June.10.2011
The Supreme Court announced on Thursday its long-awaited opinion in Microsoft Corp. v. i4i Ltd. Partnership, No. 10-290 (U.S. June 9, 2011). The High Court unanimously re-affirmed that the standard (or "burden of persuasion") for all invalidity challenges is one of "clear and convincing" evidence, regardless of whether or not the relevant evidence has previously been considered by the United States Patent & Trademark Office ("USPTO").
Under 35 U.S.C. § 282 all issued patents are "presumed valid." Appealing a jury verdict of more than $250 million, Microsoft challenged the strength of this statutory presumption arguing that a "preponderance of the evidence" should suffice to hold a claim invalid, at least where the evidence used to attack the patent has not been considered by the USPTO during the patent's prosecution.
The Supreme Court rejected Microsoft's argument, stating: "We consider whether §282 requires an invalidity defense to be proved by clear and convincing evidence. We hold that it does." In reaching this conclusion, the Supreme Court relied heavily upon its 1934 opinion in Radio Corp. of America v, Radio Engineering Laboratories, Inc. ("RCA") that required "clear and cogent evidence" to overturn an issued patent. The High Court concluded that Congress intended to codify the common law holding of RCA when it enacted the Patent Act in 1952.
Nonetheless, the Supreme Court acknowledged that "new evidence" of invalidity likely carries more weight than evidence that has been previously considered and rejected by the USPTO. The Court clarified that if the USPTO did not have all material facts before it, "its considered judgment may lose significant force." And, concomitantly, "the challenger's burden to persuade the jury of its invalidity defense by clear and convincing evidence may be easier to sustain." Accordingly, the Supreme Court indicated that a jury instruction on the effect of new evidence "can, and when requested, most often should be given."