Chief Judge Stark grants leave to amend with inequitable conduct defense

In Graphics Properties Holdings, Inc. v. Google, Inc., C.A. No. 12-1394-LPS; v. Lenovo Holdings Company, Inc., et al., C.A. No. 12-1397-LPS (D. Del. Nov. 20, 2014), Chief Judge Leonard P. Stark granted the defendants’ motion for leave to amend their answer to add an inequitable conduct defense, finding that the proposed amendment was not futile.  Id. at 2.

Defendants alleged that plaintiff withheld a Federal Circuit order during prosecution, which affirmed a construction of a term of a patent to which the patent-in-suit was a continuation.  Id. at 2-3.  Defendants further alleged that, had the PTO been aware of this order, it would not have permitted issuance of the patent-in-suit due to lack of written description or because this patent could not claim priority to the previously issued patent.  Id. at 3.  The Court concluded that the amendment was not futile.  While plaintiff had disclosed the District Court’s order regarding this term, and “[w]hile Plaintiff contends this alleged non-disclosure is not material, as the Federal Circuit Order is merely cumulative of the District Court Order, Defendants have articulated a plausible theory to the contrary.  The Amended Answer alleges that the Federal Circuit Order is material because it contained adverse statements not contained in the District Court Order” regarding what the patent’s specification did not cover.  Id. at 4.

Although the Court granted defendants’ motion, it declined to apply a recent decision on which defendants had relied.  Defendants argued that the Court’s recent decision in Masimo Corp. v. Philips Electronic North America Corp. stood for the proposition that an intentional failure to disclose a claim construction ruling inconsistent with the applicant’s position was indicative of inequitable conduct.  The Court declined to extend the holding of this case beyond the “particular circumstances” present there, but also found it “unnecessary to resolve the parties’ dispute as to just how much Masimo helps Defendants here.”  Id. at 5.

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