Pre-Litigation Investigation of Patent Validity

by Dennis Crouch

I previously wrote about the Federal Circuit’s decision in WPEM, LLC v. SOTI Inc., 2020-1483 (Fed. Cir. Dec. 9, 2020).  The case focuses on pre-filing investigation — the amount of investigation that a patentee must conduct before filing a patent infringement lawsuit.

Here, WPEM filed an infringement action against SOTI, but later dismissed the action after learning that the patent claims were very likely invalid.  The district court awarded attorney fees to the defendant based upon the fact that “WPEM conducted no pre-filing investigation into the validity and enforceability of the Asserted Patent.” WPEM, LLC v. SOTI Inc., 2020 WL 555545 (E.D. Tex. Feb. 4, 2020).  On appeal, WPEM argued that the law strongly presumes that a patent is valid and, as such, does not require any pre-filing investigation of patent validity.  The Federal Circuit did not disagree with this argument in principle, but found this particular case to be a special case because the accused product is also the prior art.  According to the Federal Circuit the fact that the accused product was on-sale before the patent’s priority date means that the dismissal also very-much about infringement.  The federal Circuit explained:

Instead, the court [implicitly] based its award of attorneys’ fees, in part, on the frivolous nature of WPEM’s infringement position . . . an issue that could have easily been foreseen with an adequate pre-suit investigation. . . . As the court reasoned, because the Accused Technology is prior art to the ’762 patent, “if WPEM prevailed on its assertion that the Accused Technology is covered by the Asserted Patent, it would have had the effect of invalidating, rather than infringing, the Asserted Patent.” Because it is undisputed that the Accused Technology is prior art to the ’762 patent, WPEM could not bring a successful infringement suit.

What the court wrote here makes sense at one level, but it also proves too much.  A patentee will never win an infringement lawsuit after admitting that the prior art anticipates the invention.  Still, I don’t believe that the court intended to conclude that pre-filing investigation requires an investigation of validity issues.

In its new petition for writ of certiorari, WPEM asks two questions:

1. Does a patent’s presumption of validity afforded by 35 U.S.C. §282 limit a district court’s discretion to find a case exceptional under 35 U.S.C. §285 when it is only later discovered the accused technology is prior art?

2. Given the clear and convincing evidence standard to invalidate a patent, does a district court have the discretion to find a case exceptional under 35 U.S.C. §285 based upon asserted but unproven grounds of invalidity and unenforceability?



The requirement for pre-filing investigation is substantially written-down in Rule 11 of the Federal Rules of Civil Procedure:

(b) Representations to the Court. By presenting to the court a pleading … an attorney or unrepresented party certifies that to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:

(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;

(2) the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law;

(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery; and

(4) the denials of factual contentions are warranted on the evidence or, if specifically so identified, are reasonably based on belief or a lack of information.

FRCP 11(b). Rule 11 has its own sanctions regime, but egregious violations of the requirements may also serve as a basis for fee shifting under the Patent Act as an “exceptional cases.”  In its decision, the Federal Circuit did not discuss Rule 11.

8 thoughts on “Pre-Litigation Investigation of Patent Validity

  1. 3

    No need for the courts to rustle in the patent weeds when a Rule 11 would have quickly and more-easily disposed of the matter.

    Running off to SCOTUS is a waste of time and money — they’re not going to bother with this case.

    1. 3.1

      I agree – plus, this cert is simply badly written (for one example, they include an item in their list of authority, but they never actually make a point linking to that asserted authority).

      Quick and rapid fire posting on a blog is one thing (even Prof. Crouch has posted a snappy comeback to someone pointing out an error). Legal submissions to an Article III court are a completely different story.

      Effective advocacy includes knowing the differences of the different fora.

    2. 3.2

      That being said, the plain point is that without direct affirmative knowledge, the fact that there is both existence and a level of a presumption SHOULD carry the day.

  2. 2

    The Plaintiff overcame the presumption of validity by pleading that the patent-in-suit was invalid. A more thorough pre-suit infringement investigation would have uncovered the patent’s invalidity.

    1. 2.1


      Mere pleading removes the required judicial level of a holding showing that a clear and convincing level was provided?


      Whether or not a more thorough investigation BEGS THE QUESTION.

  3. 1

    Was the finding of unreasonable litigation conduct here based entirely on filing the suit without any investigation? Or did it include improperly continuing the litigation even after being clearly put on notice that the sued product was on sale long before the patent application was filed, without first investigating that? Whether characterized as “impossible to be infringed” or “invalid” is irrelevant to the latter type of litigation conduct and its cost burdens on the court and the defendant.

    1. 1.1

      The case was dismissed within months of discovery that there was a prior version of the accused software that had a particular feature. Judge Gilstrap particularly found that there was nothing wrong with the post filing conduct. What goes missed is that the plaintiff had no reason to believe the accused technology was prior art as the plaintiff developed his speed lockdown feature while working on the defendants’ system, MDM. The defendant did not have the feature when the plaintiff developed it. The details are always in the facts…. These facts have led to follow-on State Court litigation against the attorney who filed the patent application.

    2. 1.2

      Also, did the defendant here file a motion for summary judgment along with its answer to the complaint?

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