Post-Trial Procedures Quiz

PDF page 85: Misconduct by the patentee in dealing with the Patent and Trademark Office, through which the patentee or its attorney deceives or misleads the patent examiner in an effort to persuade the examiner to grant the patent, was historically called “fraud on the Patent Office,” but more recently has been renamed “inequitable conduct.” A defendant can raise this issue as a defense, which if proven results in the patent being unenforceable—that is, the patentee is unable to enforce the patent or recover any damages for its infringement. Many different types of inequitable conduct have been found to render patents unenforceable,

PDF page 85: Misconduct by the patentee in dealing with the Patent and Trademark Office, through which the patentee or its attorney deceives or misleads the patent examiner in an effort to persuade the examiner to grant the patent, was historically called “fraud on the Patent Office,” but more recently has been renamed “inequitable conduct.” A defendant can raise this issue as a defense, which if proven results in the patent being unenforceable—that is, the patentee is unable to enforce the patent or recover any damages for its infringement. Many different types of inequitable conduct have been found to render patents unenforceable,

PDF page 85: Following the jury’s decision, the court will set a schedule for any equitable proceedings required and for posttrial motions. Equitable proceedings deal with matters to be decided by the judge, not the jury. In terms of xlvii post-trial motions, the winning party will ask for entry of judgment. The losing party will file a motion for xlviii judgment as a matter of law and usually also a motion for a new trial.

PDF page 85: Following the jury’s decision, the court will set a schedule for any equitable proceedings required and for posttrial motions. Equitable proceedings deal with matters to be decided by the judge, not the jury. In terms of xlvii post-trial motions, the winning party will ask for entry of judgment. The losing party will file a motion for xlviii judgment as a matter of law and usually also a motion for a new trial.

PDF page 86: Most district courts defer ruling on inequitable conduct defenses until after the liability trial addressing infringement, validity, and damages. This is a commonsense attempt at efficiency because if the patent is found invalid or not infringed at trial, the inequitable conduct issues became moot. Only if the patent is found valid and infringed does the court need to hold a separate hearing to adduce evidence of alleged inequitable conduct. The court then decides whether such conduct had been proven, which is exceedingly rare. Nevertheless, because the consequences of such a finding essentially kill the patent, defendants assert inequitable conduct whenever possible in a final effort to avoid liability. By 1988, the Federal Circuit Court of Appeals stated: “the habit of charging inequitable conduct in almost every xlix major patent case has become an absolute plague.” In an effort to stem the spread of this plague, the Federal Circuit sought to restrict its use by holding that inequitable conduct must be established by clear and convincing evidence of deceptive intent. Gross negligence does not suffice and “does not of itself justify an l inference of an intent to deceive.”

PDF page 86: Most district courts defer ruling on inequitable conduct defenses until after the liability trial addressing infringement, validity, and damages. This is a commonsense attempt at efficiency because if the patent is found invalid or not infringed at trial, the inequitable conduct issues became moot. Only if the patent is found valid and infringed does the court need to hold a separate hearing to adduce evidence of alleged inequitable conduct. The court then decides whether such conduct had been proven, which is exceedingly rare. Nevertheless, because the consequences of such a finding essentially kill the patent, defendants assert inequitable conduct whenever possible in a final effort to avoid liability. By 1988, the Federal Circuit Court of Appeals stated: “the habit of charging inequitable conduct in almost every xlix major patent case has become an absolute plague.” In an effort to stem the spread of this plague, the Federal Circuit sought to restrict its use by holding that inequitable conduct must be established by clear and convincing evidence of deceptive intent. Gross negligence does not suffice and “does not of itself justify an l inference of an intent to deceive.”

