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Has the Federal Circuit “Torpedoed” Submarine Patents?

January 24, 2002

Decision icon Decision

Last Month at the Federal Circuit - February 2002

Judges: Mayer (author), Clevenger, and Newman (dissenting)

In Symbol Technologies, Inc. v. Lemelson Medical, Education & Research Foundation, L.P., No. 00-1583 (Fed. Cir. Jan. 24, 2002), the Federal Circuit recognized the defense of prosecution laches as a bar to enforcement of patent claims.

Symbol Technologies, Inc. (“Symbol”) brought a DJ action against Lemelson Medical, Education & Research Foundation, L.P. (“Lemelson”) seeking a judgment that several of Lemelson’s patents are invalid, unenforceable, and not infringed by Symbol or its customers. The Lemelson patents are directed to what Lemelson calls “machine vision” and automatic identification technology and allegedly are entitled to the benefit of the filing date of two applications filed in 1954 and 1956.

The district court had dismissed Symbol’s laches claims. The sole issue on appeal was whether, as a matter of law, the equitable doctrine of laches may be applied to bar enforcement of patent claims that issued after an unreasonable and unexplained delay in prosecution, even though the applicant had complied with pertinent statutes and rules.

Examining the history of this defense, the Federal Circuit concluded that prosecution laches finds its origin in two Supreme Court cases: Woodbridge v. United States, 263 U.S. 50 (1923), and Webster Electric Co. v. Splitdorf Electrical Co., 264 U.S. 463 (1924). In Woodbridge, the Court first applied prosecution laches to render a patent unenforceable where the patentee failed to explain a nine-year delay in requesting the PTO to issue a patent. The patentee requested issuance only when doing so had become pecuniarily valuable. A year later, in Webster, the Court held that an unreasonable eight-year delay rendered certain claims unenforceable. For all that time, the patentee simply stood by and awaited developments as industry began to use the claimed subject matter. The Federal Circuit also cited Crown Cork & Seal Co. v. Ferdinand Gutmann Co., 304 U.S. 159 (1938), and General Talking Pictures Corp. v. Western Electric Co., 304 U.S. 175 (1938), as recognizing the existence of a prosecution laches defense to prevent prejudice against intervening public rights.

The Federal Circuit rejected Lemelson’s argument that prosecution laches is not a defense because: (1) Webster and its progeny are limited to claims arising out of interference actions; (2) the 1952 Patent Act forecloses the application of prosecution laches; and (3) the Federal Circuit has issued two nonprecedential opinions that reject prosecution laches as a defense. The claims at issue in Webster were not the subject of an interference proceeding, and the Federal Circuit found nothing in the precedent to suggest that Webster had limited prosecution laches to cases involving an interference. Moreover, the Court concluded after reviewing the legislative history and commentary, that passage of 35 U.S.C. §§ 120 and 121, entitling continuation and divisional applications, in the 1952 Patent Act, did not abrogate the defense of prosecution laches.

As to the nonprecedential cases cited by Lemelson, subscribing to the reasoning of the Ninth Circuit in Hart v. Massanari, 266 F.3d 1155 (9th Cir. 2001), the Federal Circuit confirmed its practice of issuing nonprecedential decisions and declined to consider any cited by Lemelson.

Having reversed the judgment, the Federal Circuit remanded the case to the U.S. District Court for the District of Nevada, but provided no guidance or instructions on how to apply prosecution laches.

Judge Newman dissented, agreeing with the district court that it should not intervene in equity to regulate what Congress has not. The majority, she concluded, breaks the long-standing rule that when the statutory requirements for continuing applications are met, patents are not subject to attack on nonstatutory grounds. Judge Newman disagreed that Woodbridge and Webster established the principle of laches in patent prosecution and concluded that any doubt about the reach of those cases was resolved in the 1952 Patent Act that codified the rules for continuing and divisional applications.

GATT, she reasoned, had changed the laws concerning the lifetime of a patent to address the issue of “submarine” patents. It was not, however, made applicable to existing patents or to pending applications filed before June 8, 1995. She concluded that the majority’s ruling would achieve exactly that effect retroactively even though that was rejected by Congress.