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Case 5:16-cv-01034-SLP Document 131 Filed 10/26/18 Page 1 of 20

IN THE UNITED STATES DISTRICT COURT


FOR THE WESTERN DISTRICT OF OKLAHOMA

JAMIE S. LEACH, and )


LEACHCO, INC. )
)
Plaintiffs, )
)
v. ) Case No. CIV-16-1034-SLP
)
PHARMEDOC, INC. )
)
Defendant. )

ORDER

Before the Court is Plaintiffs’ Motion for Temporary Restraining Order, Preliminary

Injunction, and Expedited Consideration and Opening Brief in Support [Doc. Nos. 102,

103].1 The matter is fully briefed and ready for decision.2 In addition to the parties’

briefing, on June 21, 2018, the Court conducted an evidentiary hearing, as requested by the

parties. See Partial Transcript of Motions Hearing dated June 21, 2018 [Doc. No. 129] (Tr.

Vol. I) and [Doc. No. 130] (Tr. Vol. II). Plaintiffs appeared through their counsel of record,

Jordan Sigale, Douglas Sorocco, Evan Talley and Julie Langdon. Defendant appeared

through its counsel of record, Mitchell McCarthy and Aryeh Kaufman.

1
Plaintiffs entitled their Motion as a “Renewed Motion” for injunctive relief. As the Court has
admonished Plaintiffs, their Motion is not a “Renewed Motion.” Plaintiffs characterize their
Motion as such, relying on injunctive relief sought in a separately filed action, Leach v. Day to
Day Imports, Inc., et al., Case No. 17-1230-SLP, transferred to this judicial district on November
14, 2017 from the United States District Court for the Central District of California. Nor is
Plaintiff’s Motion properly characterized as one seeking a temporary restraining order. See Fed.
R. Civ. P. 65.

2
Citations to the parties’ submissions reference the Court’s ECF pagination.
Case 5:16-cv-01034-SLP Document 131 Filed 10/26/18 Page 2 of 20

For the reasons set forth below, the Court finds Plaintiffs have failed to sufficiently

demonstrate irreparable harm and therefore Plaintiff’s Motion is DENIED.

I. Introduction / Relevant Factual and Procedural History

Plaintiffs commenced this action with the filing of a Complaint on September 7,

2016. Plaintiffs allege infringement of U.S. Patent No. 6,499,164 for the Snoogle®, a J-

shaped, full-body, pregnancy pillow (Snoogle). Plaintiff Jamie S. Leach invented the

Snoogle. Plaintiff Leachco, Inc. (Leachco) is the sole licensee of the Snoogle patent.

Plaintiffs filed their motion for injunctive relief on March 21, 2018. Plaintiffs claim

injunctive relief is necessitated by a drastic decrease in Snoogle sales which Plaintiffs

contend is the result of Defendant’s alleged infringing product. As Plaintiffs aptly note,

the parties have fully briefed the issue of claim construction and that matter is presently

pending before the Court. However, in the interim, Plaintiffs moved for injunctive relief.

At the most recent status conference, the parties represented to the Court that a ruling on

the pending motion for injunctive relief is a priority. Therefore, the Court has delayed a

claim construction ruling, turning its attention to this matter.

II. Governing Legal Standard

“[T]he Patent Act expressly provides that injunctions ‘may’ issue ‘in accordance

with the principles of equity.’” eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 392

(2006) (citing 35 U.S.C. § 283)). Well-established principles of equity require a plaintiff

seeking preliminary injunctive relief to establish: “that he is likely to succeed on the merits,

that he is likely to suffer irreparable harm in the absence of preliminary relief, that the

balance of equities tips in his favor, and that an injunction is in the public interest.” Winter

2
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v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008) (citation omitted); see also Apple,

Inc. v. Samsung Elecs. Co., Ltd., 695 F.3d 1370, 1373-74 (Fed. Cir. 2012) (“Apple II”

(applying factors in patent infringement case). The Court must consider all four factors

before granting a preliminary injunction, but the court may deny a preliminary injunction

if the moving party fails to make a showing on any one of the four factors. Jack Guttman,

Inc. v. Kopykake Enters., Inc., 302 F.3d 1352, 1356 (Fed. Cir. 2002); see also New Mexico

Dep’t. of Game & Fish v. United States Dep’t. of Interior, 854 F.3d 1236, 1255 (10th Cir.

