Terms and Concepts

District Court Litigation

While the PTO may accord deference to factual findings made by the court, the determination of whether an SNQ exists will be made independently of the court’s decision on validity, since the decision is not controlling on the PTO [Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1428-29 (Fed. Cir. 1988); In re Swanson, No. 2007-1534 at pp. 12-18 (citing Ethicon, 849 F.2d at n. 3 and Stevenson v. Sears Roebuck & Co., 713 F.2d 705, 710 (Fed. Cir. 1983)) (emphasis in original)].  A non-final holding of claim invalidity or unenforceability also will not be controlling on the question of whether an SNQ is present.

A prior holding of validity by a district court is therefore not inconsistent with a subsequent holding of invalidity by the PTO.  In an inter partes reexamination brought by a party to the litigation, a final holding of validity in the civil action triggers the estoppel provisions of 37 C.F.R. § 317(b) in the reexamination proceeding.  All issues that were raised or could have been raised by the party in the civil action will not be maintained in the inter partes reexamination proceeding.

“Courts do not find patents ‘valid’, only that the patent challenger did not carry the ‘burden of establishing invalidity in the particular case before the court’ …” In re Swanson, 540 F.3d 1368, 1377 (Fed. Cir. 2008).

Only a final holding of claim invalidity or unenforceability (after all appeals) is controlling on the PTO.  In such cases, an SNQ would not be present as to the claims held invalid or unenforceable [MPEP § 2686.04].  In other words, the PTO will not reexamine patent claims that previously were invalidated by a district court.  In sum, only a final, non-appealable, ruling on invalidity is binding on the PTO.

Impact on Trial

Can the existence of or developments in the reexamination proceeding, such as a final rejection of the claim(s) in suit, be brought to the attention of the jury, or is this inadmissible because it is too prejudicial?  One patent litigator shared that her mock jury research indicated that the mere knowledge by the jury of the existence of the reexamination reduced the likelihood that the jury would find invalidity because it assumed that the PTO, the administrative agency expert in deciding validity, now had assumed responsibility for this issue.  In effect, the jury would “punt” on the invalidity issue.  Assuming this jury research is reproducible, it further argues that the judge should be concerned about the prejudicial impact of any information about the existence of or developments in the reexamination on the jury.

Indeed, the possibility that unexpected developments in the reexamination could be admissible at trial has been the basis for some trial counsel choosing not to seek reexamination even when there is strong prior art.  This concern seems to be intertwined with several factors.  The first is that many judges have little practical knowledge about reexaminations and what happens at the CRU or the BPAI.  They could be “easily swayed” by initial developments from the CRU, whether it is rejection of all of the claims or allowance of some of the claims in suit in the first Office action.  The second is that some judges would like to defer the validity issue to the PTO.  The third is the possibility of a litigation stay, which if granted initially and then lifted later, could present a dilemma in explaining to the jury why there has been a time delay in the suit.

However, at least one district court decision deemed non-final reexamination proceedings to be too prejudicial to present to a jury [Microsoft Corporation et al v. Commonwealth Scientific & Industrial Research Organisation, 6-06-cv-00549 (April 9, 2009 EDTX) (Judge Davis)].  In that case, the court ruled that “without any [final] conclusions of the PTO to rely upon, evidence that the PTO is currently reexamining the patent may work to unduly alleviate defendants’ ‘clear and convincing’ burden for both invalidity and willfulness in front of the jury.”

Similarly, the Federal Circuit recently recognized that “a requestor’s burden to show that a reexamination order should issue from the PTO is unrelated to a defendant’s burden to prove invalidity by clear and convincing evidence at trial” [Procter & Gamble Co. v. Kraft Foods Global, Inc., 549 F.3d 842, 848 (Fed. Cir. 2008)].  If the trend of these recent decisions continue, it may be difficult to get any evidence at all related to reexamination proceedings before a jury.

Finally, some trial counsel take the view that, if the prior art is not successful before the CRU, it will be even less successful before the court.  This is based on the use of KSR at the PTO, the broader claim construction rules at the PTO, and the lower burden of proof of invalidity at the CRU.  To put it in sound bite terms – “If you can’t win it at the CRU, then you have even less chance to win it in court.”  Such counsel take this view particularly in jurisdictions having a reputation for upholding the validity of patents.  The court of particular interest is the United States District Court Eastern District of Texas .

The perception is that most of the judges in this “pro-patent” court resent the intrusion of the reexamination process into their judicial proceeding.  Thus, the concern is that if there is a “favorable” development in the CRU for the patent owner, the judge would be more inclined to let the jury know of this development than if there has been an “unfavorable” development.

Trial counsel who have faced this issue with these judges observe that there is a low likelihood that the judge will allow any developments in the reexamination to be brought to the attention of the jury because they need to be balanced on such admissibility determinations.  As one trial counsel put it in opining that all developments in reexaminations will be excluded from the jury, is that the balanced approach of exclusion will be based on the adage of “what is good for the goose [patent owner], is good for the gander [third party requester]”.

Fast Courts Versus Slow Courts

How might the perceived speed of a court affect a decision to file a request for reexamination?  Since the average pendency of a reexamination through the CRU, the BPAI, and the Federal Circuit is 48 to 96 months, is the vehicle of reexamination more suitable for a slow court?  As noted herein, the timing of a reexamination request depends on the requester’s overall goals.  If the purpose of a threatened reexamination is to drive settlement, then the speed of the court is irrelevant.  If the goal of the reexamination request is to stay the litigation, then speed of the request vis-à-vis the speed of the court is paramount.

