The U.S. Court of Appeals for the Federal Circuit found that the filing of a terminal disclaimer in related patents does not bind the patents for purposes of unenforceability due to inequitable conduct. Pharmacia Corporation v. Par Pharmaceutical, Inc., Case No. 04-1478, (Fed. Cir. Aug. 10, 2005) (Rader, J.).
At trial, Par admitted infringement of two of Pharmacia’s patents, U.S. 5,422,368 and 5,296,504, and did not assert any invalidity defenses. Instead, Par asserted both patents were unenforceable due to inequitable conduct in one of the patents. During prosecution of the `368 patent and after the `504 patent had issued, Pharmacia filed a declaration in response to a rejection over a prior art disclosure of a genus of compounds that included Pharmacia’s claimed compound. The declaration included inaccurate statements the district court found highly material, which were also found to contradict the declarant’s own publication as well as two Japanese publications cited in the declarant’s publication. The district court found it significant that none of the contradictory publications had been brought to the U.S. Patent and Trademark Office’s (USPTO) attention. The district court found only the `368 patent to be unenforceable due to inequitable conduct. Because Par had admitted infringement of the `504 patent, the court entered judgment for Pharmacia on it and for Par on the `368 patent. Both parties appealed.
The issues on appeal were whether Pharmacia’s actions during prosecution of the `368 patent amounted to inequitable conduct and whether a finding of inequitable conduct in the `368 patent tainted its sibling, the `504 patent.
The Federal Circuit affirmed the finding of inequitable conduct in the `368 patent based on the conflict between the declarant’s statements in his declaration and his prior publication and supporting Japanese articles, which were never reported to the USPTO. The Federal Circuit then turned to the issue of whether the filing of a terminal disclaimer in the `504 patent bound the two patents so as to taint the `504 patent under an infectious unenforceability theory.
The Federal Circuit, noting the strong policies that dictated the creation of the doctrine of co-expiration and co-ownership of related patents, found that beyond their shared expiration date, two terminally disclaimed patents maintain their individuality and are still independently presumed valid. The Federal Circuit distinguished Kingsdown Med. Consultants, Ltd., where the occurrence of inequitable conduct in procuring some of the claims of a patent was held to render the entire patent unenforceable, noting Kingsdown applied only to claims in a single patent. The Court also distinguished Hewlett-Packard Co., where a reissue patent and all of the original claims were held unenforceable due to inequitable conduct that occurred during prosecution of the reissue application, pointing out that the original patent had been surrendered and only the reissue application remained.
The Federal Circuit found the linkage of patents through a terminal disclaimer does not extend inequitable conduct in one patent to another patent that was not also acquired through culpable conduct. The Court affirmed the district court’s finding that the `504 patent is enforceable and infringed by Par.
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