Larson Mfg. Co. v. Aluminart Products Ltd. (Fed. Cir. 2008)
Larson's patent covers a specially designed outside. The appeal focuses on inequitable conduct and the Federal Circuit vacated a district court judgment that the asserted patent was unenforceable. I will return to the decision in a later post, but wanted to focus attention on the concurring opinion by Judge Linn and his call for an en banc review of inequitable conduct jurisprudence. Linn's concerns could be addressed by the Supreme Court in Aventis Pharma v. Amphastar Pharmaceuticals, which is pending certiorari.
I write separately … to express my view that this precedent has significantly diverged from the Supreme Court's treatment of inequitable conduct and perpetuates what was once referred to as a "plague" that our en banc court sought to cure in Kingsdown Medical Consultants, Ltd. v. Hollister Inc., 863 F.2d 867 (Fed. Cir. 1988) (en banc). …
Symptoms of this plague are apparent from the facts of this case. The patent-in-suit has undergone examination twice in the PTO, and the patentee has been accused of inequitable conduct on each occasion for allegedly withholding material information. During original prosecution, the PTO considered 143 references, 135 of which the submitted two more IDSs in the reexamination, each within approximately one month of the application's Office Actions. The IDSs contained all references relied on in those rejections but did not include the Office Actions themselves. With full knowledge of the co-pending application, the PTO confirmed the patent, which survived reexamination without substantive change to the litigated claims. When the litigation resumed, the accused infringer again charged the patentee with inequitable conduct, this time based on conduct in the reexamination. This second inequitable conduct allegation was the sole issue at trial. Following remand today, the litigation will continue to focus on inequitable conduct, to the exclusion of the patentee's infringement contentions.
The ease with which inequitable conduct can be pled, but not dismissed, is a problem of our own making. The Supreme Court's three inequitable conduct cases involved overt fraud, not equivocal acts of omission. Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 809, 819 (1945) ("patent claims infected with fraud and perjury" where assignee knew that its employee "gave false dates as to the conception, disclosure, drawing, description and reduction to practice" during interference proceeding and then "secured the perjured . . . application and exacted promises from the other parties never to question the validity of any patent that might be issued on that application"); Keystone Driller Co. v. Gen. Excavator Co., 290 U.S. 240, 243 (1933) (false affidavits and deposition testimonies obtained "for valuable considerations" averring that the prior art use "was an abandoned experiment" and "to keep secret the details of the prior use"); Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238, 240, 243 (1944) (false trade article procured from "an ostensibly disinterested expert" in exchange for $8,000 to gain patent issuance in spite of previously "insurmountable Patent Office opposition"), overruled on other grounds by Standard Oil Co. v. United States, 429 U.S. 17 (1976).
We clarified en banc that the "two elements, materiality and intent, must be proven by clear and convincing evidence," and that "'gross negligence' does not of itself justify an inference of intent to deceive." Kingsdown. But in seeming contradiction with Kingsdown, a standard even lower than "gross negligence" has propagated through our case law. This standard permits an inference of deceptive intent when "(1) highly material information is withheld; (2) 'the applicant knew of the information [and] . . . knew or should have known of the materiality of the information; and (3) the applicant has not provided a credible explanation for the withholding.'" Praxair, Inc. v. ATMI, Inc., 543 F.3d 1306, 1313-14 (Fed. Cir. 2008).
This test is problematic. First, the "high materiality" prong of the intent element simply repeats the materiality element. Conflating materiality and intent in this manner is inconsistent with the principle that "materiality does not presume intent, which is a separate and essential component of inequitable conduct." Manville Sales Corp. The second, "should have known" prong sets forth a simple negligence standard, lower even than the "gross negligence" standard that was expressly rejected in Kingsdown. I also question whether a fact-finder who has deemed information to be "highly material" would not also be compelled to conclude that a reasonable patentee "should have known of the materiality," at least when the patentee "knew of the information," as prong two requires. Third, the "credible explanation" prong effectively shifts the burden to the patentee to prove a negative: that it did not intend to deceive the PTO. But it is the "accused infringer"—not the patentee—who "must prove by clear and convincing evidence that the material information was withheld with the specific intent to deceive the PTO." Star Scientific, Inc. As to this third prong, we have also explained that "[t]he patentee need not offer any good faith explanation unless the accused infringer first carried his burden to prove a threshold level of intent to deceive by clear and convincing evidence." Id. As explained above, however, the first two prongs are not evidence of deceptive intent. The first is evidence of materiality; the second is evidence of negligence. These two prongs are therefore insufficient as a matter of law to establish a clear and convincing "threshold level" of deceptive intent before the third prong can ever properly come into play.
As it now stands, the test generally permits an inference of deceptive intent to be drawn whenever the three prongs are satisfied. This is in tension with the rule in Star Scientific that "the inference must not only be based on sufficient evidence and be reasonable in light of that evidence, but it must also be the single most reasonable inference able to be drawn from the evidence." Id. It cannot be said that deceptive intent is the "single most reasonable inference" when all that prong two shows is that the patentee "should have known" that the information was material. An equally reasonable inference under this test is that the patentee incorrectly believed that the information was not material, or that the patentee was negligent, or even grossly negligent. None of these gives rise to deceptive intent under Kingsdown, nor is deceptive intent the "single most reasonable inference" under Star Scientific.
For the foregoing reasons, I respectfully submit that the test for inferring deceptive intent, as it currently exists, falls short of the standard "need[ed] to strictly enforce the burden of proof and elevated standard of proof in the inequitable conduct context." Star Scientific. The facts of this case suggest that the time has come for the court to review the issue en banc.
