Will Reexamination Rescue Lawson from an Injunction?

Scott Daniels | May 23, 2011

Patent infringement litigation and reexamination proceedings are rarely synchronized, but the resolution of two reexaminations might arrive just in time to save Lawson Software from being enjoined in the ePlus v. Lawson in the Eastern District of Virginia.  The patentee, ePlus, sued Lawson in 2009 for infringement of U.S. Patent Nos. 6,023,683 and 6,505,172 relating to systems for searching catalogs for product information to generate requisition orders, specifically electronic sourcing systems commonly used by healthcare facilities and government agencies.  At the conclusion of a trial in January, the jury found that the ‘683 and ‘172 patents were valid and infringed.  Judge Robert Payne is now considering whether to enjoin Lawson from future acts of infringement.

Running in parallel with the infringement case are reexamination proceedings at the PTO, one requested in 2006 by SAP[1] for the ‘683 patent (90/008,104) and two others, by Lawson in 2009, for the ‘683 patent (90/011,066) and the ‘172 patent (95/000,487).  Judge Payne has so far rejected Lawson’s requests that the litigation be stayed pending completion of the reexaminations or that final rejections from the reexaminations be considered at the trial.

Last week, however, the PTO Board of Appeals affirmed the examiner’s rejection in the SAP reexamination of the ‘683 claims.  The Board found that two manuals were sufficiently accessible to the public to be “printed publications” under 35 U.S.C. § 102, were enabling under 35 U.S.C. § 112, and disclosed each of the limitations of the ‘683 claims.  The ‘172 claims have also been finally rejected and an appeal is now pending before the Board.  One claim of the ‘683 patent, which was found by the jury to be infringed, but was not part of SAP’s ‘683 reexamination, has received a non-final rejection in Lawson’s ‘683 reexamination.  But in view of the substantial overlap of issues between the ‘683 and ‘172 reexaminations, it is quite possible that the PTO will reject the ‘172 claims and the remaining ‘683 claim as well, on substantially the same grounds.

Of course, the PTO’s rejections of the ‘683 and ‘172 claims are not final – ePlus still has the option of appealing the Board’s judgment in the ‘683 reexamination to the CAFC, and the other two reexaminations are still before the PTO.  Nevertheless, Judge Payne must now consider whether to enjoin Lawson on the basis of patent claims determined by the PTO to be invalid over multiple prior art references.

An interesting side-light is way in which the respective parties characterize the PTO examiners.  Lawson respectfully refers to them as “three senior PTO examiners” who sit on “three judge panels.”  ePlus is, predictably, less charitable: examiners are “administrative employees at the PTO” and reexaminations are “interim, satellite, administrative proceedings.”  In fact, ePlus cautions that the “judicial system must not become a pawn of – or worse yet, held hostage to – the administrative reexamination proceeding.”  Confirming the adage that “where you stand depends on where you sit.”

[1] SAP and Ariba were previously sued by ePlus for infringement of the ‘683 and ‘172 patents.  Both settled.


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