Guest Post: Origins of the Clear and Convincing Standard

Guest Post by Professor Jeffrey Lefstin (U.C. Hastings)

Microsoft’s petition for certiorari in the i4i case challenges the Federal Circuit’s rule that patent invalidity must be proven by “clear and convincing evidence,” even when the defense rests on prior art not considered by the PTO. Nearly all of the briefs filed in the case, and nearly all academic commentary as well, assume that the rule was devised by the Federal Circuit early in its history. For example, one brief asserts that the “position of the Federal Circuit traces to dicta in a 1983 Federal Circuit panel decision [Connell v. Sears, Roebuck & Co.] that gave no reasoning and cited no authority whatsoever.”

The actual history of the rule challenged in i4i is rather different. The rule was not a creature of the Federal Circuit, but rather of its predecessor court, the Court of Customs and Patent Appeals. The CCPA held in Astra-Sjuco v. ITC, 629 F.2d 682 (CCPA 1980) that patents must be proven invalid by clear and convincing evidence. It had already held, in Solder Removal Co. v. ITC, 582 F.2d 628 (CCPA 1978), that the statutory presumption of validity is not weakened when a challenger introduces prior art not considered by the PTO.

In its first decision, South Corp. v. United States, 690 F.2d 1368 (Fed. Cir. 1982), the Federal Circuit adopted the CCPA’s case law as controlling precedent. The Federal Circuit’s early cases were quite clear: in holding that the presumption of validity was unaffected by prior art not before the PTO, the court was following the binding precedent of the CCPA, rather than creating a new rule of law.[1]

How did the CCPA, which ordinarily heard appeals from the PTO, come to create a rule governing patent litigation? Under the Trade Act of 1974, the International Trade Commission was given the power to bar importation of articles that would infringe U.S. patents. In its final years, the CCPA heard a handful of appeals – Astra-Sjuco and Solder Removal among them – from infringement complaints decided by the ITC.

It is probably not coincidental that the CCPA devised a patentee-friendly rule. For most of its history, the CCPA heard only appeals from the PTO. From this perspective it saw only the benefits of the patent system: inventors bringing their inventions to the PTO. Even in the ITC infringement cases, the CCPA saw only domestic patentees who might be injured by foreign competition.

In contrast, the regional Circuit Courts of Appeals, in their many years’ experience with infringement cases, routinely saw the costs of the patent system: infringers, perhaps even innocent infringers, who were nonetheless forced to pay heavy damages and abandon otherwise legitimate and productive activity. Given that perspective, it is not surprising that prior to 1982, several of the Circuit Courts of Appeals had held that the presumption of validity should be weakened when a challenger presents prior art not considered by the PTO. But intentionally or not, when the Federal Circuit adopted the CCPA’s precedent in South Corp., it instantly consigned any conflicting precedent from the Circuit Courts to the dustbin of history.

However, the precedent from the CCPA is not the end of the story. In South Corp., the Federal Circuit adopted not only the precedent of the CCPA, but also of its other predecessor court:  the United States Court of Claims. The Court of Claims heard patent infringement actions brought against the United States government under 28 U.S.C. § 1498, and the Federal Circuit has repeatedly held that the patent jurisprudence of the Court of Claims is binding upon it. (Most notably, the Federal Circuit maintained that the Court of Claims’ decision in Pitcairn v. United States compelled its narrow view of the experimental use defense in Roche, Embrex, and Madey.)

There was a long line of precedent from the Court of Claims holding unequivocally that the presumption of validity was weakened when a challenger introduced prior art not considered by the PTO: General Elec. Co. v. United States, 572 F2d 745, 761 (Ct. Cl. 1978); Douglas v. United States, 510 F.2d 364, 369 (Ct. Cl. 1975); Nossen v. United States, 416 F.2d 1362, 1371 (Ct. Cl. 1969); Ellicott Mach. Corp. v. United States, 405 F.2d 1385, 1392 (Ct. Cl. 1969); Martin-Marietta Corp. v. United States, 373 F.2d 972, 977 (Ct. Cl. 1967). As far as I can determine, the Federal Circuit has never taken note of these decisions. But under the Federal Circuit’s own case law, the line of authority descending from the Court of Claims is just as binding as that of the CCPA.

Note: Prof Lefstin discusses the how the CCPA’s unique perspective shaped the law it bequeathed to the Federal Circuit in a paper forthcoming in the Loyola of Los Angeles Law Review, available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1565818.


[1] See, e.g., D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144, 1147 n.2 (Fed. Cir. 1983).

93 thoughts on “Guest Post: Origins of the Clear and Convincing Standard

  1. 82

    >>Then ask you why you took that three ring >>Binder and never gave it back!

    I don’t know you in the real world Sarah and I never took a three ring Binder from you. And, I always return materials.

  2. 78

    Sarah >>You are Intellectually Dishonest.

    Thanks Sarah. Now provide one concrete example.

  3. 77

    “ever heard of commercial espionage?”

    I have, but I’ve never heard of anybody sneaking into someone else’s company and taking a patent, nor can I figure out what good that would do them. Unless that company was vying for the Guinness record for largest ribbon collection.

  4. 75

    FromAFar>>This article and many like it that are >>appearing in the dust cloud of i4i appear to >>me to be nothing more than anti-patent >>propaganda.

