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Wednesday, 22 January 2014 00:59

Supreme Court Reverses Federal Circuit's Burden of Proof Rule for Patent Infringement

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The Supreme Court today ruled unanimously that the burden of proving patent infringement rests with the patent holder, even in cases where the parties had agreed upon a licensing deal in the past. The case at issue, Medtronic, Inc. v. Mirowski Family Ventures, involved implantable heart stimulation devices (pacemakers) which were licensed by Mirowski to Medtronic in 1991. In late 2007, Medtronic filed an action with the U.S. District Court of Delaware seeking declaratory relief that its new line of devices did not infringe upon the Mirowski patents. The trial court entered a judgment of non-infringement in Medtronic's favor, which was reversed in 2012 by the Federal Circuit, based on a holding that the trial court did not properly allocate the burden of proof in the initial proceedings.

The Supreme Court today reversed the Federal Circuit's ruling, in a 9-0 decision authored by Justice Breyer. The Court clarified that the patentee always bears the burden of proving infringement, even in situations where the accused infringer agreed to a license in the past. Three legal rationales were relied upon for this conclusion. First, the traditional rule and precedent is that the plaintiff patent holder generally bears the budren of proof. Second, the Declaratory Judgment Act is "only procedural, leaving substantive rights unchanged." Third, and coming full circle, "the burden of proof is a substantive aspect of a claim."

Interestingly, underpinning the Supreme Court's decision were also two policy based notions. One is the notion that the patentee is in a better position than the alleged infringer to know, and to be able to point out, just where, how, and why a product (or process) infringes a claim of a patent. Another is that the public interest is best served by maintaining a mechanism for challenging patent rights, in order to maintain a balanced and well-functioning patent system and to keep patent monopolies within their legitimate scope.

Today's decision is the first of a number of patent cases that will be heard by the Supreme Court this year. Stay tuned for Alice v. CLS Bank, a case assessing the proper test for software patent eligibilty under Section 101, Limelight Networks v. Akamai Technologies involving issues of divided infringement, Nautilus v. Biosig Instruments regarding the proper standard for indefiniteness under Section 112, as well as Highmark v. Allcare and Octane Fitness v. Icon Health, two cases directed to the award of attorneys fees in exceptional patent cases under Section 285.

For the complete court opinion -- http://www.supremecourt.gov/opinions/13pdf/12-1128_h315.pdf

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Tony Guo

As a specialized technology counsel, Tony supports his clients in the high tech, creative, and online industries. His primary areas of practice include intellectual property protection, Internet law, and startups. Tony is a USPTO registered patent attorney, as well as a licensed lawyer in California and Florida. He comes from a background involving considerable hardware and software development experience, having worked in both development and IT roles in the tech and finance industries.

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