2017) (“‘[T]he movant’s failure to sustain its burden of proving irreparable harm ends the

inquiry and the denial of injunctive relief is warranted.’”) (quoting Glenwood Bridge, Inc.

v. Minneapolis, 940 F.2d 367, 371 (8th Cir. 1991)).

“A preliminary injunction is an extraordinary remedy never awarded as of right.”

Winter, 555 U.S. at 24. In the specific context of patent infringement, the Federal Circuit

has similarly recognized that a preliminary injunction is a “drastic and extraordinary

remedy that is not to be routinely granted.” National Steel Car, Ltd. v. Canadian Pacific

Ry., Ltd., 357 F.3d 1319, 1324 (Fed. Cir. 2004).

III. Discussion

“Perhaps the single most important prerequisite for the issuance of a preliminary

injunction is a demonstration that if it is not granted the applicant is likely to suffer

irreparable harm before a decision on the merits can be rendered.” 11A Charles Alan

Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice & Procedure § 2948.1 (2d

ed.1995). A party seeking a preliminary injunction “must make a clear showing that it is

at risk of irreparable harm, which entails showing a likelihood of substantial and immediate

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irreparable injury.” Apple II, 695 F.3d at 1374 (internal quotation marks and citation

omitted).

To demonstrate irreparable harm, a plaintiff must establish that it is subject to harm

that cannot be adequately compensated through monetary damages. See Celsis In Vitro,

Inc. v. CellzDirect, Inc., 664 F.3d 922, 930 (Fed. Cir. 2012) (“[T]he irreparable harm

inquiry seeks to measure harms that no damages payment, however great, could address.”);

Dominion Video Satellite, Inc. v. Echostar Satellite Corp., 269 F.3d 1149, 1156 (10th Cir.

2001) (“A plaintiff suffers irreparable injury when the court would be unable to grant an

effective monetary remedy after a full trial because such damages would be inadequate or

difficult to ascertain.”); Econova, Inc. v. DPS Utah, No. 1:12-CV-174-TC, 2012 WL

5944257 at *13 (D. Utah, Nov. 28, 2012) (unpublished op.) (“The essence of showing

irreparable harm is demonstrating an injury that money damages cannot sufficiently

remedy.”).

The Tenth Circuit has articulated the standard for establishing irreparable harm as

follows:

To constitute irreparable harm, an injury must be certain, great, actual and


not theoretical. Irreparable harm is not harm that is merely serious or
substantial. [T]he party seeking injunctive relief must show that the injury
complained of is of such imminence that there is a clear and present need for
equitable relief to prevent irreparable harm. It is also well settled that simple
economic loss usually does not, in and of itself, constitute irreparable harm;
such losses are compensable by monetary damages.

Heideman v. South Salt Lake City, 348 F.3d 1182, 1189 (10th Cir. 2003) (internal citations,

alterations and quotations omitted). Plaintiffs, therefore, have the burden of establishing

that “during the time it will take to litigate this case in district court” if no injunction is

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issued, it “will have an irreparable effect in the sense of making it difficult or impossible

to . . . restore the status quo ante in the event [it] prevail[s].” Id. (emphasis added).

In the context of patent infringement, a plaintiff satisfying the irreparable harm

factor must also demonstrate a causal nexus relating the alleged harm to the alleged

infringement. Apple, Inc. v. Samsung Elecs. Co., Ltd., 678 F.3d 1314, 1324 (Fed. Cir.

2012) (“Apple I”). And, while infringement of one’s patent right constitutes injury, the

Federal Circuit has made clear that under eBay, “the patentee’s right to exclude alone

cannot justify an injunction.” Robert Bosch, LLC v. Pylon Mfg. Corp., 659 F.3d 1142,

1149 (Fed. Cir. 2011). Instead, the court must consider the right to exclude along with

other evidence of injury and assess whether irreparable harm exists. See id.

