Motion Federal Circuit Court of Appeal by pid17270

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									Symbol Technologies:
The (re)birth of Prosecution Laches

Austin IPLA, March 27, 2001
Jennifer C Kuhn
Gray Cary
The takeaway points:
  The enforceability of a patent may
  be challenged because of the
  length of the prosecution, even if
  all statutes and rules were
  followed.
  Non-precedential opinions may be
  disregarded by the Federal Circuit.
Symbol Techs., Inc. v. Lemelson Medical
277 F.3d 1361 (Fed. Cir. 2002).

   Symbol and Cognex Corp. filed separate DJ’s
   against the Lemelson foundation.
   After consolidation, Lemelson filed a Motion
   to Dismiss arguing:
       No claim or controversy (12(b)(1))
       Prosecution Laches failed to state a claim upon
        which relief could be granted (12(b)(6)).
   District Court denied the 12(b)(1), and
   granted the 12(b)(6).
The issue on appeal:
  “The sole issue on appeal is whether, as
  a matter of law, the equitable doctrine
  of laches may be applied to bar
  enforcement of patent claims that
  issued after an unreasonable and
  unexplained delay in prosecution even
  though the applicant complied with
  pertinent statutes and rules.” Symbol
  Techs., 277 F.3d at 1263.
Limitations of the Decision
  The panel only addresses the
  existence of the prosecution laches
  defense.

  There is almost no guidance on the
  scope of the defense.
Facts about the Lemelson Patents
  Of the patents involved in the suit, the
  average time from filing to issue: 34
  months (range 7 months through 10
  years 2 months).
  Average time from priority date to
  issuance of claims: 15 years, 5
  months (range 6 years, 3 months
  through 27 years, 6 months).
The Three Sources of Law for
the Federal Circuit’s Decision
  Supreme Court “precedent.”
  1952 Patent Act’s application on that
  Supreme Court precedent
  Prior unpublished Federal Circuit
  opinions.
  (But, the majority neglects to analyze
  CCPA and Court of Claims cases
  interpreting 1952 Patent Act)
The Structure of Federal
Circuit Predecessor Courts
                                     Federal Circuit


    Court of Caims         Court of Customs and Patent Appeals        Patent infringement
   Appellate Division            TTAB and BPAI Appeals           appeals from Regional Circuits
(Precedent to Fed. Cir.)          (Precedent to Fed. Cir.)        (Not Precedent in Fed. Cir.)
The Three Sources of Law for
the Federal Circuit’s Decision

  Supreme Court “precedent.”
  1952 Patent Act’s application on
  that Supreme Court precedent.
  Prior unpublished Federal
  Circuit opinions.
Supreme Court Prosecution Laches
Precedent

  Woodbridge v.         Webster Electric Co.
  United States, 263    v. Splitdorf Electrical
  U.S. 50 (1923):       Co., 264 U.S. 463
  Patent was not        (1924): Claims
  issued after a nine   subject to an
  year delay in         unreasonable eight-
  prosecution.          year delay were not
                        enforceable in
                        infringement suit.
Woodbridge:
 Woodbridge filed his application in 1852, used
 the PTO’s “secret vault” to keep his patent
 from issuing until 1861.
 PTO ultimately refused to allow his claims to
 issue because of the “length of time he had
 allowed his invention to slumber.” 263 U.S.
 at 54.
 Other inventors had obtained patents in the
 field without the benefit of Woodbridge’s. Id.
 at 56.
The Potential Standard:
  The Supreme Court cited the Constitution,
  the special statute referring the case which
  created a laches defense, and Court’s own
  opinion in Kendall which stated an inventor
  may forfeit his rights “by an attempt to
  withhold the benefit of his improvement from
  the public until a similar or the same
  invention should have been made and
  introduced by others.” Kendall v. Winsor, 21
  How. 322, 329.
Ambiguity of the standard
  Appears to be similar to intervening
  rights from the law of reissue
  applications.
  However, Supreme Court uses “should
  have been made and introduced”
  instead of language requiring that
  someone actually have made the
  invention.
Distinguishing Lemelson from Woodbridge
  The Congressional Reference statute
  authorizing Woodbridge’s case explicitly
  authorized prosecution laches as a defense.
  Woodbridge violated PTO rules, lied to the
  PTO about filing a foreign patent application
  and admitted to the Court that he delayed to
  maximize his royalties.
Distinguishing Lemelson from Woodbridge