    Great post. I agree completely with you. You note that these lemonheads do not go through the difficulty a patent holder has in enforcing a patent which include that anyone can anonymously request a patent be re-examined. This may throw a cloud on a patent for years.

    It is intelectually dishonest to write articles such as the one above. I would like to see an article that examines the motivation of people like you. Do companies funnel money to you directly or indirectly? Frankly, what I think is that you bend over for some cash and throw your morals and principles out the window.

    If you lemonheads want to attack patents do it fairly. Filth.

  5. 74

    Sure, isn’t that one of the basic Infringer’s Rights? Oops, my bad – I thought I had stopped in the parallel universe of Supreme Equity.

  6. 70

    INANE: No points for guessing what variety of pipe was involved, presumably?

    Well, ok. It was my George Carlin corn-cob, specially coked with residues of the finest resins.

    But if CAFC were to rule that there are no validity presumptions with respect to art not considered by the PTO, then — poof — my dream becomes a reality, every IDS will be a 30 minute upload on EFS, and K can close down EAST/WEST.

  7. 69

    I just wanted to set the historical record straight.

    By leaving out the historical Supreme Court stuff – nice, no conflict of interest there with any pet theories and setting that record straight is real believable – NOT. btw – nice job at breaking the internetz.

    IBP,

    I don’t think ANON was saying he was above the fray – I think he was saying that ya should stop bein a whiny little school girl and asking for stuff every hour. Ya got your answer, now stfu.

    ANON,

    Chillax dude – even with my widely known “Homey don’t give answers” platform, Iza still get petulant knuckleheads wanting answers. They can’t help themselves.

  8. 68

    Gentlemen – I am glad my post sparked such an animated discussion!

    I am well aware that the clear and convincing standard is rooted in the 19th century cases on presumption of administrative regularity (though as a technical matter, it was Astra-Sjuco that makes the principle part of the CAFC’s precedent). I didn’t think that story needed retelling here.

    My focus in the post was on what I take to be the rule challenged in i4i: that the presumption of validity is unaffected when a challenger introduces relevant prior art that was not before the PTO.

    That rule seems to have originated with the CCPA, and was not the rule of decision in several of the regional Circuits prior to 1982.

    I don’t take a position about the merits of the rule (or the presumption itself); I just wanted to set the historical record straight.

    Regards
    Jeff

  9. 67

    Well, it sure takes a lot to draw some people out of the weeds.

    Anon–

    Thanks for the post. You are quite right about earlier decisions, now we need to hear a response from the OP. Lefstin???

    Your analogy to land patents is interesting, but your post indicates that questions of validity regarding patents, grants, and other formal evidence of title from the U.S. were resolved in courts of equitable jurisdiction, presumably applying equitable principles. The C&C standard appears often in the consideration of equitable remedies, such as in the consideration of parol evidence relating to the finding of a constructive trust (although some such as Scott argue for a preponderance standard in that specific instance).

    In deciding patent validity challenges and in deciding outcomes, I think that neither the CAFC nor the USSC is invoking equitable jurisdiction or applying equitable principles. The party seeking a finding of invalidity is not seeking an equitable remedy. I cannot apprehend the specific utility of the equitable land patent paradigm in the legal technology patent paradigm (injunctions excepted).

    IF the land patent validity issues are, in fact, considered equitable.

    Tangentially, although you claim to be irritated by the apparent petulance of my repeated posts, I notice you did respond at some length, pretty much first thing in the morning.

    If it could be fairly said that my post smacked of petulance, it can be fairly said that your post smacked of arrogance. Assist my understanding, indeed! You have absolutely no idea of my level of understanding of this issue; you’ll notice I have stayed away from substantive contribution or comment on this thread, until now.

    In descending into similar incivility, you reveal yourself as not above the fray.

    Weary,

    Yes, one can try to be understated in one’s criticism–but the successful acknowledgement, reception, and incorporation thereof then depend upon a high level of intelligence, acuity, and perspicacity of the target. Recently, around here, evidence of such traits has been on the wane. Brutality, though unpalatable, affords much less room for uncertainty and ignorance.

    Malcolm seemed to learn this lesson long ago. How unfortunate.

  10. 66

    weary lexicographer writes, “Incidentally, “worthless tripe” is a bit redundant. But why use one word when you get to bill the client for four?”

    Au contraire mon frere lexikographos, tripe be worthing mucho as can see in below.

    link to squidoo.com

  11. 65

    Professor Healey writes, “On the other hand, having sat once on a criminal jury where no defense was put on by the accused and the only argument for acquittal was “reasonable doubt”, I am confident that the clear and convincing standard of proof has no practical impact on jurors in deliberation.”

    So…. you’re saying you convicted the perp despite the government’s case not having been proven BARD?

  12. 64

    I’d like to revive one of my favorite patent reform pipe-dreams.

    No points for guessing what variety of pipe was involved, presumably?

  13. 63

    Turning for the moment to the way it should be instead of the way it is, I’d like to revive one of my favorite patent reform pipe-dreams.

    Examiners should do no searching. Zip. [PTO costs fall like a rock. Fees do, too. Ha, ha, ha.] Applicants should not be required to disclose art they know of. [Inequitable conduct charges shrivel up and die.]

    The only art considered during prosecution should be the art voluntarily provided by the applicant, BUT . . . the presumption of validity given the resulting patent should apply only with respect to the art provided by the applicant, and of course with respect to 101, 112, et al. procedural issues. There would be no presumption as to any art not disclosed by applicant.

