Supreme Court Affirms Clear and Convincing Standard

The Supreme Court affirmed the existing standard of proving patent invalidity by clear and convincing evidence.  Microsoft Corp. v. i4i L.P.

Initially, when the Court agreed to review this case, it was thought that they planned to continue efforts to erode patent protection.  Slowly, as the case has proceeded through the briefing stage and oral argument, the balance seemed to tip back.  The Solicitor’s support of i4i’s position was of particular importance.  It now seemed more uncertain what the outcome would be.  Perhaps the Court would affirm the current standard.

It is still a surprise, however, that today’s opinion of affirmance was unanimous.

The Opinion

Justice Sotomayor delivered the opinion of the Court which took a very straightforward approach to the case.  The case is simply one of statutory interpretation as to the meaning and intent of Congress in enacting 35 U.S.C. § 282. 

The Court relied heavily on Judge Rich’s opinion in American Hoist where he indicated that the intent of § 282 was merely to codify the existing common law presumption that the PTO did its job properly.  The challenger’s burden is to prove invalidity by clear evidence.  Judge Rich, being a principal drafter of the 1952 Patent Act, was determined to be authoritative in the matter.

The Court noted that § 282 indicates who has the burden of proving invalidity, it does not indicate a standard for so proving.  Since Congress didn’t explicitly state the standard, it was presumed to be codifying or acquiescing the existing standard.  To determine the standard as of enactment of the statute, the Court relied on Justice Cardozo’s opinion in RCA where he referred to a patent challenger’s “heavy burden” that must be greater than a “dubious preponderence.”  The Court must presume that Congress intended to incorporate this heavy burden into § 282.

The Court rejected Microsoft’s arguments that the heightened burden only related to oral testimony or proof of prior inventorship.  The Court also addressed Microsoft’s argument that, under the Federal Circuit’s interpretation, the first sentence of § 282 would render the second sentence superfluous.  The Court agreed with Microsoft on this issue, but could determine no construction that would avoid excess language.  Thus, the Court would rely on the common law standard.

Next, the Court addressed Microsoft’s proposed hybrid standard of proof that would require clear and convincing evidence for evidence previously considered by the examiner and a preponderence for new evidence that was not previously considered.  First, the Court noted that if this had been Congress’ intent with regard to § 282, it would have said so explicitly.  Contrary to Microsoft’s contention, no lower courts had applied the hybrid standard.  Even had they done so, that would not be relevant to the Supreme Court’s determination.  Finally, the Court recognized that patent examiners are not required to cite on the patent every reference they have considered.  This alone would render the hybrid approach impractical.

The Court did recognize that newly uncovered evidence may be granted more weight when determining whether invalidity has been proven by clear and convincing evidence.  In fact, the Court endorsed the position that the jury could be instructed as to the effect of the new evidence.  If it is disputed whether the evidence was previously considered, the jury can be instructed to consider the issue.

The Court briefly reviewed the various policy arguments raised in the numerous briefs in the case.  Many had argued that too many bad patents were being issued and that these patents were insulated from challenge by the heightened standard.  Others argued that the heightened standard is part of the patent bargain.  The Court declined to address these issues believing them to be for Congress and not the Court to consider.

Finally, the Court noted that Congress has modified § 282 many times since its enactment and even since the Federal Circuit began to consistently interpret the statute to require the clear and convincing standard of proof.  Never once has it considered an amendment that would change that standard.  Thus, Congress clearly intends to maintain the clear and convincing standard.

Other Opinions

Justice Breyer, joined by Justices Scalia and Alito, joined the Court’s opinion, but wrote separately to address the fact/law distinction raised in the AIPLA’s amicus brief.  Only facts need be proven by clear and convincing evidence.  The overall legal determination of invalidity does not require a clear and convincing standard.  He advocated using special interrogatories or special verdicts to separate the legal and factual issues for the jury.  This would also facilitate appellate review.

Finally, Justice Thomas wrote separately.  He was the only member not to join the Court’s opinion, but he did concur in the judgment.  He does not believe that Congress sought to codify any standard of proof in § 282.  He does believe, however, that the Supreme Court established the clear and convincing standard in the RCA case.  This case has not been overruled and controls the case.

Conclusion

This opinion shows that the Supreme Court can, at times, get patent cases right.  Reducing invalidity challenges to a preponderence of the evidence would have severely weakened issued patents.  Installing a new hybrid system of proof would have severely buried the PTO in prior art.  That result would have further exacerbated the problems with the application backlog and pendency.

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5 Responses to “Supreme Court Affirms Clear and Convincing Standard”

  1. Online Global Week in Review 17 June 2011 from IP Think Tank Says:

    [...] Supreme Court affirms high standard of proving patents invalid – Microsoft Corp. v. i4i Limited Partnership (Electronic Frontier Foundation) (Patent Arcade) (Patently-O)  (IPBiz) (IAM) (IPBiz) (Patentology) (ipwars) (Patents Post Grant) (The Prior Art) (Patent Docs) (IPKat) (PatLit) (IPblog) (Patently Biotech) (Maier & Maier) (IPBiz) (Patent Law Practice Center) (Inventive Step) [...]

  2. China Update 18 June 2011 from IP Think Tank / 中国知识产权动向,2011年6月18日 来自IP Think Tank Says:

    [...] Supreme Court affirms high standard of proving patents invalid – Microsoft Corp. v. i4i Limited Partnership / 美国最高法院在微软诉i4i公司一案中,确认证明专利无效的准则 (Electronic Frontier Foundation) (Patent Arcade) (Patently-O)  (IPBiz) (IAM) (IPBiz) (Patentology) (ipwars) (Patents Post Grant) (The Prior Art) (Patent Docs) (IPKat) (PatLit) (IPblog) (Patently Biotech) (Maier & Maier) (IPBiz) (Patent Law Practice Center) (Inventive Step) [...]

  3. IP Down Under » Online Global Week in Review 17 June 2011 from IP Think Tank Says:

    [...] Supreme Court affirms high standard of proving patents invalid – Microsoft Corp. v. i4i Limited Partnership (Electronic Frontier Foundation) (Patent Arcade) (Patently-O)  (IPBiz) (IAM) (IPBiz) (Patentology) (ipwars) (Patents Post Grant) (The Prior Art) (Patent Docs) (IPKat) (PatLit) (IPblog) (Patently Biotech) (Maier & Maier) (IPBiz) (Patent Law Practice Center) (Inventive Step) [...]

  4. IP Down Under » China Update 18 June 2011 from IP Think Tank / 中国知识产权动向,2011年6月18日 来自IP Think Tank Says:

    [...] Supreme Court affirms high standard of proving patents invalid – Microsoft Corp. v. i4i Limited Partnership / 美国最高法院在微软诉i4i公司一案中,确认证明专利无效的准则 (Electronic Frontier Foundation) (Patent Arcade) (Patently-O)  (IPBiz) (IAM) (IPBiz) (Patentology) (ipwars) (Patents Post Grant) (The Prior Art) (Patent Docs) (IPKat) (PatLit) (IPblog) (Patently Biotech) (Maier & Maier) (IPBiz) (Patent Law Practice Center) (Inventive Step) [...]

  5. Supreme Court to Hear More Patent Cases in October 2011 Term « INVENTIVE STEP Says:

    [...] decided Global-Tech where it ruled that willful blindness=knowledge for induced infringement, and i4i where it ruled that patent invalidity must be proved by clear and convincing evidence.  After a [...]

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