Plaintiffs rely on the following to establish irreparable harm: (1) lost sales beginning

in approximately August 2017; (2) diminution in goodwill and harm to reputation; (3)

pricing; (4) hyper-aggressive marketing by Defendant; (5) reduction in workforce; and (6)

continued viability of Leachco. In addition to the testimony and exhibits introduced at the

evidentiary hearing, Plaintiffs support their allegations with the Verified Complaint filed

in a separate action, see discussion supra, the Declaration of Leachco’s Chief Operating

Officer, Alex Leach, and a Supplemental Declaration of Mr. Leach.3

3
The Court declines to consider the allegations of the Verified Complaint filed in the separate
action. The Verified Complaint is over seventy pages in length, as compared to the seven-page
First Amended Complaint which serves as the operative pleading in this action. And, even if the
Court were to consider the Verified Complaint, the allegations relied upon are of a conclusory
nature. See, e.g., Lantec, Inc. v. Novell, Inc., 306 F.3d 1003, 1019 (10th Cir. 2002) (district court
need not treat allegations of verified complaint as an affidavit if the allegations are merely
conclusory or not made on personal knowledge). The Verification is signed by Jamie Leach. Ms.
Leach did not testify at the hearing nor did she provide an affidavit in support of Plaintiffs’ request
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A. Evidence of Irreparable Harm

1. Mr. Leach’s Declaration

The first declaration of Mr. Leach is dated October 10, 2017. See Leach Decl.

[Doc. No. 103-1]. This declaration was prepared for purposes of a request for injunctive

relief in the separate action pending before this Court and brought by the same plaintiffs as

those who filed the instant action. See discussion supra, n. 1.4

Mr. Leach states that since 1999, when Leachco began selling the Snoogle, until

2014, sales have increased yearly on average by about twenty percent. Id., ¶ 9. Mr. Leach

does not provide any information concerning sales for the approximately three-year period

from 2014 to 2017. He states, however, that the first severe drop in sales occurred in July

2017. Id., ¶ 10. Although he “initially suspected that Pharmedoc, Inc. had to be behind

the sharp decline” in the sales, see id., ¶ 14, he states that “following an investigation,

Leachco has come to believe that other corporations and/or individuals associated with

Doctors-Deals are behind the significant increase in importation and sales of the Saint

Glory Full Body Pregnancy Pillow” and that “Doctors-Deals is by far the next biggest

player in full body pillow sales on Amazon.com.” Id., ¶ 15.5

for injunctive relief in either the separate action or this action. Moreover, the Verification itself is
qualified as to the extent of Ms. Leach’s personal knowledge.

4
Pharmedoc is one of several named defendants in the separate action. On March 21, 2018,
Plaintiffs filed the instant Motion for injunctive relief and one day prior, on March 20, 2018, filed
a Motion to Withdraw their application for injunctive relief in the separate action.

5
In advance of the hearing, Plaintiffs submitted (but did not admit) the declaration of Yakov
Kroll. Pl.’s Hr’g Ex. 22. Mr. Kroll states that he has been the CEO of Pharmedoc since its inception
and that “Doctors-Deals is the name that Pharmedoc uses as its online seller’s name.” Id., ¶¶ 5-7.
6
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2. Mr. Leach’s Supplemental Declaration

Mr. Leach submitted a Supplemental Declaration in this action dated March 20,

2018. Mr. Leach reaffirms the statements set forth in his Declaration as “true and correct.”

See Suppl. Leach Decl. [Doc. No. 103-2], ¶4. Notwithstanding his prior attribution of

infringing conduct to the entity Doctors-Deals, he now states that Pharmedoc is responsible

for Leachco’s lost sales. Mr. Leach states that since his execution of the Declaration,

“Leachco has experienced a further drastic reduction in its sales to Amazon.com of the

Snoogle® Total Body Pillow, which has significantly impacted Leachco’s market share

for pregnancy and maternity pillows, its overall operations, and threatens its continued

existence as a company.” Id., ¶ 6. He states that Leachco has been forced to reduce its

workforce “because of the declining sales.” Id., ¶ 9. Mr. Leach states that effective

February 23, 2018, “due to the catastrophic sales drop” Leachco had to discontinue its

“night or second shift.” Id., ¶ 10. He states the “second night shift was started in January

2015 to keep up with the growth and demand of the business.” Id.

Mr. Leach further identifies various “aggressive and targeted marketing and

advertising” practices of Pharmedoc that he discovered in February 2018 when he “visited

Pharmedoc’s product page.” Id., ¶ 11. He further cites Pharmedoc’s alleged improper use

of a trademark of a different product manufactured by Leachco (and not at issue in this

litigation), which he refers to as the “Leachco Back ‘N Belly” pillow, which, along with

the Snoogle, is “one of Leachco’s most popular, best-selling products for years.” Id., ¶ 17.

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3. Mr. Leach’s Testimony at the Evidentiary Hearing

Mr. Leach testified that he first became aware of Pharmedoc’s alleged infringing

product in January or February of 2016. Tr. Vol. II at 154:8-11. He explained that Leachco

and Pharmedoc compete on the websites of Amazon and other e-commerce sites. Tr. Vol.

