News Item
Deliberate delay in prosecuting a patent application not always fatal(11/12/10)
The United States is unique in permitting patent applicants to file unrestricted continuations and thus deliberately prolong the prosecution of a patent application. Applicants may keep an application pending until the time is right for issuance of a patent, perhaps with claims better suited in the light of experience to deter infringers, and the patent will be a surprise to the market if the application has not been published. The practice of delay, however, is limited under current law because the patent will expire at the date twenty years after the earliest priority date claimed, plus any patent term adjustments and extensions that may be allowed. Another limit on deliberate delay is the doctrine of prosecution laches. Prosecution laches is an equitable defense to a charge of patent infringement that requires the accused infringer to show that the delay in prosecution of the patent application was unreasonable and unexplained and constitutes an egregious misuse of the patent system under the totality of the circumstances. The United States Court of Appeals for the Federal Circuit recently decided that the accused infringer also must prove “prejudice” due to “intervening rights” in order to succeed with this defense.
In Cancer Research Technology Ltd. v. Barr Laboratories, Inc., the applicants had filed their initial application in 1982. The examiner rejected a claim for a method of treating a cancer by administering a tetrazine derivative compound on the grounds of lack of utility, meaning he did not think the method would work and wanted proof that it would. Instead of responding, the applicants abandoned the application and filed a continuation application. When the examiner issued the same rejection in the new application, the applicants abandoned the new application and filed another continuation. They did this nine more times and eventually filed a continuation application in 1991 that issued as U.S. Patent 5,260,291 in 1993. The Food and Drug Administration (FDA) first approved one of the claimed compounds, temozolomide (marketed as Temodar®), for use in treating a cancer in 1999. With extensions of time for FDA regulatory approval delay and pediatric exclusivity, the patent will expire in 2014. The nine years of delay due to the repeated abandonment and continuation procedure turned out to be quite useful to the patent owner.
A divided panel of the Federal Circuit reversed the district court’s judgment holding the ‘291 patent unenforceable based on prosecution laches and inequitable conduct. The majority reviewed Supreme Court precedent concerning prosecution laches and the most relevant Federal Circuit cases, namely the two Symbol Technologies Inc. v. Lemelson Medical Foundation cases and In re Bogese. It held that a prosecution laches requires a showing of “prejudice” and that “to establish prejudice an accused infringer must show evidence of intervening rights, i.e., that either the accused infringer or others invested in, worked on, or used the claimed technology during the period of delay.” The majority found that “there has been no evidence presented that anyone was deterred from entering the market for temozolomide because Cancer Research’s patent issued in 1993 rather than several years earlier. Thus, the delay had only limited consequences to Barr and the public.”
A strong dissent by Judge Prost, in which she argued that the patent owner had “stall[ed] prosecution for its own business purposes for nearly a decade,” and “there is no basis for the majority’s new requirement that one must confine himself to the period of prosecution delay in determining whether prejudice exists,” may be a precursor for en banc review of this case by the full court.