Patents Post-Grant: Perceived Patent Reexamination Misstep Haunts Plaintiff

Patents Post-Grant: Perceived Patent Reexamination Misstep Haunts Plaintiff

A successful reexamination from a defendant perspective does not always result in an overt claim change or cancellation. In other words, even where claims are confirmed, statements in the reexamination record that are inconsistent with arguments made in a concurrent litigation may provide key evidence necessary to prevail during a Markman hearing, or offer new, non-infringement positions to defendants.

Late last month, in Kilopass Technology Inc., v. Sidense Corp (NDCA), the Court cited to seemingly inconsistent statements made by a Patentee during the patent reexamination of U.S. Patent 6,777,757 to drive its claim construction ruling, explaining:

[T]he Court noted that Kilopass had argued before this Court during claim construction that "wordlines" and "bitlines" were interchangeable, and that the Court had largely agreed with Kilopass in it Claim Construction Order . . . Following that Order, Kilopass took the exact opposite position in overcoming prior art before the PTO Board of Appeals and Interferences (the "BPAI"), stating that, "[w]ith respect to claims 5 and 11, [Kilopass] agrees with the Examiner that Tanaka does not show a gate formed from a column bit line. As can been seen [sic] in Figure 2(b) of Tanaka, the gates of the transistors are coupled to row wordlines. Therefore claims 5 and 11 are not anticipated by Tanaka." . . .  (Kilopass's Jan. 6, 2012 BPAI Brief)). The Court found that in making this argument, Kilopass had made a clear and unmistakable disavowal of scope regarding claims showing gates formed from column bit lines. Id. at 8; see Spectrum Intern., Inc. v. Sterilite Corp., 164 F.3d 1372, 1379 (Fed. Cir. 1998) [enhanced version available to lexis.com subscribers] ("Claims may not be construed one way in order to obtain their allowance and in a different way against accused infringers.").

Kilopass seeks reconsideration based on a filing it made with the USPTO following the Court's May 1, 2012 Order. The day after the Court issued its Order on claim scope disavowal, Kilopass filed a document with the USPTO entitled "Submission Under 37 C.F.R. § 1.985(A) Concerning Ongoing Litigation Activity and Supplement to the Respondent's Brief to Correct an Error Made Without Deceptive Intent." . . .  In that submission, Kilopass informed the USPTO that it made an error in its statement agreeing with the PTO Examiner, and provided other reasons as to why Tanaka does not anticipate its patent. Id. Civil Local Rule 7-9 allows a party to seek reconsideration where it can show,inter alia, "the emergence of a new material fact . . . occurring after the time of such order . . ." L.R. 7-9(b)(2). The Court finds that the rule does not apply where the "new material fact" is merely a party's attempt to undo a strategic position for which it has been penalized. It was in Kilopass's interest to argue that wordlines are different from bitlines in its BPAI brief; however, after that position damaged its case in this Court, Kilopass sought to reverse its position before the BPAI. Moreover, Kilopass vigorously opposed Sidense's motion for estoppel and claim disavowal that brought Kilopass' incongruous position to the attention of the Court. Nowhere in its opposition did Kilopass suggest that it made a mistake in the BPAI brief. See Kilopass's Opp. to Sidense's Mot. for Recon., Dkt. 207. Instead, Kilopass argued that its "position at the PTO was fully consistent with its earlier position" and that it "did not persuade the Court to adopt a claim construction position that would create a risk of inconsistent judicial rulings." Id. at 6-9. Only after the Court found that Kilopass adopted inconsistent positions and disavowed claim scope, did Kilopass re-characterize its BPAI position as error and file a submission with the USPTO to "correct an error made without deceptive intent." See dkt. 228-7. This type of gamesmanship is not the purpose for which Civil Local Rule 7-9 allows for reconsideration.

The above debate bears out a very important application of patent reexamination concurrent with litigation, namely, the creation of additional fodder for claim construction purposes.

Clearly, a successful patent reexamination from a defendant perspective does not necessarily require that a Patentee cancel or amend claims. As such, when facing a suit in a district court in which a Markman Hearing is scheduled some 12-18 months from initiation, pursuit of patent reexamination at the outset of the dispute may prove an effective strategy to focus the later claim construction.

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