Lying to the Patent Office invalidates patent
With Therasense, the Federal Circuit took a stance indicating that a charge of inequitable conduct would be very difficult to win. Inequitable conduct invalidates the patent. Inequitable conduct is a serious charge that is directed to the character of a person. Plus, defendants or alleged infringers were using the claim of inequitable conduct to place the patent owner in an unfavorable light even if no inequitable conduct had occurred. However, the following case illustrates the type of conduct that would be considered egregious for the defendant to win based on inequitable conduct.
In Intellect Wireless v. HTC (Fed. Cir. 2013), the patent owner sued HTC on various patents. The patent owner in obtaining these patents prepared and filed an affidavit indicating that he invented the patented idea prior to one of the prior art references cited by the examiner. In actuality, he did not. However, the inventor attempted to show that he invented the invention prior to the date of the reference. The patent is governed by the first to invent rule instead of the first inventor to file rule under the America Invents Act. Under the first to file rule, the inventor wouldn’t have been able to obtain the patent. Nonetheless, with a lie, the inventor was successful in convincing the examiner that he was first in time so the was first in right. In other words, the prior art reference that the examiner utilized to reject the patent application shouldn’t be used. Hence, the examiner granted the patent.
The examiners at the patent office do not have extensive power to ask for more information from the inventor. They take the inventor’s word at face value unless there are some inconsistencies in the documents. For the most part, the patent system works on an honor system with the threat of inequitable conduct, invalidity of your patent and sanctions. In this case, the inventor took advantage of the honor system and the defendant’s attorneys took him to the task. He failed and the patents were held to be unenforceable for inequitable conduct.
The patent owner argued that he cured the inequitable conduct. In particular, the inventor explained that even though he had attempted to misguide the examiner, he cured the problem. In particular, the inventor misguided the examiner by expressly stating that the inventor had conceived and actually reduced the invention to practice prior to the effective date of the prior art reference. In reality, the inventor never actually reduced the invention to practice but did do it constructively (i.e., filing of a patent application). The inventor’s attorney of record attempted to cure the false statements by resubmitting the declaration but did not expressly point out the errors. Instead, the patent attorney merely changed the verbiage and left the examiner to figure things out for himself.
The Federal Circuit held that merely submitting correct information after submitting knowingly false statements do not cure the inequitable conduct. Also, the court found a pattern of submitting false statements by the inventor in other related patents and patent applications. To cure the inequitable conduct, you must point out the errors and correct them.
This case provides an illustration of the type of conduct that is considered egregious enough for defendants and alleged infringers to win on a charge of inequitable conduct.
This case also stands out as an example to inventors of what not to do in procuring a patent. The inventor expends funds to procure a patent, build a business, secure licensees only to have these very patents deemed unenforceable (i.e., worthless). The goal of patent prosecution is to procure enforceable patents. By lying to the patent office, shortcuts are taken and in the long run, it doesn’t make sense. In my opinion, it would have been better to argue around the prior art references.