Great post Luke. I had been wondering the same thing but had never come to the idea of asking. Intuitively, one would think that, when something is proved by evidence, the more evidence ‘cumulates, the more sure one can be, that it does indeed prove the fact. If I were a jurymember in a murder trial, I should be grateful for every bit of cumulative evidence I can discern. But 6 uses it like everybody else in patent law, where “cumulative” is used as a term of dismissal, and to mean “adding nothing new to what we knew already”. Do the criminal lawyers use “cumulative” in the same way as 6? I hope not.
Quoth 6:
“I haven’t seen a claim yet that took 1000 references to cover without any of them being cumulative. Look that word up, then avoid submitting those kinds of references”.
Well, when I look in a dictionary, I see things like “increasing or enlarging by successive addition” or “tending to prove the same point”; the latter under the sub-heading “Law”.
So I’ve never understood what is meant by “cumulative reference”, since I don’t see how any reference after the first you submit could *not* be cumulative.
Every reference enlarges the amount of evidence (definition one) and, unless you submit something outlandishly unrelated, every reference is in support of “the same point” i.e. the knowledge base relating to the patent application (definition two).
So clearly cumulative must refer to some abstruse meaning of “relating to”. But I am unaware of any case law concerning exactly what “cumulative” means in US patent law context. Could someone oblige me?
Cheers, Luke
The federal circuit has made the mess of inequitable conduct. They should fix it, not Congress.
Judge Linn is certainly correct that the Federal Circuit case law is muddled. As I painfully learned last year, the outcome of an inequitable conduct appeal in the Federal Circuit often depends in large part on which judges participate on the panel. Clearly, different panels of the Federal Circuit apply different inequitable conduct standards. This situation is intolerable as a matter of basic justice, and it makes it almost impossible to counsel clients on the strengths and weaknesses of inequitable conduct charges.
But I do not think the solution is to make it harder to prove inequitable conduct. To the contrary–I believe the sole test should be whether material information was withheld or misrepresented–with materiality being defined as any information a reasonable examiner would have considered arguably relevant. The burden should be on practitioners to disclose material information and failure should automatically lead to loss of the patent, regardless of whether there was intent to deceive, negligence, or recklessness. This simple approach will avoid the nightmare of endless litigation on the issue of intent and focus the issue on one objective dispute–was material (relevant) information withheld or misrepresented. And the definition of materiality should be very broad–anything even arguably relevant should be disclosed.
Those who would make it harder to prove inequitable conduct, like those who promoted deregulation of banking and securities markets, are falling into the same intellectually misguided trap that led to our current economic crises. We need to hold professionals to higher standards of accountability, not to lower standards. Otherwise, the patent system–like the banking and securities systems–will turn into the wild wild west once more, requiring massive governmental bailouts (in this case, massive government stripping away of ill-gotten patents and profits earned from their enforcement).
Imposing strict liability on practitioners and patentees who withhold or misrepresent material information is entirely reasonable. A patent is a license to act as a monopolist, often to the detriment of the interests of consumers. We give patents as incentives to develop science and the useful arts, but entitlement to such incentives is a privilege, not an absolute right. It is entirely just and fair that the persons who may receive vast economic benefits from this govenmental benefit program (i.e. patent license) must fully comply with licensing requirements–i.e., disclosing all material information. Failure to comply eliminates a condition precedent to entitlement to the license and, therefore, it is neither arbitrary nor unfair to strip the patent license from the patentee who has withheld material information.
Chicken Little should read a book called “Fooled by Randomness”. The way to succeed is to distinguish between the signal and the noise. Put together everything on this blog and one can discern what signal the courts are sending out. The world is ever smaller. On the IPKat blog this morning is an announcement of the arrival in Europe of double patenting law. In the other direction, ICU is an echo of established European patent law, and it needn’t bring drafting chaos in its wake. It just perpetuates the CAFC warning to “Be careful What You Ask for”. As to ICU, I’m thinking that the ages old saw still applies today “He who lives by the sword will die by the sword”.
“This paragraph by Judge Linn is ridiculous.”
MM,
The only thing “ridiculous” is your repeated rhetorical nonsense. You remain (forever) clueless.
Paul Cole: You’re absolutely right that inequitable conduct is a “monster” that threatens to devour good patents, as well as the bad. This “plague” needs to go or at least be put in a cage and opened only for the most egregious instances (as enumerated in my 6-point statement at the beginning of the comments).
As everyone knows from KSR, once you start applying common sense you have to re-write all your manuals!
Paul, what do you do for your clients? Apply common sense, right. Neither 2000 references, nor 2.
So long as
1. conduct inequitable = loss of patent, and
2) a “clutch at any straw” standard is operated by the Plaintiff,
the monster will thrive, no, whatever threshold you select. Tougher sanctions is one solution. Maybe it’s the only one that will kill the monster? Mind you, discovery, at the level that will expose IC, will presumably remain, and that’s an even bigger monster, no?
Like Judge Linn I am of the view that inequitable conduct has grown into a monster, and from a European standpoint wastes effort and resources both at the client/attorney level and at the Patent Office level.
How does filing 200 references ASSIST an examiner? If he or she has to read them all, it imposes an unreasonable burden. Why not just file the one or two references that are important and leave out the rest?
What burden does all this impose on the prosecution attorney? If you read the decision, you will see how much analysis was needed to reach a conclusion that the references in issue were merely cumulative. Is this a burden that should be imposed on every attorney, including an attorney for a small entity, during prosecution, with the sanction that if he or she gets it wrong there should be an inequitable conduct finding?
