Laches has long been a defense to patent infringement. Laches exists when the patent holder unreasonably and inexcusably delays in filing a patent suit to the material prejudice of the accused infringer. If the delay exceeds six years, then the delay is presumed to meet all the requirements of the laches defense. A finding of laches bars the patent holder from recovering any pre-suit damages.
The intersection of laches and statutes of limitations is at the heart of a recent Supreme Court copyright case, Petrella v. Metro-Goldwyn-Mayer, Inc., 134 S. Ct. 1962 (2014). Like patent law, copyright law provides both a laches defense and a statute of limitations. Pre-Petrella, the laches defense would bar all pre-suit recovery, even if the delay occurred outside the statute of limitations.
In Petrella, the Supreme Court held that laches was an equitable defense, used by federal courts only when federal statutes did not provide a corresponding statute of limitations. The enactment of a statute of limitations eliminates the need for the laches defense and, as such, the Supreme Court abolished laches in copyright cases. However, the holding in Petrella was limited to copyright, and the Court noted that it has “not had occasion to review the Federal Circuit’s position” regarding laches and patent law.
The Federal Circuit recently had that occasion. In SCA Hygiene Products Aktiebolag v. First Quality Baby Products, LLC, the defendants obtained summary judgment of its laches defense. No. 2013-1564, 2014 U.S. App. LEXIS 17830 (Fed. Cir. Sep. 17, 2014). The plaintiffs sought reversal of the laches finding, relying in part on the Petrella copyright case. The logic of Petrella, the plaintiffs argued, applied equally to patent and copyright law: both have statutes of limitations and, as such, laches should apply to neither body of law.
Laches has been part of Federal Circuit precedent for decades. The preeminent laches opinion — A. C. Aukerman Co. v. R. L. Chaides Constr. Co. — issued in 1992. 960 F.2d 1020 (Fed. Cir.) (en banc). The SCA court noted that Petrellaleft Aukerman intact and held, “Because Aukerman may only be overruled by the Supreme Court or an en banc panel of this court, Aukerman remains controlling precedent.” SCA, 2014 U.S. App. LEXIS 17830.
As of now, the Laches defense is available to accused patent infringers. But for how long? No court has examined the issue of whether the logic of Petrella should be applied to patent law. In October, the plaintiffs filed a petition for an en banc rehearing, asking the Federal Circuit to directly address this issue. The Federal Circuit has not decided whether to grant an en banc rehearing, but the SCA decision seemingly invites such an outcome. Hopefully, in the coming months we will have further clarity regarding whether Laches remains an available defense to patent infringement.