Symbol Technologies:

1. Symbol Technologies: The (re)birth of Prosecution Laches Austin IPLA, March 27, 2001 Jennifer C Kuhn Gray Cary

2. The takeaway points: • The enforceability of a patent may be challenged because of the length of the prosecution, even if all statutes and rules were followed. • Non-precedential opinions may be disregarded by the Federal Circuit.

3. Symbol Techs., Inc. v. Lemelson Medical 277 F.3d 1361 (Fed. Cir. 2002). • Symbol and Cognex Corp. filed separate DJ’s against the Lemelson foundation. • After consolidation, Lemelson filed a Motion to Dismiss arguing: • No claim or controversy (12(b)(1)) • Prosecution Laches failed to state a claim upon which relief could be granted (12(b)(6)). • District Court denied the 12(b)(1), and granted the 12(b)(6).

4. The issue on appeal: • “The sole issue on appeal is whether, as a matter of law, the equitable doctrine of laches may be applied to bar enforcement of patent claims that issued after an unreasonable and unexplained delay in prosecution even though the applicant complied with pertinent statutes and rules.” Symbol Techs., 277 F.3d at 1263.

5. Limitations of the Decision • The panel only addresses the existence of the prosecution laches defense. • There is almost no guidance on the scope of the defense.

6. Facts about the Lemelson Patents • Of the patents involved in the suit, the average time from filing to issue: 34 months (range 7 months through 10 years 2 months). • Average time from priority date to issuance of claims: 15 years, 5 months (range 6 years, 3 months through 27 years, 6 months).

7. The Three Sources of Law for the Federal Circuit’s Decision • Supreme Court “precedent.” • 1952 Patent Act’s application on that Supreme Court precedent • Prior unpublished Federal Circuit opinions. • (But, the majority neglects to analyze CCPA and Court of Claims cases interpreting 1952 Patent Act)

8. The Structure of Federal Circuit Predecessor Courts

9. The Three Sources of Law for the Federal Circuit’s Decision • Supreme Court “precedent.” • 1952 Patent Act’s application on that Supreme Court precedent. • Prior unpublished Federal Circuit opinions.

10. Woodbridge v. United States, 263 U.S. 50 (1923): Patent was not issued after a nine year delay in prosecution. Webster Electric Co. v. Splitdorf Electrical Co., 264 U.S. 463 (1924): Claims subject to an unreasonable eight-year delay were not enforceable in infringement suit. Supreme Court Prosecution Laches Precedent

11. Woodbridge: • Woodbridge filed his application in 1852, used the PTO’s “secret vault” to keep his patent from issuing until 1861. • PTO ultimately refused to allow his claims to issue because of the “length of time he had allowed his invention to slumber.” 263 U.S. at 54. • Other inventors had obtained patents in the field without the benefit of Woodbridge’s. Id. at 56.

12. The Potential Standard: • The Supreme Court cited the Constitution, the special statute referring the case which created a laches defense, and Court’s own opinion in Kendall which stated an inventor may forfeit his rights “by an attempt to withhold the benefit of his improvement from the public until a similar or the same invention should have been made and introduced by others.” Kendall v. Winsor, 21 How. 322, 329.

13. Ambiguity of the standard • Appears to be similar to intervening rights from the law of reissue applications. • However, Supreme Court uses “should have been made and introduced” instead of language requiring that someone actually have made the invention.

14. Distinguishing Lemelson from Woodbridge • The Congressional Reference statute authorizing Woodbridge’s case explicitly authorized prosecution laches as a defense. • Woodbridge violated PTO rules, lied to the PTO about filing a foreign patent application and admitted to the Court that he delayed to maximize his royalties.

15. Distinguishing Lemelson from Woodbridge • Lemelson has not violated any PTO rule. • Symbol Technologies litigation is about enforceability, not issuance. • PTO was much faster in 1852, making a nine year delay that much more unreasonable.

16. Webster: (1924) • Eight years after original application, and after self serving interference, broad claims were added by amendment to a divisional. 264 U.S. at 465 • Inventor “stood by and awaited developments” as others disclosed subject matter of later filed claims. Id.

17. Potential standard • Webster creates a rebuttable presumption that the two year limit from reissue practice applies to “laches, equitable estoppel or intervening private or public rights.” 264 U.S. at 471.

18. Supreme Court “Ratifies” Laches • Crown Cork & Seal Co., Inc. v. Ferdinand Gutman Co., Inc., 304 U.S. 159 (1937): Two year time limit of Webster was held to be dictum. Appears to require abandonment,as well as intervening rights. Id. at 168. • General Talking Pictures Corp. v. Western Elec. Co., Inc., 304 U.S. 175 (1938): Rejected laches because there was no evidence of “intervening rights.” Id. at 183.

19. Supreme Court Summary • Woodbridge “should have” standard is superseded for infringement cases. • Proof of “adverse intervening rights” is required before patentee must justify delay. • There is no time after which prosecution is presumptively unreasonable. • Equity for competitors, rather than Constitutional limitations on patent terms, forms basis for prosecution laches.

20. Another Supreme Court case • Overland Motor Co. v. Packard Motor Car Co., 274 U.S. 417, 424 (1927). • “We do not know on what principle we could apply the equitable doctrine of abandonment be laches [sic] in a case where the measure of reasonable promptness is fixed by statute, and no other ground appears by reason of which laches could be imputed to the applicant.”

