Court again finds that Exergen, and not Therasense, provides standard for pleading inequitable conduct.

The Court recently denied, without prejudice, a defendant’s motion for leave to file an amended answer, and in the process addressed the appropriate standard for pleading inequitable conduct in light of the Federal Circuit’s opinion in Therasense, Inc. v. Becton, Dickinson and Co., 649 F.3d 1276 (Fed. Cir. 2011). Bayer Cropscience AG v. Dow Agrosciences LLC, C.A. No. 10-1045 (RMB/JS) (D. Del. Apr. 12, 2012). In Bayer Cropscience, the defendant sought to amend its answer to add an inequitable conduct counterclaim and related affirmative defense. The plaintiff opposed the proposed amendment, arguing that the amendment was futile because it failed to allege facts upon which the “single most reasonable inference” to draw was that the inventor specifically intended to deceive the PTO. Id. at 9-10. The Court, citing then-Magistrate Judge Burke’s recent report and recommendation in Wyeth Holdings Corp. v. Sandoz, Inc., C.A. No. 09-955-LPS-CJB (D. Del. Feb. 3, 2012) (adopted by Judge Stark on March 1, 2012), explained that Therasense “discussed the evidentiary standard to be used at trial … [and] did not evaluate the sufficiency of the parties’ pleadings.” Id. at 10. Accordingly, the Court explained that the appropriate standard was not the “single most reasonable inference” standard articulated in Therasense, but instead was whether, under Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312 (Fed. Cir. 2009), the defendant “pled sufficient facts from which a reasonable inference can be drawn that material information was not given to the PTO because [the plaintiff] specifically intended to deceive the PTO.” Id. at 10-11.

The Court found that it could not reasonably infer from the facts alleged in the proposed amended answer “that [the inventor] had a specific intent to deceive the PTO simply because he did not reveal one aspect of the results published in his 1995 article.” The Court added, “[t]his is especially true since [the defendant] does not allege that [the inventor] had any role or involvement in the prosecution of the ‘401 patent … [or that the inventor] had a direct personal stake in the outcome of the prosecution.” Id. at 11-12. Further, the defendant’s argument that the inventor specifically intended to deceive the PTO was “at odds with the objective fact that [the inventor] published the allegedly incriminating information…” in a paper while the ‘401 patent was being prosecuted: “The Court agrees with [the plaintiff’s] argument that ‘[the defendant] offers no reasonable explanation for why [the inventor] would tell the whole world in a later publication something he didn’t want the PTO to know.’” Id. at 12.

Although the Court found Exergen, and not Therasense, to be the appropriate pleading standard for inequitable conduct, it explained that Therasense was nevertheless relevant because it rejected the former “sliding scale” analysis under which intent could be inferred based upon a showing that material information was withheld, or under which withheld information could be inferred to be material where an intent to deceive was sufficiently alleged. Id. at 7, 12-13 (citing Therasense, 649 F.3d at 1290-91).

Bayer Cropscience AG v. Dow Agrosciences LLC, C.A. No. 10-1045 (RMB/JS) (D. Del. Apr. 12, 2012).

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