    This would encourage applicants to spill their guts in the IDS because the value of their patent will be in direct proportion to the quantity and quality of art they provide.

    To prevent burying the PTO with references there would have to be a disclosure limit of, say, 100, references, beyond which a stiff fee is charged.

  14. 62

    IANAE,

    Man, you be letting me down. You got better than that.

    Even a dull instrument like me can take apart your arguments.

    Here, let me give it a whack:

    How do you steal a patent?” That little manilla 7 3/4 by 8 3/8 gold-seal, red-ribboned Title be easily concealed into legal pads, filefolders, briefcase, heck, even shoved down Malcolm’s patents – all would do the trick.

    Let’s not forget just how different land patents and utility patents are.” – new sport – speedjumping. The point here is how they are similar, not how they are different.

    Since it’s not doing that anyway, what’s the point of keeping it?” – Now you sound like Dim Light when he says scrap the entire examination system and go for registration only. The argument about “the standard” can easily be susbtitued with the argument about “the whole Examiner’s corp.” Plus, what you say to do will likely worsen the situation, not make it better.

    I think the invalid ones should be subject to evisceration. Anybody who disagrees with that, stand up and be counted.” Wow , talk about your obvious straw man – the point isn’t evisceratin the invalid ones, it be what does it take to arrive at the point that the ones in question be invalid. Max’s little sister hits the prize with the right answer: “It is only jaded patent lawyers and infringers.”

  15. 61

    In an 1871 dispute regarding U.S. Pat. No. 52,730 and U.S. Patent No. 63,917, the court in McMillin v. Barclay, 16 F.Cas. 302 C.C.Pa. (1871) noted, “The only remaining question, affecting the validity of the patent, is, …. The burden of disproving this is upon the party who denies it. Evidence of disputable or doubtful import will not meet this requirement, but it must be clear and convincing.”

    To cited the above, please use:

    PatentlyO Law Blog, at link to patentlyo.com (October 17, 2010).

  16. 60

    billy G: a patent is a property as demonstrated in Ebay v MercExchange. go steal someone’s car and see what happens..

    How do you steal a patent?

    Cowboy: In my view that importance is present for invention patents as well as landgrant patents.

    Let’s not forget just how different land patents and utility patents are.

    If we use the distressingly common fencepost analogy for patents, a land patent is a fence around a particular area of land. Every bit of land is surrounded by one and only one fence. You may enter your fence and do as you please within its boundaries, but others may not. More to the point, nobody else may fence off any of the property inside your fence. If your land wasn’t fenced off by you, it would quickly be fenced off by someone else, and you’d lose your rights in that land.

    A patent of invention is a fence too, but there are millions of other fences, many of which also fence off part or all of your property. The “landscape” looks like a Venn diagram exploded. They’re a different kind of fence, too. Owning one of the fences doesn’t permit you to do anything within its boundaries, and someone else’s fence doesn’t prevent you from having your own. Your fence is useful for keeping other people out, but it’s no indication of where you can go, and you won’t lose the right to go anywhere or do anything if someone else encroaches on your boundary or forcibly takes your fence down.

    Cowboy: My guess is that those who have not been party to one of these cases would be astounded at how regularly the courts overturn patents.

    I thought the whole point of the current standard was that it promotes investor confidence and the stability of administrative rulings. Since it’s not doing that anyway, what’s the point of keeping it?

    Cowboy: It is only jaded patent lawyers and infringers who think these things should be subject to evisceration in courts.

    I think the invalid ones should be subject to evisceration. Anybody who disagrees with that, stand up and be counted.

  17. 59

    damm, someone’s taking Ned’s place as site historian. But what I really want to know is how the ancient Romans felt about this.

    Ned, new homework assignment for ya – check those cites, and be quick about it.

  18. 58

    Nice history lesson, Anon, thanks.

    The big deal policy issue is enunciated in the Maxwell case: “the importance and necessity of the stability of titles dependent on these official instruments.”

    In my view that importance is present for invention patents as well as landgrant patents. I think the debate amongst the posters is how important it really is. Perhaps it would be illuminating to poll the business and investing public. My guess is that those who have not been party to one of these cases would be astounded at how regularly the courts overturn patents. After all, we all know that the jury members are swayed by the red ribbon and gold seal. That jury perception is embodiment of the trust and confidence that the population puts in patent grants. It is only jaded patent lawyers and infringers who think these things should be subject to evisceration in courts.

  19. 57

    It can be singly, doubly, triply redundant, but not “a bit” redundant.

    Indeed, IBP. But one can try to be understated in one’s criticism, can’t one?

  20. 56

    Inviting Body Punches,

    Unlike others, I have real work to do and cannot sit around and jump to every request for information. Your strident requests not much more than an hour apart smack of petulance, and I am loath to assist your understanding if but for that reason alone.

    As for Ping, goodness knows what he is trying to say.

    As for my message posted on the other thread, I was referring to the fact that the battle over the presumption that Microsoft brings to the Supreme Court is not a new battle at all. Our Supreme Court, ever the weather vane in trying to react to the perceptions (seemingly moreso than the realities) of the day, took a decidedly negative approach to patents in the late 30’s – driven by the animus of Justice Douglas. This is all historical fact – I will leave the details to you. Suffice to say that prior to that attack, the view held even by the Supreme Court could be summarized by Radio Corp. of America v. Radio Engineering Laboratories, Inc., 293 U.S. 1, 2 (U.S. 1934): “Even for the purpose of a controversy with strangers there is a presumption of validity, a presumption not to be overthrown except by clear and cogent evidence.

