A § 256 claim for correction of inventorship does not accrue until the patent issues. [T]he failure to challenge inventorship before the PTO [does not] bar an inventor from later contesting inventorship under § 256.
On November 14, 2012, in Hor v. Chu, the U.S. Court of Appeals for the Federal Circuit (Newman, Prost,* Reyna) affirmed-in-part, reversed-in-part, vacated-in-part and remanded the district court's summary judgment that laches and equitable estoppel barred Hor's claim under 35 U.S.C. § 256 for correction of inventorship of U.S. Patents No. 7,056,866 and No. 7,709,418, which related to superconducting compositions with transition temperatures higher than the boiling point of liquid nitrogen. The Federal Circuit stated:
To prevail on a defense of laches, a defendant must establish that (1) the plaintiff's delay in filing a suit was "unreasonable and inexcusable," and (2) the defendant suffered "material prejudice attributable to the delay." For inventorship claims under § 256, a delay of six years after a claim accrues creates a rebuttable presumption of laches. . . . Section 256 creates a private cause of action to correct inventorship in an issued patent. [This court applies a] six-year laches presumption for § 256 correction of inventorship claims and held that the laches period began when "the omitted inventor knew or should have known of the issuance of the patent." [We have not addressed] the precise question presented here: Does the laches period for a § 256 claim begin to run before a patent issues when the omitted inventors knew or should have known prior to patent issuance that their names were omitted from the patent application? We conclude that the answer is no.
A § 256 claim for correction of inventorship does not accrue until the patent issues. The reason is simple: that is what the language of the provision requires. Under well-established laches principles, "[a] cause of action cannot be barred by laches before it accrues; it is never extinct when it comes into existence." Here, the district court found that the laches period for Hor's and Meng's § 256 claims started to run pre-patent issuance -- i.e., before the § 256 claims actually accrued -- because Hor's and Meng's inventorship claims were not cabined to a claim under § 256. Instead, relying on the potential availability of certain procedures to correct inventorship while a patent application is still pending before the U.S. Patent and Trademark Office ("PTO") -- namely, petitioning for correction of inventorship under 35 U.S.C. § 116 or initiating a 35 U.S.C. § 135 interference proceeding -- the district court determined that the laches period for inventorship claims begins "when a plaintiff knew or should have known that the defendant filed a patent application covering his alleged inventive contributions and failed to name him as an inventor, regardless of whether such notice occurred prior to the patent's issuance."
The district court apparently found that §§ 116 and 135 proceedings were adequate substitutes for a § 256 inventorship claim such that the failure to seek a correction of inventorship pursuant to one of those statutory provisions prior to patent issuance could prevent an omitted inventor from later bringing a § 256 claim. We disagree. Nothing in the plain language of § 256 or the accompanying regulations indicates that the failure to challenge inventorship before the PTO can potentially bar an inventor from later contesting inventorship under § 256.
And imposing such a limitation runs afoul of our instruction that § 256 be "interpreted . . . broadly" to protect the "public interest of assuring correct inventorship designations on patents." Moreover, the specific procedural rules governing §§ 116 and 135 further convince us that the district court's reliance on these purported alternative remedies to support its laches analysis was misplaced. With respect to § 116, . . . inventorship correction under this provision requires consent of all the parties. In this case -- as in most § 256 cases brought by an omitted inventor -- Hor's and Meng's inventorship is contested. Thus, § 116 likely was not an available avenue for Hor and Meng to correct their omitted inventorship while the applications for the '866 and '418 patents were pending before the PTO.
Regarding interferences, § 135(b)(1) allows for an interference challenging an issued patent if the claim provoking the interference was made within one year of the challenged patent's issuance. Because a party can provoke an interference post-issuance of the challenged patent, the availability of an interference proceeding does not persuade us that a § 256 claim can accrue preissuance for laches purposes. Finally, while we recognize that the prompt resolution of inventorship disputes certainly is a desirable goal, there may be circumstances in which it would be inefficient to require an omitted inventor to initiate an inventorship dispute while the application is still pending. Throughout the back-and-forth negotiation between the patentee and the PTO examiner, the original claims are routinely narrowed or even cancelled. Thus, in many cases, an omitted inventor may not know whether he or she has a cognizable inventorship claim until the examination concludes and the patent finally issues.
Accordingly, [we] hold that the laches period for a § 256 correction of inventorship claim begins to run when "the omitted inventor knew or should have known of the issuance of the patent," regardless of whether the omitted inventor knew or should have known of the omitted inventorship while the patent application was pending before the PTO. Here, Hor and Meng filed their claims within six years of the issuance of the '866 and '418 patents; the district court, therefore, legally erred in finding that a presumption of laches attached to these claims. The district court's judgment in favor of Chu based on the affirmative defense of laches consequently is reversed.