Thursday, June 9, 2011

Want to invalidate a patent in litigation? You still need to prove invalidity with clear and convincing evidence - Microsoft v. i4i

Justice Sotomayor said it succintly:
Under §282 of the Patent Act of 1952, “[a] patent shall be presumed valid” and “[t]he burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.” 35 U. S. C. §282. We consider whether §282 requires an invalidity defense to be proved by clear and convincing evidence. We hold that it does.
Defendants seeking to invalidate a patent must do so with clear and convincing evidence. Microsoft lost a large judgment to i4i for its custom XML feature of Word. Read more details here, if you like. Microsoft eventually asked the Supreme Court to lower this standard. At the least, Microsoft asked the Court to craft a standard that kept a clear and convincing burden if a defendant wanted to invalidate a patent with prior art the Patent Office had previously considered. But, for new prior art that had never been before the Patent Office, Microsoft asked the Court to lower the burden. The Court didn't adopt such a standard, but did give Microsoft something:

Simply put, if the PTO did not have all material facts before it, its considered judgment may lose significant force. Cf. KSR, 550 U. S., at 427. And, concomitantly, the challenger’s burden to persuade the jury of its invalidity defense by clear and convincing evidence may be easier to sustain. In this respect, although we have no occasion to endorse any particular formulation, we note that a jury instruction on the effect of new evidence can, and when requested, most often should be given. When warranted, the jury may be instructed to consider that it has heard evidence that the PTO had no opportunity to evaluate before granting the patent. When it is disputed whether the evidence presented to the jury differs from that evalu- ated by the PTO, the jury may be instructed to consider that question. In either case, the jury may be instructed to evaluate whether the evidence before it is materially new, and if so, to consider that fact when determining whether an invalidity defense has been proved by clear and convincing evidence.

The Court then concluded:

Congress specified the applicable standard of proof in 1952 when it codified the common-law presumption of patent validity. Since then, it has allowed the Federal Circuit’s correct interpretation of §282 to stand. Any recalibration of the standard of proof remains in its hands

Justice Breyer's concurrence (joined by Justices Scalia and Alito)

These three Justices joined the opinion of the Court, but wrote separately to make clear the distinction between standards of proof as applied to facts (i.e. when a product was first sold) and as applied to the law (i.e. do the given facts show that the product in question was previously in public use). As to the latter -- issues of law -- the Court's opinion on the clear and convincing standard has no bearing.

Justice Thomas's concurrence

Justice Thomas concurred in the judgement of the Court, but did not agree that Congress had codified a standard by utilizing the expression "presumed valid." Rather, because the statute is silent on the standard of proof, it simply did not change the common law, which included the heightened standard. Same result, different reason.


Affirmed.



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