You can try a patent infringement case, win a verdict awarding millions in damages, and prevail on appeal as to the other side's invalidity defense, but still lose the case because the U.S. Patent and Trademark Office later declares the patent invalid.
So held the Federal Circuit, by a 2-1 vote, on July 2, 2013. Fresenius USA, Inc. v. Baxter Int'l, Inc., No. 12-1334 (Fed. Cir. July 2, 2013). The majority, per Circuit Judge Dyk, ruled that, under Mendenhall v. Barber-Greene Co., 26 F.3d 1573 (Fed. Cir. 1994), the post-judgment outcome of the USPTO re-examination trumped the district court and Federal Circuit results because the judgment had not become truly final when the USPTO issued its invalidity finding.
Circuit Judge Newman dissented. He wrote:
My colleagues now hold that this entire litigation and decisional panoply is negated by the later decision of the Patent and Trademark Office of the issue of validity. My colleagues hold that the prior final adjudication by this court of validity and infringement is irrelevant, and that the later decision by the PTO overrides and displaces our prior adjudication, depriving the parties to that adjudication of their binding judgments.
This holding violates the rules of finality, for judgments of Article III courts are “final and conclusive upon the rights of the parties,” Gordon v. United States, 117
U.S. 697, 702 (1864);
Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 226 (1995) (same).
I respectfully dissent.
Will the decision prompt district courts to stay cases pending the results of re-exam proceedings, fearing all their work will go for naught? Will the case go en banc?
What do you think? Let us know.