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Inequitable Conduct: The End of the Plague

by Orlando Lopez

On Wednesday, May 25, 2011, the Court of Appeals for the Federal Circuit (CAFC) issued their en banc decision on the inequitable conduct case of Therasense v Becton -Dickinson, ending the inequitable conduct plague that had propagated through patent litigation and had patent attorneys filing large numbers of references to the USPTO.  The ruling of inequitable conduct has always required materiality of the evidence being withheld and intent to deceive the Patent Office (USPTO); however, this two-prong test has dulled and somewhat merged over the years.  The punishment for inequitable conduct is the unenforceability of the entire patent, which the CAFC referred to as the “atomic bomb” of patent litigation.  No patent litigator would want to be accused of not using weapons of mass destruction against the opposition.

In their en banc decision, the CAFC attempted to put an end to the plague.  After this decision, the standard for intent requires “the accused infringer [to] prove by clear and convincing evidence that the applicant knew of the reference, knew that it was material, and made a deliberate decision to withhold it.” Under the new standard for materiality, a “reference may be material if it would have blocked patent issuance under the PTO’s different evidentiary standards [-]See MPEP §§ 706 (preponderance of the evidence), 2111 (broadest reasonable construction)” with the exception of egregious conduct.  Although the majority opinion gives the example of false affidavits as egregious conduct, egregious conduct is not only limited to that example.

With the standards for materiality and intent that the present opinion provides, an end to the plague is expected.  As Dorothy might have said, “Hooray, hooray, the wicked plague is dead!”

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