To what extent is all this needed? We now have publicly accessible keyword searchable databases such such as the USPTO database and esp@acenet. File histories at least in Europe and the US are available on-line.
In the case in issue the relevant CIP was notified to the USPTO. The objection was that specific office actions which were held to be material were not notified to the USPTO. If the assumption is that an examiner being notified of a closely related and potentialy material file in the USPTO would not study it, that assumes an utterly incredible level of lack of curiosity and attention to detail amongst the US examining corps, who should more credibly be assumed to be diligent and well educated people aiming to do a good job, especially in a reexamination case.
One problem is the materiality standard. If you look at the decided cases it is much closer to an anticipation or clear obviousness standard than is generally recognized, and US judges are on the whole far more reasonable people than parakletophobia and litigation paranoia might suggest. But a narrower and more specific definition of the disclosure obligation coupled with a higher threshold for intent to deceive could significantly reduce the problems.
By “less than miniscule” I suppose you mean that you “have no idea what you’re talking about.”
Why don’t you just, mmmm goahead and move your desk to Storage B. Mmmmm Kay? Thanks a bunch Mooney.
Noise, not sure if this help, but by “beyond miniscule” I mean “less than miniscule.”
“The percent of patents that are improperly held unenforceable each year for inequitable conduct is beyond miniscule.” – Malcolm
“I incorrectly referred to “a gradual 15% increase in inequitable conduct pleadings over the past 25 years.” Should be “a gradual doubling”!
Still, only a minor fraction of the total number of cases.” – Malcolm (on another thread – same topic).
Interesting twist on meaningless Malcom math:
Minor fraction > beyond miniscule.
Only makes sense in the World of Mooney that a number beyond miniscule has more import than a number that is a minor fraction.
Get your track shoes on Malcolm, I sense another running session is imminent.
“The percent of patents that are improperly held unenforceable each year for inequitable conduct is beyond miniscule.” Are we trumpeting an undefined percent of issued patents? Litigated patents?”
We’re talking about litigated patents, obviously. I’ll let you do the math, friend.
“why assasinate the character of the patent attorney”
LOL. Even the micro-public of patent prosecutors could care less who these allegedly corrupt prosecutors are, just like the micro-public of scientists could care less if one of their peers’ declarations gets shredded during litigation.
SamIam “I seriously dispute “that intentional withholding of material information when practicing before the USPTO” happens “routinely”. Who specifically practices that “routine”?”
Um ….
“How much luck have they had in enforcing their patents?”
Quite a bit, as I noted in my comment. It’s called “licensing.” Look it up. It’s sort of a shortcut where you imagine how much it would cost to litigate an issue.
It has always seemed ridiculous to me that we have such an adversarial system for applying for patents, but applicants are required to testify against themselves. And I don’t know why there is a need to find “inequitable conduct” for failure to submit some reference cited in a patent filed in another country in another language by someone else who works for one of your parent company’s foreign affiliates. If that art is so deadly, the Court can just invalidate those claims of the patent under 102 or 103, without touching other, valid claims of the patent. And why assasinate the character of the patent attorney and force them to do through a character and fitness review? The current law is draconian, to say the least.
“What we’re talking about here is intentional misrepresentation or withholding of material information when practicing before the USPTO. Nobody seriously disputes that this doesn’t happen routinely.”
I seriously dispute “that intentional withholding of material information when practicing before the USPTO” happens “routinely”. Who specifically practices that “routine”? How much luck have they had in enforcing their patents?
“And nobody disputes that a mechanism needs to be in place to prevent the chicanery and punish wrongdoers.”
I seriously dispute that strawman as well. Objectively, what percent of patents are procured due to intentional deception of the examiner? As for the alleged need for submission of material prior art, most countries of the world seriously dispute that ANY mechanism is needed to submit “material” information. Must the their criminal genes ;-), but Australia recently eliminated its submission requirement. Defend why USPTO examiners can not find sufficient relevant prior art on their own. Ignoring 6, how many examiner’s agree that applicant prior art submissions do anything but complicate examination?
“Currently the mechanism is one that minimizes the effects on practitioners and maximizes the effects on the patent.”
Anyone care to share with us what minimal “effects” the resulting malpractice suit had on their practice after “the mechanism” successfully invalidated, due to a negligent omission, a patent they prosecuted?
“This is about lying.” Nasty habit. Perhaps someone can recommend a therapist or 12-step program for it?
As for those practitioners accused of inequitable conduct due to negligent failure to submit an arguably material reference, and the strict liability that attaches to that “equitable” negligence (good grief!), is flailing the “liar” brush the best defense of the lunacy that Judge Linn courageously challenges?
“The percent of patents that are improperly held unenforceable each year for inequitable conduct is beyond miniscule.” Are we trumpeting an undefined percent of issued patents? Litigated patents? Patents adjudicated by the Federal Circuit? Is there no data that supports this “beyond miniscule” strawman?
MM: “But how did you enjoy strawman? Did you share a cigarette afterwards?”
My mistake. Obviously I imagined where you said “relevant” you meant “material,” as the legal standard for what must be submitted is MATERIALITY rather than RELEVANCY.
So your position seems then to be that the threshold should be lowered from information “material” to patentability to information “relevant” to patentability? Would you happen to have case law to support this assertion, or do you have an argument in favor of it? I can’t see how such a change would be anything but unduly burdensome to the PTO.
I suggest you review the relevant case law before making more statements that make you look foolish.
egd “Interesting that you have a different definition of “material” from the Court.”
I didn’t define “material”. But how did you enjoy strawman? Did you share a cigarette afterwards?