ITC patent actions are notoriously fast and bear some special attention.  As most readers are aware, ITC investigations proceed more quickly than district court actions.  Some reports indicate that an ITC investigation is generally completed within 15 months, whereas the average patent litigation in district court takes approximately 22 months [Vivek Koppikar, Evaluating the International Trade Commission’s Section 337 Investigation, 86 J. PAT. & TRADEMARK OFF. SOC’Y 432, 433 (2004)].  In the past, the speed with which the ITC had to proceed was strictly mandated by statute.  Since the statute was amended in 1994, the ITC now must “conclude any such investigation and make its determination under this section at the earliest practicable time after the date of publication of notice of such investigation” [19 U.S.C. § 1337(b)(1)].

Due to this statutory mandate for a swift investigation, it should not be surprising that the ITC is hesitant to stay its investigations.  One recent ITC case confirms the ITC’s reluctance.  In this case, the presiding administrative law judge (“ALJ”) granted a stay pending reexamination of the patents-in-suit [In re Freescale Semiconductor, Inc., Misc. No. 875, 2008 WL 2951399 (Fed. Cir. June 25, 2008) (non-precedential)].  On appeal to the Commission, the stay was rejected, and proceedings were reinstated.  The defendant petitioned the Federal Circuit for a writ of mandamus that the stay be reinstated.  The Federal Circuit refused to reinstate the stay, finding that the Commission had justified its action and that hardship, inconvenience, and avoidance of a particularly complex trial are not sufficient reasons to grant mandamus.

At the same time, however, the ITC has not adopted any per se rule regarding staying an investigation in light of a concurrent reexamination at the PTO.

Rather, the ALJ will weigh several factors, including:

  1. the stage of discovery and the hearing date;
  2. the issues in question and trial of the case;
  3. the undue prejudice or clear tactical disadvantage of any party;
  4. the stage of the reexamination at the PTO;
  5. the efficient use of ITC resources; and
  6. the availability of alternative remedies in federal court [In re Certain Personal Computer/Consumer Electronic Convergent Devices, Components Thereof and Products Containing Same, Inv. No. 337-YA-558, ALJ Order No. 6, 2006 ITC (U.S.I.T.C. Feb. 7, 2006) (order granting temporary stay)].

Because of the speed with which the ITC conducts its investigations, litigants should expect an ITC investigation to proceed at its normally rapid pace with a low likelihood that the ALJ will stay the investigation.

Cases with Multiple Defendants

In cases with multiple accused infringers, how should a patent owner deal with reexamination threats by a single defendant, or a plurality of defendants?  For the multiple defendants contemplating a reexamination strategy, what if the defendants are not of a single mind when it comes to reexamination strategy?  Should reexamination be explicitly dealt with in any joint defense agreement?  Again, any reexamination request can be timed so that it will not likely affect any trial proceedings.  A requester could further allay fears by committing to the other non-participating defendants not to request a litigation stay should the claims be rejected by the PTO.  Of course, a consensus strategy is most desirable, but nothing is likely to bar a single defendant from launching a reexamination request if it believes its interests are best served by doing so.

One final consideration is how the real party in interest rule is addressed in multiple-defendant cases, as discussed above.  Do the requester’s non-participating co-defendants fall under the estoppel provisions?  If not, could the same art be “litigated” at the PTO and at the district court by these non-participating defendants? We are not aware of this tactic having been tested, but joint defense groups may want to consider such a strategy.

Judge’s Perception of Reexamination

Might a judge view a reexamination request as usurping the judge’s authority?  Does it help if the reexamination request is submitted by counsel not associated with trial counsel?  Keep in mind that ex parte reexamination requests may be filed anonymously.  Could it be in the requester’s interest, where there is co-pending litigation, to anonymously file the reexamination request?  Patent owners should consider interrogatories and/or production requests directed to whether the accused infringers have filed a reexamination request or caused a reexamination request to be filed.

Historically, many district court judges viewed reexaminations, particularly ex parte reexaminations, with disbelief and have been reluctant to grant stays especially if their court operates on a “fast track.”  More recently at Sedona discussions, some judges have expressed the view that they may rethink their approach in the future now that the CRU has been created and the PTO statistics seem to indicate prompt processing of reexaminations and a high probability of the reexamination resulting in some or all of the claims being found unpatentable.  However, other judges are troubled by the time delay of reexaminations [See Order Denying Sun Microsystem, Inc.’s Renewed Motion For Partial Stay in Network Appliance Inc. v. Sun Microsystems, Inc., United States District Court for Northern District of California (C-07-06053), issued November 4. 2008].  Litigants thus should pay special attention in the court filings relating to stays to explain the current reexamination environment.

Impact on Laches

Do reexamination proceedings or the issuance of a reexamination certificate have any impact on the six-year statutory laches provisions of 35 U.S.C. § 286?  A recent decision by the Federal Circuit seems to indicate that a reexamination certificate will not restart or impact the six-year laches presumption for enforcing an issued patent [See Serdarevic v. Advanced Med. Optics, Inc., 87 U.S.P.Q.2d 1481, 1484-85 (Fed. Cir. 2008)].  This appears consistent with the notion that a patent is fully  enforceable on its original claims, even when it is involved in reexamination proceedings.


  • Prior Holding of Validity
  • Final Non-Appealable Holding
  • Prejudicial Impact on Jury
  • Courts Perceived as “Pro-Patent”
  • ITC Factors for Stay Pending Reexamination
  • Joint Defense Group Consensus Agreements
  • Real Party in Interest and Joint Defense Groups