  Lemelson has not violated any PTO
  rule.
  Symbol Technologies litigation is about
  enforceability, not issuance.
  PTO was much faster in 1852, making a
  nine year delay that much more
  unreasonable.
Webster: (1924)
 Eight years after original application,
 and after self serving interference,
 broad claims were added by
 amendment to a divisional. 264 U.S. at
 465
 Inventor “stood by and awaited
 developments” as others disclosed
 subject matter of later filed claims. Id.
Potential standard
  Webster creates a rebuttable
  presumption that the two year limit
  from reissue practice applies to “laches,
  equitable estoppel or intervening
  private or public rights.” 264 U.S. at
  471.
Supreme Court “Ratifies” Laches
  Crown Cork & Seal Co., Inc. v. Ferdinand
  Gutman Co., Inc., 304 U.S. 159 (1937): Two
  year time limit of Webster was held to be
  dictum. Appears to require abandonment,as
  well as intervening rights. Id. at 168.

  General Talking Pictures Corp. v. Western Elec.
  Co., Inc., 304 U.S. 175 (1938): Rejected laches
  because there was no evidence of “intervening
  rights.” Id. at 183.
Supreme Court Summary
 Woodbridge “should have” standard is
 superseded for infringement cases.
 Proof of “adverse intervening rights” is
 required before patentee must justify delay.
 There is no time after which prosecution is
 presumptively unreasonable.
 Equity for competitors, rather than
 Constitutional limitations on patent terms,
 forms basis for prosecution laches.
Another Supreme Court case
  Overland Motor Co. v. Packard Motor Car Co.,
  274 U.S. 417, 424 (1927).
  “We do not know on what principle we could
  apply the equitable doctrine of abandonment
  be laches [sic] in a case where the measure
  of reasonable promptness is fixed by statute,
  and no other ground appears by reason of
  which laches could be imputed to the
  applicant.”
Lemelson’s arguments:
  Webster and following cases are limited
  to interferences.
     But Crown Cork and General Talking
      Pictures are not interference cases.
The Three Sources of Law for
the Federal Circuit’s Decision

  Supreme Court “precedent.”
  1952 Patent Act’s application on
  that Supreme Court precedent.
  Prior unpublished Federal
  Circuit opinions.
Sections 120 and 121
  These two sections codified existing
  continuation practice which had been
  governed by PTO rules:
     Section 120: Benefit of earlier filing date in the
      U.S.
     Section 121: Divisional applications


  No part of Title 35 directly addresses
  prosecution laches.
Reliance on Legislative History
  Plain language of statute controls “in
  the absence of clearly expressed
  legislative intent to the contrary.”
  Transco Prods. Inc. v. Performance
  Contracting Inc., 38 F.3d 551, 556-57
  (Fed. Cir. 1994) (Rich, J.).
  Transco holds that the 1952 patent act
  merely codified continuation practice.
Legislative History of 120-21
  The opinion relies on Federico lectures and
  commentary on the 1952 Patent Act, which
  mention “equitable defenses such as laches,
  estoppel and unclean hands.” 75 J. Pat &
  Tm. Office Soc. 161, 215 (1993) (reprint of
  Federico’s 1954 post Patent Act article).
  Decision extrapolates from this quote to the
  conclusion that the drafters (and thus
  Congress) intended to maintain the defense
  despite not including prosecution laches in
  section 282.
Lemelson’s arguments:
  Webster and following cases are limited to
  interferences.
    But Crown Cork and General Talking Pictures are
     not interference cases.
  The plain language and legislative
  history of the 1952 Patent Act foreclose
  the defense of prosecution laches.
     Federico ex post facto lectures indicated
      that laches was preserved
The Three Sources of Law for
the Federal Circuit’s Decision

