Federal Circuit Applies Therasense Standard, Finding Inequitable Conduct in Apotex v. UCB

On August 15, 2014, the Federal Circuit in Apotex Inc. v. UCB, Inc., found that a patent applicant’s affirmative misrepresentations of material fact to a patent examiner constituted inequitable conduct.

To reach this decision the court employed a test established in Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir. 2011) (en banc). In Theranos, the court established that the traditional materiality prong of the test for inequitable conduct needed to amount to “but for” materiality, i.e., that the patent would not have been granted if the Examiner had been aware of the undisclosed or misrepresented art or information.

On Friday, the Federal Circuit held that the district court’s findings of but-for-materiality and intent to deceive were not clearly erroneous, because the patent applicant had demonstrated an “overall pattern of misconduct.”

Dr. Charles Sherman, founder and chairman of Apotex and the primary subject of the dispute, admitted that he had transcribed details of various experiments in the past tense as if the experiments had occurred, yet admitted that the experiments were made up in his head.

In addition, Dr. Sherman made multiple misrepresentations to the PTO during prosecution of the ‘556 patent. Finally, Sherman purposely shielded an expert from relevant information to obtain a declaration that misinformed and led the Examiner to finally allow the claims.
Taken together, the court found that Sherman’s actions constituted an “overall pattern of misconduct,” and that Dr. Sherman had intentionally violated his duty of candor. Apotex argued that Dr. Sherman was merely advocating a particular interpretation of the prior art, and that the court therefore could not establish deceptive intent. In light of Sherman’s admissions, the Court was not persuaded, finding that his statements were factual in nature and contrary to the true information he had in his possession.

In light of Apotex, applicants must make vigilant efforts to make sure the Examiner aware of all the information one has in his possession. Experiments must be corroborated by hard data, and every effort must be made to facilitate the Examiner’s objective analysis of the application and its supporting documents.