II at 155:16-156:12. The evidence relied upon by Leachco for purposes of preliminary

injunctive relief, however, is focused solely on Leachco’s Amazon sales.6

Mr. Leach testified that in the summer of 2017, Leachco’s overall sales to Amazon

comprised about 30-35% of Leachco’s total business. Tr. Vol. II at 151:23-152:1. He then

testified that during that same time period approximately 50% of Leachco’s total sales of

the Snoogle were to Amazon. Tr. Vol. II at 152:2-152:12.7

6
In their Motion, Plaintiffs state that Pharmedoc sells its pillow on “at least the following e-
commerce outlets: Pharmedoc.com, Amazon.com, Walmart.com, and Wayfair.com.” Pl.’s Mot. at
12. And at the hearing, Mr. Leach testified that Leachco sells the Snoogle to Amazon, Bed Bath
& Beyond, Buy Buy Baby, Babies “R” Us, Destination Maternity, A Pea in the Pod and
Nordstrom’s. Tr. Vol. II at 177:20-178:6. But, as stated, the evidence relied upon by Plaintiffs
for preliminary injunctive relief focuses solely on Amazon sales.
7
Mr. Leach testified as follows:

Q. How much of Leachco’s overall sales did Amazon represent, let’s say last
summer?
A. I would say over 50 percent was the – can you ask the question again? Was
it Snoogle sales to Amazon, how much of our –
Q. In overall sales of Leachco, how much of Leachco’s overall sales last
summer were to Amazon.com?
A. Oh, probably 30 percent. They probably made up 30 to 35 percent of our
total business.
Q. And with respect to the Snoogle sales that Leachco makes overall, how
much of the Snoogle sales last summer was Leachco making to Amazon of the total
Snoogle sales?
A. I don’t think I understand.
Q. Let me see if I can phrase it differently. In the summer of 2017, if you take
Leachco’s total sales of the Snoogle and you take Amazon’s sales of the Snoogle,
what percentage was on Amazon?
8
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With respect to the Snoogle, Mr. Leach testified that in May 2017, Leachco’s sales

to Amazon of the Snoogle original in ivory, Leachco’s biggest seller on Amazon, totaled

approximately $403,000.00 as compared to $67,764.00 one year later in May 2018. Tr.

Vol. II at 162:4-163:4; see also Pl.’s Hr’g Ex. 25. Mr. Leach testified he does not know

how Amazon works, but it appears that the decline in sales has caused Leachco to “slide

down product pages” when a search for “certain key words” is done. Tr. Vol. II at 163:5-

9. Mr. Leach testified that based on Leachco’s drop in sales, Leachco’s share of the market

on full body pillows has dropped. Tr. Vol. II at 163:10-12. Mr. Leach did not distinguish

among the various full-body-pillow products of Leachco when making this statement.

When asked about the effect of Amazon’s diminishing sales on the “overall health

of Leachco” Mr. Leach testified that the company has had to reduce its work force. Tr.

Vol. II at 168:23-169:7.8 In September 2015, the daily attendance of personnel was 133

workers, as compared to 86 workers in May 2018. Tr. Vol. II at 173:17-21; see also Pl.’s

Hr’g Ex. 26. Mr. Leach testified that some of his employees might be worrying about the

stability of their jobs. Tr. Vol. II at 174:8-175:1. When describing the “overall impact” of

A. I can say that of our total sales, Leachco as a company, the total sales, about
50 percent – a little over 50 percent of our total sales were on the Snoogle to
Amazon.

Tr. Vol. II at 151:18-152:12.

8
Mr. Leach testified about work force numbers utilizing Pl.’s Hr’g Ex. 26. He did not prepare the
exhibit but said it had been prepared by his brother-in-law, another member of the Company. Mr.
Leach testified he did not check the document to make sure its contents were accurate and correct,
but that he often relied upon his brother-in-law for business information. Tr. Vol. II at 169:11-25.
Defendant objected to use of the exhibit and the Court overruled the objection, noting that issues
as to the sufficiency of the evidence would be considered by the Court and could be explored
through cross-examination. Tr. Vol. II at 170:1-171:7.
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the loss of Snoogle sales, Mr. Leach testified that the community of Ada, Oklahoma, where

Leachco is headquartered, depends on Leachco. Tr. Vol. II at 175:6-18.