    Of course, with the advent of the most anti-patent Supreme Court in this nation’s history, the attack on patents then (as apparently now) dealt with the facets that made a strong patent – including the presumption of validity. This can be clearly seen in Cleveland Punch & Shear Works Co. v. E. W. Bliss Co., 145 F.2d 991, 999 (6th Cir. Ohio 1944):

    It seems reasonably clear that both master and court were led to their conclusions, though with some reluctance, by the presumption of validity inhering in the patent grant, a presumption not accorded great weight in the more recent decisions of the Supreme Court, notwithstanding its positive assertion in Philippine Sugar Estates Development Co. v. Government of Philippine Islands, 247 U.S. 385, 38 S.Ct. 513, 62 L.Ed. 1177, [**26] and Radio Corporation v. Radio Laboratories, 293 U.S. 1, 54 S.Ct. 752, 78 L.Ed. 1453. The stricter tests of invention applied by the Supreme Court in recent years, have been repeatedly noted by us and by other Courts.

    In other words, the acts of the Supreme Court immediately before the 1952 Act (which is arguably a reaction against such vehemence) were in opposition to an earlier holding – it is that earlier holding that I referred to.

    But more to the point of Dennis Crouch’s prospecting thread was the alignment of patent grants with the other patents grants of our nation’s early history – land patents. Even though certain antagonists are quick to deny any such link, those links exist and have merit for the current discussion.

    In those types of cases, the presumption goes even further back in time:

    Clear and convincing proof would seem, therefore, to be necessary to overcome the presumption.

    Iron Silver Mining Co. v. Mike & Starr Gold & Silver Mining Co., 143 U.S. 394, 417 (U.S. 1892)

    The general doctrine on this subject is, that, when in a court of equity it is proposed to set aside, to annul, or correct a written instrument, for fraud or mistake in the execution of the instrument itself, the testimony on which this is done must be clear, unequivocal and convincing, and it cannot be done upon a bare preponderance of evidence which leaves the issue in doubt.

    Where the purpose is to annul a patent, a grant, or other formal evidence of title from the United States, the respect due to such an instrument, the presumption that all the preceding steps required by law had been observed, the importance and necessity of the stability of titles dependent on these official instruments, demand that the effort to set them aside should be successful only when the allegations on which this attempt is made are clearly stated and fully proved.

    Maxwell Land-Grant Case, 121 U.S. 325 (U.S. 1887)

    Funny how the “court of equity” line works against the antagonist that love to discuss the power that the courts of equity have – but then again, that one has always been susceptible to selective reasoning.

  21. 54

    IBP,

    lighten up Sunshine – and keep away from Ned’s meds – they aint been doin ya no good, ya hear.

    Ping then tries to invoke Anon’s supposed legal knowledge to undermine the premise of the original post–when pressed for details, neither of them have supplied any.

    And then along comes Anon with worthless and ego-centric tripe.

    Cepts Ya never pressed me for details. And if ya woulda, ida tell ya what I what I tell the rest of the harbingers of ha-ha – Homey don’t do answers.

    Do your own research – clearly, this C&C predates the good prof’s work above. I aint baggin too heavy on him – but he is from the land of ivory towers and theza kinda dissociate from reality in those tall towers.

  22. 53

    a patent is a property as demonstrated in Ebay v MercExchange. go steal someone’s car and see what happens..

  23. 52

    Lexi–

    Right!

    Earnest rather than “erstwhile”.

    I think tripe can have worth, if it is at least humorous.

    Back at you–I don’t think something can be “a bit” redundant.

    It is either redundant, or not.

    It can be singly, doubly, triply redundant, but not “a bit” redundant.

  24. 51

    The OP Lefstin makes what seems to be a humble and erstwhile attempt to toss something out for consideration in an interesting and at least semi-rigorous way.

    What was erstwhile about Mr. Lefstin’s attempt? Methinks you use words the meanings of which you know not. Which fact casts doubt on your ability to construe the term “negative right.”

    Incidentally, “worthless tripe” is a bit redundant. But why use one word when you get to bill the client for four?

  25. 50

    I will honor you by answering your first 2 questions. Your third question is unworthy of a response.

    The general answer to the first 2 questions is that the entirety of your first 2 paragraphs was ridiculous.

    The specific answer to your first question is “Yes”, it is ridiculous to characterize a patent as a “negative right”.

    The specific answer to your second question is that the basic premise of your postulate is ridiculous, and hence the remainder, also ridiculous.

    The commentary on this blog has been going downhill.

    The OP Lefstin makes what seems to be a humble and erstwhile attempt to toss something out for consideration in an interesting and at least semi-rigorous way.

    Ping then tries to invoke Anon’s supposed legal knowledge to undermine the premise of the original post–when pressed for details, neither of them have supplied any.

    And then along comes Anon with worthless and ego-centric tripe.

    Hats off to the OP.

  26. 48

    So when I said a patent is only a negative right,that was ridiculous? Or was it when I pointed out that since a patent is a negative right, losing a patent doesn’t cost the patentee any positive rights, and therefore he can keep doing whatever he was doing before?

    Or was the ridiculous part where you imagined that I was saying patents have no value at all to a business?

  27. 47

    It isn’t only the implication that is ridiculous, it is the entirety of the first 2 paragraphs.

