United States District Court, D. New Jersey
& GREINER, PC Robert T. Egan, Esq. Lloyd Freeman, Esq.
Mark Oberstaedt, Esq. Christine S. Baxter, Esq. Trevor J.
Cooney, Esq. Erin R. Carroll, Esq. Julie A. Robinson, Esq.
One Centennial Square Haddonfield, N.J. 08033 Counsel for
Hac Vice: BRYAN CAVE LLP Lawrence Scarborough, Esq. Kathleen
S. Callahan, Esq. Jacob A. Kramer, Esq. Daniel T.
O'Connor, Esq. J. Michael Cooper, Esq. Daniel I. Prywes,
Esq. Desmonne A. Bennett, Esq. 1155 F Street, N.W.
Washington, DC 20004 Counsel for Plaintiff/Counter-Defendant
K&L GATES LLP Anthony P. Larocco, Esq. Charles F. Rysavy,
Esq. Kathy D. Helmer, Esq. Dana B. Parker, Esq. Michael E.
Waller, Esq. Robert F. Pawlowski, Esq. Mark D. Marino, Esq.
Ashley L. Turner, Esq. Benjamin I. Rubinstein, Esq. Stacey A.
Hyman, Esq. Scott G. Kobil, Esq. Matthew S. Sachs, Esq. One
Newark Center 10th Floor Newark, N.J. 07201
Counsel for Defendants/Counterclaimants
Hac Vice: K&L GATES LLP Douglas F. Broder, Esq. Anthony
P. Badaracco, Esq. Daniel A. Pincus, Esq. Counsel for
E. IRENAS, Judge
before the Court in this antitrust matter is the motion for
permanent injunction of Counterclaimants Telecom Labs, Inc.
and Continuant Inc.
a seven-month trial, the jury found Counterclaim-Defendant
Avaya Inc. ("Avaya") liable on two of the eight
causes of action presented: (1) attempted monopolization of
the post-warranty maintenance market for Avaya-brand private
branch exchange telephony systems ("PBXs"); and (2)
unlawful tying of software patches for Avaya-brand predictive
dialer systems ("PDSs") to (i) the purchase of
Avaya-brand post-warranty maintenance or (ii) an agreement
not to use TLI/C for such maintenance.
light of the verdict, TLI/C moves the Court to issue an
extensive injunction canceling the vast majority of the
licensing agreements Avaya has with its customers and voiding
all contracts the company has with its Business Partners.
TLI/C also seeks the implementation of internal and external
compliance monitors to prevent future anticompetitive
conversely, argues TLI/C has failed to demonstrate it is
entitled to injunctive relief.
light of the strict demands that must be met before equitable
relief can be granted, the Court holds that only a narrow
injunction is appropriate. Specifically, the Court grants
Avaya PBX customers who purchased their machines between 1990
and 2008 the right to access on-demand maintenance commands
("ODMCs") on their own systems, free of charge, for
maintenance and administrative tasks. This right extends to
those purchasers' agents, such as independent service
providers, who access the ODMCs for the customers'
has failed, however, to demonstrate its entitlement to the
additional relief requested.
detailing the jury's verdict and TLI/Cs proposed
injunction, the Court sets forth the equitable analysis it
must utilize and the conflicting case law evaluating the
propriety of injunctive relief under § 16 of the Clayton
Act, 15 U.S.C. § 26. The Court then applies these
traditional equitable principles to TLI/Cs motion.
this suit has been the subject of numerous opinions,
knowledge of the facts, which went largely uncontested during
trial, is presumed.
jury found that there was a relevant antitrust aftermarket
for post-warranty maintenance of Avaya PBXs, and that Avaya
attempted, unsuccessfully, to monopolize this aftermarket.
(Dkt. No. 1322 (Jury Verdict) Questions 1-3)
the jury found that there was no relevant antitrust
aftermarket for patches for Avaya PBXs, (Question 4), and
that Avaya did not conspire with its Business Partners to
unreasonably restrain trade with respect to post-warranty
maintenance of Avaya PBXs, (Question 6).
regards to PDSs, also referred to as "dialers, "
the jury found a relevant antitrust aftermarket for
post-warranty maintenance of Avaya-brand PDSs, but Avaya
neither attempted to monopolize, nor successfully
monopolized, such a market. (Questions 7-9)
jury did find that there was a relevant antitrust aftermarket
for patches for Avaya-brand PDSs, and that Avaya "tied
the availability of patches for Avaya-brand dialers to (i)
the purchase of Avaya-brand post-warranty maintenance or (ii)
an agreement not to use an ISP for such maintenance."
the jury found that TLI/C was in fact injured by Avaya's
conduct, that Avaya's violation of the antitrust laws was
a material cause of TLI/Cs injury, and that TLI/C suffered an
injury of the type the antitrust laws were intended to
prevent. (Question 14)
light of Avaya's liability and the injury incurred, the
jury awarded $20 million in compensatory damages. (Question
the verdict and pursuant to Fed.R.Civ.P. 65 and § 16 of
the Clayton Act, TLI/C makes the instant motion. The
injunction it seeks is extensive.
TLI/C asks the Court to order Avaya to:
• refrain from enforcing "any past or present
Contract" that "imposes any restrictions on an
Owner's ability to access and execute ODMCs on its PBX or
PDS for purposes of performing maintenance or administrative
tasks, " or allowing TLI/C to do the same. (Dkt. No.
1328-3 ("Proposed Injunction"), § III.A.)
• cease disseminating all written or oral communications
indicating that a customer's accessing ODMCs for
maintenance or administrative tasks is prohibited.
(Id., § III.B)
• void all "provision[s] of an existing agreement
with a Business Partner." (Id., § III.F)
• cease disabling, removing, or deactivating MSPs on the
PBX system(s) of any Owner that is a present or Prospective
Customer of TLI/C." (Id., § III.I)
• stop issuing FUD letters and using the word
"unauthorized" to describe TLI/C. (Id.,
§ III.J., K.)
• affirmatively notify prospective customers of TLI/C of
the restrictions, both through First Class mail as well as
publication in 16 newspapers and websites. (Id.,
§ IV, A., B.)
• retract all disparaging remarks made by Avaya about
TLI/C. (Id., § IV.F.)
• re-enable, re-install, or reactivate any MPSs that
Avaya previously disabled, removed, or deactivated.
(Id., § IV.E.)
proposed injunction further requires Avaya to hire both
internal and external compliance monitors to ensure both that
the requirements of the injunction are followed and that no