Federal Circuit Clarifies Requirements for Prior Invention Invalidity Challenges

Practical Law Legal Update 1-521-0912 (Approx. 4 pages)

Federal Circuit Clarifies Requirements for Prior Invention Invalidity Challenges

by PLC Intellectual Property & Technology

Key Litigated Issue

The key litigated issue in Amkor Technology, Inc. v. International Trade Commission was whether Amkor's patent was invalid under Section 102(g)(2) of the Patent Act.

Background

In December 2003, Amkor Technology, Inc. initiated a Section 337 investigation in the International Trade Commission (ITC) alleging that Carsem (M) Sdn Bhd, Carsem Semiconductor Sdn Bhd and Carsem, Inc. (collectively Carsem) violated Section 337 of the Tariff Act of 1930 by importing and selling within the US, after importation, certain encapsulated integrated circuit devices that infringed certain claims of Amkor's Patent No. 6,433,277 ('277 Patent).

Key to the issue on appeal, Carsem argued that Amkor's patent was invalid under Section 102(g)(2) based on a prior invention described in another US patent owned by ASAT, Inc. and other third parties (collectively ASAT).

In a first Supplemental Initial Determination (ID), the administrative law judge (ALJ) found that Amkor's patent was not invalid on the basis that:

The co-inventor of the ASAT invention conceived of the ASAT invention in a foreign country sometime during April or May.
Amkor's '277 Patent technology was conceived of sometime during May through August, or on December 10, of that same year.
The ASAT invention was not prior art under Section 102(g)(2) because Carsem failed to prove by clear and convincing evidence that the ASAT's April or May invention date is earlier than Amkor's May through August date of invention.

However, the Commission reversed the ALJ's determination, finding the ASAT invention an invalidating prior invention under Section 102(g)(2). It relied on the Federal Circuit's decision in Oka v. Youssefyeh, involving an interference proceeding, to determine that the earliest possible priority date of invention for Amkor's patent must be December 10, the last date in the range of possible dates, which fell after the April or May date of invention for ASAT's invention. On remand, the ALJ issued a second supplemental ID consistent with the Commission's ruling. Amkor appealed to the Federal Circuit.

Outcome

In its August 22, 2012 decision, the Federal Circuit reversed the Commission's ruling that Amkor's patent was invalid under Section 102(g)(2) and remanded to the ITC for further proceedings. On appeal, Amkor argued that Carsem provided insufficient evidence that ASAT's inventor's domestic disclosure was before the critical date. The court clarified disclosure requirements for prior invention invalidity challenges (see Disclosure Requirements for Prior Invalidity Challenges) but did not rule on this ground. Instead, it held that the Commission erred in its priority date determination (see Commission's Error Applying Oka).

Disclosure Requirements For Prior Invention Invalidity Challenges

The Federal Circuit's decision clarified the requirements for disclosures of foreign made inventions for purposes of the "made in this country" requirement of Section 102(g)(2). Although not disputed by the parties, the Federal Circuit confirmed its holding in Scott v. Koyama, that an inventor of a foreign invention may rely on the date that the invention was disclosed in the US as a conception date for priority purposes, was still good law despite amendments to Section 102(g) under the American Inventors Protection Act of 1999.

The Federal Circuit also found that there is no requirement for disclosures to be made in writing as argued by Amkor. Whether written or oral, the content of the domestic disclosure must be enough to encompass the complete and operative invention.

Commission's Error in Applying Oka to Validity Dispute

The Federal Circuit determined that the Commission erred by relying on Oka to determine the date of Amkor's invention.

Carsem could only show a range of dates for the ASAT invention (April through May), only the first 30 days of which pre-dated Amkor's possible conception date (May through August). The last 31 days overlapped with Amkor's possible conception date. The court found that while this evidence could show that the ASAT inventor might have conceived of the invention first, it was not sufficient to meet the clear and convincing evidence burden necessary to invalidate Amkor's patent.

The court noted that unlike Oka, this was not an interference proceeding and standards that apply to interferences do not necessarily apply to validity disputes. Instead, an issued patent has a presumption of validity under Section 282 of the Patent Act that can only be overcome with clear and convincing evidence.

Practical Implications

The Federal Circuit's decision in this case clarified that:

The inventor of a foreign invention may rely on the date that the invention was disclosed in the US as a conception date for priority purposes.
The disclosure does not need to be in writing.
The Oka rule, where the court gives the last possible conception date to a party who can only provide a range of dates to determine date of invention, cannot be extended to validity contests because patents are presumed valid and invalidity must be proven by clear and convincing evidence.

Although oral disclosure of an invention in the US may be a basis to prove invalidity under Section 102(g)(2), the Federal Circuit is not making it any easier for a patent challenger to invalidate a patent on prior invention grounds. The patent challenger still must provide specific evidence that meets the clear and convincing standard to prevail in a validity contest.

Federal Circuit Clarifies Requirements for Prior Invention Invalidity Challenges | Practical Law