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Asghari-Kamrani v. United Services Automobile Ass'n
Citations: 252 F. Supp. 3d 562; 2017 U.S. Dist. LEXIS 81552Docket: CIVIL NO. 2:15cv478
Court: District Court, E.D. Virginia; May 18, 2017; Federal District Court
A Motion for Judgment on Partial Findings was filed by Plaintiffs Nader Asghari-Kamrani and Kamran Asghari-Kamrani against United Services Automobile Association (USAA) for patent infringement, following an initial complaint submitted on October 30, 2015, and a Second Amended Complaint on April 12, 2016. USAA responded with a Motion to Dismiss on April 28, 2016, alongside an Answer and Counterclaims alleging inequitable conduct and asserting the patent's unenforceability due to Plaintiffs' failure to disclose known prior art to the Patent and Trademark Office (PTO). USAA’s claims included false certifications of non-publication requests and material misrepresentations regarding the patent's priority claims. Plaintiffs sought to dismiss these counterclaims on May 16, 2016. The Court found the patent claims invalid for being directed at an abstract idea, leading to the dismissal of USAA's counterclaims on July 5, 2016. Subsequently, USAA sought attorney’s fees and a correction to the judgment, which the Court granted on August 15, 2016. An Amended Counterclaim was ordered by the Court, filed on October 4, 2016, followed by Plaintiffs' responsive motions, which were denied on December 9, 2016. Lastly, a Motion for Summary Judgment filed by Plaintiffs was denied on April 13, 2017. The Court ultimately granted Plaintiffs' Motion for Judgment on Partial Findings on April 25, 2017, elaborating on its findings and reasoning in the order.
On April 18, 2017, a bench trial commenced, during which plaintiffs moved for Judgment on Partial Findings after USAA concluded its case-in-chief. The court granted this motion on April 24, 2017. The plaintiffs are the inventors of Patent No. 8,266,432 (the "’432 patent"), a system for user identification and authentication online, filed on September 15, 2008, and issued on September 11, 2012. The patent describes three entities involved in its methods: the "Central-Entity," which secures user information; the "User," who requires authentication for online transactions; and the "External-Entity," which provides goods or services and needs to validate users digitally. The Central-Entity creates a secure account for the User, who uses a Username and a dynamically generated SecureCode to access services.
The court previously ruled that the claims of the ’432 patent were invalid as they pertained to an abstract idea under 35 U.S.C. § 101. The trial focused on representations made by the plaintiffs to the United States Patent and Trademark Office (PTO) regarding three related patents: Patent No. 7,356,837 (the "’837 patent"), Patent No. 7,444,676 (the "’676 patent"), and Patent No. 8,281,129 (the "’129 patent"). The plaintiffs claim that the ’432 patent is entitled to the earlier filing date of the ’837 patent based on two potential chains of priority involving the ’676 and ’129 patents. USAA contends that the plaintiffs made material misrepresentations to the PTO that could render the entire family of patents unenforceable.
The Patent Act permits district courts to award reasonable attorney fees to the prevailing party in exceptional cases, as outlined in 35 U.S.C. § 285. Exceptional cases are defined as those that are notably different due to the strength of a party’s litigating position or the unreasonable manner in which the case was handled. The determination of whether a case is exceptional is made at the court's discretion, taking into account factors such as frivolousness, motivation, objective unreasonableness, and considerations of compensation and deterrence. Unreasonable conduct that does not warrant independent sanctions may also be evaluated. Additionally, inequitable conduct can serve as a basis for awarding attorney fees, and a court must assess any inequitable conduct by a patentee before the Patent and Trademark Office (PTO).
USAA has presented three arguments for attorney's fees: the plaintiffs lacked a factual or legal basis for their complaints, engaged in bad-faith litigation, and committed inequitable conduct before the PTO in relation to the prosecution of the ’432 patent. The April 2017 bench trial specifically addressed the third argument.