PDF page 86: Most district courts defer ruling on inequitable conduct defenses until after the liability trial addressing infringement, validity, and damages. This is a commonsense attempt at efficiency because if the patent is found invalid or not infringed at trial, the inequitable conduct issues became moot. Only if the patent is found valid and infringed does the court need to hold a separate hearing to adduce evidence of alleged inequitable conduct. The court then decides whether such conduct had been proven, which is exceedingly rare. Nevertheless, because the consequences of such a finding essentially kill the patent, defendants assert inequitable conduct whenever possible in a final effort to avoid liability. By 1988, the Federal Circuit Court of Appeals stated: “the habit of charging inequitable conduct in almost every xlix major patent case has become an absolute plague.” In an effort to stem the spread of this plague, the Federal Circuit sought to restrict its use by holding that inequitable conduct must be established by clear and convincing evidence of deceptive intent. Gross negligence does not suffice and “does not of itself justify an l inference of an intent to deceive.”

PDF page 86: Most district courts defer ruling on inequitable conduct defenses until after the liability trial addressing infringement, validity, and damages. This is a commonsense attempt at efficiency because if the patent is found invalid or not infringed at trial, the inequitable conduct issues became moot. Only if the patent is found valid and infringed does the court need to hold a separate hearing to adduce evidence of alleged inequitable conduct. The court then decides whether such conduct had been proven, which is exceedingly rare. Nevertheless, because the consequences of such a finding essentially kill the patent, defendants assert inequitable conduct whenever possible in a final effort to avoid liability. By 1988, the Federal Circuit Court of Appeals stated: “the habit of charging inequitable conduct in almost every xlix major patent case has become an absolute plague.” In an effort to stem the spread of this plague, the Federal Circuit sought to restrict its use by holding that inequitable conduct must be established by clear and convincing evidence of deceptive intent. Gross negligence does not suffice and “does not of itself justify an l inference of an intent to deceive.”

PDF page 86: Nevertheless, the plague continued, leading a Federal Circuit judge to write: “‘Inequitable conduct’ in patent practice means misconduct by the patent applicant in dealings with the patent examiner, whereby the applicant or its attorney is found to have engaged in practices intended to deceive or mislead the examiner into granting the patent. It is a serious charge, and the effect is that an otherwise valid and invariably valuable patent is rendered unenforceable, for the charge arises only as a defense to patent infringement. As this litigation-driven issue evolved, the law came to demand a perfection that few could attain in the complexities of patent practice. The result was not simply the elimination of fraudulently obtained patents, when such situations existed. The consequences were disproportionately pernicious, for they went far beyond punishing improper practice. The defense was grossly misused, and with inequitable conduct charged in almost every case in litigation, judges came to believe that every inventor and every patent attorney wallowed in sharp li practice.” lii Still the plague continued, leading Federal Circuit Judge Gajarsa in 2010 to then refer to it as a “pandemic.” Research showed that the percentage of patent cases in which inequitable conduct was charged grew from liii less than 5 percent in 2000 to 40 percent by 2009.

PDF page 86: Finally, on May 25, 2011, the Federal Circuit restricted the doctrine of inequitable conduct by changing the liv standard for materiality and clarifying the requirements for finding intent to deceive. To find inequitable conduct, the court held that the party alleging unenforceability must prove a specific intent to deceive the USPTO by clear and convincing evidence. Moreover, the decision to deceive the USPTO must be knowing and deliberate. The court also clarified that district courts may not use a “sliding scale” to find intent. In other words, the Federal Circuit held it improper to find that a weak showing of intent was sufficient based on a strong showing that the information was material, or that a weak showing of materiality was sufficient based on a strong showing of intent. Although intent can be inferred to meet the clear and convincing evidence standard, specific intent to deceive must be “the single most reasonable inference able to be drawn from the evidence.”

PDF page 86: Regarding materiality, the court required a “but- for materiality” standard. In other words, the standard for materiality now requires that “but for” the alleged deception, the USPTO would not have allowed the claim.

PDF page 87: If the jury (or judge, in a bench trial) finds that the asserted patent has been infringed, it is often asked to determine whether such infringement was “willful.”A finding of willful infringement allows the judge to award enhanced damages under 35 U.S.C. § 284, which provides in relevant part that the court may increase the damages award by up to three times the amount found. This is a potent consequence of a showing that a defendant’s infringement was willful.