In its November 15, 2013 opinion in Ohio Willow Wood Co. v. Alps S., LLC, the US Court of Appeals for the Federal Circuit affirmed the district court's grant of summary judgment of invalidity of Ohio Willow Wood's (OWW) patent and reversed the district court's grant of summary judgment of no inequitable conduct. On the issue of invalidity, the Federal Circuit agreed with the district court that OWW was collaterally estopped from challenging the validity of the patent claims because another district court had found similar claims in a related patent invalid for obviousness.

On December 27, 2004, OWW sued Alps South, LLC (Alps) in the US District Court for the Southern District of Ohio for infringement of its US Patent No. 5,830,237 (the '237 patent). After claim construction, Alps filed the first of two ex parte reexaminations of the '237 patent and the district court stayed the litigation. While the case was stayed, OWW sued Thermo-Ply, Inc. (Thermo-Ply) in the US District Court for the Eastern District of Texas for infringement of its US Patent No. 7,291,182 (the '182 patent). The '182 patent issued from a continuation application of the '237 patent, and both patents are directed to gel-lined cushioning devices that go over the stump of an amputated limb to make prosthetic devices more comfortable. The Eastern District of Texas granted summary judgment of invalidity of the '182 patent, finding the claims invalid for obviousness.

The claims of the '237 and '182 patent use slightly different language to describe the invention. In particular, the '237 patent claims a "tube sock-shaped covering," an "amputation stump being a residual limb" and "fabric in the shape of a tube sock," but the '182 patent claims a "cushion liner for enclosing an amputation stump, said liner comprising a fabric covering having an open end for introduction of said stump and a closed end opposite said open end."

In the first reexamination of the '237 patent, the examiner rejected the claims as obvious over the Silosheath prior art, which is a sock-shaped piece of nylon fabric turned inside out and dipped in gel to make a coating on the interior of the sheath. OWW distinguished the '237 patent over the Silosheath by explaining that there was some gel that bled through to the exterior of the Silosheath. OWW amended the '237 patent claims to clarify that the gel coating was only on the inside.

In the second reexamination of the '237 patent, the examiner rejected the claims as obvious over the Single Socket Gel Liner (SSGL), which did not have any gel on the outside of the liner and was developed by the same person that developed the Silosheath, Mr. Jean-Paul Comtesse. The Board of Patent Appeals and Interferences (BPAI) reversed the examiner's rejection because it had relied on the uncorroborated deposition testimony of Mr. Comtesse.

After the New Jersey court lifted the stay, the court granted summary judgment of invalidity of the '237 patent based on the collateral estoppel effect of the obviousness determination on the '182 patent. The district court also granted summary judgment of no inequitable conduct.

On appeal, the Federal Circuit affirmed the district court's grant of summary judgment of invalidity of the '237 patent on the basis of collateral estoppel. Most notably, the Federal Circuit:

The Federal Circuit also affirmed the district court's grant of summary judgment of invalidity on other claims that were not subject to the collateral estoppel argument and reversed the grant of summary judgment of no inequitable conduct.

The Federal Circuit agreed with the district court's grant of summary judgment of invalidity based on the collateral estoppel effect of the litigation between OWW and Thermo-Ply. Specifically, the Federal Circuit agreed that OWW could not challenge the invalidity of claims 1, 2, 4, 15, 16 and 20 of the '237 patent because similar claims of the '182 patent had been found invalid as obvious.

The Federal Circuit held that collateral estoppel applies if the differences between the relevant claims do not materially alter the question of invalidity. In its application of collateral estoppel to the '237 patent, the Federal Circuit emphasized that:

The Federal Circuit also reversed the district court's grant of summary judgment of no inequitable conduct and remanded the case to the district court to determine whether OWW committed inequitable conduct during the two reexaminations of the '237 patent.

On the materiality prong, the Federal Circuit concluded that there was a genuine issue of material fact on whether:

For the intent prong, the Federal Circuit determined that there was a genuine issue of material fact, and remanded to the district court to decide whether OWW's attorney acted with deceptive intent during the reexaminations of the '237 patent.

The Federal Circuit's decision on the collateral estoppel issue may impact patent owners that assert related patents in different actions, even if there are differences in the claim language. The Federal Circuit's decision suggests that patent owners may not be able to rely on variations in claim language to overcome collateral estoppel challenges, but the decision leaves room for district courts to not apply collateral estoppel if they find that there are differences in the invalidity analyses. Patent owners should consider the scope of any differences in the claim language of related patents and, if faced with a collateral estoppel challenge, be prepared to explain how the invalidity analysis would change because of those differences.