Regarding judgment on inequitable conduct claims, under Fed. R. Civ. P. 52(c), a court can issue a judgment against a party if that party has been fully heard on an issue in a nonjury trial. The court must provide findings of fact and conclusions of law to support any judgment. Inequitable conduct claims are determined by the court, as they are equitable in nature and not to be decided by a jury. Each patent applicant is required to maintain candor and good faith to the PTO, and violations of this duty can render the related patent claims unenforceable.
A finding of inequitable conduct can affect not only a single patent but also render unenforceable related patents and applications within the same technology family. Inequitable conduct encompasses actions such as misrepresentation of material facts, failure to disclose material information, or submission of false information, all with intent to deceive. This duty of candor applies throughout the prosecution history of the patent and extends to conduct occurring after the patent has been issued. Federal regulations mandate that all individuals involved in the patent application process owe a duty of candor and good faith to the PTO, requiring disclosure of all material information.
Key individuals subject to this duty include inventors, attorneys, agents, and others substantively involved in preparing or prosecuting the application. To establish inequitable conduct, a party must demonstrate that the patent applicant misrepresented or omitted material information with specific intent to mislead the PTO. The burden of proof requires showing both materiality and intent separately. The standard for proving intent has been heightened, necessitating that specific intent to deceive be the most reasonable inference drawn from circumstantial evidence, which must be established by clear and convincing evidence, as direct evidence of intent is often scarce.
Evidence must demonstrate deceitful intent based on all circumstances, and if multiple reasonable inferences exist, intent to deceive cannot be established. A district court errs if it overlooks one reasonable inference in favor of another when evaluating materiality or intent. Mere negligence or a "should have known" standard does not fulfill the intent requirement in cases of nondisclosure. Clear and convincing evidence is necessary to show that an applicant deliberately withheld a known material reference, proving knowledge of the reference, its materiality, and a conscious choice to withhold it. Knowledge of a reference and a failure to submit it does not automatically indicate specific intent to deceive. The mere fact that non-disclosed information is later deemed material does not satisfy the intent to deceive requirement. Intent to deceive cannot be inferred if the reasons for withholding are plausible. The burden of proof rests on the party alleging inequitable conduct; thus, the patentee is not required to provide a good faith explanation unless the accused infringer first demonstrates a threshold level of intent to deceive.
Materiality for establishing inequitable conduct is defined as "but-for" materiality, meaning that if the PTO had known of the undisclosed prior art, it would not have allowed the claim. However, the presumption of validity is not extinguished if the misrepresentation did not affect patent issuance. An exception exists for cases of affirmative egregious misconduct, such as filing a false affidavit, which is inherently material. In such cases, proving "but-for" causation is not necessary; demonstrating egregious misconduct suffices.
The parties disagree on the burden of proof for materiality concerning inequitable conduct in relation to a motion for attorney's fees, with some arguing for a preponderance of the evidence standard and others advocating for clear and convincing evidence. This District recognizes the existing confusion, noting that courts vary in their application of these standards depending on the stage of the proceedings. For instance, a clear and convincing standard is applied when inequitable conduct is presented as a defense, while a preponderance of the evidence is used for fee awards under 35 U.S.C. § 285. Some courts consistently apply the clear and convincing standard in this context.
In a referenced case, the District aligned with another court's approach, asserting that while clear and convincing evidence is necessary to prove inequitable conduct, the defendant contends that it can use a preponderance of the evidence standard. The court will assess the evidence related to inequitable conduct among other evidence under the totality of circumstances using a preponderance of the evidence standard. If the evidence of inequitable conduct meets the clear and convincing threshold, it will carry significant weight in the overall assessment.
The trial focused on representations made by the Plaintiffs and their patent agents and attorneys to the PTO regarding the '432 patent and its related patents ('837, '676, and '129 patents) and a continuation application ('538 application). USAA alleged that five individuals engaged in inequitable conduct during the prosecution of the '432 patent, while two others were noted for their actions that, although not constituting inequitable conduct, were relevant to the conduct of the primary five individuals.
