Federal Circuit Finds Foreign Lawsuits Did Not Avoid a Laches Bar

On February 16, 2016, in a patent case that could have implications on the trademark side, the Federal Circuit ruled that the pursuit of foreign enforcement actions were not sufficient to avoid a successful laches defense by a U.S.-based defendant.

Hedwig Lismont is a Belgian citizen who claimed to have developed a method for manufacturing goods covered by a German Patent which issued in 1998 and a U.S. Patent which issued in 2002. Both the German Patent and U.S. Patent in question are owned by German manufacturing company Alexander Binzel Schweisstechnik Gmbh & Co. KG (Binzel-Germany). Between October 2000 and at least 2009, Mr. Lismont filed two litigations in Germany, as well as separate due process actions in the German Federal Constitutional Court and the European Court of Human Rights related to his inventorship claim for the German patent. On October 31, 2012, twelve years after initiating the first litigation in Germany, Mr. Lismont filed his claim to correct inventorship of the U.S. Patent in the Eastern District of Virginia. Binzel-Germany filed a motion for summary judgment asserting Mr. Lismont’s ’patent inventorship claim was barred by laches.

In patent cases, a rebuttable presumption of laches attaches whenever more than six years have passed from the time a purportedly omitted inventor knew or should have known of the issuance of the relevant patent. Here, the District Court found the presumption attached because the laches clock started to run when the U.S. Patent issued in 2002, and Mr. Lismont did not file suit until more than ten years later. On appeal, Mr. Lismont argued that he did not delay in initiating the litigation because he had been seeking to vindicate his inventorship rights in German and European courts. The Federal Circuit disagreed, finding nothing in his German or European litigations to indicate that he sought to correct the inventorship of the U.S. Patent. The Court also noted that even if the German courts had discussed inventorship of the U.S. Patent, a United States action would likely still have been necessary. Therefore, the presumption of laches was appropriate.

The court also found, however, that although the fact that Mr. Lismont pursued foreign litigations was an insufficient basis to avoid the presumption of laches, the presumption could be rebutted if the defendant had received adequate notice not only of the foreign proceedings but, in addition, of the plaintiff’s intention to pursue his patent rights in the U.S. upon their completion. The Court found no such notice had occurred in this case.

Mr. Lismont pointed to a document in the first German litigation where he stated that “the [named inventor] has applied for the patent that is in dispute here in the Unite[d] States in his own name as inventor” and then stated that “an extension of claim according to § 263 ZPO is therefore expressly reserved.” The section referenced, however, referred to the German Code of Civil Procedure that permits amendments to pleadings pending in a German civil action and therefore did not communicate an intent to pursue a claim in the United States.

Mr. Lismont also pointed to a June 2002 letter to the named inventor in the U.S. Patent in which he (1) noted the existence of the U.S. Patent application, (2) advised that he would “carefully examine and prosecute [the named inventor’s] conduct and actions in all legal respects,” and (3) notified the named inventor that failure to pay damages would result in the initiation of “appropriate legal action with no further notification.” The Court found no indication in the letter that Mr. Lismont intended file a claim to correct inventorship of U.S. Patent, and also found it relevant that six months after sending the letter, Mr. Lismont followed through on his threat by suing in Germany. It also concluded that Mr. Lismont’s request for “worldwide damages” in the German litigations was not sufficient to provide adequate notice of intent to pursue an inventorship claim as to the United States.

Accordingly, the Federal Circuit found no abuse of the District Court’s discretion in concluding that laches barred Mr. Lismont’s claim.

The case is Lismont v. Alexander Binzel Corporation, No. 2014-1846 (Fed. Cir. Feb. 16, 2016).