# Nichino v. Valent: The TMA's Irreparable Harm Presumption Bursts Like a Bubble

> The Third Circuit reads the TMA's presumption of irreparable harm as a bursting bubble: slight rebuttal evidence defeats it, and Nichino's injunction fails.

Topic: Trademarks  |  Author: Lidiia Levitska  |  Source: Intellectual Property Law (outsideipcounsel.com)
Canonical: https://outsideipcounsel.com/blog/nichino-v-valent-tma-irreparable-harm-presumption/


In *Nichino America, Inc. v. Valent U.S.A. LLC*, 44 F.4th 180 (3d Cir. 2022) (No. 21-1850), the Third Circuit became the first federal court of appeals to construe the rebuttable presumption of irreparable harm that Congress wrote into the Lanham Act through the Trademark Modernization Act of 2020. Argued March 22, 2022, and decided August 12, 2022, the precedential opinion by Judge Paul Matey (joined by Judges Bibas and Phipps) affirmed the District of Delaware's denial of a preliminary injunction against a competing pesticide mark. Judge Matey opened with characteristic understatement: whether a federal court may enjoin an allegedly infringing trademark "can be a bit confusing." His answer supplies the operating manual that district courts across the country now follow.

The decision defines what Congress actually bought trademark owners when it revived the presumption. On the Third Circuit's reading, it is a burden-of-production device grounded in Federal Rule of Evidence 301: the plaintiff gets a temporary assumption of irreparable harm, but once the defendant produces even a "slight evidentiary showing" that confusion is unlikely to cause irreparable injury, the presumption "has done its work and simply disappears like a bursting bubble." For litigants who assumed the TMA restored the old near-automatic trademark injunction, *Nichino* was a cold shower.

## At a glance

- **Case:** *Nichino America, Inc. v. Valent U.S.A. LLC*, 44 F.4th 180 (3d Cir. 2022), No. 21-1850
- **Court:** United States Court of Appeals for the Third Circuit (precedential), on appeal from the District of Delaware (Judge Leonard P. Stark)
- **Decided:** August 12, 2022; opinion by Judge Matey, joined by Judges Bibas and Phipps
- **Holding:** The TMA's rebuttable presumption of irreparable harm operates under Federal Rule of Evidence 301 as a shift in the burden of production only; a defendant rebuts it with evidence sufficient for a reasonable factfinder to conclude confusion is unlikely to cause irreparable harm, after which the presumption has no further effect.
- **Disposition:** Denial of Nichino's preliminary injunction affirmed.
- **Status:** Final; as of July 2026 it remains the leading circuit-level construction of the TMA presumption.

## The rise, fall, and return of the presumption

For most of the twentieth century, trademark plaintiffs who showed a likelihood of confusion effectively got irreparable harm for free, on the theory that confusion inherently damages goodwill in ways damages cannot repair. The Supreme Court unsettled that arrangement in *eBay Inc. v. MercExchange, L.L.C.*, 547 U.S. 388 (2006), which held that injunctions issue only on a traditional four-factor equitable showing, and *Winter v. Natural Resources Defense Council, Inc.*, 555 U.S. 7 (2008), which required a showing that irreparable harm is likely, not merely possible. The circuits then split over whether those principles killed the trademark presumption. The Ninth Circuit said yes in *Herb Reed Enterprises, LLC v. Florida Entertainment Management, Inc.*, 736 F.3d 1239 (9th Cir. 2013); the Third Circuit followed in *Ferring Pharmaceuticals, Inc. v. Watson Pharmaceuticals, Inc.*, 765 F.3d 205 (3d Cir. 2014). Other courts kept presuming harm, so trademark owners faced meaningfully different injunction odds depending on the forum.

Congress resolved the split in the Trademark Modernization Act of 2020, Pub. L. No. 116-260, §§ 221-26 (enacted December 27, 2020), which amended 15 U.S.C. § 1116(a) to provide that a plaintiff seeking an injunction "shall be entitled to a rebuttable presumption of irreparable harm" upon a finding of infringement for final relief, or "upon a finding of likelihood of success on the merits" for preliminary relief. What Congress did not say is how the presumption works: what rebuts it, and what happens then. That silence is the question *Nichino* answered.

