Last week, the Federal Circuit issued its decision in Therasense v. Becton, Dickinson. The case did not exactly come out the way the PTO wanted.
In its amicus brief in the case, the PTO argued, quite sensibly, that the main cause of the problems dealing with inequitable conduct was that the Federal Circuit simply didn’t follow its own law. Although the court had quite forcefully stated in its seminal 1988 Kingsdown opinion that inequitable conduct required proof of specific intent to deceive the PTO, over time “specific intent” had come to mean something akin to negligence.
Regarding the materiality prong of the test, the PTO argued that its own Rule 56 standard for materiality is the correct one. In its current iteration, the Rule 56 standard is as follows:
(b) Under this section, information is material to patentability when it is not cumulative to information already of record or being made of record in the application, and
(1) It establishes, by itself or in combination with other information, a prima facie case of unpatentability of a claim; or
(2) It refutes, or is inconsistent with, a position the applicant takes in:
(i) Opposing an argument of unpatentability relied on by the Office, or
(ii) Asserting an argument of patentability.
A prima facie case of unpatentability is established when the information compels a conclusion that a claim is unpatentable under the preponderance of evidence, burden-of-proof standard, giving each term in the claim its broadest reasonable construction consistent with the specification, and before any consideration is given to evidence which may be submitted in an attempt to establish a contrary conclusion of patentability.
The Federal Circuit, however, held that it was exactly this standard for materiality that led to the problems with inequitable conduct. Ruling that it is not bound by PTO rules, the court chose a much stricter “but-for” materiality standard.
What will the PTO do?
The Therasense case dealt with the patent infringement defense of inequitable conduct, while PTO Rule 56 deals with the duty of disclosure to the PTO by patent applicants. While these two issues are inextricably linked, with the defense flowing from how applicants undertake their duty of disclosure, they are two separate issues. The PTO has indicated that it is studying the decision and will issue guidance to applicants soon. It is possible that the PTO could simply keep the Rule 56 standard for applicant disclosures and permit the Federal Circuit to use a different standard for violations of the duty. This could lead to a confusing hodge-podge of standards.
The stick (some would argue the in terrorem pressure) that forces applicants to follow the PTO’s duty of disclosure is the remedy for inequitable conduct, the holding of a patent or patent family to be unenforceable, plus possible attorneys’ fees and the like. By making it much more difficult to obtain such a remedy, the PTO’s rule would seem to be less burdensome and fearful. The PTO could still sanction attorneys for failure to comply with Rule 56, but the Office readily admits that it does not have the resources to adjudicate and enforce these issues.
Then, there’s the issue of whether the decision is indeed final. Perhaps the case will be appealed to the Supreme Court. It seems unlikely that the Court would agree to hear the case, but in any event, even that decision would not be made until early fall or later. If the Court does hear the case, it could be another year before a decision.
With these issues in mind, the question remains: what will the PTO do?