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« Court Report | Main | Pharma and Software Companies File Joint Amicus Brief in Therasense Case »

August 02, 2010

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While reading the brief, I was struck by the disparity with what the brief was wanting ("but for") and the statement:

"herein 'the scope of inequitable conduct may range from outright fraud, to deceit, to gaining an advantage by unfair means.' Behavior and activity amounting to inequitable conduct 'that may render a patent unenforceable is broader than "common law fraud," ' "

Specifically the "advantage by unfair means" and the "broader than common law fraud" speak against a strict "but for" standard. It seems like the IPO wants to hide this difference in plain sight.

Skeptical:
you're pointing out something that everybody's been struggling with. If the Supreme Court had said anywhere that it demands a "but for" standard, you'd think that somebody would have figured that out by now.
The really important point is: a "but for" standard is not inconsistent with, and therefore permissible under the Supreme Court cases. Nothing in those cases bars the Federal Circuit from adopting the test if it believes that's best for the system at this time.
The unclean hands cases, you point it out yourself, have really no standard at all. That doctrine could deny relief for infringement even if the plaintiff's misconduct has nothing to do with the patent office. All that's required is that the litigant be a scumbag. That's no standard.
All this talk about resurrecting the unclean hands doctrine will only give infringers new ideas. Let's leave it for dead and go with "but for" materiality.

Moocow,

I cannot agree with your statement of "The really important point is: a "but for" standard is not inconsistent with, and therefore permissible under the Supreme Court cases."

Clearly, were such a statement be true, it would have to square with two phrases hiding in plain sight that I brought forward: "advantage by unfair means" and the "broader than common law fraud".

It does not.

"But for" would eviscerate the "advantage by unfair means" as that statement currently does not require the advantage to have been successfully played out, and is a much lower threshold.

Similarly, you ignore the differences in scope between intent as in common law fraud and the current "broader than common law fraud", without explanation.

This reminds me of the early nineties when in a particular industry improprieties were being splashed on the front pages and the response was to limit action beyond that which was called out by law to the point of addressing "even the appearance of" such improprieties. I equate the current very broad reading of inequitable conduct to be along those lines, where even the appearance of inequitable conduct is to be avoided (and as Kevin points out - this does carry the ramification that excessive prior art will be submitted on IDS's). While you are correct in that the wider parameters of the existing law are far less clear than a "but for" standard, I think the CAFC will once again look over their shoulders and hesitate to make a bright-line rule - even one such as this that would move the patent world closer to the rest of the law.

Skeptical:
I don't think "but for" materiality eviscerates Keystone Driller's "wrongful advantage" language. With tongue-in-cheek, I would counter that there's nothing wrongful about the advantage gained by someone who procures a valid patent.

But the better distinction follows if we keep in mind that the unclean hands doctrine and the modern inequitable conduct doctrine really serve two different purposes. The former was invoked by the Supreme Court to deal with unclean litigants, the latter was created by the CCPA to deal with unclean patents.

Thus, for example, a patentee who perfectly innocently procures a patent in the PTO, later discovers that it contains invalid claims, and then conceals the evidence of invalidity and enforces that patent, could properly be denied relief under the unclean hands doctrine - yet there was no "inequitable conduct." Heck, a DJ plaintiff who doesn't even HAVE a patent could be denied relief under the unclean hands doctrine if its conduct is bad enough. That tells me that unclean hands really has very little to do with what we understand by "inequitable conduct" today.

Conversely, a licensee who enforces a patent without knowledge that the licensor concealed something material during prosecution could not be reached by the unclean hands doctrine - there's nothing unclean about such a litigant - yet lose the patent due to "inequitable conduct" irrespective of its validity.

So, given insufficient overlap between the two doctrines, we have to qualify the Court's statements in Keystone Driller and Precision Instrument. A broad range of reprehensible conduct could qualify to make a litigant "unclean." But not every litigant is automatically unclean just because there was inequitable conduct in the PTO. And the Supreme Court never set any standards that define impermissible conduct in the PTO if the litigant was not unclean. That's why I think the CAFC is free to do what it believes to be in the system's best interest.

Moocow,

First, thank you for your post - You have elucidated, or to borrow from former Justice Stevens, you have pellucidly distinguished actions during prosecution (IC) and actions post prosecution (clean hands) and I believe, in fact, that the conflation of these two, have, in no small part, added to the confusion of application, of any of the various doctrines, to any identifiable standard.

Or in other words - we have more than one thing on the table and there is some confusion about which item we are talking about at any one particular time.

Second, I believe that the CAFC is expressly NOT free to do what it may believe to be in the system's best interest because the Supreme Court has both historically chided the CAFC for bright-line rule making in attempts to clarify patent jurisprudence AND chided the CAFC for even trying to make patents distinct from the rest of the legal world.

In effect, the CAFC has been placed in a dammed if you do and dammed if you don't conundrum.

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