Inequitable Conduct and the Duty to Disclose. Tonya Drake March 2, 2010
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1 Inequitable Conduct and the Duty to Disclose Tonya Drake March 2, 2010
2 Inequitable conduct Defense to patent infringement A finding of inequitable conduct will render a patent unenforceable Claims may still be valid, but be unenforceable 2
3 Inequitable conduct allegations 45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Percentage of cases including an allegation of inequitable conduct Inequitable Conduct litigation has become an absolute plague. Dickson Indus. (Fed. Cir. 2009) Source: Christian E. Mammen, Controlling the Plague : Reforming The Doctrine of Inequitable Conduct, Berkeley Technology Law Journal,
4 Federal Circuit decisions Number of decisions Inequitable Conduct No Inequitable Conduct Finding Vacated (remanded to district court) Source: Christian E. Mammen, Controlling the Plague : Reforming The Doctrine of Inequitable Conduct, Berkeley Technology Law Journal,
5 Inequitable conduct and the duty to disclose Breach of the duty to disclose is the foundation of many inequitable conduct allegations Rule 56 sets out the duty to disclose 5
6 Rule 56 the duty to disclose Who? Each individual associated with the filing and prosecution of a patent application What? Material information - information a reasonable examiner would consider important Why? Examination is more effective when the examiner is aware of and evaluates all information material to patentability 6
7 Two part test materiality and intent Requires proof of: 1) an affirmative misrepresentation of material fact, failure to disclose material information, or submission of false material information 2) by that act intended to deceive the patent office 7
8 Balancing of materiality and intent Equitable balancing of materiality and intent when balanced against high materiality, the showing of intent can be proportionally less Bristol-Meyers Squibb Co. (Fed. Cir. 2003) Was conduct was so culpable that the patent should be held unenforceable? 8
9 Materiality Reasonable examiner standard What would a reasonable examiner consider important in deciding whether to allow the application? Rule 56 standard Establishes a prima facie case of unpatentability or Refutes, or is inconsistent with positions taken by the applicant Not cumulative 9
10 Examples of possibly material information Highly relevant prior art Information that contradicts statements to the patent office Information of prior sales Co-pending applications Rejections of substantially similar claims References and office actions from related applications Related litigation information 10
11 Intent to deceive Evidence must show intent to deceive Gross negligence alone is not sufficient Intent to withhold a reference is not sufficient However, intent to deceive may be proven by circumstantial evidence Good faith should be considered 11
12 Dayco v. Total Containment 2003 Overview: A contrary decision of another examiner can be material even when included in an office action in a co-pending application in a separate family The office action was from an application with no priority relationship to the patent in suit The applicant had not disclosed either the co-pendency or the adverse office action 12
13 McKesson v. Bridge Medical 2007 Overview: An office action in a substantively related (not by priority) co-pending application can be material Examiner was aware of the fact of the co-pendent prosecution, but was not specifically notified of the office action BUT - the district court characterized the prosecuting attorney s testimony as not credible, contradicted by the evidence, and undermined by his own prior testimony 13
14 Larson v. Aluminart Overview: Actions from related copending applications can be material even when co-pendency has been disclosed and the office actions discuss only cumulative art 14
15 Larson v. Aluminart 15
16 Larson: Materiality Why were the 3 rd and 4 th office actions material? Not simply boilerplate reiterations of previous rejections The 3rd Office Action was the first to convey a specific explanation about a reference Later withdraw of 3 rd rejection did not change materiality 16
17 Larson - Guidance on intent Instructed the district court to "take into account any evidence of good faith, which militates against a finding of deceptive intent" Directed the district court to consider that the patentee had disclosed the co-pending application and the 1 st and 2 nd office actions 17
18 Larson - Summary Office actions from related, co-pending applications can be material to prosecution even where: the fact of the co-pendency has been disclosed, and the office actions discuss only cumulative art Notifying the examiner of related prosecution and disclosing earlier documents from that related prosecution evinces good faith 18
19 Practice Tips Doubts about whether information, including office actions, should be disclosed should be resolved in favor of disclosure If applications are co-pending, notify the examiner of their co-pendency However, merely disclosing the existence of co-pending applications or related proceedings is not necessarily sufficient Keep close track of ongoing prosecution in US and foreign counterparts Consider citing references and office actions from related cases 19
20 Therasense v. Becton, Dickinson Overview: statements made to the European Patent Office during a proceeding involving the European counterpart of another patent family were material 20
21 Therasense v. Becton, Dickinson 382 Patent EPO Counterpart Common Inventors 551 Patent optionally, but preferably Revocation Proceeding 21
22 Therasense The statements made to the EPO were material The statements made to the EPO contradicted the statements made to the USPTO The attorney read the EPO decision and knew or should have known that the withheld information would have been highly material to the [USPTO] examiner Federal Circuit affirmed findings of both materiality and intent 22
23 Therasense - inequitable conduct should be rare Although the court affirmed the finding of inequitable conduct, it noted that such a finding should be rare Judge Linn, Dissent: the individuals subjectively believed that the withheld information was immaterial when they withheld it 23
24 Practice Tips Be particularly vigilant when submitting affidavits Carefully review relevant documents and publications to ensure that any affidavit is complete and accurate Keep close track of continuations, divisionals, and foreign counterparts Do not take inconsistent positions in different jurisdictions Consider centralized prosecution of patent families 24
25 Can you disclose too much? Over citation can also result in allegations of inequitable conduct Burying a material reference is unlikely to satisfy the intent prong 25
26 Guidance for prosecutors Resolve doubts in favor of disclosure Set up a standard procedure Don t rely on the procedure to avoid citing art Consider consolidating patent prosecution or having someone responsible for distribution of information Only file patent applications in jurisdictions of value 26
27 Thank You Tonya Drake Associate Fish & Richardson P.C. Special Thanks To Frank Gerratana and Proshanto Mukherji for their help preparing this presentation
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