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Supreme Court Limits Laches in Patent Cases

The Supreme Court recently held in SCA Hygiene Products Aktiebolag v. First Quality Baby Products, LLC that the defense of laches cannot be invoked against a claim for damages brought within the statutory six-year limit. The decision comes at little surprise given the Court’s ruling in Petrella v. Metro-Goldwyn-Mayer, which considered a similar provision of the Copyright Act. The Court reasoned that Congress set forth an express limitations period in the patent laws, and giving effect to laches within the statutory period would amount to judicial overriding. In his lone dissent, Justice Breyer noted that the decision ignores the application of laches to reign in abusive pre-litigation conduct by a patent holder who unreasonably delays suit, knowing he can collect damages for the previous six years of infringement.

Supreme Court Narrows Patent Infringement Venue

In the case of TC Heartland LLC v. Kraft Foods Group Brands LLC, the United States Supreme Court issued an opinion that is likely to limit the universe of available venues in which a patent holder can bring an action for infringement. Under the particular patent venue statute, the appropriate venue for patent infringement is anywhere infringement has occured, as long as the accused infringer has a regular and established place of business, or where the accused infringer “resides.” In the context of a corporation, the definition of residing had been open to interpretation, but the TC Heartland opinion made explicit that residence under the patent venue statute refers only to the state of incorporation. 

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Supreme Court to Determine International Scope of Lost Profits in Patent Infringement Suits

One measure of damages for patent infringement is compensation for lost profits of the patent owner. Additionally, a patent owner may enjoin the export of parts of a patented invention from the United States, if the parts will be assembled or used for an infringing purpose. However, the Supreme Court is set to answer the question of whether lost profits may be awarded to the patent owner for service contracts, performed outside the U.S., making use of those parts exported from the U.S. in the case of WesternGeco LLC v. ION Geophysical Corp. If the answer is affirmative, then the scope of damages available to a patent owner may be drastically expanded — up to USD $93 Million in WesternGeco’s case.

When is an invention “on sale?”

The Supreme Court is currently posed with the question: Does the confidential sale of an invention disqualify that invention from later patenting? Helsinn Healthcare S.A. v. Teva Pharm. USA, Inc., 138 S.Ct. 2678 (2018).

The patent statute does not directly address this question, but does state that an invention is precluded from patenting if that invention was “on sale” or “in public use” prior to the filing date for that patent application. Years of case law have added to the meanings of these terms. But now there is an additional term, “or otherwise available to the public.”  35 U.S.C. § 102(a)(1).  Under which circumstances does this new term preclude patenting? Circumstances that are applicable to the certified question for the Court?

The Supreme Court has previously ruled that public use of an invention will not preclude patenting if the public use is for experimentation.  Pfaff v. Wells Elecs., 525 U.S. 55, (1998).  That Court qualified the statutory language, reading in the experimentation use.  But that Court did not rule on the “on sale” criteria except to identify a distinction between experimental use and “products sold commercially.” Is there a similar qualification of a commercial sale, supported by precedent and legislative history, that can exempt a confidential sale from being barred from patenting?

And where would “otherwise available to the public” fit in here? Does “otherwise” mean that the previous items in the list, such as “on sale,” are also to be understood as “available to the public?” Or is it a modern catch-all for new patentability conditions that were not contemplated when the provision was written in 1952?