  Supreme Court “precedent.”
  1952 Patent Act’s application on
  that Supreme Court precedent.
  Prior unpublished Federal
  Circuit opinions.
Previous unpublished opinions
reject the laches defense?
 Bott v. Four Star Corp., 848 F.2d 1245 (Fed.
 Cir. 1988) (Bissell, Archer and Mayer).
 Argument rejected was based on the two-
 year reissue limitation from Webster.
 “Accordingly, we are not persuaded…that this
 court should adopt equitable safeguards to
 limit continuation applications when the
 Congress gave no indication that it intended
 to so do.” Id. at *1 (citing In re Hogan, 559
 F.2d 595, 604 n. 13 (CCPA 1977) and In re
 Henrikson, 399 F.2d 253, 262 (CCPA 1968)).
Previous unpublished opinions
reject the laches defense?
  Ricoh Co., Ltd. v. Nashua Corp., 185
  F.3d 884 (Fed. Cir. 1999). Rejects
  Nashua’s argument that it is entitled to
  intervening rights.
  Cites Kingsdown Medical Cons., Ltd. v.
  Hollister, Inc., 863 F.2d 867, 874 (Fed.
  Cir. 1988), approving claims specifically
  added to cover competitor’s product.
Lemelson’s arguments:
  Webster and following cases are limited to interferences.
   But Crown Cork and General Talking Pictures are not
    interference cases.
  The plain language and legislative history of
  the 1952 Patent Act foreclose the defense of
  prosecution laches.
      Federico: laches was preserved, but CCPA and Fed
       Cir decisions during Rich’s tenure indicate
       otherwise.
  Unpublished decisions reject laches
      Whether the panel was right or wrong to reject its
       earlier decisions, they are actually distinguishable.
Judge Newman’s Dissent
Newman: Let Congress Do It
  “[T]he court should not intervene in equity
  where Congress has not.” citing district court
  and Northwest Airlines Inc. v. Transport
  Workers Union of Am., 451 U.S. 77, 97
  (1981).
  Cites CCPA cases (Henrikson and Hogan)
  where equitable changes to the 1952 Patent
  Act’s continuation practice scheme were
  rejected.
Conflict in Precedent Ignored
  Both CCPA and Court of Claims address
  the legislative history of the 1952
  Patent Act.
  Pratt & Whitney Co. v. United States,
  345 F.2d 838 (Ct. Cl. 1965) holds claims
  invalid due to laches citing Webster.
  Id. at 843-44.
CCPA Precedent
  Henrikson shows the ambiguity of the
  legislative history, as the BPAI (Federico was
  on the board) was overruled by the CCPA
  (Rich was on the court) on the PTO’s attempt
  to limit the number of continuations. New
  limitations to section 120 are for Congress to
  decide. 399 F.2d at 1388.
  Hogan: “The 24 years of pendency herein
  may be decried, but a limit upon continuing
  applications is a matter of policy for the
  Congress, not for us.” 559 F.2d at 604.
Resolution of Conflict
  Both CCPA and Court of Claims decisions are
  precedential. South Corp. v. United States,
  690 F.2d 1368 (Fed. Cir. 1982).

  Resolution of conflict between the two
  require en banc consideration. UMC Elec. Co.
  v. United States, 816 F.2d 647 (Fed. Cir.
  1987).
Conclusion:
Considerations for Prosecutors,
Litigators and Licensing Attorneys
Potential Prosecution Flags:
  Continuation or divisional claims that
  are broader than the original claims?
  Festo encourages narrower claims.
  Claims added to cover competing
  products in the market place?
  Kingsdown specifically approves this.
  Prosecutions that are unusually long?
  20 year term may not excuse this.
Potential Litigation Issues
  Opinion gives no guidance on
  application of prosecution laches.
  May open the door to testimony about
  the internal operations of the PTO.
  Tension with Kingsdown will complicate
  the application of the defense.
Potential Licensing Issues
  Previously solid patents may now
  be unenforceable.

  Portfolio review should now include
  investigation of potential adverse
  intervening rights.
Symbol Technologies:
Questions

								
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