The Supplemental Examination procedure provided for in the America Invents Act is a new tool for patentees to seek a review of their issued patent(s) in order to inoculate them against an inequitable conduct charge in certain subsequent proceedings. Inequitable conduct is a judiciallycreated affirmative defense to patent infringement, which, in recent years, has been asserted widely in patent litigation proceedings and become a common part of litigation strategy. The consequences of a finding of inequitable conduct are severe: first, the entire patent is rendered unenforceable; second, the “taint” of inequitable conduct may spread to related patents and applications in the same family and render an entire patent portfolio unenforceable; and third, a finding of inequitable conduct may allow the case to be found exceptional, entitling the alleged infringer to attorneys fees under 35 U.S.C. § 285.  A 1988 study estimated a charge of inequitable conduct was asserted in 80% of all patent infringement cases. Citing “the problems created by the expansion and overuse of the inequitable conduct doctrine,” the Federal Circuit recently curtailed the reach of the defense by raising the standard for proving that the alleged bad act was material to patentability and that the patentee undertook the alleged bad act with intent to deceive the U.S. Patent and Trademark Office (USPTO). The court also rejected an earlier measure holding that the weight of evidence needed to show materiality was inversely proportional to the weight of evidence needed to show a patentee’s intent to deceive (and vice-versa). Finally, the court held that a finding of inequitable conduct should not immediately render a patent unenforceable. Rather, the court must also “weigh the equities” to determine whether the inequitable conduct warrants the unenforceability remedy.
Supplemental Examination goes into effect September 16, 2012 and applies to all patents issued before, on, or after the effective date. The new Supplemental Examination procedure will allow a patentee to remove the basis for a charge of inequitable conduct in advance of the charge. With exceptions, the effect of a Supplemental Examination is that the courts are barred from holding a patent unenforceable on the basis of conduct relating to information considered, reconsidered, or corrected during the Supplemental Examination proceeding. The procedure allows a patentee to have the USPTO “consider, reconsider, or correct information believed to be relevant to the patent.” If the USPTO considers the information to raise a “substantial new question of patentability”, the Director will order a reexamination of the patent. Unlike a traditional reexamination, which is limited to patents and printed publications, there is no limit on the issues that can be raised and considered during the reexamination resulting from a Supplemental Examination request.
Thus, the new Supplemental Examination procedure allows a means for initiating reexamination for issues under any information “believed to be relevant to the patent,” such as issues of possession and enablement under 35 USC § 112, or § 102 regarding “public use” or the “on sale” bar, so that a patentee can attempt to make their patent(s) bulletproof.
In order to obtain the benefit of Supplemental Examination, the patentee must be proactive and make the request before inequitable conduct is pled with particularity in a civil action or set forth with particularity in an ANDA notice letter. The Supplemental Examination and any resulting reexamination must be completed before the date that a patent infringement civil action or action before the International Trade Commission is brought in order for the benefit to apply.
Supplemental Examination does not shield the patentee from gross misconduct such as fraud or attempted fraud. Where fraud on the USPTO was practiced or attempted, the Supplemental Examination will not commence or be immediately terminated. The Director shall also refer the matter to the Attorney General for appropriate action. Supplemental Examination also does not shield the patentee from the imposition of sanctions based on criminal or antitrust laws or sanctions by the USPTO for misconduct.
In sum, a wise course of action for patentees considering litigation to enforce a patent or anticipating an ANDA filing would be to carefully review their patent portfolio to determine if a Supplemental Examination is warranted for any issued patent. Further, potential defendants having information that would support a charge of inequitable conduct under the stricter Therasense standard would be wise to consider filing a declaratory judgment action in order to preserve the charge before the patentee can cure the conduct using this new tool of Supplemental Examination.