## CENTAUR versus SENSTAR: closely balanced marks in the farm chemical market

Nichino America has sold a pesticide under the registered mark CENTAUR since 2004. Valent U.S.A. trademarked a competing product called SENSTAR in 2019, giving it a logo that resembled CENTAUR's colors, fonts, and arrow artwork. Both products are used in the same regions against many of the same insects, and both reach farmers through distributors. But the products differ sharply: SENSTAR is a liquid sold at $425 per gallon, while CENTAUR is a solid sold by the 622-pound pallet at $24 per pound. Nichino sued for trademark infringement and moved to enjoin SENSTAR's launch, in one of the first cases to apply the newly effective TMA.

Applying the ten-factor likelihood-of-confusion test from *Interpace Corp. v. Lapp, Inc.*, 721 F.2d 460 (3d Cir. 1983), the district court found the question close: five factors favored Nichino, two were neutral, and three factors the court called "very important" (overall similarity, purchasing habits, and Valent's intent) favored Valent. The court concluded that Nichino had "narrowly" shown a likelihood of success even though "there is not an abundance of evidence of likelihood of confusion." That finding triggered the TMA presumption of irreparable harm. But the court then credited Valent's evidence that pesticide purchasers are a sophisticated class that buys with great care, noted the absence of actual confusion evidence, found no independent proof of irreparable harm from Nichino, and held that the equities and public interest also cut against relief. Nichino appealed only the irreparable harm ruling.

## Rule 301 and the three-step framework

The Third Circuit's key interpretive move was to read the TMA against Federal Rule of Evidence 301, the default rule for presumptions in federal civil cases: "the party against whom a presumption is directed has the burden of producing evidence to rebut the presumption," but the rule "does not shift the burden of persuasion, which remains on the party who had it originally." Because the TMA creates a rebuttable presumption without explaining its mechanics, Rule 301 fills the gap. And under precedents like *Cappuccio v. Prime Capital Funding LLC*, 649 F.3d 180 (3d Cir. 2011), and *McCann v. Newman Irrevocable Trust*, 458 F.3d 281 (3d Cir. 2006), only a small quantum of evidence carries a Rule 301 production burden; even "a single, non-conclusory affidavit" based on personal knowledge can suffice.

From that foundation, Judge Matey distilled a three-step protocol. First, the court assesses the plaintiff's evidence solely on likelihood of success on the merits, consulting the *Lapp* confusion factors for that purpose alone; commenting at this stage on whether the confusion evidence also shows irreparable harm "veers impermissibly into the burden of persuasion." If the plaintiff fails on the merits, the inquiry ends. Second, if likely infringement is shown, the TMA is triggered and the burden of production shifts to the defendant "to introduce evidence sufficient for a reasonable factfinder to conclude that the consumer confusion is unlikely to cause irreparable harm." The court assumes irreparable harm at this stage even if the plaintiff has offered nothing; the focus trains entirely on the defendant's evidence, through "a meaningful consideration of the facts, not a box-checking review of the Lapp factors." Third, if the defendant makes that "slight evidentiary showing," the presumption "has no further effect": it "simply disappears like a bursting bubble," and the burden of production returns to the plaintiff to point to evidence that irreparable harm is likely absent an injunction. The court also rejected Nichino's argument that § 226(b), the TMA's rule of construction, demanded a stickier presumption; read in context it simply means a plaintiff gets the presumption even for conduct predating the statute.

## A bursting bubble, and a harmless misstep below

Applying its new framework, the panel found the district court had "admirably navigated Congress' newly minted rebuttable presumption," with one exception. The district court had cited Nichino's failure to produce actual confusion evidence at the rebuttal stage. That was error: at step two the only question is whether the defendant has adduced affirmative evidence that irreparable harm is unlikely, and a defendant "cannot meet that production burden simply by pointing to Nichino's lack of evidence."

The error was harmless because Valent had its own evidence. The record showed that the relevant buyers, small commercial farmers, exercise great care in purchasing pesticides: the products' very different prices, the expense of a season's treatment, reliance on expert recommendations, and the crop-destroying consequences of misapplication all heighten purchasing care. It was therefore plausible that consumers "will confirm their pesticide selection before staking their farms on an inadvertent purchase," which met the light burden of production and burst the presumption. The burden then returned to Nichino, which had offered no independent irreparable harm evidence and did not argue otherwise on appeal. Under *NutraSweet Co. v. Vit-Mar Enterprises, Inc.*, 176 F.3d 151 (3d Cir. 1999), failure on any element defeats a preliminary injunction, so the denial stood. A closing footnote added that the equities also favored Valent, whose re-branding losses would run into the millions, and that the public interest was "better served by allowing continued access to an innovative product" usable against all insect life stages.

