Inequitable Conduct - What Standard for Materiality?

By Malcolm K. McGowan & Bruce T. Wieder

Where inequitable conduct occurs during prosecution of a patent application, a court can declare the resulting patent unenforceable against the world. Akron Polymer Container Corp. v. Exxel Container, Inc. 148 F.3d 1380, 1381 (Fed. Cir. 1998). Patent practitioners and litigants in patent infringement suits recognize the importance of an inequitable conduct allegation, as does the U.S. Court of Appeals for the Federal Circuit. See, e.g., Dayco Prods., Inc. v. Total Containment, Inc., No. 02-1497 (Fed. Cir. May 23, 2003); Bristol-Myers Squibb Co. v. Rhone-Poulenc Rorer, Inc., No. 02-1280 (Fed. Cir. April 15, 2003); Hoffman-La Roche, Inc. v. Promega, Corp., 323 F.3d 1354 (Fed. Cir. 2003); and Duro-Last v. Custom Seal, 321 F.3d 1098 (Fed. Cir. 2003).

Inequitable conduct may be shown where an applicant, with deceptive intent, misrepresents a material fact, fails to disclose material information, or submits false material information to the U.S. Patent and Trademark Office ("PTO") during prosecution of a patent application. Purdue Pharma L.P. v. Boehringer Ingelheim GMBH, 237 F.3d 1359, 1366 (Fed. Cir. 2001). In Dayco, the Federal Circuit gave notice that it may change the definition of "materiality" in inequitable conduct determinations.

For many years, the Federal Circuit held that material information, for purposes of an inequitable conduct determination, includes prior art that "a reasonable examiner would have considered . . . important in deciding whether to allow the patent application." See, e.g., Driscoll v. Cebalo, 731 F.2d 878, 884 (Fed. Cir. 1982). Materiality also "embraces 'any information that a reasonable examiner would substantially likely consider important in deciding whether to allow an application to issue as a patent.'" Akron Polymer, 148 F.3d at 1382 (quoting Akron Polymer Container Corp. v. Exxel Container, Inc., 40 USPQ2d 1265, 1269 (Fed. Cir. 1995) (nonprecedential)).

Before 1992, the court's "reasonable examiner" standard of materiality was mirrored in 37 C.F.R. 1.56(a) (1977) ("Rule 56"), which defined information as material "where there is a substantial likelihood that a reasonable examiner would consider it important in deciding whether to allow the application to issue as a patent." Indeed, the intent of the drafters of Rule 56 was to codify "the existing [PTO] policy on fraud and inequitable conduct, which is believed consistent with the prevailing case law in the federal courts." Official Gazette of the U.S. PTO (Vol. 955, No. 4, Feb. 22, 1977).

In 1992, the PTO amended Rule 56. This change was not made to reflect a shift in judicial precedent, but instead to "present a clearer and more objective definition of what information the Office considers material to patentability." 57 Fed. Reg. 2021, 2025 (Jan. 17, 1992). The new rule more starkly defines materiality:

[I]nformation is material to patentability when it is not cumulative to information already of record or being made of record in the application, and

(1) It establishes, by itself or in combination with other information, a prima facie case of unpatentability of a claim; or

(2) It refutes, or is...