Reforming Patent Validity Litigation: The Dubious Preponderance

Berkeley Technology Law Journal, Feb 2014

By Mark D. Janis, Published on 06/01/04

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Reforming Patent Validity Litigation: The Dubious Preponderance

BERKELEY TECHNOLOGY LAW JOURNAL REFORMING PATENT VALIDITY LITIGATION: THE "DUBIOUS PREPONDERANCE" By Mark D.Jani st 0 0 2004 Mark D. Janis In an environment in which corporate officials complain to Congress about the existence of patent "trolls,"1 perhaps it should not come as a surprise that patent law reform proposals are finding a receptive audience. Major reports on the patent system compiled by the Federal Trade Commission (FTC)2 and the National Academy of Sciences (NAS) 3 advocate a number of reforms touching on both the administrative processes of the patent system and the treatment of patent rights in the courts. While the INTRODUCTION reform proposals are not particularly notable for their originality,4 they are presented with a tone of urgency that has not been heard for some years. The FTC Report identifies patent litigation as one area in need of scrutiny and selects the presumption of patent validity5 in patent litigation as a particular target for reform. According to the FTC Report, the existence of the presumption is "not objectionable" because the patent challenger should bear the burden of overcoming the U.S. Patent and Trademark Office's (USPTO) determination of patentability. 6 The Report's objections focus on the standard of evidence for overcoming the presumption, and here, the FTC can discern "no persuasive reason" why the existing clear and convincing evidence standard should be retained.7 Instead, patent challengers should be able to overcome the presumption of validity by evidence that meets the preponderance standard, according to the Report.8 In one respect, it is not surprising that the FTC has focused on the presumption of patent validity. The presumption is an easy target; it enhances the leverage of the patent trolls. 9 However, in another respect, the new focus on the presumption of validity may seem startling, at least to those within the patent community. The Federal Circuit's pronouncements on the presumption of validity have become routine. In dozens of decisions, the Federal Circuit has repeated core principles: the patent challenger bears the ultimate burden of persuasion on patent invalidity; 10 to carry this burden, the patent challenger must establish relevant facts by clear and convincing evidence;11 clear and convincing evidence is "evidence which 4. Most of the proposals are eerily familiar, having been proposed-and discarded-in previous episodes of patent law reform stretching back to the 19th Century. I have previously commented on the reiterative nature of patent law reform. Mark D. Janis, PatentAbolitionism, 17 BERKELEY TECH. L.J. 899 (2002). 5. 35 U.S.C. ยง 282 (2000) (providing in relevant part that, "A patent shall be presumed valid. Each claim of a patent.., shall be presumed valid independently of the validity of other claims ....The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity."). 6. FTC REPORT, supranote 2, ch. 5, at 28. 7. Id. 8. Id. 9. According to David Simon, "These patent trolls have the presumption of validity on their side. It is difficult to convince a jury of patent invalidity in light of the heightened evidentiary standard of clear and convincing evidence." Patent Improvement Quality Hearings,supranote 1, at 4 (testimony of David Simon). 10. See, e.g., New England Braiding Co. v. A.W. Chesterton Co., 970 F.2d 878, 882 (Fed. Cir. 1992) ("The presumption acts as a procedural device which places the burden of going forward with evidence and the ultimate burden of persuasion of invalidity at trial on the alleged infringer."). 11. See, e.g., Geneva Pharm., Inc. v. GlaxoSmithKline PLC, 349 F.3d 1373 (Fed. Cir. 2003) (upholding summary judgment of invalidity for double patenting). produces in the mind of the trier of fact an abiding conviction that the truth of the factual contentions is highly probable."' 2 This Article critically examines the FTC's proposals concerning the presumption of validity. In Part II, I identify two general functions of presumptions in law, the expressive and instrumental functions. In Part III, I argue that the FTC's proposal overlooks the expressive function of the presumption of patent validity and I consider the insights that might be gained from considering the expressive function. In Part IV, I analyze the FTC's arguments touching on the instrumental function of the presumption of validity, and conclude that they are plausible, but deserve refinement and further probing. II. EXPRESSIVE AND INSTRUMENTAL FUNCTIONS OF PRESUMPTIONS The FTC Report's proposal to reform the presumption of validity provokes some fundamental questions about patent validity adjudication. Most directly, the Report encourages the patent community to think more carefully about what the presumption of validity is designed to accomplish. We might answer the question by returning to first principles-by considering the functions that presumptions are generally des (...truncated)


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Mark D. Janis. Reforming Patent Validity Litigation: The Dubious Preponderance, Berkeley Technology Law Journal, 2014, Volume 19, Issue 3,