Saturday, July 17, 2010

Newman dissents in denial of stay in Avid

Among other things, Avid sought to stay the mandate of the case (involving inequitable conduct)
until Therasense was decided.
This request was denied on July 16, 2010 but Judge Newman made some significant points in dissent.

Newman began:

Avid moves this court to stay its petition for rehearing
en banc until our en banc consideration of Therasense, Inc.
v. Becton, Dickinson & Co., 593 F.3d 1289 (Fed. Cir. 2010),
which bears on the precise issue of Avid’s appeal, that is,
the criteria for “inequitable conduct” during patent prosecu-
tion. I would grant this stay.

Of practices at the US Supreme Court:

The practice of staying the finality of related cases while
the law is clarified is not unusual. The Supreme Court
often holds petitions for writ of certiorari in cases involving
the same issue being decided in another case before the
Court. As explained in Lawrence v. Chater, “‘We fulfill our
judicial responsibility by instructing the lower courts to
apply the new rule retroactively to cases not yet final.’” 516
U.S. 163, 167 (1996) (quoting Griffith v. Kentucky, 479 U.S.
314, 323 (1987)). Thus the Supreme Court “regularly
hold[s] cases that involve the same issue as a case on which
certiorari has been granted and plenary review is being
conducted in order that (if appropriate) they may be
[granted, vacated and remanded] when the case is decided.”

IPBiz notes that such practice was applied to Prometheus after
the Bilski decision.

The particular issue in the Avid case was the non-disclosure
of a demonstration of one Dr. Stoddard:

This court held that Dr. Stoddard’s demonstration dur-
ing the Livestock Committee trade show of what the panel
calls “some of Avid’s technology,” and Avid calls a “precursor
product,” was material to patentability and that Dr.
Stoddard was required to assure that the patent examiner
was informed.1 According to the panel opinion, the district
court “found that the precursor product, while not invalidat-
ing, reflected the closest prior art, and thus was highly
material to patentability.” Avid Identification Sys., Inc. v.
Crystal Import Corp., 603 F.3d 967, 973 (Fed. Cir. 2010)
(“Avid II”). While “closest prior art” has been discussed in
the context of whether certain information is cumulative of
that already presented to an examiner, see, e.g., AstraZeneca
Pharms. LP v. Teva Pharms. USA, 583 F.3d 766, 773-75
(Fed. Cir. 2009), it has never been the law that information
is “highly material” simply because it is “closest.” It is not
disputed that whatever was demonstrated was not an
invalidating disclosure of the patented invention, and not a
sale or offer to sell the patented invention, for the jury found
that the demonstration at the Livestock Committee was not
invalidating. See Avid I, 2007 WL 2901415, at *1.

Of Dr. Stoddard's status in all of this:

Dr. Stoddard, who is the president of Avid, is a veteri-
narian whose principal occupation is running an animal
hospital; he is not an electronics engineer and not a chip
designer and not an inventor of the patented device and not a lawyer.

[In passing, the Court of Appeals for the Federal Circuit recently changed its website. This rendered some previous links


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