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)