2011 June : US PTO Litigation Alert™

Florida Court Stays Case Three Weeks before Trial

| June 3, 2011

The other day a judge told me, essentially, that he did not care for reexaminations and that he would never stay an infringement case pending completion of a reexamination proceeding.  The judges of the Southern District of Florida take a different view.  On Tuesday, Judge Marcia Cooke stayed the case Plasticos Vandux de Colombia v. Robanda Int’l, pending completion of a reexamination of one of the three patents-in-suit, despite the fact that trial in the case was scheduled to start June 20th

Judge Cooke’s decision is notable in two respects.  The first was her analysis of the delay of the litigation caused by a stay, quoting the 2008 Roblor Marketing decision from the Southern District of Florida: “[r]ather than being a reason for denying a stay, the resulting delay in proceedings serves the interests of correctness and finality, by assuring that any decision by the PTO can be taken into account by the court prior to further proceedings even though it necessarily results in deferral of the final outcome of this case”  (emphasis added). 

Second, Judge Cooke granted the stay based on a reexamination rejection of the claims of one patent-in-suit; there are two other patents-in-suit, as well as false marking and unfair competition counts.  The Judge explained that the claims of the other two patents were quite similar to the rejected claims, implying that the claims of all three patents were likely to rise or fall together.  Regarding the other counts, she stated that a “court may stay a case in its entirety pending reexamination despite the existence of unrelated claims in the interest of judicial economy and efficient case management,” citing an opinion from earlier this year by Judge William Alsup of the Northern District of California. 

Reexamination does not Rescue Lawson from Injunction

| June 2, 2011

Last week we speculated that the results to date in three reexaminations might save Lawson Software from being enjoined in the ePlus v. Lawson case in the Eastern District of Virginia.  After a trial in January, the jury found that ePlus’s U.S. Patent Nos. 6,023,683 and 6,505,172 relating to electronic sourcing systems were valid and infringed, whereupon ePlus asked Judge Robert Payne to enjoin Lawson from future acts of infringement. 

Lawson replied that no injunction should issue because it was likely to prevail on the validity and infringement issues, either in the co-pending reexamination proceedings or at the CAFC.  Indeed, the PTO Board of Appeals had recently affirmed the examiner’s rejection in the reexamination of the ‘683 claims, and rejections had issued in the other reexaminations. 

Despite the pending reexaminations, Judge Payne decided to enjoin Lawson.  He began by noting that on three previous occasions he had refused attempts by Lawson to use the reexaminations to affect the litigation.  Critically, he held that a patent “claim is not invalidated unless and until the entire reexamination process, culminating in an appeal to the Federal Circuit, has occurred, a final decision is reached adverse to the patentee, and a certificate is issued by the PTO cancelling the patent claims”  (emphasis added).  The Judge added that he was troubled by “uncertainty of both the outcome of those appeals and the length of time until the last reexamination proceeding is concluded…” (emphasis added).  He also noted that the ePlus patents will expire in a few years, so that a “grant [of] a stay of the permanent injunction based on the reexamination proceedings would put into doubt whether ePlus would ever enjoy the remedy to which it has proven it is entitled.” 


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What Does Therasense Mean for Reexamination?

| June 1, 2011

Last week’s en banc decision by the CAFC in Therasence v. Becton, Dickinson, establishing a “but-for” test for the materiality prong of inequitable defenses, promises to ease substantially the burden on patent applicants to flood the examiner with prior art references.  Applicants still must submit references that are material under PTO Rule 1.56, but no longer face the prospect of unenforceability if they err in doing so – a reference is material for an inequitable conduct defense in litigation only if the patent would not have issued “but-for” the non-disclosure of that reference to the PTO. 

What about reexamination?  For the most part, there will be little change.  Certainly, the possibility of establishing that a reference is material is one of the collateral benefits from requesting reexamination for an accused infringer.  Yet, establishing materiality is rarely the primary motivation for filing a request. 

Nonetheless, to determine whether an undisclosed reference would have blocked issuance of a patent, a court must place itself in the shoes of the original examiner.  The issue is patentability, not validity.  A court must give the patent claims their “broadest reasonable scope,” not their scope under Markman as in litigation.  Further, the standard of proof for patentability at the PTO is preponderance of the evidence, not clear and convincing evidence. 


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