Antitrust and Prosecution Delay Laches by liuhongmei


									Prosecution Delay Laches and
    Inequitable Conduct
         Prof Merges

35 U.S.C. 315 Appeal

(a) PATENT OWNER.- The patent owner involved in
  an inter partes reexamination proceeding under
  this chapter-
(b) THIRD-PARTY REQUESTER.- A third-party
(1) may appeal under the provisions of section 134,
  and may appeal under the provisions of sections
  141 through 144, with respect to any final decision
  favorable to the patentability of any original or
  proposed amended or new claim of the patent
(c) CIVIL ACTION.- A third-party requester whose
  request for an inter partes reexamination results in
  an order under section 313 is estopped from
  asserting at a later time, in any civil action arising
  in whole or in part under section 1338 of title 28,
  the invalidity of any claim finally determined to be
  valid and patentable on any ground which the
  third-party requester raised or could have raised
  during the inter partes reexamination proceedings.
  This subsection does not prevent the assertion of
  invalidity based on newly discovered prior art
  unavailable to the third-party requester and the
  Patent and Trademark Office …
Jerome Lemelson, 1923-1997
Mr. Lemelson, who died in 1997, was granted more than 500
  U.S. patents, making him (from a patent-count standpoint,
  anyway), one of the most prolific inventors in U.S. history.
  Some have compared him with Edison (that patent count
  again), but unlike Edison, most people would have difficulty
  recognizing his name or what any of his inventions were. Ask
  the dozens of companies he sued over the years for alleged
  patent infringement, and observers of developments in
  patent law, and they may tell you that Lemelson’s most
  significant (and lucrative) invention was how to game the
  U.S. patent system.
United States Patent 5,351,078 Lemelson * September
  27, 1994 Apparatus and methods for automated
  observation of objects

Apparatus and methods are disclosed for automatically
  inspecting two- or three-dimensional objects or
  subjects. A detector and the object are moved
  relative to each other. In one form, a detector, such
  as a camera or radiation receiver, moves around an
  object, which is supported to be rotatable such that
  the detector may receive electromagnetic energy
  signals from the object from a variety of angles. The
  energy may be directed as a beam at and reflected
  from the object, as for visible light, or passed
  through the object, as for x-ray radiation.
The detector generates analog image
 signals resulting from the detected
 radiation, and an electronic
 computer process and analyzes the
 analog signals and generates digital
 codes, which may be stored or
 employed to control a display.
Inventors: Lemelson; Jerome H. (Incline
  Village, NV) Assignee: Lemelson Medical,
  Education & Research Foundation
  Limited Partnership (Incline Village, NV)
  Filed: September 16, 1993
        “Continuation Abuse”
MAJOR controversy over stringent PTO rules
 limiting number of continuations that
 patentee is allowed to file
Supreme Court of the United States.

       WOODBRIDGE et al.
      Decided Nov. 12, 1923.
Justice Taft
In this case we have a delay of 9 1/2 years in
  securing a patent that might have been had
  at any time in that period for the asking,
  and this for the admitted purpose of making
  the term of the monopoly square with the
  period when the commercial profit from it
  would be highest. Not until war or fear of
  war came was there likely to be a strong
  demand for rifled cannon and their
Hence the inventor, having put his order
 for the issue of a patent into the secret
 archives of the Patent Office in 1852, sat
 down and waited until after the Civil
 War came on in 1861 before seeking to
 avail himself of the patent, thus
 postponing the time when the public
 could freely enjoy it for nearly 10 years.
Meantime other inventors had been at
 work in the same field and had
 obtained patents without knowledge of
 the situation with respect to
 Woodbridge's invention.
This is not a case where evidence has to
 be weighed as to the purpose of the
 inventor. He avows his deliberate
 intention. This is not a case of
 abandonment. It is a case of forfeiting
 the right to a patent by designed delay.
    Defenses: Antitrust/Misuse

• Patents confer market power

• Market power can be abused

• When it has been, this may provide a defense
  for an infringer
          Updating Lemelson

• Cancer Research Tech Ltd. V. Barr Labs, Fed.
  Cir. Nov. 9, 2010

• Original app filed Aug 23, 1982; 1st office
  action, Nov. 1983; continuation filed;
  followed by 10 more continuations, with
  finally a substantive response, patent issued
  in Nov. 1993
           Cancer Res. Cont’d

• Federal Circuit held, no prosecution delay
  laches because no one invested in, worked
  on, or otherwise used the claimed
  technology while it was lying dormant

• No “prejudice,” no “intervening rights”

• Judge Prost dissented: delay is per se
         Inequitable Conduct

• Common law-type defense

• Very powerful weapon for accused infringers

• Finding of inequitable conduct renders
  patent unenforceable
     Supreme Court caselaw

The Supreme Court has held
 patents unenforceable only in
 cases of ‘fraud on the Patent
See eg, Walker Process Equip., Inc.
 v. Food Mach. & Chem. Corp.,
 382 U.S. 172, 175, 176 (1965).
          Federal Circuit cases
Kingsdown properly requires powerful proof
  of scienter: “*T+he involved conduct, in
  light of all the evidence, including
  evidence indicative of good faith, must
  indicate sufficient culpability to require a
  finding of intent to deceive.” 863 F.2d at
     Materiality requirement

“*I+f the Patent Office had been
  aware of the complete or true
  facts, the challenged claims
  would not have been allowed.”
  Norton v. Curtiss, 433 F.2d 779,
  794 (C.C.P.A. 1971).
          Materiality (cont’d)

• Not all omissions or deceptive statements are

• Some are essentially “harmless”
• Involves status of arguments made before
  the European Patent Office in an opposition

• Statements involved a prior patent on the
  same technology claimed in the patent at
  issue in the Federal Circuit case
Claim 1, ‘551 Patent
        Prior patent: 4,545,382

• Specification included statement that lack of
  membrane was a preferred embodiment

• No mention of fact that one skilled in the art
  would believe lack of membrane to be an
  inventive feature of the invention
              District court

• Failure to inform PTO of this argument at the
  European Patent Office constituted
  inequitable conduct

• Patent held unenforceable
        Federal Circuit opinion

• Affirmed trial court

• Raised proper standard for Inequitable
  conduct as an issue for en banc appeal
            Therasense brief

• Constitutional issues

• Conformity with other branches of IP law

• Practical considerations

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