United States District Court, D. Oregon
Mansfield, Harris Bricken, llp, John J. Edmonds, Stephen F.
Schlather, Shea N. Palavan, Brandon G. Moore, and Eric R.
Carr, Collins Edmonds & Schlather, pllc, Of Attorneys for
S. Gill, Stoll Stoll Berne Lokting & Shlachter, pc, Jenny
W. Chen, Chen IP Law Group, Rueiguang Road, Neihu District,
Taipei Taiwan Andrew T. Oliver, Amin, Turocy & Watson,
llp, Of Attorneys for Defendant.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
Michael H. Simon United States District Judge.
Planar Systems, Inc. (“Planar”) alleges in its
Amended Answer and Counterclaims that Plaintiff Mass.
Engineered Design, Inc. (“Mass”) engaged in
inequitable conduct before the United States Patent and
Trademark Office (“PTO”). First, Planar alleges
inequitable conduct in the reissue proceedings relating to
U.S. Patent No. RE36, 978 (the '978 Patent).
Specifically, Planar alleges that Mr. Jerry Moscovitch, the
owner of Mass. and inventor of the '978 Patent, submitted
a false declaration dated October 1, 1998 (the
Planar alleges that Mass. engaged in inequitable conduct
before the PTO in prosecuting U.S. Patent No. 8, 102, 331
(the '331 Patent), by failing to disclose material
information. Planar alleges that Mass. failed to disclose a
provisional application, U.S. Patent Application Serial No.
60/113, 742 (the '742 Application), filed December 23,
1998. Because of pretrial rulings made by the Court, however,
no evidence of Planar's inequitable conduct claim
relating to the '331 Patent was admissible at trial.
requests only equitable relief. The Court has jurisdiction
over this matter under 28 U.S.C. §§ 1331 and 1338.
The Court held a bench trial on July 11 and 12, 2018. Having
weighed and evaluated all of the evidence and considered the
legal arguments of counsel, the Court makes the following
Findings of Fact and Conclusions of Law pursuant to Federal
Rule of Civil Procedure 52(a). For the reasons that follow,
the Court finds in favor of Mass.
STANDARDS FOR INEQUITABLE CONDUCT
Inequitable conduct is an equitable defense to patent
infringement. Therasense, Inc. v. Becton, Dickinson &
Co., 649 F.3d 1276, 1285 (Fed. Cir. 2011). “To
prevail on the defense of inequitable conduct, the accused
infringer must prove that the applicant misrepresented or
omitted material information with the specific intent to
deceive the PTO.” Id. at 1287.
“The accused infringer must prove both elements-intent
and materiality-by clear and convincing evidence.”
Id. These are separate elements. Id. at
1290. “[A] court must weigh the evidence of intent to
deceive independent of its analysis of materiality.”
“In a case involving nondisclosure of information,
clear and convincing evidence must show that the applicant
made a deliberate decision to withhold a
known material reference.” Id. at
1290 (emphasis in original) (quotation marks omitted).
“Proving that the applicant knew of a reference, should
have known of its materiality, and decided not to submit it
to the PTO does not prove specific intent to deceive.”
“Because direct evidence of deceptive intent is rare, a
district court may infer intent from indirect and
circumstantial evidence. However, to meet the clear and
convincing evidence standard, the specific intent to deceive
must be the single most reasonable inference able to be drawn
from the evidence.” Id. (citation and
quotation marks omitted). This means that when multiple
reasonable inferences can be drawn, intent to deceive cannot
be found. Id. “[T]he evidence must be
sufficient to require a finding of deceitful intent
in the light of all the circumstances.” Id.
(emphasis in original) (quotation marks omitted).
Generally, “the materiality required to establish
inequitable conduct is but-for materiality.”
Id. at 1291.
“When an applicant fails to disclose prior art to the
PTO, that prior art is but-for material if the PTO would not
have allowed a claim had it been aware of the undisclosed
prior art.” Id. In making this assessment, the
court applies the preponderance of the evidence standard, and
gives the patent claims their broadest interpretation.
Id. at 1291-92.
cases of “affirmative egregious misconduct, such as the
filing of an unmistakably false affidavit, the misconduct is
material.” Id. at 1292.
the party asserting inequitable conduct meets its burden to
prove both elements, then the court “must weigh the
equities to determine whether the applicant's conduct
before the PTO warrants rendering the entire patent
unenforceable.” Id. at 1287.
to Federal Rule of Civil Procedure 52(a)(1), the Court finds
the following facts by a preponderance of the evidence.
Credibility of Witnesses
trial, the Court received testimony from Mr. Mirek Waraksa
and Mr. Moscovitch. Although the Court does not find that
either witness intentionally testified falsely or in a
misleading manner, the Court finds that Mr. Waraksa had
problems with his recollection and testified inconsistently,
both on the stand and as compared to his previous sworn
testimony, which was received only for impeachment purposes.
The Court notes that Mr. Waraksa testified regarding his
longstanding mental illness diagnosis and medications, and
their effect on his memory and ability to recall details. The
Court also received testimony via deposition designations
from Mr. Mark Elchuk, a former patent attorney for Mr.
Moscovitch. The Court finds that testimony to be generally
credible, although Mr. Elchuk did not have a clear
recollection of the relevant events.
Background of the Relevant Patents
April 26, 1996, Mr. Waraksa, as the patent agent for Mr.
Moscovitch, filed U.S. Patent Application No. 08/638, 158
(the '158 Application) titled “Dual Display
System.” On November 18, 1997, this application issued
as U.S. Letters Patent No. 5, 687, 939 (the '939 Patent).
October 13, 1998, patent attorney Mark Elchuk filed U.S.
Patent Application No. 09/172, 193 (the '193
application), on behalf of Mass. and named inventor Mr.
Moscovitch, seeking a reissue of the '939 Patent. On
December 5, 2000, this ...