USAA has alleged four instances of inequitable conduct related to the prosecution of the ’432 patent. First, it claims Dr. Tadayon misrepresented the priority claims to benefit from the filing date of the ’837 patent, while Plaintiffs, including Mr. Fortkort and Ms. Cao, failed to correct this misrepresentation. Second, after being notified of the misrepresentation, Plaintiffs filed a pro se petition with the PTO, falsely stating the delay in correction was unintentional. Third, Mr. Kim filed certificates of correction with the PTO, also falsely swearing that any delay in claiming a new priority chain back to the ’837 patent was unintentional. Fourth, USAA alleges that Plaintiffs filed false Non-Patent References (NPRs) with the ’676 and ’129 patents.
In response, Plaintiffs argue that USAA has not met the legal standard for proving inequitable conduct under Therasense, particularly regarding specific intent to deceive the PTO and the materiality of the alleged misconduct. They contend that USAA has not shown that any individual acted with the intent to deceive or that the actions were "unmistakably false affidavits" or but-for material. However, USAA maintains that mislabeling a priority claim is inherently material, as it affects the determination of prior art. The Court intends to address each allegation of inequitable conduct in detail. The first allegation involves the misrepresentation of priority claims related to "continuations" and "continuations-in-part," explaining how continuation applications can claim priority to earlier filings, thereby limiting available prior art for patent examination.
A continuation-in-part (CIP) patent application retains substantial content from its parent application while introducing new material not previously disclosed. Claims in a CIP can only benefit from the parent patent's filing date if they were adequately disclosed in the parent application; claims introducing features not present in the parent do not receive this priority and instead take the filing date of the CIP. A priority claim can only be filed while the parent application is pending; once issued, it becomes public domain, preventing any child patent from claiming priority.
In the case of the ’432 patent, USAA contended it is unenforceable due to material misrepresentations made by Dr. Tadayon and others regarding its priority claims, which violated their duty of candor to the Patent and Trademark Office (PTO). Dr. Tadayon falsely represented the ’432 patent as a continuation of the ’676 patent, which was itself a continuation of the ’837 patent, thereby claiming an improper priority date. The correct relationship is that they are continuations-in-part. During the prosecution of the ’432 patent, neither the plaintiffs nor their representatives, including Mr. Fortkort, corrected this misrepresentation. The court must determine if there was intent to deceive the PTO, as USAA argues that this misrepresentation was aimed at avoiding anticipation by the grandparent patent, the ’837 patent, which shares the same specification as the ’432 patent.
In August 2001, Plaintiffs filed a patent application resulting in the ’837 patent, which has an identical specification to the later-filed ’432 patent. Once issued, the ’837 patent would serve as anticipatory prior art against the ’432 patent, as it was in the public domain prior to the filing of the ’432 application. Plaintiffs could have avoided this issue by filing the ’432 patent as a continuation application while the ’837 patent was still pending; however, the ’837 patent issued on April 8, 2008, and the ’432 application was not filed until September 15, 2008, thereby missing the opportunity.
To circumvent potential invalidation of the ’432 patent by the ’837 patent, Plaintiffs claimed priority through the ’676 patent, which was filed on September 30, 2005, when the ’837 patent was still pending. USAA contended that Plaintiffs and their agents misrepresented the relationships among the three patents, leading to the erroneous designation of the ’432 patent as a continuation of the ’676 patent, which in turn was claimed as a continuation of the ’837 patent. USAA asserted that this misrepresentation prevented the Patent and Trademark Office (PTO) from questioning the continuity of disclosure, as the PTO was led to believe the specifications were the same.
However, USAA pointed out that the ’676 patent contains a different disclosure than the ’432 patent and was filed with a Non-Publication Request (NPR), indicating it was a different invention. Consequently, USAA argued that there was a break in the priority chain, preventing the ’432 patent from claiming continuation status through the ’676 patent. This mislabeling, according to USAA, violated the duty of candor and duty to disclose owed to the PTO by Plaintiffs and their representatives. Furthermore, USAA highlighted that Dr. Tadayon, a sophisticated practitioner with significant credentials, acted deliberately, reinforcing the inference of intent to deceive.