“Way to go. 6 obviously has no clue what U.S. patent litigation is about, or has ever been accused of inequitable conduct (as I and many, many other patent prosecutors without proof). ”
I’m sorry for your ills, but you (and many many other patent prosecutors that I personally know of) do ridiculous things that beg the question of your intent and whether or not you have some information that is material.
A quick example. I have a method of making something involving the creation of a type of part. Reference A shows the whole method except the creation of that particular part. The reference B shows a method of making a species of that type of genus part. The attorney then argues that it isn’t obvious to combine B with A because OTHER species in reference B have some properties that are x y and z that are incompatible with the method in A. He neglects to say what the properties that the actual species in question has with respect to A, and while I wasn’t 100% sure of what they are I had a good idea of what they were. Is that information material? What is the likelihood that the information about the properties of the species in question was right beside the properties of the other species in whatever reference it was he was using to find those properties? About 99.999999%. If I never find the information in question, which I did not, how am I supposed to tell if any patent I might issue would be valid?
What is the attorney’s intent here? To facilitate justice being done, to make a “good” and “reasonable” argument, or to try to pull one over? There is a 99.99999% chance that it is the later. Because if he does have the information, which he very likely does, then his argument makes no sense what so ever and is completely bogus. And if this case went to trial, and he never gave me the information, and they found out somehow that he did indeed have it, then it is my opinion that the law should take that situation for what it was, and not require outlandish “proof” etc. that he was pulling bs.
That sht needs to go. Oh, and btw JD, that is a case where material factual information is probably right beside the applicant and if he doesn’t hand it over in the next reply willingly I will gladly press for a request for information. And if he tries your patented go f yourself the case will not pass to issue before me. Of course, I doubt very seriously he’ll do anything but comply in the next response.
“I got an office action recently including a PTO1449 in which the examiner refused to consider a reference I cited because I did not know its publication date and described it as “Undated -Possible prior art””
He probably did consider it but couldn’t find the date either so he handed it back to you to do it or have it officially on your head instead of his. Seems perfectly reasonable to me, you’re the one in the best position to find out where your own reference came from in many instances. Where did you get the reference, and what makes you think it is possible prior art? If you told him that then perhaps he would have done your part for you, iirc it is your job to put dates on references in an IDS isn’t it?
“once they have been allowed to get complicated. ”
Nip it, nip it in the bud.
“Equity is all about fairness, and I think it manifestly unfair that an otherwise valid patent can be held unenforceable with any finding of IC under the current confused regime.”
Unfair to whom? The patentee, or the alleged infringer wasting his day in court?
“I think that is wrong. If current law allows, IC allegations should require separate proceedings. Conduct should be brought to the attention of the PTO, investigated by the PTO, and charges brought by the PTO in an appropriate forum.”
Translation: I’d like to make this really complicated and involve the party whom I aggrieved in the first instance begging their wrath.
“Since the PTO acts as the “people’s representative” in such a matter, they would have a burden to demonstrate the equitability of their own conduct–no ridiculous OA’s, no new ground of rejection in final OA before ground of rejection in non-final OA is resolved, no action illegal on its face, no official notice without substantial evidence, the list goes on and on.”
Translation: I’d like to add additional burden to a party. For no reason what so ever except to add more burdens to the system that is already burdened unduly.
“2) patent is invalid–speaks for itself, and PTO could levy a fine to recover costs associated with the conduct, plus maybe something punitive.”
A hand or two? If so, I’m all for the entirety of your plan. If not, I’m against it.
“about the absurdity that results in applicants feeling that they have to offer up to the PTO bits of paper when they don’t know, and can’t find out, and so can’t tell the Exr, if it’s prior art or not.”
How exactly did they come by this piece of information that they just can’t find a date for? What happened, did someone die? Idk max, the public has a “right” to see whatever info that the app has that is material imo and I don’t see how this can possibly be absurd.
Malcolm I’m pretty sure he meant that it was the difficulty of dismissing the claim that was the problem, not the ease with which it is plead, or at least not to the same extent.
“So you, as an examiner, have no problem considering the 300 references I am going to submit that my first keyword search turned up, just in case one of them happens to be relevant (and is misclassified so that it isn’t found when I narrow the search to classes + keyword)?”
I support equally draconian measures for folks that send in irrelevant/cumulative references.
One easy solution to your problem: Jepson.
The other easy solution is to submit references that cover the material information that you know about and don’t submit extra ones/cumulative ones.
“But is a holding of unenforceability that affects an applicant “lawful”?””
I believe we covered this in a previous thread. And the answer was yes.
“There’s a lot of information that applicants produce even before they talk to a patent attorney. Do you want my inventor’s 8 notebooks of research? Notes from any attendee at his presentations? Tape recordings (or transcripts) of dinner conversations from every conference he attended during his development process?”
If you’re willing to call most of, if not all, of it prior art then sure, that would probably be more helpful than a few hours in EAST. Especially if it contained good footnotes/citations.
“I’m sure some industries could satisfy this heavy burden, but would examiners appreciate getting several thousand references to consider? Would it increase your efficiency?”
I haven’t seen a claim yet that took 1000 references to cover without any of them being cumulative. Look that word up, then avoid submitting those kinds of references.
MM: “All of those documents are relevant if they contradict the position you are taking before the PTO in your specification or in your Responses to Office Actions.”
Interesting that you have a different definition of “material” from the Court.
