In a ruling issued yesterday by the Northern District of California, Judge William Alsup found patent 5,820,551 owned by the medical device company Abbott Diabetes Care (formerly Therasense) invalid due to inequitable conduct.
The finding is especially harsh, as the patent holder loses all rights to enforce the patent.
The district court originally sided with Becton Dickinson, a decision affirmed by a three-judge panel at the Federal Circuit.
In November 2010, the case was argued en banc before the Federal Circuit, which set a higher standard for deciding when a patent holder has procured a patent through inequitable conduct.
The court remanded the case back to the district court for reconsideration under the new standard.
Jim Badke of Ropes & Gray, who represented Becton Dickinson, said there had been significant doubt that courts would ever find inequitable conduct again.
“The impact our case will have is basically to send a message that you can still win inequitable conduct and that there are behaviours that no court will tolerate or should tolerate when procuring a patent,” he told Managing IP.
In the opinion, Judge Alsup noted that the documents that had been withheld contradicted Abbott’s declaration and submission.
“Had the EPO briefs been presented to him, the examiner would have seen through Abbott’s representations to him,” he said. “In that event, the examiner would have persisted in the 13-year history of rejections. This is an inference but it has been shown by clear and convincing evidence.”
Last year, there was speculation Becton Dickinson would ask the Supreme Court to consider the issue. In the opinion, Judge Alsup pointed out that of the 12 circuit judges who participated in the two appellate decisions, six expressly favoured the new and tougher materiality standard.
“Despite the closeness of the decision and the importance of the question to our patent system and national economy, no petition for certoriari was filed in the Supreme Court,” he wrote.
Orrick’s Richard Martinelli said this case might not have been the right one for the Supreme Court to consider the standard.
“This has now proven that even under the very high bar set in Therasense, the facts here were bad enough according to the judge who heard the case that it still met the higher standard,” he said. “What we need now is probably a case that would fail under the higher standard but still seems to have activity that seemed improper.”
Given the significant interest, it’s likely the matter will once again reach the Federal Circuit and ultimately the Supreme Court.
“If you’re prosecuting a patent application today, this may not be the standard five years from now,” Badke said. “I think you need to be careful, when prosecuting a patent application, not to be too lax with what you disclose to the Patent Office and the candour you exercise. The en banc decision does not let you off the hook or satisfy your duty of candour to the Patent Office.”
