of the combination would not constitute a permissible repair. We have 

divided permissible repair into two categories—replacement of readily replaceable parts 

and refurbishment. In each instance the concept of proportionality is pertinent, though 

less so in the case of readily replaceable parts. A part is not readily replaceable if the 

part in question constitutes the bulk of the value of the patented item. And 

refurbishment is not a permissible repair if, for example, "the extent of the refurbishment 

. . . [would be] disproportionate to the overall value of the parts that were not replaced." 

Fuji Photo Film, 474 F.3d at 1296; see also Husky Injection Molding Sys., Ltd. v. R & D 

Tool & Eng'g Co., 291 F.3d 780, 786-87 (Fed. Cir. 2002) (noting that replacing the 

2006-1615 6 
entirety of a patented car except for its spark plugs would be impermissible 

reconstruction). Thus, it appears that under the facts of this case, the replacement of 

the toner cartridge would constitute impermissible reconstruction because it would 

essentially be a "second creation of the patented entity." Aro Mfg. Co., 365 U.S. at 346 

(citations omitted). 

 In sum, Canon has established a substantial likelihood—albeit not a certainty—of 

success on its claim that Defendants have infringed Claim 58 of the '018 Patent. 

B. Irreparable Harm Balance 

At the preliminary injunction stage, irreparable harm consists of harm that could 

not be sufficiently compensated by money damages or avoided by a later decision on 

the merits. DAN B. DOBBS, LAW OF REMEDIES 193-94 (2d ed. 1993). To reach an 

irreparable harm balance, a trial court compares the irreparable harm that would be 

sustained by the movant if a preliminary injunction were erroneously denied with the 

irreparable harm that would be sustained by the non-movant if a preliminary injunction 

were granted in error. Id. at 187. 

As the trial court found, competition from Defendants will likely result in 

substantial price erosion of Canon's patented product as well as loss of Canon's market 

share. Due to the difficulty (if not impossibility) of determining the damages resulting 

from price erosion and loss of market share, an award of money damages would not be 

sufficient. Moreover, Defendants' business operations are geographically "far-flung," 

making the enforcement of a money judgment "exceedingly difficult." Canon Inc. v. 

GCC Int'l, Ltd., 450 F. Supp. 2d 243, 255 (S.D.N.Y. 2006). Thus, to the extent that 

money damages against Defendants were awarded, there appears to be a reasonable 

2006-1615 7 
basis for the district court's finding that there would be little probability that Canon could 

effect the collection of a money judgment. 

On the other hand, as the district court found, there is little, if any, harm that 

would be suffered by Defendants by virtue of an erroneous grant of a preliminary 

injunction that could not be fully compensated by a money damage award against 

Canon under Fed. R. Civ. P. 65(c). 

In light of Canon's demonstration of the potential of substantial irreparable harm, 

and Defendants' failure to make any such demonstration, this court agrees with the 

district court's conclusion that the irreparable harm balance favors Canon. 

C. Public Interest 

As the district court noted, the public benefits from lower prices resulting from 

free market competition. However, the public also has an interest in the enforcement of 

patents. Hence, consideration of the public interest favors neither side. 

D. The Ultimate Balance 

The ultimate decision in a preliminary injunction context requires a flexible 

balancing of the parties' respective showings of potential irreparable harm and the 

movant's likelihood of success on the merits. "If, after balancing [the irreparable harm 

to plaintiff against that of the defendant], the balance tips decidedly in favor of the 

plaintiff, a preliminary injunction will be granted if the plaintiff has raised questions going 

to the merits so serious, substantial, difficult and doubtful, as to make them fair ground 

for litigation and thus for more deliberate investigation." Direx Israel, Ltd. v. 

Breakthrough Med. Corp., 952 F.2d 802, 813 (4th Cir. 1991) (internal quotation marks 

omitted). "A request for a preliminary injunction is evaluated in accordance with a 

2006-1615 8 
2006-1615 9 

'sliding scale' approach: the more the balance of irreparable harm inclines in the 

plaintiff's favor, the smaller the likelihood of prevailing on the merits he need show in 

order to get the injunction." Kowalski v. Chicago Tribune Co., 854 F.2d 168, 170 (7th 

Cir. 1988). 

 In the instant case, the district court reasonably evaluated Canon's likely success 

on the merits and the irreparable harm balance and did not abuse its discretion in 

granting the preliminary injunction. 

CONCLUSION 

For the foregoing reasons, the district court's grant of the preliminary injunction is 

affirmed. 

COSTS 

No costs.