B. Application

The Court addresses each of the factors relied upon by Plaintiffs in support of their

allegations of irreparable harm.

1. Lost Sales

Plaintiffs attribute the decline in Amazon sales of the Snoogle to Pharmedoc’s

alleged infringing product. Plaintiffs rely on Pharmedoc’s Amazon presence, its marketing

tactics, and the fact that Pharmedoc is a direct competitor.

Direct competition in the same market is a factor suggesting the potential for

irreparable harm without enforcement of a patentee’s right to exclude others from

practicing the invention. See, e.g., Finjan, Inc. v. Blue Coat Sys., LLC, No. 15-cv-03295-

BLF, 2016 WL 6873541 at *6 (N.D. Calif. Nov. 22, 2016) (unpublished op.) (citing

Presidio Components, Inc. v. Am. Tech. Ceramics Corp., 702 F.3d 1351, 1363 (Fed. Cir.

2012)). The evidence presented to the Court demonstrates that Leachco and Pharmedoc

are direct competitors on Amazon. But Leachco and Pharmedoc are not lone competitors.

At the hearing, Pharmedoc introduced evidence of other companies that sell competing

products. And Mr. Leach testified that Leachco has dozens of competitors in the full-body

pregnancy pillow market. Tr. Vol. II at 223:20-224:10.

The Court recognizes that “the absence of a two-supplier market does not weigh

against a finding of irreparable harm.” Bosch, 659 F.3d at 1151. However, even if lost

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sales are attributable to Pharmedoc, Plaintiff must show that lost sales are the result of

infringement. Apple I, 678 F.3d at 1324. As the Federal Circuit has explained:

Sales lost to an infringing product cannot irreparably harm a patentee if


consumers buy that product for reasons other than the patented feature. If the
patented feature does not drive the demand for the product, sales would be
lost even if the offending feature were absent from the accused product.

Id. Thus, if customers are buying Pharmedoc’s product for reasons other than the alleged

patented features, the irreparable harm requirement is not satisfied.

In Bosch, a case Plaintiffs rely upon, the court found irreparable harm based, in part,

on the fact the parties were direct competitors. In that case, Bosch introduced evidence of

direct competition in specific market segments, loss of market share and access to potential

customers, and the defendant’s inability to satisfy any judgment that might be entered

against it. Id., 659 F.3d at 1152. Notably, in Bosch, there was no dispute regarding the

contours of the relevant market and Bosch introduced evidence that it lost the business of

Walmart, one of its largest participants in the market, to its competitor and the alleged

infringer, Pylon. Id. at 1153.

Here, conversely, the relevant market is unclear. The evidence demonstrated a

range of full-body pregnancy pillows exists on Amazon and those pillows are sold by many

different companies. While only a few competitors of Leachco manufacture a pillow with

a J-shape or C-shape (the shape manufactured by Plaintiff and Defendant, respectively),

there are a number of other pregnancy pillows in the market. Plaintiff did not provide any

evidence that customers buy the Pharmedoc pillow over the Snoogle pillow because of the

alleged patented features. Specifically, Plaintiff did not provide any evidence that the J-

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shape of its pillow is preferred to the shape of other full-body pregnancy pillows. Without

such evidence, the relevant market and consequently, the lost sales attributable to

Pharmedoc, is unclear.9

Moreover, other evidence at the evidentiary hearing undermines Plaintiffs’ position

that Pharmedoc’s alleged infringement has caused Leachco’s lost sales. Evidence was

introduced at the hearing to show that sales of other Leachco products on Amazon have

also declined. Additionally, Leachco has stopped spending money on social media

advertising. Leachco has also faced difficulty registering its products through Amazon

Market Services. And, the Snoogle customer ratings on Amazon have dropped. There is

no evidence that the drop in customer ratings is in any way attributable to Pharmedoc.

Additionally, at the hearing, email correspondence between Mr. Leach and Ellen

Chang was introduced. See Pl.’s Hr’g Ex. 27. Mr. Leach testified that Ms. Chang is

Leachco’s main buyer at Amazon and has served in that capacity for approximately the last

two years. Tr. Vol. II at 182:1-19. The email discusses Leachco’s decline in sales on

Amazon, without reference to any particular product. And, Mr. Leach testified that Ms.

Chang’s email appears to reference Leachco’s overall business. Tr. Vol. II at 182:21-

183:8.