    Anon? The Supreme Court decision(s)??????

  28. 46

    There is no universality among “business”, as your earlier post necessarily implied.

    I presume you’ll be making the same sort of comment to Ned and everyone else who ever discusses this issue, then?

    I’m perfectly happy with “necessarily implying” that patents don’t make businesses exist (as we all know, in no small part because AI vehemently asserts the contrary), and invalidating the bad patents isn’t going to completely chill business investment in the good ones. Was there anything else I implied that you consider “ridiculous”?

  29. 45

    He really doesn’t need reliability that badly. A patent is only a negative right. He can still run his business with or without that patent, and his other business risks will far outweigh the possible invalidity of his patent in both probability and cost.

    If a patent were a positive right, the patentee would have much more need for reliability, because losing his patent could cost him his business. But in reality, the patent only costs other people their business, and it’s those other people who need the reliability of being able to practice the prior art without fear of injunction.

    Ignores the reality that having patents is a business (to some in toto, to others, in large degree). C’mon INANE, ya looking bad when you be talking outside your element here. Take a plebian business course then come back.

  30. 44

    IANAE–

    There is no universality among “business”, as your earlier post necessarily implied.

  31. 43

    Without the patent, one can make major investments in developing a market, only to see it all ripped away by big competition. Such is what actually happened here when i4i’s flagship product was incorporated into the monopolist infringer’s product with knowledge of the harm it would cause i4i.

    What Microsoft demonstrated is that even with a patent you can see your investments all ripped away by big competition. Except, of course, that nobody ever stopped i4i from selling a product, and i4i had a right to sue Microsoft and collect some damages if they could keep existing long enough for the litigation to play out.

    Now, i4i’s patent is apparently not-invalid, and would apparently be not-invalid under any reasonable standard of proof, so perhaps this is a poor example. If the standard remains clear and convincing they will have had the “reliability” of a patent, but they will still have had to withstand a validity challenge that got appealed all the way to the Supreme Court, and it was obviously no deterrent to infringement. A lower standard of proof wouldn’t have made life any worse for them, in any possible way. It might even have saved them one level of appeal, if the lower standard had been settled law.

    If you can explain to me how a lower standard of proof or a weaker presumption would have adversely affected i4i in any way, I’m willing to listen.

    Without a patent, indepedent developers of new products will simply not invest.

    Right, but they will still invest with a patent, even if that patent has only a bare presumption of validity. Because every business involves risk, and venture capital is no exception. Changing the standard of proof won’t automatically wipe out all US patents, and you might as well stop acting like it will.

    Ditto drug makers. They need patent protection to justify the investment.

    And yet, you can still buy ASA from Bayer and acetaminophen from JNJ. Even though they’re not only off patent, but more expensive than competing equivalent formulations. Losing a patent doesn’t mean losing a business.

  32. 42

    IANAE, you still do not seem to understand businees. Every business involves risk. When you are marketing the better mousetrap, patent protection is critical. Without the patent, one can make major investments in developing a market, only to see it all ripped away by big competition. Such is what actually happened here when i4i’s flagship product was incorporated into the monopolist infringer’s product with knowledge of the harm it would cause i4i.

    Without a patent, indepedent developers of new products will simply not invest. We the people are harmed.

    Ditto drug makers. They need patent protection to justify the investment.

    It is a truism. Strong patent protection strongly promotes investment and the progress of the useful arts. Strong patent protection strongly promotes startups and the jobs they bring. Strong patent protection is a major component of the economic strenght of America. It should not lightly be brushed aside to protect a particular monopolist.

  33. 38

    Ned: But, since the patent owner needs reliability,

    He really doesn’t need reliability that badly. A patent is only a negative right. He can still run his business with or without that patent, and his other business risks will far outweigh the possible invalidity of his patent in both probability and cost.

    If a patent were a positive right, the patentee would have much more need for reliability, because losing his patent could cost him his business. But in reality, the patent only costs other people their business, and it’s those other people who need the reliability of being able to practice the prior art without fear of injunction.

    Cowboy: Why are we looking out for the infringer?

    Because if the patent is invalid the infringer shouldn’t be penalized for practicing the claim.

    I should have thought that was, for lack of a better word, obvious.

    Cowboy: So you say the patentee is supposed to be left with NOTHING, even though you concede he may have invented and disclosed in the manner required by Section 112 patentable subject matter that the infringer has made/used/sold?

    Yes. Isn’t that the law? Section 112 also requires that the invention be claimed. Also, what TINLA said.

  34. 37

    I object to the good professor not pointing out that the result in this case probably does not depend upon the answer the question presented: the presumption of validity.

    Objection overruled.

  35. 36

    “So you say the patentee is supposed to be left with NOTHING, even though you concede he may have invented and disclosed in the manner required by Section 112 patentable subject matter that the infringer has made/used/sold?”

    Ideally, there should be some dependent claims directed to numerous variations on this apparently important feature, so the patent will be saved even if the independent claim is found to be invalidly overbroad. It’s one of those finer points of patent prosecution that typically gets hammered home to the litigators, instead of to the prosecutors who need the lesson. But, many of us typically keep a continuation application on file for just such an occasion, so that its claims can be narrowly shrunk down about the offending product as the need arises.