Dr. Tadayon was aware of the distinction between continuation and continuation-in-part applications and knew about the pending applications related to the ’432 patent, as he referenced them in the priority claim. USAA argued that Dr. Tadayon and the Plaintiffs intended to deceive by attempting to file a continuation of the ’837 patent to bypass its issuance. Mr. Fortkort, who represented them during the ’432 patent issuance and the filing of the ’538 application, failed to correct errors regarding the continuity claims in the ’538 application, which mistakenly reflected the relationships between the ’432, ’676, and ’837 patents as continuations rather than continuations-in-part. Although the PTO acknowledged this error and issued a corrected filing receipt, USAA contended that the Plaintiffs relied on the erroneous priority claim of the ’432 patent to overcome prior art during prosecution.
Additionally, USAA highlighted the actions of litigation counsel Reece Nienstadt, who made misleading changes to priority claims in an Information Disclosure Sheet filed with the PTO, inaccurately representing the ’432 patent as a continuation-in-part of the ’676 patent. Despite this misstatement, the original continuity claims remained unchanged at the time of filing. USAA suggested that these actions indicated a broader intent to deceive, citing precedent that allows inferring intent from a patent counsel’s behavior.
While the Court recognized that USAA presented sufficient evidence to suggest intent to deceive, it ultimately concluded that USAA did not meet the clear and convincing standard of proof required to demonstrate specific intent to deceive on the part of Dr. Tadayon, the Plaintiffs, or Mr. Fortkort. The Plaintiffs provided a plausible overarching explanation for their conduct, asserting that their goal was to file the application in a cost-effective manner, which included initially hiring Dr. Tadayon for his reasonable fees before switching to Ms. Cao due to rising costs.
The Plaintiffs transitioned from Ms. Cao to Mr. Fortkort not due to cost concerns, but rather for proximity, as Mr. Fortkort was based in Northern Virginia while Ms. Cao was in Arizona. They later discontinued Mr. Fortkort's services because his fees became too high, eventually hiring Mr. Kim and his law firm as their patent attorneys. The Court noted that the Plaintiffs aimed to minimize expenses by hiring various attorneys for specific filings, which led to confusion. Each attorney acknowledged that their review of patent applications was limited; they focused only on the aspects of the applications they were tasked with, often neglecting a comprehensive review of the entire patent file or related patents due to the high volume of paperwork and multiple concurrent cases. Mr. Fortkort indicated that his review process was adaptable based on client needs and costs, leading to potentially inadequate examination of supporting documents. The Court concluded that the Plaintiffs relied on their attorneys to manage the filing of the '432 patent and navigate PTO procedures, but due to their cost-consciousness, the attorneys' standard review practices, and the complexity of the patent files, there was insufficient scrutiny of the priority claims in the application. Both Plaintiffs, while knowledgeable about their inventions, lacked expertise in patent law, resulting in a failure to thoroughly evaluate the filing strategy for their patents.
Nader and Kamran Asghari-Kamrani testified that they relied on Dr. Tadayon for legal advice regarding the filing of a patent continuation, stating they lacked understanding of the differences between continuations and continuations-in-part. The Court found their misunderstanding regarding priority claims plausible, equating it to a lack of intent to deceive. Dr. Tadayon's testimony indicated he believed his priority claims were correct and that he did not thoroughly review prior applications unless necessary for the case at hand. He could have claimed priority through the ’400 application if he had been aware, suggesting no intentional mistake. Expert witnesses at trial also provided inconsistent views on priority claims, reinforcing the complexity of patent applications. The Court concluded that Dr. Tadayon's potential oversight was reasonable given the extensive file histories and cost concerns, and therefore, it did not establish intent to deceive. Mr. Fortkort’s testimony corroborated that he did not routinely examine previously filed patents unless specific issues arose during prosecution.
