Duty to Disclose References, Grounds of Rejection, and Allowance of Related Subject Matter Applications

Much fuss is currently being made about the USPTO's new rules that will require applicants to identify commonly-owned applications with a common inventor that are filed within two months of each other. However, those requirements are only the tip of the iceburg when it comes to disclosure requirements for applications having related subject matter.

For example, in McKesson Information Solutions v. Bridge Medical (May 18, 2007), the Federal Circuit held all claims in a patent to be unenforceable for inequitable conduct where three items of information were not disclosed. Two of those items invloved information from a related subject matter application that was not part of the same patent family.

The first item at issue in the case was a prior art patent, cited by another Examiner in a related subject matter but non-family application, where the reference appeared to contradict the applicant's arguments in favor of patentability. The applicant notified the examiner about the application, but the references cited in the other application were not disclosed.

The Court rejected counsel's reliance on Federal Circuit precedent - specifically, Akron Polymer Container Corp. v. Exxel Container, Inc. (Fed. Cir. 1998) - that disclosure of the existence of the application being examined by the other Examiner was sufficient to discharge counsel's Rule 56 duty of disclosure:

We agree with McKesson's assertion that Akron Polymer earns it some credit for
the fact that Schumann did disclose the co-pendency of the '149 application to
Examiner Trafton in the assessment of the overall inferences to be drawn from
all the facts in the case. The district court did in fact credit McKesson with "some evidence of a lack of intent to deceive under Akron Polymer." Findings and conclusions, slip op. at 44; see also id., slip op. at 48 (giving Schumann
credit for disclosing the co-pendency of the application that issued as the '372
patent). But the district court weighed all the evidence, as discussed above in
this opinion, and held that the favorable inference drawn from disclosure of the
second application "does not overcome the inference of an intent to deceive
established by the [other] facts." Id., slip op. at 44.

The attorney also did not inform the Examiner about the grounds of rejection of "substantially-similar" claims in the related subject matter, nonfamily application before the other Examiner:

Under Dayco, that [materiality] standard is satisfied in the rejected-claims setting if the rejected claims are substantially similar to the claims at issue. 329 F.3d at 1368. In other words, a showing of substantial similarity is sufficient to prove materiality. It does not necessarily follow, however, that a showing of substantial similarity is necessary to prove materiality. Indeed, in the same way that prior art need not be substantially similar in order to be material (e.g., the telephone system of Baker, though not substantially similar to the '716 claims, is nevertheless material), rejected claims in a co-pending application also need not be substantially similar in order to be material. Therefore, to the extent there is a difference among "in some respects identical," "substantially similar," and substantial similarity "in content and scope," that difference is inconsequential so long as the evidence clearly and convincingly proves materiality in one of the accepted ways. See Digital Control, 437 F.3d at 1316. Here, the district court found under the accepted "reasonable examiner" standard that Examiner Lev's rejection of certain '149 claims was in fact material to the prosecution of the '278 application before Examiner Trafton. Our role on appeal is to determine whether that finding is clearly erroneous.

The third and final item of undisclosed material information was the allowance of the CIP application by the same Examiner that "gives rise to a conceivable double patenting rejection:"

Another perceived error pointed to by McKesson is the district court's alleged failure to consider the fact that Examiner Trafton was the examiner who allowed the '372 claims, and that he did so within a few months of allowing the '716
claims. It is unclear whether McKesson is arguing that this alleged failure
undermines the district court's finding of materiality or its finding of intent.
Compare Appellant's Br. at 48 (materiality), with Appellant's Reply Br. at 30-31
(intent). If this argument goes to materiality, it must fail because, as stated
above, the allowance of the '372 claims is material. The most McKesson can argue is that the allowance is cumulative by virtue of the fact that Examiner Trafton, as the '278 examiner, probably remembered allowing the '372 claims and then realized the materiality of such allowance to the '278 application claims. However, because the record is devoid of any evidence in this regard, we cannot conclude that the allowance is cumulative. J.P. Stevens & Co. v. Lex Tex, Ltd., 747 F.2d 1553, 1564 (Fed. Cir. 1984) ("[T]he district court did not find actual knowledge by the primary examiner—it merely noted possibilities and, where inequitable conduct is at issue, mere possibilities are insufficient.") (emphasis in original). Moreover, the MPEP at the time explained that a prosecuting attorney should not "assume that [a PTO examiner] retains details of every pending file in his mind when he is reviewing a particular application," MPEP § 2001.06(b) (5th ed. rev. 3, 1986) (quoting Armour & Co. v. Swift & Co., 466 F.2d 767, 779 (7th Cir. 1972)), and PTO regulations required all disclosures to be in writing, 37 C.F.R. § 1.2; see also MPEP § 2002.02 (5th ed. rev. 3, 1986). Schumann thus was not entitled to assume that Examiner Trafton would recall his decision to grant the claims of the '372 patent when he was examining the '278 application in the absence of a written disclosure to that effect. If, on the other hand, McKesson makes this argument to undermine intent, the argument fails as a factual matter because Schumann specifically testified that he did not consider the identity of the examiner in deciding whether to disclose information about co-pending applications.

As noted by Kevin E. Noonan of Patent Docs,

The real mischief arises in the Federal Circuit's affirmance of the principle that not only the existence but the course of prosecution of related applications should be disclosed to Examiners during prosecution. The institution of the Patent Application Information Retrieval (PAIR) system makes it easier in practice to make note of developments in related cases. However, the Federal Circuit's decision is properly understood to impose the additional requirement that an applicant (or her counsel) take affirmative steps to bring such parallel prosecution to the attention of each examiner in related applications. Even more burdensome is the requirement that an applicant remind an examiner of actions taken by that same examiner in related applications, with the concomitant proscription against assuming that the Examiner is aware of the relationships between the applications, even when said relationships have been explicitly made on the record. This kind of handholding by applicants of Examiners appears unrealistic and unnecessary, in view of the supposed presumption that an Examiner has done his or her job properly. Announcing a new requirement that applicants take affirmative steps to ensure that Examiners are aware of their actions is incompatible with this presumption.

Although the views of only one panel (and a divided one at that), this case should increase the patent bar's apprehension regarding the Federal Circuit's grasp of its role in bringing consistency to U.S. patent law, and its capacity to come to an agreement not only within particular panels but with its own precedent. The inconsistency illustrated in the McKesson case can do nothing but make even more uncertain the value of U.S. patents, a result diametrically opposed to Congressional intent in establishing the Federal Circuit.