  36. 34

    I object to the good professor not pointing out that the result in this case probably does not depend upon the answer the question presented: the presumption of validity. The reason is that the Supreme have always required evidence to overturn a patent to be clear, and required a high standard for evidence of the kind Microsoft is advancing.

    If the outcome of the case does not depend on the answer to the issue presented to them to decide, the Supremes should not take the case.

  37. 33

    Well, there might be. I certainly don’t concede that such a thing is probable. But why would any sane infringer take that chance if he doesn’t have to?

    Why are we looking out for the infringer?

    In my big picture, the patentee is supposed to lose if his patent doesn’t have a valid and infringed claim.
    So you say the patentee is supposed to be left with NOTHING, even though you concede he may have invented and disclosed in the manner required by Section 112 patentable subject matter that the infringer has made/used/sold?

  38. 32

    IANAE: A patent that is not anticipated is new. It does not per se withdraw anything from the public domain.

    A patent that is obvious “blocks” others from pursuing that avenue. That is wrong only to the extent that the path is “obvious.”

    But, since the patent owner needs reliability, it seems quite unremarkable that the standard should be that the patent is convincingly obvious.

  39. 31

    After all, what expectation would the Office have to live up to if the standard is lowered?

    What expectation does the PTO have to live up to now? Do you think they’re making an effort to issue only those patents that are clearly and convincingly valid? The law says they have to issue patents unless they find something wrong in the limited time they have to search, and that’s apparently exactly what they’re doing.

    If they’re going to issue patents you don’t like anyway, wouldn’t you rather weed them out in litigation than let them be enforced?

  40. 30

    In the spirit of being careful about what one wishes for and the law of unintended consequences, does it seem likely to anyone that decreasing the standard of review will only increase the percentage of crxppy patents that the PTO issues? After all, what expectation would the Office have to live up to if the standard is lowered?

  41. 29

    This comment concedes that there is probably validly patentable subject matter disclosed in the application that can be made the subject of an allowable claim that the infringer infringes.

    Well, there might be. I certainly don’t concede that such a thing is probable. But why would any sane infringer take that chance if he doesn’t have to?

    So, in the big picture, the infringer is SUPPOSED to lose.

    That’s a mighty big picture you’ve got there. I think it’s affecting your perspective. In my big picture, the patentee is supposed to lose if his patent doesn’t have a valid and infringed claim.

  42. 28

    “If you think someone else’s patent is invalid over prior art, why would you commence a procedure that gives them a chance to narrow their claims by amendment, while limiting the types of prior art that can be cited?”

    This comment concedes that there is probably validly patentable subject matter disclosed in the application that can be made the subject of an allowable claim that the infringer infringes. So, in the big picture, the infringer is SUPPOSED to lose.

  43. 27

    I’ve yet to see a case where the difference between C&C and preponderance makes a difference in court.

    Then there’s nothing to be lost by lowering it, and it seems to me that, if all other things are equal, we should choose a lower standard over a higher one.

    I disagree, however, that it would make no difference. As has been noted, even with a lower standard, Microsoft stands a good chance of losing this case on the merits, but Microsoft is approaching this strategically. It has a history of wanting a lower standard, and clearly it believes that a lower standard would, overall, make a difference in the dozens of patent suits it faces at any given time.

    I don’t understand how anyone could observe our system as it currently operates and conclude that our courts resolve patent disputes unfairly in favor of the patentee.

    This conclusion does not necessarily follow from your observation that accused infringers tend to win on the merits. It could well be that in a perfectly just world, accused infringers would win even more often than they already do.

    Altering the standard certainly wouldn’t cure the most glaring criticism (expense)

    Presumably to the extent it makes it easier to invalidate patents, more cases will settle and settle earlier. Or, at the margin, questionable cases won’t be brought in the first place. That should make things cheaper.

    I think the real gain from changing the standard, however, would be for patent applicants to pursue stronger, narrower claims and for patentees to only try to enforce stronger, narrower claims.

  44. 24

    They can’t do it until the patentee gives them jurisdiction by essentially threatening to commence litigation itself.

    DJ jurisdiction now requires little if any actual threat by the patentee, though of course you know that. A letter with a product and a patent number may be enough, and for pharmaceuticals a patentee’s assertion that its own products are covered by its patents is sufficient.

    Shouldn’t he get a fair hearing and a proper determination of his rights on the merits in whatever forum he chooses?

    Why do you think the current regime lacks fairness? I’ve yet to see a case where the difference between C&C and preponderance makes a difference in court. Accused infringers win much of the time (if not most of the time) on cases that actually make it to a verdict. Clearly there’s a selection bias involved in determining which cases make it that far, but I don’t understand how anyone could observe our system as it currently operates and conclude that our courts resolve patent disputes unfairly in favor of the patentee. Altering the standard certainly wouldn’t cure the most glaring criticism (expense), and may essentially reduce a jury trial on invalidity to a personality contest between the parties’ experts. If the defendants cannot clearly articulate and support their invalidity argument, they shouldn’t win at trial (or before the PTO, or anywhere). If they can clearly articulate and support their invalidity argument, they already win. I don’t observe the problem you seem to complain about in these threads.

  45. 23

    Well, since the CCPA precedent established that new prior art is still subject to the C+C standard when the infringer is foreign and the patentee is US, and since the USCC precednt established that the POTE standard applies whn the infringer is domestic, there’s only one possible outcome:

    The C+C standard is lowered for new prior art to POTE only if either of the following is true:

    (1) the infringer is domestic; or

    (2) the patentee is foreign.