“information is material when a reasonable examiner would consider it important in deciding whether to allow the application to issue as a patent” Symantec Corp. v. Computer Assocs. Int’l, Inc., 522 F.3d 1279, 1297 (Fed. Cir. 2008)
“Information concealed from the PTO may be material even though it would not invalidate the patent.” Li Second Family Ltd. v. Toshiba Corp., 231 F.3d 1373, 1380 (Fed. Cir. 2000).
Inequitable conduct requires the applicant to have
a) made an affirmative misrepresentation of material fact
b) failed to disclose material information; or
c) submitted false material information.
I think everyone can agree that a) and c) are clearly within the realm of inequitable conduct, where an applicant or attorney is making positive assertions. But b) is an error of omission, and according to the above quotes, an attorney is supposed to know what a “reasonable examiner” would consider material to patentability.
Not only that, but an attorney must include references which he KNOWS would not invalidate the patent.
So by deduction, the “reasonable examiner” finds “material relevant to patentability” to include information that is NOT relevant to patentability.
Do you see why some attorneys might be concerned over this standard? Especially when “‘burying’ a particularly material reference in a prior art statement containing a multiplicity of other references can be probative of bad faith.” Molins PLC v. Textron, Inc., 48 F.3d 1172, 1183, 33 U.S.P.Q.2d (BNA) 1823, 1831 (Fed. Cir. 1995).
Don’t submit enough = inequitable conduct.
Submit too much = inequitable conduct.
Combine that with a low bar to raise the issue and shifting the burden to the patent holder and most attorneys are going to see a problem.
“Mooney”–
“The percent of patents that are improperly held unenforceable each year for inequitable conduct is beyond miniscule.”
I assume that what you mean is the the determinations of IC are both substantively and procedurally correct and appropriate, and hence “proper”.
But is a holding of unenforceability that affects an applicant “lawful”?
“Mooney”–
My criticism remains even if you replace “invalidation” with “a finding of unenforceability”.
The “attorney failure” I referred to being failure to comply with 37 CFR 1.56
There is no spin
“it is very much disputable whether or not sanction against a patentee is appropriate or lawful for attorney failure, and if so, whether or not invalidation is the appropriate or lawful sanction.”
I mispoke and meant to say “unenforceable.” But your statement is filled with spin. “Attorney failure”? That’s not inequitable conduct. Attorneys fail all the time. According to some commenters here, anytime an attorney fails to get the “broadest possible claim” for their client, they are “failing.” That’s not what we’re talking about here.
What we’re talking about here is intentional misrepresentation or withholding of material information when practicing before the USPTO. Nobody seriously disputes that this doesn’t happen routinely. And nobody disputes that a mechanism needs to be in place to prevent the chicanery and punish wrongdoers. Currently the mechanism is one that minimizes the effects on practitioners and maximizes the effects on the patent. Discuss whether you want to change that.
egd “There’s a lot of information that applicants produce even before they talk to a patent attorney. Do you want my inventor’s 8 notebooks of research? Notes from any attendee at his presentations? Tape recordings (or transcripts) of dinner conversations from every conference he attended during his development process?”
All of those documents are relevant if they contradict the position you are taking before the PTO in your specification or in your Responses to Office Actions.
This isn’t rocket science, people. This is about lying and the methods used to identify liars and punish them. The percent of patents that are improperly held unenforceable each year for inequitable conduct is beyond miniscule.
6: Why everyone thinks this needs to rise to “fraudulent” levels is beyond me. Someone is withholding relevant info, make them pay for wht [sic] they end up doing to society. A lose [sic] of a patent is but a small price when it could be your hands.
So you, as an examiner, have no problem considering the 300 references I am going to submit that my first keyword search turned up, just in case one of them happens to be relevant (and is misclassified so that it isn’t found when I narrow the search to classes + keyword)?
There’s a lot of information that applicants produce even before they talk to a patent attorney. Do you want my inventor’s 8 notebooks of research? Notes from any attendee at his presentations? Tape recordings (or transcripts) of dinner conversations from every conference he attended during his development process?
I’m sure some industries could satisfy this heavy burden, but would examiners appreciate getting several thousand references to consider? Would it increase your efficiency?
“Mooney”: “I know this much: patents continue to be deservedly invalidated for inequitable conduct. Given that indisputable fact,…”
On the contrary, it is very much disputable whether or not sanction against a patentee is appropriate or lawful for attorney failure, and if so, whether or not invalidation is the appropriate or lawful sanction.
Your conclusory statement has not foreclosed discussion on this issue. Removing the word “deservedly” would be helpful.
“Larson’s patent covers a specially designed outside. ”
Is it just me, or does this seem a touch broad?
“If you think the answer’s simple, that’s because you simply haven’t understood the question.”
A nomination for Max’s post of the decade.
“Where’s the problem EG (sorry, I’m an outsider)? Why can’t the Examiner note the arrival of the document.”
Max,
Unfortunately, much of examination in the USPTO is a matter of forms and form paragraphs. “Art” that isn’t in a written document (and which the current SB08 form for listing non-patent art provides no ability to describe so the a patent examiner can initial it) is the problem. And if there’s no initially of this “art,” there’s no conclusive (or even presumptive) record that this “art” was ever “considered” by the examiner.
I realize this isn’t “logicaL” (so sayeth the patent professional “Spocks” like me), but that’s the reality of dealing with such “art” in the USPTO. The examiners simply don’t know how (at least in my experience) to deal with such “art”, unless you make what they consider an “admission of prior art” (APA), which you may not be willing to make (for example, you aren’t legally certain that the “art” is truly a “public use” or “on sale”). That’s the problem in a nutshell.