9
When asked if Leachco’s “share of the market of fully body pillows” had dropped, Mr. Leach
testified: “I would say so because our sales have dropped drastically.” Tr. Vol. II at 163:10-12.
Such testimony is wholly conclusory. And later, Mr. Leach testified he did not know whether
Pharmedoc had increased its market share in proportion to Leachco’s lost market share and that he
didn’t think he had ever seen that information. Tr. Vol. II at 226:5-9.
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In the email, Ms. Chang references a 60% decline in Leachco’s Amazon traffic.

And, Mr. Leach references Leachco’s inability to register the Snoogle and its other top

seller, the Back ‘N Belly, in Amazon’s Brand Registry program because “those names were

not printed directly on or attached directly to the product.” Pl.’s Hr’g Ex. 27. At the

hearing, Mr. Leach testified that Leachco had “a hard time with the brand registry” and

that it “hasn’t worked like we thought and understood it would.” Tr. Vol. II at 188:9-18.

In the email, Mr. Leach also referenced a decline in sales due to “counterfeit

products.” Pl.’s Hr’g Ex. 27. He makes no reference to Pharmedoc. Instead he states:

“[w]e have two counterfeit products that we ordered recently. By the time we got them

and were able to prove they were counterfeit those sellers had sold all of their units and the

damage was done, bad reviews, lowered ratings, etc. This is why I refer to this as ‘whack

a mole’ situation as it is a serious and recurring problem.” Id.

At the hearing, Mr. Leach did not relate the situation described in his email to Ms.

Chang to Pharmedoc’s alleged infringement of the Snoogle. Instead, he addressed

problems with counterfeit sellers such as “people making products, calling them Leachco

. . . marketing their products as a Leachco product, people using our photography all those

sorts of things.” Tr. Vol. II at 189:1-6. And Mr. Leach acknowledged that these matters

affect Leachco’s listings on Amazon. Tr. Vol. II at 189:24-191:7.

When Defendant’s counsel asked Mr. Leach if he thought Pharmedoc was

responsible for Leachco’s drop in sales, he stated: “My testimony is this: A small family

company such as us has to go after – has to protect and defend its intellectual property.

And a small company that has finite resources has to go over those that they think are

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responsible, most egregious. So if the question is about Pharmedoc, then that’s why we

pursued this litigation.” Tr. Vol. II at 225:15-20. But Mr. Leach’s subjective beliefs about

lost sales are insufficient to establish any causal connection.

In sum, the relevant market is not sufficiently defined, a number of unexplained e-

commerce factors appear to play a significant role in the decline in sales of the Snoogle on

Amazon and attribution of lost sales to Pharmedoc is largely speculative.10 Without more

specific evidence, the Court finds Plaintiffs have failed to meet their burden of

demonstrating irreparable harm based on lost sales.

2. Diminution in Goodwill and Harm to Reputation

In their Motion, Plaintiffs state: “Leachco has come to understand that consumers

believe that Leachco has somehow authorized the manufacture and/or sale of the

PharMeDoc Pillow due to its infringing nature.” Pl.’s Mot. at 13. And Plaintiffs further

state “[f]or each of these instances of confusion (of which Leachco is aware), there are

likely to be many other angry and disappointed consumers who will never purchase another

Leachco product because of their experience with the PharMeDoc Pillow.” Id. Plaintiff’s

cite Mr. Leach’s Declaration as support. But the Declaration merely repeats these same

conclusory and speculative statements. The issue of goodwill and harm to reputation was

not further addressed at the evidentiary hearing except that Mr. Leach testified that Leachco

might lose employees – a factor discussed infra. Although “[p]rice erosion, loss of

10
Mr. Leach testified that he did not know “how all the algorithms and how Amazon works but it
does appear that Leachco has slid down product pages whenever you search certain key words.”
Tr. Vol. II at 163:5-12. Again, this testimony is wholly conclusory and is one example which
demonstrates that the record regarding Amazon sales is insufficiently developed.
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goodwill, damage to reputation, and loss of business opportunities are all valid grounds for

finding irreparable harm,” see Celsis, 664 F.3d at 930, here Plaintiffs’ allegations of loss

of goodwill and damage to reputation are too speculative.

3. Pricing

For substantially the same reasons, Plaintiffs allegations regarding pricing are

unpersuasive. Plaintiffs state that Pharmedoc offers its pillows at prices significantly below

the average price of the Snoogle. Pl.’s Mot. at 14. And the record reflects the Pharmedoc

pillow is listed at a lower price on Amazon than the Leachco Snoogle. Plaintiffs further

state that the pricing, coupled with Defendant’s aggressive marketing, has caused Leachco

to slip in its Amazon rankings. Id. Again, however, Plaintiff cites no evidence in support,

other than the conclusory statements in Mr. Leach’s Declaration.

