Unenforceable Patents

By Jason Rantanen

Although the en banc Federal Circuit raised the bar for establishing inequitable conduct in Therasense v. Becton Dickinson, findings of inequitable conduct are still possible as illustrated by the district court's decision on remand in that case last week.  Given that the harsh consequence of a finding of inequitable conduct remain unchanged by Therasense, it remains a very real risk for patent holders asserting their patents in litigation.  What, then, are the characteristics of patents that historically have been the subject of an inequitable conduct finding? 

In a recently released draft paper, Lee Petherbridge, Polk Wagner, and I discuss the results of a study in which we empirically examined patents that were determined to be unenforceable due to inequitable conduct and compared them to litigated patents.  We report evidence that unenforceable patents are different from litigated patents.  Unenforceable patents have significantly longer pendency, more parent applications, and contain more claims.  Unenforceable patents also cite fewer U.S. patent references.  Surprisingly, we found no evidence that patents with foreign inventors are more likely to be unenforceable and no evidence that the subject matter of a patent associates with an inequitable conduct determination.  Using these observations, we hypothesize about why inequitable conduct happens, how inequitable conduct relates to patent policy, and what - if anything - practitioners who are concerned about an inequitable conduct determination might take as potential warning signs.

We are still grappling with what our results might teach about why inequitable conduct happens. As this is a working draft, we welcome any comments about that or any other aspects of the study.  The paper can be downloaded here: http://papers.ssrn.com/abstract=2031173.