Thanks Punch. You’ve done far more thinking on this than me. As to absurdity, I was thinking about the absurdity that results in applicants feeling that they have to offer up to the PTO bits of paper when they don’t know, and can’t find out, and so can’t tell the Exr, if it’s prior art or not. Imagine a Peer to Patent submission:
Here’s something, Ms Examiner. No idea whether it was ever published, but maybe you’ll find it useful all the same.
Utterly absurd.
This paragraph by Judge Linn is ridiculous:
“Symptoms of this plague are apparent from the facts of this case. The patent-in-suit has undergone examination twice in the PTO, and the patentee has been accused of inequitable conduct on each occasion for allegedly withholding material information. During original prosecution, the PTO considered 143 references, 135 of which the submitted two more IDSs in the reexamination, each within approximately one month of the application’s Office Actions. The IDSs contained all references relied on in those rejections but did not include the Office Actions themselves. With full knowledge of the co-pending application, the PTO confirmed the patent, which survived reexamination without substantive change to the litigated claims. When the litigation resumed, the accused infringer again charged the patentee with inequitable conduct, this time based on conduct in the reexamination.”
So where are the “symptoms of the plague”? Judge Linn speaks as if there is magical numerical threshold (e.g., 200 references, 2 re-exams) beyond which any allegations of inequitable conduct “must be” dismissed as unfounded.
In fact, applicants tend to play just as many games during re-examination as they do during initial prosecution. Moreover, by the time a second re-exam is entered into, the likelihood of the Applicant having taken completely contradictory positions with respect to the prior art and/or their own technology increases dramatically.
If I’m defendant looking at that prosecution history, including the re-exams, and I see such contradictions, why isn’t it reasonable to assume that the contradictory statements are *intentional*? After all, these are professional attorneys prosecuting this application at great cost because everyone is aware that it’s extremely important. According to Judge Rader, “reputations” are on the line. Surely, then, crucial issues of fact should not not expected to be obscured or misrepresented by *mistake*!
Judge Linn also writes: “The ease with which inequitable conduct can be pled, but not dismissed, is a problem of our own making.”
Judge Linn assumes the “ease” of inequitable conduct pleading is “a problem.” Why is it a problem? If there are so many frivolous pleadings of inequitable conduct, where are the sanctions against the pleaders?
I know this much: patents continue to be deservedly invalidated for inequitable conduct. Given that indisputable fact, it’s hard to see why the “ease of pleading” IQ is a “a problem.” Rather, it seems to be a solution to a much more pervasive problem.
I finally read the opinion, including Judge Linn’s concurrence. Judge Linn makes a very astute observation that the Federal Circuit (with the help of patent litigators who should know better) has created an unnecessary “monster” out of inequitable conduct. Also as Judge Linn accurately characterizes the three leading SCOTUS cases on inequitable conduct (a characterization I shared before I saw his concurrence), these three cases “involved overt fraud, not equivocal acts of omission.”
Also, while reference is made repeatedly to Dayco Products, astonishingly no reference is made to McKesson Information Solutions v. Bridge Medical. While the result in McKesson makes me ill (and points out a glaring problem of how harshly and inconsistently the amorphous “second-guessing” standard for inequitable conduct is applied), why isn’t McKesson relevant here?
Max–
Without opining on whether or not “the law is absurd”, I believe that it is certainly, at least, confused, inarticulate, and inadequate–which can lead to seemingly absurd outcomes.
Max–
I do believe that IC should always be able to be addressed, but only according to the principles of equity–akin to the equitable remedy of an injunction being adjudged according to the appropriate equitable princples.
Equity is all about fairness, and I think it manifestly unfair that an otherwise valid patent can be held unenforceable with any finding of IC under the current confused regime.
As I understand it, IC as currently conceptualized is a defense to an allegation of patent infringement. A litigant effectively steps into the shoes of society and makes the charge in the first instance.
I think that is wrong. If current law allows, IC allegations should require separate proceedings. Conduct should be brought to the attention of the PTO, investigated by the PTO, and charges brought by the PTO in an appropriate forum.
Also, EQUITY IS A TWO-WAY STREET: 3 of the “maxims of equity” are: 1) one who seeks equity must do equity, 2)one who comes into equity must come with clean hands, and 3) between equal equities the law will prevail.
Since the PTO acts as the “people’s representative” in such a matter, they would have a burden to demonstrate the equitability of their own conduct–no ridiculous OA’s, no new ground of rejection in final OA before ground of rejection in non-final OA is resolved, no action illegal on its face, no official notice without substantial evidence, the list goes on and on.
Some suggestions for various outcomes:
If IC found, and solely the doing of the practitioner, appropriate disciplinary action should be taken.
If IC found, and solely the doing of the patentee, 2 outcomes–1) patent is still valid–should still be enforceable after PTO levies a fine against the patentee, on behalf of the public; 2) patent is invalid–speaks for itself, and PTO could levy a fine to recover costs associated with the conduct, plus maybe something punitive.
If patentee and attorney in active collusion, both of the above.
If patentee actively inequitable and attorney negligent, both of the above, with lower discipline against attorney.
If patentee negligently inequitable and attorney either negligent or actively inequitable, no fine against patentee, appropriate sanctions against attorney, and private action by patentee against attorney if patent rights disappear or are lessened as a result.
Where’s the problem EG (sorry, I’m an outsider)? Why can’t the Examiner note the arrival of the document and say either:
“If Applicant can’t be arsed to tell me if this is prior art or not, well then I can’t be arsed to consider it as prior art”.
or:
“Since you’re asking me, here goes. If it’s art, then I say it renders the claim unpatentable. OK?”
How I like these threads, when they expose the absurdity of the law, as it is now.