  46. 22

    If a patent is not clearly invalid, i.e., it covers the prior art (anticipated), it should not be invalidated.

    If a patent is not clearly valid, it should not be enforced.

    A wrongly invalidated patent might adversely affect one person’s business, and probably not even fatally. A wrongly enforced patent can have a much wider-ranging effect.

    Microsoft is arguing here to invalidate a patent on evidence that is unreliable: hearsay and circumstantial.

    Microsoft apparently thinks that its evidence is convincing on a balance of probabilities. If it’s as bad as you say it is, the standard of proof question is moot and shouldn’t be heard in this case, lest it turn into another Bilski.

  47. 21

    In those cases, the infringer and his/her counsel can put their money where their mouth is and ask the PTO to reexam.

    If you think someone else’s patent is invalid over prior art, why would you commence a procedure that gives them a chance to narrow their claims by amendment, while limiting the types of prior art that can be cited?

    While you’re at it, please explain to me again why an infringer should be encouraged to consider a court of law an inappropriate forum for settling the question of law on which his entire business may depend.

  48. 20

    Regardless of the presumption of correctness issue, there is an indepedent reason for keeping he bar high: reliance.

    If one wants to build a hut, an easilty revocable land patent is all that one requires. But if one is to make the investment in a skyscrapper, one needs more reliability.

    If a patent is not clearly invalid, i.e., it covers the prior art (anticipated), it should not be invalidated. Clear evidence of anticipation is the kind of evidence that should be required to overturn a patent. When it comes to obviousness, not only should the evidence be clear, but it should be utterly convincing.

    But this argument is largely beside the point. Microsoft is arguing here to invalidate a patent on evidence that is unreliable: hearsay and circumstantial. Direct evidence of the prior art no longer exists. The software alleged to be prior art is long gone. Such evidence has always required a very high standard of proof under Supreme Court precedent.

  49. 19

    You might recall that the infringer isn’t actually allowed to choose the litigation process without the patentee’s permission.

    I think the instances of an infringer being caught unaware of the patent until the complaint hits his doorstop are few and far between. In many cases there has been an opinion of counsel that the patent is invalid, so go ahead and make,use and sell. In those cases, the infringer and his/her counsel can put their money where their mouth is and ask the PTO to reexam.

  50. 18

    IANAE I realize there’s a lot of anti-intellectual and anti-rational sentiment out there, but it still amazes me that getting the determination of patentability correct is such a low priority.

    Every patent denied is a hundred jobs destroyed.

    Meanwhile …

    MERS (“Mortgage Electronic Registration System”) invites financial companies to enter names of their own employees into a MERS webpage which then automatically regurgitates boilerplate “corporate resolutions” that purport to name the employees of other companies as “certifying officers” of MERS. These certifying officers also take job titles from MERS stylizing themselves as either assistant secretaries or vice presidents of the MERS, rather than the company that actually employs them. These employees of the servicers, debt collectors, and law firms sign documents pretending to be vice presidents or assistant secretaries of MERS, Inc. even though neither MERSCORP, Inc. nor MERS, Inc. pays any compensation or provides benefits to them. Astonishingly, MERS “vice presidents” are simply paralegals, customer service representatives, and foreclosure attorneys employed by other companies. MERS even sells its corporate seal to non-employees on its internet web page for $25.00 each. Ironically, MERS, Inc.—a company that pretends to own 60% of the nation’s residential mortgages—does not have any of its own employees but still purports to have “thousands” of assistant secretaries and vice presidents.

    link to news.firedoglake.com

    Promote the progress!

  51. 17

    “Infringers” do this all the time with declaratory judgment actions.

    They can’t do it until the patentee gives them jurisdiction by essentially threatening to commence litigation itself.

    Why should the infringer be penalized for choosing litigation when that option was placed before him by the patentee? Or worse, when the patentee drags the infringer into court and the infringer asserts invalidity by counterclaim? Shouldn’t he get a fair hearing and a proper determination of his rights on the merits in whatever forum he chooses?

  52. 16

    You might recall that the infringer isn’t actually allowed to choose the litigation process without the patentee’s permission.

    “Infringers” do this all the time with declaratory judgment actions. If they file in the right district, they may even get the action stayed pending reexam.

  53. 15

    I would have to dust off my Admin Law textbook, but I’m fairly certain that the evidence issue is a red herring proffered by the anti-patent paid shills.

    There is substantial precedent that when parties can and do present new evidence before the district court, the administrative agency’s decision should be given less deference. These citations are taken from cases involving the Individuals with Disabilities Education Act, which provides for the introduction of new evidence at the district court level:

    “The more that the district court relies on new evidence, however, the less it should defer to the administrative decision: [j]udicial review is more searching the greater the amount (weighted by significance) of the evidence that the court has but the agency did not have.” Alex R. ex rel. Beth R. v. Forrestville Valley School, 375 F.3d 603 (7th Cir., 2004) (quoting School Dist. v. Z.S., 295 F.3d 671 (7th Cir.2002)).

    “Deference to the hearing officer makes sense in a proceeding under the Act for the same reasons that it makes sense in the review of any other agency action — agency expertise, the decision of the political branches (here state and federal) to vest the decision initially in the agency, and the costs imposed on all parties of having still another person redecide the matter from scratch. But the district court’s authority under § 1415(e) to supplement the record below with new evidence, as well as Congress’s call for a decision based on the “preponderance of the evidence,” plainly suggest less deference than is conventional.” Kerkam v. McKenzie, 862 F. 2d 884 (D.C.Cir. 1988).