4. Hyper-Aggressive Marketing

Plaintiffs contend that Pharmedoc’s aggressive marketing tactics have resulted in

irreparable harm to it. Plaintiffs point to the approximately $10,000.00 per month they

estimate Pharmedoc is spending on advertising but provide no evidence of the same. See

Tr. Vol. II at 165:10-17; see also Leach Decl., ¶ 22. Moreover, this factor cuts both ways.

As set forth above, evidence in the record shows that Leachco’s own e-commerce

marketing (or lack thereof) may be the cause of decline in sales. Mr. Leach testified that

Leachco had been spending $5,000.00 - $7,000.00 on marketing, but then stopped those

marketing efforts. Tr. Vol. II at 193:23-194:25.

Plaintiffs also submitted a screenshot of an Amazon search showing a Pharmedoc

advertisement stating, “our body pillows got your back and belly” and contend this

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supports their showing of irreparable harm because one of Leachco’s other top sellers is

the Back ‘n Belly pillow. See Pl.’s Hr’g Ex. 28 at 4; see also Tr. Vol. II at 166:4-167:7.

The Back ‘n Belly pillow is not at issue in this litigation. Although this evidence might

suggest customers could be confused about the Pharmedoc and Leachco products, that

issue is not central to the infringement claim in this action. Nor have Plaintiffs produced

any evidence of actual confusion by any customers.

5. Reduction in Workforce

Leachco submitted some evidence that it has had to reduce its workforce and

attributes the reduction to Pharmedoc’s alleged infringement. The evidence shows that the

number of Leachco’s own employees has remained steady throughout the period of time

in question, and has not varied significantly in relation to Pharmedoc’s entry into the

market. Tr. Vol. II at 210:5-16; see also Pl.’s Hr’g Ex. 26. With respect to Leachco’s

employees, Mr. Leach speculated that they might go someplace else to work but did not

provide evidence that any employees had actually left their employment based on concerns

about Leachco’s decline in sales. Tr. Vol. II at 235:9-236:8.

The workforce reduction actually relates to the number of temporary employees

Leachco hires through an employment agency. Mr. Leach testified when Leachco does

not need the temporary employees they are reassigned to other employment through the

employment agency. Tr. Vol. II at 212:19-213:4. Under these circumstances, the Court

finds this factor does not weigh in Plaintiffs’ favor.

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6. Continued Viability of Leachco

Plaintiffs introduced evidence that Leachco experienced its greatest sales of

approximately $17 million in 2016. Mr. Leach testified that annual sales in 2017 were

approximately 15 million and that annual sales for 2018 were projected to be approximately

10 million. Tr. Vol. II at 152:13-23. Although the record demonstrates a notable decline

in annual sales, Plaintiffs provided no evidence that demonstrated the Company would not

be viable based on projected sales for 2018. Mr. Leach further testified that the community

of Ada depends on Leachco, but did not identify any specific evidence in support of this

statement. The Court, therefore, finds this factor too, does not weigh in Plaintiffs’ favor.

7. Other Factors

The Court also considers Plaintiffs’ delay in seeking injunctive relief. Plaintiffs

commenced this action in September 2016 and did not move for injunctive relief until

nearly nineteen months later. Plaintiffs seek to temper this delay arguing that they did not

understand the “full force” of the infringement until approximately September 2017.

Plaintiffs also rely on the fact that they moved for injunctive relief in the separately filed

action and that they anticipated this action would have been tried in March 2018.

Delay cuts against finding irreparably injury, but delay is one factor in the

irreparable harm analysis. Fish v. Kobach, 840 F.3d 710, 753 (10th Cir. 2016). The Court

must consider whether the delay was reasonable, was not a decision by a party to “sit on

its rights” and did not prejudice the nonmovant. Id.

Plaintiffs have employed many strategies in attempting to obtain relief in the

separate action and in this action, in choosing their forum(s), and in deciding which

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defendants to sue and for what harms. Understandably, discovery has helped shape

Plaintiffs course of action. And, Plaintiffs have shown, to some extent, that that the scope

of the alleged irreparable harm was not immediately ascertainable.

