Patent Law – Proving an inventor’s inequitable conduct gets harder

When an inventor applies for a patent, the inventor is supposed to inform the Patent and Trademark Office (PTO) of all material prior art.  What that means, in very simple terms, is that the inventor has a duty to inform the PTO of all information that has some bearing on whether the patent should be issued.

If the inventor fails to disclose prior art and the failure to disclose was with the intent to deceive the PTO into issuing the patent, a court might not enforce the patent against an alleged infringer on the grounds the patentee engaged in inequitable conduct.

Lately, it has been common for defendants of patent infringement lawsuits to assert an inequitable conduct defense (perhaps in as many as 80% of patent infringement cases according to some studies), resulting in what is often a substantial amount of work to prove and rebut the defense.  The added time and expense has been described by some courts as a “plague.”

The US Court of Appeals for the Federal Circuit recently raised the bar for proving an inequitable conduct defense in the case of Therasense, Inc. v. Beckton, Dickinson and Company.  Most notably, the Therasense court ruled that proving intent to deceive now requires evidence that the applicant knew of material prior art and made a “deliberate decision” to deceive the PTO by withholding a reference to such prior art and that the materiality of the undisclosed prior art must be so important that “but-for” the deception, the PTO would not have allowed the patent claim(s) covered by the undisclosed prior art.

This is in contrast to prior cases which held the intent to deceive could be proven with circumstantial evidence from which a general intent to deceive could be inferred versus the specific intent to deceive that now must be shown; and that the materiality of the undisclosed prior art could be determined from vague standards such as what a reasonable examiner would consider or whether the information is inconsistent with the position the patent applicant had taken.

Based on this case as well as other recent cases requiring strict pleading standards for asserting an inequitable conduct defense, prevailing on an inequitable conduct defense will now be very difficult.  However, since inequitable conduct regarding any single claim renders an entire patent unenforceable and can render unenforceable other related patents, there is a good chance patent infringement defendants will not be deterred from continuing to assert an inequitable conduct defense.

For more on this case, see this Bloomberg article.

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