On September 30, 2013 District Judge Laura Taylor Swain denied plaintiff Worldwide Home Products’ motion to strike defendant Time’s patent law expert’s report and testimony, and granted Time’s motion for summary judgment of inequitable conduct.

Worldwide holds U.S. Patent No. 7,938,300 (“the ’300 patent”) which relates to a clothing hanger with a “supporting means in the form of a cascading hook for supporting additional hangers thereform.” Worldwide’s attorney filed an IDS during prosecution that disclosed an undated website image of a printed product brochure (“Merrick Reference”) which offered for sale certain hangers (“Merrick Hangers”) with similarities to the hangers described in the Patent Application at issue. While the Merrick Reference only included a low resolution thumbnail picture of the Merrick Hangers, plaintiff’s attorney possessed physical versions of the Merrick Hangers, and had taken high resolution photographs of the hangers. The Examiner determined that the Merrick Reference was indeed prior art and initially rejected the Application. However, after a telephone interview and “Amendment After Final,” the Examiner allowed the application with the claims amended to include that the first hanger was “abutting the top surface of the cascade hook member of said hanger.” Plaintiff’s attorney never sent the Examiner a physical version of the Merrick Hangers or the high resolution digital photographs of the Merrick Hangers. Defendant later learned that the Merrick Hangers were presented in the Merrick Reference and the first hanger did abut the top surface of the cascade hook of the second hanger.

The court allowed the expert report and testimony of defendant’s patent expert—a former Patent Examiner and prosecuting attorney—because he was qualified as an expert in patent law and his opinions were relevant to the adequacy of plaintiff’s disclosures to the Examiner.  The court went on to apply the Therasense, Inc. v. Becton, Dickenson & Company standard for inequitable conduct: clear and convincing evidence “that the applicant knew of the reference, knew it was material and made a deliberate decision to withhold it.” 649 F.3d 1276 (Fed. Cir. 2011). Under Therasense the materiality required is a “but-for materiality standard.” Id. at 1292 and 1295. The defendant must show by preponderance of evidence that the Examiner would not have allowed the claims but-for the nondisclosure or misrepresentation. Id. The court found that the materiality of the Merrick Hangers and Merrick Reference was not in dispute; it could not have been reasonably argued that the Merrick Hangers would not have been material to the Examiner’s decision. The court also held that the only reasonable inference from the undisputed facts was that the attorney intended to deceive the Examiner. Therefore the court granted defendants motion for summary judgment declaring the ’300 patent “unenforceable” due to inequitable conduct.

Case: Worldwide Home Prods. v. Time, Inc. No. 11 Civ. 3633 (LTS), 2013 BL 268170 (S.D.N.Y. September 30, 2013)