## Open questions

- **How little is too little?** The court demanded affirmative evidence, not attorney argument, but set the threshold at what a reasonable factfinder could credit. Where a genuinely "slight" showing shades into a token one will be worked out case by case.
- **Will other circuits follow Rule 301?** Another circuit could treat the TMA presumption as carrying more inertia, recreating the forum-dependent odds the statute was meant to eliminate. As of July 2026, no circuit has squarely rejected *Nichino*'s bursting-bubble reading.
- **Does the analysis differ for permanent injunctions?** Section 1116(a) also presumes irreparable harm upon a finding of infringement for final relief. Whether the same easily-burst mechanics apply after a full merits victory remains open.
- **What role does actual confusion evidence play?** The panel confined the plaintiff's confusion showing to step one, yet acknowledged that confusion evidence often bears on both success and harm. How courts keep those inquiries separate is unresolved.

## Implications for brands and businesses

- **Build the irreparable harm record from day one.** The presumption should be treated as a tiebreaker, not a substitute for proof. Declarations documenting lost customers, damaged goodwill, quality complaints, or price erosion belong in the opening motion, because the plaintiff must be ready the moment the bubble bursts.
- **Defendants should lead with buyer sophistication.** *Nichino* shows that evidence of careful, expert-guided, high-stakes purchasing can defeat the presumption even where the plaintiff has established likely success on a closely balanced *Lapp* analysis. Pricing differences, sales channels, and purchase deliberation are now front-line injunction defenses.
- **Affirmative evidence is required; gaps are not enough.** A defendant cannot rebut by attacking the plaintiff's silence. Both sides should assume the court will look only at what the defendant affirmatively produced when deciding whether the presumption survives.
- **Forum analysis still matters.** Until more circuits weigh in, the practical strength of the TMA presumption may vary by forum. In the Third Circuit it is a modest procedural head start; counsel should not promise clients more than that.

## Frequently asked questions

**Did the Trademark Modernization Act restore automatic injunctions in trademark cases?** No. The TMA gives a plaintiff who shows likely success a rebuttable presumption of irreparable harm, but under Nichino that presumption only shifts the burden of production. The defendant can burst it with a slight evidentiary showing, and the plaintiff always retains the ultimate burden of persuasion on every preliminary injunction factor.

**What evidence is enough to rebut the TMA's presumption of irreparable harm?** Not much. The Third Circuit requires only evidence sufficient for a reasonable factfinder to conclude that the confusion shown is unlikely to cause irreparable injury. In Nichino, proof that pesticide buyers are sophisticated, price-aware purchasers who rely on expert recommendations met that light burden. A defendant cannot simply point to gaps in the plaintiff's proof, though; it must produce affirmative evidence of its own.

**What should a trademark plaintiff do after the presumption is rebutted?** Treat the presumption as a bonus, not a plan. Once it bursts, the burden of production returns to the plaintiff, so the motion papers should include concrete evidence of irreparable harm from the start: lost customers, reputational damage, quality complaints, or survey and declaration evidence tying the confusion to injury that money cannot fix.

## Authorities and sources

- [*Nichino America, Inc. v. Valent U.S.A. LLC*, No. 21-1850 (3d Cir. Aug. 12, 2022) (precedential opinion)](https://www2.ca3.uscourts.gov/opinarch/211850p.pdf)
- [*Nichino America, Inc. v. Valent U.S.A. LLC*, No. 21-1850 (3d Cir. Aug. 12, 2022), govinfo (official copy)](https://www.govinfo.gov/app/details/USCOURTS-ca3-21-01850)
- [15 U.S.C. § 1116 (injunctive relief), Cornell LII](https://www.law.cornell.edu/uscode/text/15/1116)
- [Federal Rule of Evidence 301, Cornell LII](https://www.law.cornell.edu/rules/fre/rule_301)
- [*eBay Inc. v. MercExchange, L.L.C.*, 547 U.S. 388 (2006), Cornell LII](https://www.law.cornell.edu/supct/html/05-130.ZS.html)
- [Amol Parikh, "Rebuttal Presumption of Irreparable Harm Still Alive When Assessing Trademark Preliminary Injunctions," McDermott IP Update (Aug. 25, 2022)](https://www.ipupdate.com/2022/08/rebuttal-presumption-of-irreparable-harm-still-alive-when-assessing-trademark-preliminary-injunctions/)
- [Patricia K. Ruiz, "Trademark case: Nichino America Inc. v. Valent U.S.A. LLC," Kluwer Trademark Blog (Mar. 13, 2023)](https://legalblogs.wolterskluwer.com/trademark-blog/trademark-case-nichino-america-inc-v-valent-usa-llc-isa/)