Testimony indicated that the filings were focused solely on the patent's subject matter in relation to prior art highlighted by the PTO, without needing to address parent or grandparent patents. The individual was uncertain why the PTO's correspondence regarding potential priority issues was not addressed, but mentioned that a paralegal typically handled such communications. He believed that if a significant issue had existed concerning the priority chain, he would have investigated it further. The Court found Mr. Fortkort's explanation plausible considering the extensive volume of patent filings, the number of applications managed, and the cost-effective practices of the Plaintiffs. Consequently, the Court did not find sufficient evidence of intent to deceive, acknowledging that while the work might have been inadequate, a plausible explanation for the oversight existed. The Court noted that the limited review scope of the ’432 patent application, related patents, and the complexities of patent law contributed to potential negligence in reviewing priority claims. Despite USAA presenting a seemingly valid claim of intent to deceive related to mislabeling priority dates, the existence of a plausible alternative explanation precluded a finding of specific intent to deceive. Therefore, USAA could not prove by clear and convincing evidence that Dr. Taday-on, Mr. Fortkort, or the Plaintiffs intended to deceive the PTO concerning the mislabeling of priority claims. Additionally, the Plaintiffs were made aware of the priority chain mislabeling on February 8, 2016, during litigation.
On February 22, 2016, Nader Asghari-Kamrani filed a pro se Petition to Accept an Unintentionally Delayed Claim and a Request for Certificate of Correction for the ’432 Patent with the PTO. The petition sought to correct mislabeling in priority claims, changing the status from continuations to continuations-in-part, asserting that the delay in filing was unintentional. USAA contended that the delay was not unintentional and suggested deceptive intent to prevent the invalidation of the ’432 patent by the ’837 patent.
USAA presented four main arguments:
1. The petition's changes conflicted with the inventor's prior testimony, which indicated a desire to file a continuation rather than a continuation-in-part.
2. Despite being represented by legal counsel, the plaintiffs filed the petition pro se, indicating an understanding that the claim of unintentional delay was false.
3. The plaintiffs failed to consult with their former counsel before altering the claims, raising questions about the intent behind the changes.
4. There were inconsistencies in the plaintiffs' testimony regarding the relationship between the patents, notably that a continuation-in-part should introduce new subject matter, which the plaintiffs claimed the ’432 patent did not.
Despite these allegations, the Court did not find sufficient evidence to conclude that the plaintiffs acted with intent to deceive or that the affidavit was definitively false.
Nader Asghari-Kamrani testified that Mr. Nienstadt did not file the petition for the Plaintiffs regarding the 432 patent because he was not the attorney of record with the PTO; Mr. Kim held that position. Asghari-Kamrani indicated he would have had Mr. Kim or someone from his firm file the petition, but the firm was reportedly busy. To avoid further delays in correcting the priority chain, he decided to file the petition himself. The Court found this explanation plausible.
Asghari-Kamrani also testified that he and his brother investigated the patent family's file history to verify the correct priority chain and ensure they were not previously informed of any issues. He stated that the Plaintiffs had possession of all relevant files throughout the life of the patent and had no recollection of any prior counsel informing them of mislabeling. Consequently, he believed they had sufficiently reviewed the priority claims before filing the pro se petition, which led them to conclude that any delay was unintentional. He did not feel the need to contact past attorneys about the priority claim issue because he believed it was being addressed for the first time. The Court found this explanation regarding their investigation to be plausible.
In contrast, the Northern District of Georgia case cited, 3D Medical Imaging Systems, LLC, involved a patent owner who claimed an unintentional delay in the late payment of a maintenance fee without having personal knowledge or conducting an investigation into the prior owner's non-payment. This lack of inquiry led to a finding of inequitable conduct. Here, however, the Plaintiffs' testimony about their investigation supported their claim of unintentional delay in filing the petition.
