What Happens after the Reexamination Stay is Lifted?

| April 20, 2012

 An extremely popular strategy for a defendant accused of patent infringement is (1) to request reexamination of the patent and then (2) to convince the trial judge that the reexamination will simplify the issues to be tried, so that he or she should stay the litigation pending completion of the suit.  But how does the trial judge treat the defendant if, several years later, the Patent Office confirms the patentability of the claims and the litigation resumes?  Not very well, the defendant learned this week in Cardiofocus v. Cardiogenesis, 2012 U.S. Dist. LEXIS 54892.

The case had resumed after being stayed for two years for reexamination of the two patents-in-suit, where some of the claims were disclaimed, and the other claims were confirmed.  Judge Nathaniel M. Gorton of Massachusetts was asked to rule on a series of summary judgment motions offered by the parties.  Judge Gorton’s analysis, of course, dealt carefully with the merits of each motion.  And yet there was also an edge to the judge’s comments, suggesting that he did not regard the detour of the case to the Patent Office, requested by the defendant, to have been helpful.

Judge Gorton began:

At the outset, it is worth noting that it was the defendant which moved to stay the case for three years pending patent reexamination. According to defendant (at the time), a stay would give the PTO the opportunity to use its considerable expertise to resolve the underlying issues of patent validity. Now that the PTO has ruled adversely to the defendant, it seeks to re-litigate the matter in this forum.

Ouch.

Later, denying the defendant’s motion for judgment of obviousness, Judge Gorton made the commonplace point that where

the PTO has considered the prior art in the context of a validity challenge during patent re-examination, the burden of proof to invalidate a patent on obviousness grounds is particularly heavy.

He then took a sharper tone:

Over the past three years, the defendant has raised the same or similar arguments to the PTO on eight separate occasions in its enduring quest to have the patents-in-suit declared invalid. Each time, the PTO reviewed the prior art, it concluded that it “would not be important to a reasonable examiner in deciding the patentability” of the claims at issue and confirmed the validity of the patents. The defendant seeks a ninth bite at the apple.

On the inequitable conduct defense, Judge Gorton ruled for the patentee, but noted in an aside that “the PTO admonished the defendant for submitting such materials in the re-examination proceeding and expunged them from the record.”  The Judge also scolded the defendant for the style of its briefing to the court on that defense: “Defendant should be made aware that hyperbolic statements and frequent capitalization, bolding and underlining throughout its briefs have the opposite of their intended effect.”

Finally, on the issue of laches, Judge Gorton opined that “any prejudice resulting from the passage of time is partially of the defendant’s own doing: after all, it was the defendant that repeatedly moved this Court to stay the case pending patent re-examination.”

It is clear that judges take seriously their responsibility for fairly adjudicating patent infringement claims.  And when they stay a case, with the expectation that reexamination will simplify the issues, they may feel some sense of betrayal when the case is not simplified. 

Category: Stays/District Courts

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