“…and how do I submit “derived” art”
Me,
I’m presuming you mean “art” that’s not in written documents. If so, what I’ve done is present a narrative in the IDS itself that describes, as best I can (and it isn’t easy to do), what that “art” is, and the relevant facts and circumstances surrounding that “art.” I don’t be believe a formal declaration is necessary (37 CFR 1.97-98 don’t require one)
The big problem here is that the examiner’s don’t generally know what to do (or how to indicate how to make of record) such “art.” That’s at least been my experience.
Hope this is helpful.
6 Have you forgotten the PTO administration’s zealous effort to burden applicants who attempt to submit anything that an adversary may later say is material?
How about the cavalier way that the rules allow examiners to refuse to consider a reference. I got an office action recently including a PTO1449 in which the examiner refused to consider a reference I cited because I did not know its publication date and described it as “Undated -Possible prior art”
So, body punches, are sanctions (like “inequitable conduct”) needed, or not? What do you say? The rest of the world doesn’t have IC. People dissemble, even lie. Some think the US should copy the ROW. But should it? Isn’t IC a good thing, when kept firmly in its place. Or would the USA be better without it. As I say, these things aren’t easy. There is a similar debate in the UK, about whether permission of a claim amendment that saves a patent from revocation should be the patent owner’s right(a l’Europe continentale) or an equitable relief, like it always used to be in England. In the words of the song “You don’t know what you’ve got….till it’s gone”.
And, OK, mentioning Cheney was a low blow, but it STILL makes me angry.
EG-
…and how do I submit “derived” art? A dec I guess, but I have never seen this done. I guess you do it daily, and go through all your inventor files and notes…I am sure you do, right?
“I’ll accept liberal Rule 11 for inequitable conduct if you’ll accept liberal Rule 11 for charges of infringement.”
Alan,
Fair enough, you’ve got a deal, at least with regard to me. Like inequitable conduct, patent infringement shouldn’t be alleged “frivolously” and without investigation to develop the facts to support it.
Max–
How I do appreciate sarcasm.
“35 USC 285 and FRCP 11 should be liberally applied to “frivolous” allegations of inequitable conduct.”
I’ll accept liberal Rule 11 for inequitable conduct if you’ll accept liberal Rule 11 for charges of infringement.
6: thanks. As a PTO Examiner, however, you will know that one of the hardest tasks for an inventor is to bring simplicity out of complexity. It’s easy to make things more complicated, much harder to simplify, once they have been allowed to get complicated. Inventors who do it get dollars. Judges who do it should get at least a bucketful of kudos.
And Inviting: Society takes its lead from the top, right? The rule of law is precious, right? Why be afraid about IC? No such fears visited themselves on the lawyers who advised Mr Cheney, when he was VP.
“Why everyone thinks this needs to rise to “fraudulent” levels is beyond me. Someone is withholding relevant info, make them pay for wht they end up doing to society. A lose of a patent is but a small price when it could be your hands.”
6,
Because, like MaxDrei correctly said, you’re clueless about what happens in patent litigation in the U.S. If you were ever accused of this “plague” like I and many, many other patent prosecutors have without factual support, you would understand, but you obviously don’t. Again, remember what I said about “a man has got to know his limitations.” Or you can continue on with your rhetorical nonsense, and “make my day.”
“6: you’ve never been part of a litigation team, right?”
Max,
Way to go. 6 obviously has no clue what U.S. patent litigation is about, or has ever been accused of inequitable conduct (as I and many, many other patent prosecutors without proof). It’s time for this “plague” to be done away with, like the rest of the world which has no such “plague.”
“EVEN WHEN YOU SUBMIT EVERYTHING THAT IS PUBLISHED”
Have you read U.S.C 102 lately?
link to uspto.gov
Anything available to you under that needs to be submitted.
I did read that case you’re referring to, I don’t have time to reread it atm.
“How do I sumit that cocktail napkin I found on the plane. Do I need to tape all my inventor’s conversation and submit those?”
I suggest you put all that info in the background. Apparently putting it there relieves you from having to submit the actual reference itself. Which seems absurd to me, I hope I’m mistaken on that part. Either way, putting it in the background can’t hurt. There are of course other ways of doing it. One might be calling the examiner and making an express admission that some limitations are old. That would relieve the materiality wouldn’t it? You have lots of options. And don’t tell me that you can’t use the express admission option because of some duty blah blah blah. I’ve had attorneys admit portions of things were known already. All the time.
All this might be irrelevant- Hatch just said their will be IQ int he reform bill, and he predicts passage.
link to reuters.com
“The Senate version of the patent reform bill does not currently include language making it harder to strip a patent holder of a patent if they erred in the application process, known as “inequitable conduct” in the patent world.
But the Republican from Utah said that language would soon be added.”
“forge justice out of the application of the law and the simultaneous pursuit of the legitimate interests of all parties and the general good of society.”
is what the wiki says you guys do.
“So I have a flat fee for searching, on which I take a bath.”
Either your water is really expensive or that must be a really long bath.
In the Monsanto v Bayer case what would you call that prior art from someone’s notes about someone else’s art – “derived” prior art? “Interpreted” prior art?
6-
Go look at the actual facts in the Monsato v Bayer case. They submitted the abstract of the poster, the published facts, and the lawyer was found to have committed inequitable conduct because he did not also submit someone notes about the poster who attended the conference. Can you even submit that in an IDS? Would you need a declaration with it? Has anyone heard of this? Doesn’t matter, the glorious E.D. Mo and the Fed. Circ. say you should manipulate patent offcie procedures in order to avoid inequitable conduct – EVEN WHEN YOU SUBMIT EVERYTHING THAT IS PUBLISHED! That is an insane outcome. How do I sumit that cocktail napkin I found on the plane. Do I need to tape all my inventor’s conversation and submit those?
