Despite Therasense's Heightened Standard, Another Inequitable Conduct Claim Survives Summary Judgment

October 4, 2011


It appears that the announced death of inequitable conduct claims may have been premature. As described below, yet another court allowed such claims to survive summary judgment.

A court in the Northern District of Illinois denied summary judgment on the plaintiff's motion for summary judgment of no unenforceability. Citing the Federal Circuit's recent decision in Therasense v. Becton, Dickinson & Co., 2011 WL 2028255 (Fed. Cir. May 25, 2011), the court reiterated the new, heightened standard for proving inequitable conduct that to prevail on such a claim, "the accused infringer must prove by clear and convincing evidence that the applicant knew of the [prior art] reference, knew that it was material, and made a deliberate decision to withhold it." Slip Op. at 15. Moreover, "merely proving that the applicant should have known of the reference's materiality is insufficient. Though a district court may infer intent from indirect and circumstantial evidence, in order to meet the clear and convincing evidence standard, the specific intent to deceive must be 'the single most reasonable inference able to be drawn from the evidence.'" Id. Finally, the accused infringer must prove that the omitted reference is but-for material by showing that the PTO would not have allowed the claim had it been aware of the undisclosed prior art. Id.

The accused infringer claimed that the patentee engaged in inequitable conduct during the prosecution of the patent-in-suit by improperly adding new matter by: (1) submitting an incorrect English translation of the international application; (2) representing to the USPTO that no new matter had been added to the substitute specification filed with the USPTO; and (3) representing that the substitute specification had been provided as required by the Examiner and omitting the proper substitute specification.

As a threshold matter, the court determined that the possible addition of new matter in violation of 35 U.S.C. ยง 132 is possibly but-for material because it can lead to the rejection of claims as not being supported by the specification. Because the summary judgment record was susceptible of multiple reasonable inferences, including the inference that the patentee intended to deceive the USPTO by not including an English language translation of the original international application, the court held it would be improper for it to hold that the patentee's omitting the translation was not material. On the issue of whether the substitute specification contained new matter, the court held that there was a triable issue of fact based on whether the patentee's omission of the translated original application was material. Finally, the court again found a triable issue regarding whether providing the wrong substitute specification was material.

On the issue of whether the patentee had the requisite intent, the court found that the record contained circumstantial evidence from which intent to deceive may be reasonably be inferred, including the patentee's (1) alleged inaccurate representations to the USPTO during prosecution, (2) patent practitioners' failure to make the necessary inquiry into the underlying facts and circumstances, (3) omission of figures in the European Patent application in order to promote the likelihood of obtaining the European patent, and (4) patentee's refusal to allow a certain deposition. The court held that this circumstantial evidence permitted multiple reasonable inferences for the patentee's omissions and representations, which successfully raised an issue of material fact for trial regarding the patentee's intent.

On the inequitable conduct claim based on the alleged withholding of the engineering drawings, the court found the omitted drawings were arguably material based on the testimony of the accused infringer's expert that the omitted drawings when combined with other prior art "may have caused the USPTO to reject the claims." The court concluded there was a triable issue on the intent even though the USPTO was presented with the omitted drawings in reexamination and determined that they were not material. Not surprisingly, the court also found that the circumstantial evidence presented could lead a reasonable fact finder to infer the requisite intent to deceive the USPTO by withholding the drawings.

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While the Federal Circuit's decision in Therasense was believed to have significantly weakened inequitable conduct claims, this district court's decision shows that it may remain viable where the circumstantial evidence provides multiple reasonable inferences regarding the patentee's intent. Arguably, the district court did not apply the correct standard for determining specific intent to deceive whereby the indirect evidence of intent satisfied the specific intent requirement only where it is the single most reasonable inference to be drawn from the evidence.

Kathrein-Werke KG v. Radiacion Y Microondas S.A., et al, Case No. 07-CV-2921 (N.D. Illinois September 26, 2011)

The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. We represent inventors, patent owners and technology companies in patent licensing and litigation. Whether pursuing patent violations or defending infringement claims, we are aggressive and effective advocates for our clients. For more information contact Greg Cordrey at 949.623.7236 or GCordrey@jmbm.com.