21. Lemelson’s arguments: • Webster and following cases are limited to interferences. • But Crown Cork and General Talking Pictures are not interference cases.

22. The Three Sources of Law for the Federal Circuit’s Decision • Supreme Court “precedent.” • 1952 Patent Act’s application on that Supreme Court precedent. • Prior unpublished Federal Circuit opinions.

23. Sections 120 and 121 • These two sections codified existing continuation practice which had been governed by PTO rules: • Section 120: Benefit of earlier filing date in the U.S. • Section 121: Divisional applications • No part of Title 35 directly addresses prosecution laches.

24. Reliance on Legislative History • Plain language of statute controls “in the absence of clearly expressed legislative intent to the contrary.” Transco Prods. Inc. v. Performance Contracting Inc., 38 F.3d 551, 556-57 (Fed. Cir. 1994) (Rich, J.). • Transco holds that the 1952 patent act merely codified continuation practice.

25. Legislative History of 120-21 • The opinion relies on Federico lectures and commentary on the 1952 Patent Act, which mention “equitable defenses such as laches, estoppel and unclean hands.” 75 J. Pat & Tm. Office Soc. 161, 215 (1993) (reprint of Federico’s 1954 post Patent Act article). • Decision extrapolates from this quote to the conclusion that the drafters (and thus Congress) intended to maintain the defense despite not including prosecution laches in section 282.

26. Lemelson’s arguments: • Webster and following cases are limited to interferences. • But Crown Cork and General Talking Pictures are not interference cases. • The plain language and legislative history of the 1952 Patent Act foreclose the defense of prosecution laches. • Federico ex post facto lectures indicated that laches was preserved

27. The Three Sources of Law for the Federal Circuit’s Decision • Supreme Court “precedent.” • 1952 Patent Act’s application on that Supreme Court precedent. • Prior unpublished Federal Circuit opinions.

28. Previous unpublished opinions reject the laches defense? • Bott v. Four Star Corp., 848 F.2d 1245 (Fed. Cir. 1988) (Bissell, Archer and Mayer). Argument rejected was based on the two-year reissue limitation from Webster. • “Accordingly, we are not persuaded…that this court should adopt equitable safeguards to limit continuation applications when the Congress gave no indication that it intended to so do.” Id. at *1 (citing In re Hogan, 559 F.2d 595, 604 n. 13 (CCPA 1977) and In re Henrikson, 399 F.2d 253, 262 (CCPA 1968)).

29. Previous unpublished opinions reject the laches defense? • Ricoh Co., Ltd. v. Nashua Corp., 185 F.3d 884 (Fed. Cir. 1999). Rejects Nashua’s argument that it is entitled to intervening rights. • Cites Kingsdown Medical Cons., Ltd. v. Hollister, Inc., 863 F.2d 867, 874 (Fed. Cir. 1988), approving claims specifically added to cover competitor’s product.

30. Lemelson’s arguments: • Webster and following cases are limited to interferences. • But Crown Cork and General Talking Pictures are not interference cases. • The plain language and legislative history of the 1952 Patent Act foreclose the defense of prosecution laches. • Federico: laches was preserved, but CCPA and Fed Cir decisions during Rich’s tenure indicate otherwise. • Unpublished decisions reject laches • Whether the panel was right or wrong to reject its earlier decisions, they are actually distinguishable.

31. Judge Newman’s Dissent

32. Newman: Let Congress Do It • “[T]he court should not intervene in equity where Congress has not.” citing district court and Northwest Airlines Inc. v. Transport Workers Union of Am., 451 U.S. 77, 97 (1981). • Cites CCPA cases (Henrikson and Hogan) where equitable changes to the 1952 Patent Act’s continuation practice scheme were rejected.

33. Conflict in Precedent Ignored • Both CCPA and Court of Claims address the legislative history of the 1952 Patent Act. • Pratt & Whitney Co. v. United States, 345 F.2d 838 (Ct. Cl. 1965) holds claims invalid due to laches citing Webster. Id. at 843-44.

34. CCPA Precedent • Henrikson shows the ambiguity of the legislative history, as the BPAI (Federico was on the board) was overruled by the CCPA (Rich was on the court) on the PTO’s attempt to limit the number of continuations. New limitations to section 120 are for Congress to decide. 399 F.2d at 1388. • Hogan: “The 24 years of pendency herein may be decried, but a limit upon continuing applications is a matter of policy for the Congress, not for us.” 559 F.2d at 604.

35. Resolution of Conflict • Both CCPA and Court of Claims decisions are precedential. South Corp. v. United States, 690 F.2d 1368 (Fed. Cir. 1982). • Resolution of conflict between the two require en banc consideration. UMC Elec. Co. v. United States, 816 F.2d 647 (Fed. Cir. 1987).

36. Conclusion: Considerations for Prosecutors, Litigators and Licensing Attorneys

37. Potential Prosecution Flags: • Continuation or divisional claims that are broader than the original claims? Festo encourages narrower claims. • Claims added to cover competing products in the market place? Kingsdown specifically approves this. • Prosecutions that are unusually long? 20 year term may not excuse this.

38. Potential Litigation Issues • Opinion gives no guidance on application of prosecution laches. • May open the door to testimony about the internal operations of the PTO. • Tension with Kingsdown will complicate the application of the defense.

39. Potential Licensing Issues • Previously solid patents may now be unenforceable. • Portfolio review should now include investigation of potential adverse intervening rights.

40. Symbol Technologies: Questions