Plaintiffs' explanation for their actions is deemed plausible, which precludes a finding of intent to deceive, even if USAA's counter-explanation is equally or more plausible. Consequently, USAA does not meet the heightened intent standard required under Therasense. The court also found Plaintiffs’ belief that any delay was unintentional to be plausible, thereby ruling that the signing of the petition was not unequivocally false.
Regarding the alleged unintentional delay in establishing a new priority chain through the ’129 patent, Plaintiffs’ attorney, Mr. Kim, submitted two petitions to the PTO on August 8 and 30, 2016, claiming a benefit for the ’432 patent back to the ’837 grandparent patent via the T29 patent. The first petition, filed on August 8, stated that the potential new priority claim was discovered around July 6, 2016, and included a sworn statement asserting that the entire delay in filing the priority claim was unintentional. However, this petition was rejected for procedural deficiencies. The second petition reiterated the claim of unintentional delay but was later challenged by USAA at trial.
USAA argued that the statement of unintentional delay was false and made with intent to deceive, citing that both Plaintiffs and their counsel were aware of the relationship between the ’432 and ’129 patents since 2011. Evidence included the simultaneous filing of powers of attorney for both patents and the filing of mutual terminal disclaimers to address double-patenting rejections, which USAA claimed indicated that the Plaintiffs had knowledge of the existing connections between the applications. Additionally, Plaintiffs filed a Notice of Allowance for the ’129 patent on January 18, 2006, further supporting USAA's argument.
USAA contends that the filing of the NPR by the Plaintiffs indicated that the 129 patent represented a different invention from the ’837 and ’432 patents, thus disqualifying the Plaintiffs from claiming priority through the 129 patent. USAA asserts that the Plaintiffs could not assert that any delay in claiming priority was unintentional, arguing instead that the actions of Mr. Kim and the Plaintiffs were intended to mislead the PTO regarding the priority claims of the ’432 patent. This was allegedly to preserve the ’432 patent's benefit from the filing date of the ’837 patent, thereby avoiding invalidation by the prior art. USAA further claims that Mr. Kim lacked a full understanding of the filing strategy and did not truthfully represent the delay as unintentional, pointing to his minimal investigation before filing the petitions, which largely relied on his law partner’s prior work.
USAA noted that Mr. Kim's filings were strategic rather than corrective of oversight, aimed at addressing USAA's PTO petitions regarding the priority claims. While USAA suggested that there was specific intent to deceive the PTO, the Court did not find sufficient evidence of such intent. Mr. Fortkort testified that, despite receiving a double patenting rejection, he opted not to challenge the similarity assessment due to the complexity and cost implications of extensive filings. He also indicated that the mere filing of power of attorney for both patents did not imply an examination of their claims for priority relationships. Consequently, it was reasonable to conclude that neither Mr. Fortkort nor the Plaintiffs were aware of any potential priority claim between the patents, as Mr. Kim had relied on his partner's investigation prior to filing.
A declaration from the patentees indicated that any delay in the patent process was unintentional. Mr. Kim relied on this declaration and conducted an investigation before filing two petitions. During this process, he consulted previous patent agents and attorneys to confirm that no prior claims of priority through the ’129 patent existed. After learning from the PTO that additional declarations were unnecessary, he proceeded with the second petition. The Court determined it was reasonable to believe Mr. Kim thought the unintentional delay claims were true at the time of signing, and that the intent to deceive or the existence of an unmistakably false affidavit were not the most reasonable inferences given his investigation efforts. The Court also found that even if the unintentional delay statement was incorrect, Mr. Kim's actions could stem from a careless investigation or honest mistake, leading to a plausible explanation for his conduct.
USAA's fourth allegation concerned improper Non-Publication Requests (NPRs) submitted with the ’676 and ’129 patents, claiming they were false because they certified that the inventions had not been the subject of applications in other countries. However, there was a corresponding international Patent Cooperation Treaty (PCT) application with similar specifications filed prior to the NPRs. USAA argued that this discrepancy rendered the NPRs false under 37 C.F.R. 11.18(b), asserting that either the ’676 and ’129 patents were different inventions from the ’837 patent, preventing priority claims, or the plaintiffs had lied in their NPRs, which would lead to the abandonment of the ’676 and ’129 patents and invalidate the related ’432 patent due to anticipation by the ’837 patent.
