Addressing a declaration that allegedly contained false statements about the invention’s alleged reduction to practice, the U.S. Court of Appeals for the Federal Circuit affirmed a district court’s ruling that two patents were unenforceable due to inequitable conduct, finding that the patentee made multiple material misrepresentations that resulted in overcoming prior art.  Intellect Wireless, Inc. v. HTC Corporation, Case No. 12-1658 (Fed. Cir., Oct. 9, 2013) (Moore, J.).

The patents in issue are owned and maintained by Intellect Wireless.  During the prosecution of the patents, the inventor submitted a Rule 131 declaration to swear behind and overcome a prior art reference, stating that “the claimed invention was actually reduced to practice and was demonstrated at a meeting … in July of 1993.”  A revised Rule 131 declaration was later filed in which this statement was removed, while other statements were added describing a “prototype now in the Smithsonian that was in development for a … demonstration” in July of 1993, an “actual reduction to practice” and “bringing the claimed subject matter to commercialization.” 

After issuance of the patents, Intellect sued HTC for patent infringement.  As a defense, HTC asserted that the patents were unenforceable on the ground that Intellect had engaged in inequitable conduct by submitting false declarations to the U.S. Patent and Trademark Office (PTO) and failing to correct the misrepresentations.  The district court agreed, and Intellect appealed. 

The Federal Circuit, applying the two-prong test for inequitable conduct, requiring both a showing of withholding material facts and an intent to deceive, found that Intellect committed inequitable conduct by filing a false declaration and then failing to cure the misconduct. The Court found that it is “undisputed” that the inventor’s “original declaration was unmistakably false” and that “the revised declaration obfuscated the truth.”  The Court focused on the fact that the revised declaration never expressly negated the false references to actual reduction to practice in the original declaration and therefore did not openly advise the PTO of the misrepresentations as required.  Accordingly, the Court found that the materiality prong was met.

The Federal Circuit further highlighted the fact that the inventor submitted a false declaration during prosecution of another patent in the family, as well as that the inventor submitted a misleading press release to the PTO during prosecution of yet another patent in the family.  The Court found that submission of the false affidavit in the asserted patents raised a strong inference of intent to deceive and that the pattern of deceit engaged in by the inventor makes the inference stronger.  The Court further found that the inventor’s intent to deceive could be affirmed based on the content of the two declarations, where the “the completely false statements in a first declaration were followed by a replacement declaration that, rather than expressly admitting the earlier falsity, dances around the truth.”  Accordingly, the Court found that the intent prong was also met.

The Federal Circuit explained that Therasense made clear that filing a false affidavit is material.  The Court also found that both the failure of the applicant and the attorney to tell the PTO the truth during the prosecution of the applications for the asserted patents and the pattern of deceit by the applicant in the prosecution of other patent applications evidenced intent to deceive.