“6: you’ve never been part of a litigation team, right? Word of advice: It’s like in UK Patent Attorney qualifying examinations. If you think the answer’s simple, that’s because you simply haven’t understood the question.”
Max, you know me dude, I’m all about making the question simple to begin with. Our system needlessly complicates wayyyyyyyyy to much. In other realms of life as well. I understand perfectly well that there would be consequences of doing such simplification, a price well worth paying.
I, as an attorney of 10 years and a patent prosecutor, have never seen a profession-wide interpretation of what it means to be an “officer of the court”. If anyone out there has specific info, I’d be grateful to see it.
I have assumed that it has meant that I have to affirmatively work to protect what “public trust” there is in the court system, and in the patent system. This has included telling clients that there are things they cannot do, and things that they should not do–or rather, than I would not help, or enable them to do, that would subvert, or pervert, the public interest.
I realize this can be in tension with the duty of zealous representation–but the duty to the client is not the only duty of an attorney. That’s why we have Juris Doctor, Esquire, etc. after our names–because we are supposed to perform to a higher ethical standard to maintain the balance between the private interests of our clients and the public interest, while working to advance the private interest of our clients versus those of other private parties in any proceedings.
It is difficult. In practice, this attitude has forced me to always “go the extra mile” for my clients, a service for which I don’t charge them anything. I bill for representing a client’s interests, but I don’t bill for anything relating to my role as an “officer of the court”.
I will not submit an application without having performed a search–myself. Not only would that likely result in a weaker, invalid, denied, or unenforceable patent, but it could potentially waste the public’s time and money in a prosecution of the application, in addition to the client’s time and money.
So I have a flat fee for searching, on which I take a bath.
I know all about 35 USC and the burden of the prima facie standard, and that there is no legal requirement to have conducted a search (let alone by yourself personally). But I believe that there is a duty to the court/patent office, as a “public officer”, not to mention an ethical duty to the client. Flowing from that duty are the further duties to analyze and report the results to the PTO.
To make a long story short, if I charged for all the time I put into an app, NOT ONE OF MY CLIENTS WOULD HAVE BEEN ABLE TO AFFORD FILING. Granted, my clients are small entities and start-ups, but my point is that with power comes responsibility, and I believe that as attorneys we must bear some burden, even financially, as officers of the court. Over and above CLE’s.
Although I may practice to a higher ethical standard than some, or maybe even most, I am still VERY afraid of IC.
Good topic Dennis. I think it supports my line, that stakeholders in the US patent system are entitled to hold the courts more or less wholly responsible for the present mess, and that the courts are inherently better placed than politicians to “clean up” the mess they’ve needlessly made of the statute. That the judges don’t have what it takes to do that clean up job is not my worry.
6: you’ve never been part of a litigation team, right? Word of advice: It’s like in UK Patent Attorney qualifying examinations. If you think the answer’s simple, that’s because you simply haven’t understood the question.
Is it fair to lose the exclusive right, when their is no intent to decieve by anyone? It seems a very strange outcome…
Idk Linn, I agree that the standards are messed up with regards to the caselaw, but I can’t say that the caselaw itself might not need to be changed. I do agree that the charges should be easier to dismiss though. At the same time, it should be easier to find. Cure both these ills at the same time then you have a winning match. If you withhold a material reference your patent should bite the dust. Every, single, time. No intent blah blah blah bull. You withheld it? You have an invalid patent. Stop playing coy with the office, tell them about relevant information, get a patent on what you are entitled to, nothing more, nothing less. Pay the price if you can’t do this, it is SIMPLE to do compared to the overall mess of prosecution/enforcement. No burden to prove this or that, blah blah blah. Was their an omission? Was it material? End of analysis, invalid patent. Maybe we could give them a chance to get a reissue or something, but we’d need stat changes.
Why everyone thinks this needs to rise to “fraudulent” levels is beyond me. Someone is withholding relevant info, make them pay for wht they end up doing to society. A lose of a patent is but a small price when it could be your hands.
Here’s my proposal for removing inequitable conduct as the “plague” it is because it is alleged all too often with no facts to support:
1. The “materiality” prong can be proven only if it is shown that one or more patent claims (or the entire patent itself if we’re talking an issue like improper inventorship) would not have issued “but for” the deliberate omission or misrepresentation of the alleged “mateial” information.
2. The “intent to deceive” prong requires proof of specific intent or “wanton or reckless disregard” as to the omitted/misrepresented information. So-called “gross negligence” shouldn’t be the standard.
3. Completely dump the “sliding scale test.” This conflates the “materiality” and “intent to deceive” prongs in a way that’s not helpful.
4. Each of the “materiality” and “intent to deceive” prongs must be proven “beyond a reasonable doubt.” That will leave inequitable conduct to address only the truly “egregious” instances.
5. Inequitable conduct must be alleged with the particularity required for fraud under FRCP 9.
6. 35 USC 285 and FRCP 11 should be liberally applied to “frivolous” allegations of inequitable conduct.
That’s my 2 cents to get this “plague” put in its appropriate place, and to get back to judging patents on the merits.
I hope this is a harbinger of inequitable conduct reform from the CAFC itself – before Congress steps in and mucks it up. But if the CAFC has for years ignored its own en banc decision in Kingsdown Medical (which apparently is still good law), why should we expect subequent CAFC panels to toe the line in a new en banc decision that reiterates Kingsdown.
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