USAA contended that the Plaintiffs and their representatives attempted to conceal improper Non-Publication Requests (NPRs) to evade penalties under 37 C.F.R. 11.18(b), which could lead to the termination of proceedings in the USPTO. USAA asserted that this constituted inequitable conduct rendering the '432 patent unenforceable. They argued that even if the NPRs were not but-for material, an exception exists for false declarations under Thera-sense, which does not alter the requirement that false affidavits demonstrate materiality. However, the Court did not find that the Plaintiffs or their agents had the specific intent to deceive the PTO, noting that the Plaintiffs filed the NPRs pro se and understood "invention" to mean a specific application rather than the overall subject matter. The Plaintiffs testified there is no established definition of "invention" for PTO purposes, and differing interpretations were reasonable. The Court concluded that it was plausible the Plaintiffs believed the NPRs were valid since the applications in question had not been subject to foreign filings, and thus, they did not act with intent to deceive nor file false affidavits. USAA failed to prove that the NPRs were but-for material, as MPEP 1122 indicates that improper NPRs do not lead to abandonment of the U.S. application. The Court found it reasonable to infer that any failure to rescind the NPRs stemmed from a belief in their truthfulness, resulting in a lack of clear and convincing evidence of intent to deceive by USAA.
USAA was unable to prove the filing of a false affidavit or establish but-for materiality by either a preponderance of the evidence or clear and convincing evidence, leading the Court to reject claims of inequitable conduct. Although USAA's allegations were initially deemed strong enough to survive dismissal and summary judgment motions, and sufficient evidence was presented at trial to suggest inequitable conduct, the Court applied the heightened standard from Therasense, which requires clear proof of intent to deceive and materiality. Ultimately, the Court found that USAA did not meet this burden, resulting in a conclusion that the Plaintiffs’ patent remains enforceable. The Court granted the Plaintiffs’ Motion for Judgment on Partial Findings and directed the Clerk to notify Counsel of Record. Additionally, the Court denied a motion to prevent the deposition of two attorneys involved with the PTO filings, limiting the scope of their depositions to their work related to PTO filings, related patent examinations, their obligations, and intent regarding those filings. The Federal Circuit highlighted the duty of disclosure under PTO rules as resting on inventors and those involved in the application’s preparation and prosecution. Lastly, it noted that a patent application can benefit from an earlier filed application if it meets certain conditions set forth in 35 U.S.C. 120.
The Director may interpret a failure to submit an amendment within the specified time as a waiver of benefits under this section. Procedures may be established for accepting unintentionally delayed submissions, which may include a required fee payment. Under 35 U.S.C. 102(d), patents and published applications can be considered prior art based on their effective filing dates. This includes provisions for claiming priority or earlier filing dates based on previous applications.
In the litigation involving Mr. Nienstadt, the Court noted his unusual involvement, having a financial interest in the case. His offers to represent previous patent agents during depositions were deemed highly unusual, particularly since one witness already had separate legal representation. The Court suggested that Mr. Nienstadt may have misused attorney-client privilege to prevent witnesses from providing certain testimonies, attributing these actions to his inexperience in litigation.
The case of 3D Medical Imaging Systems, LLC distinguished itself from Network Signatures regarding unintentionally delayed maintenance fee payments. The attorney in Network Signatures had personal knowledge of the reasons for non-payment and mistakenly believed there was no commercial interest in the patent. In contrast, the attorney from 3D Medical Imaging Systems lacked knowledge about the reasons for the delay and did not investigate, thus submitting a petition without an accurate basis for certification. Former Director Q. Todd Dickinson acknowledged that the Plaintiffs were pro se and navigating complex patent procedures at the time of their request.