  54. 14

    getting the determination of patentability correct is such a low priority.

    Agreed – we really should be focusing in on the examination in the first place, amirite IANAE?

    infringer isn’t actually allowed to choose the litigation process without the patentee’s permission.

    Cepts when the infringer asks for either Ex Parte or Inter Partes reexam, ya mean?

  55. 13

    If the infringer chooses instead to use the cumbersome litigation process,

    Hey Cowboy, what if the patentee chooses to use the “cumbersome litigation process”? You might recall that the infringer isn’t actually allowed to choose the litigation process without the patentee’s permission.

  56. 12

    The PTO re-exam process does not use C&C, so if the patent infringer thinks he/she has evidence that the patent is invalid, why not go use re-exam? It is a LOT cheaper than litigation.

    If the infringer chooses instead to use the cumbersome litigation process, it should be harder to do. Keeping C&C in the courts encourages use of re-exam, which is faster, cheaper and allows the PTO correct its own mistakes.

  57. 11

    In fact, if you think about it from a common sense standpoint, it would be even more ludicrous to admit new evidence under a lower standard.

    Ah, I see. The more evidence left unconsidered by the administrative agency, the more we should protect its decision from that evidence.

    I realize there’s a lot of anti-intellectual and anti-rational sentiment out there, but it still amazes me that getting the determination of patentability correct is such a low priority.

  58. 10

    Doesn’t the fact that the CAFC has followed the CCPA precedent and not that of the Court of Claims make it a little hard for anyone to get them to change course, short of taking it before the Supreme Court?

  59. 8

    David Healey, on his blog, writes: “… I’ve gained some perspective on the best way to protect and exploit IP assets.”

    In my opinion Mr. Healy, if you think weakening the presumption of validity is among “the best way to protect and exploit IP assets” you’ve given me at least one great reason to hire someone else.

    plurality: I would have to dust off my Admin Law textbook, but I’m fairly certain that the evidence issue is a red herring proffered by the anti-patent paid shills. From a pure admin law standpoint, you don’t want final agency decisions coming under continued scrutiny based on “new evidence” that would be considered under a lower standard. The final decision on patentability is what is protected by the heightened standard, not whether or not “new” evidence, not considered by the PTO. We can presume that the world is always full of “new” evidence. Unless it is proffered according to C&C the agency finding should stand. In fact, if you think about it from a common sense standpoint, it would be even more ludicrous to admit new evidence under a lower standard.

  60. 7

    Anon,

    Can you provide us with the specific 1920’s SC case(s) you mentioned in your earlier post on another thread, and tell us how they inform the cited CCPA decisions?

  61. 6

    FromAfar: “that agency determinations involving technical questions (and those that involve the loss of a valuable right) are entitled to great weight and deference.”

    Shouldn’t this deference indicate the proper treatment of the evidentiary findings of the USPTO, rather than changing the standard of proof required? That is to say, the court should trust the USPTO’s findings concerning the evidence presented to them, but reach its own conclusion if additional unconsidered evidence is provided to the court?

  62. 5

    This is a cogent and well-argued guest post: Thank you Professors Crouch and Lefstin.

    As the Amicus Brief of the 36 Professors written by Professor Lemley points out, the chaos of the patent office should not be complemented by a global clear and convincing standard of proof.

    On the other hand, having sat once on a criminal jury where no defense was put on by the accused and the only argument for acquittal was “reasonable doubt”, I am confident that the clear and convincing standard of proof has no practical impact on jurors in deliberation.

  63. 4

    So it traces back to the CCPA, does it?

    And I thought that the last thread traced it back to at least the Supreme Court in the 20’s and 30’s.

    Well, so much for “the quality of content is fine and the conclusion is good.”

  64. 3

    Nicely presented information in this post, I prefer to read this kind of stuff. The quality of content is fine and the conclusion is good. Thanks for the post.

  65. 2

    Very fair, I must say, FromAfar, when you write that such learned Papers “appear to me” to be nothing more than anti-patent propaganda.

    Each of us sees the world subjectively, through his or her own prism, informed by his or her own peculiar prejudices.

    Inevitably then, it all “appears” to me quite differently.

    But we don’t need to go through the arguments for and against a preponderance as opposed to a C+C standard all over again, do we. For they have been exhausively worked out already, on earlier threads.

  66. 1

    It is folly in my opinion, to focus only on various exclusively patent law related theories and conveniently supportive precedents when the key basis for the presumption of validity lies in the well settled admin law principle, supported by decades upon decades of ciruit level and SCOTUS level precedent, that agency determinations involving technical questions (and those that involve the loss of a valuable right) are entitled to great weight and deference.

    The professor opines “It is probably not coincidental that the CCPA devised a patentee-friendly rule.” As if there is a problem with establishing a patent friendly rule for a valuable right that is granted at great expense. That lower courts found the effect of often disruptive patented technologies, well, disruptive, is not a basis for impugning well settled law.

    Would the professor and his cohorts, propose that a valuable right be granted at great expense then be immediately subject to attack by courts of the very government that granted it in the first place? This would be the ultimate joke foisted upon the applicant/patentee. This article and many like it that are appearing in the dust cloud of i4i appear to me to be nothing more than anti-patent propaganda.

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