But Plaintiffs expressly rely on the fact that this matter was set for trial in March

2018 under the terms of the Court’s original scheduling order as grounds for justifying their

delay. The Court finds unpersuasive Plaintiffs’ reliance on the trial date. Plaintiffs made

the choice to pursue injunctive relief in the separate action rather than in this action.

Plaintiffs only explanation for not pursuing injunctive relief in both actions – a course

Plaintiffs clearly were entitled to take -- is that at the time they first moved for injunctive

relief, the trial of this action was five months away. But, at that same time, Plaintiffs filed

a motion to transfer this action to California. Notably, in moving for a transfer, Plaintiffs

argued that (1) claim construction was important; (2) pursuing claim construction without

Defendant Saint Glory “would raise due process concerns”; and (3) if this Court did not

transfer the action, “it w[ould] likely find itself significantly revising its current scheduling

order and adding dates, filings, and proceedings related to patent claim construction.”

Pl.’s Mot. [Doc. No. 50] at 13 (emphasis added). Thus, Plaintiffs clearly contemplated, as

early as October 2017, that this matter would not proceed to trial in March 2018.11

11
One week later, on November 3, 2017, Plaintiffs moved to withdraw their motion to transfer.
See Mot. [Doc. No. 51]. On that same date, Plaintiff dismissed without prejudice its claim against
Saint Glory pursuant to Fed. R. Civ. P. 41(a)(1)(A)(i). See Pl.’s Notice [Doc. No. 52]. Plaintiff
then took an abruptly different position when Defendant moved to amend the scheduling order and
argued that the March 2018 trial date was imperative and that “Pharmedoc is clearly interested in
delaying trial to create more time for their [sic] continued patent infringement.” Pl.’s Resp. [Doc.
No. 59] at 4.
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Moreover, even if the case would have proceeded to trial in March 2018, as

Plaintiffs had originally hoped, a trial would not have addressed the issue of permanent

injunctive relief. That matter would have been left for the Court’s equitable determination

after a jury verdict – and assuming Plaintiffs prevailed at trial. See eBay, 547 U.S. at 391

(“The decision to grant or deny permanent injunctive relief is an act of equitable discretion

by the district court.”). Plaintiffs’ back and forth between the two actions has been

prejudicial to Defendant as Defendant has expended resources in both actions to defend

against Plaintiffs’ request for injunctive relief. The continued insinuations by Plaintiffs

that delay in these matters is attributable to actions of Defendant or actions of the federal

courts (both here and in California) is unpersuasive. See, e.g., Case No. CIV-17-1230, Pl.’s

Notice [Doc. No. 48] at 3 (“When th[e] [California] Court determined it should not hear

Plaintiffs’ TRO Application until after the Oklahoma Court decided Plaintiffs’ transfer

motion, Plaintiffs were effectively denied the ability to obtain injunctive relief against

Defendants (excluding Pharmedoc) for their direct, induced, and/or contributory

infringement of the ‘164 Patent.”). Plaintiffs make similar insinuations in this action. See,

e.g., Pl.’s Mot. [Doc. No. 103] at 8 (“[T]his case has been removed from the Court’s March

2018 trial docket, and Plaintiffs presently have no certainty or expectation for when the

trial (and potential for a permanent injunction) will take place.”). To the contrary, Plaintiffs

have made strategic choices and could have, but did not, move for injunctive relief in the

present action simultaneously with requesting such relief in the separate action.

Finally, the Court considers whether money damages are inadequate. Plaintiffs have

not directly addressed this factor in their briefing and the record is devoid of probative

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evidence on this point. As set forth above, Plaintiffs’ allegations of loss of goodwill, harm

to reputation and the viability of the continued existence of Leachco are supported only by

speculation. Plaintiffs, therefore, have failed to demonstrate money damages are

inadequate.

IV. Conclusion

In sum, the Court finds Plaintiffs have failed to sufficiently demonstrate irreparable

harm, i.e., harm that is both imminent and cannot be adequately addressed through

monetary damages. Therefore, Plaintiffs’ request for injunctive relief is denied. Based on

this finding, the Court deems it unnecessary to address the remaining factors governing

preliminary injunctive relief.

IT IS THEREFORE ORDERED that Plaintiffs’ Motion for Temporary Restraining

Order, Preliminary Injunction, and Expedited Consideration and Opening Brief in Support

[Doc. Nos. 102,103] is DENIED.

IT IS SO ORDERED this 26th day of October, 2018.

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