Scarinci Hollenbeck, LLC, LLCScarinci Hollenbeck, LLC, LLC

Firm Insights

SCOTUS Eliminates Laches Defense in Patent Infringement Suits

Author: Scarinci Hollenbeck, LLC

Date: April 25, 2017

Key Contacts

Back

The U.S. Supreme Court held that the laches defense does not bar a claim for patent infringement

In SCA Hygiene Products v. First Quality Baby Products, the U.S. Supreme Court held that the equitable doctrine of “laches” does not bar a claim for patent infringement brought within the Patent Act’s six-year statutory limitations period.

SCOTUS Eliminates Laches Defense in Patent Infringement Suits
Photo courtesy of Stocksnap.io

Applying the Laches Defense to Intellectual Property Disputes

Laches is an equitable defense under which a legal right or claim will not be enforced if a significant delay in asserting the right or claim has prejudiced the opposing party. The rationale behind the doctrine is that sitting on your legal rights for an unreasonable amount of time may be unfair to the defendant. While laches is a frequently asserted affirmative defense, courts often decline to enforce it, particularly within the term of the applicable statute of limitations.

The Court’s recent decision involves the Patent Act’s six-year limit on past patent damages. In 2003, SCA Hygiene Products Aktiebolag and SCA Personal Care, Inc. (collectively, SCA), sent a letter notifying First Quality Baby Products that their adult incontinence products infringed an SCA patent. First Quality responded that its own patent antedated SCA’s patent and rendered it invalid. In 2004, SCA sought reexamination of its patent by the U.S. Patent and Trademark Office (USPTO) considering First Quality’s prior patent. Three years later, the Patent and Trademark Office confirmed the SCA patent’s validity. SCA sued First Quality for patent infringement in 2010. The District Court granted summary judgment to First Quality on the grounds of equitable estoppel and   laches.

In 2014, and while SCA’s appeal was pending, the Supreme Court held that the defense of laches cannot be used to shorten the three-year copyright limitations period set forth in 17 U.S.C. § 507(b). Writing for the Court in Petrella v. Metro-Goldwyn-Mayer, 134 S. Ct. 1962 (2014), Justice Ruth Bader Ginsburg explained that “[i]nviting individual judges to set a time limit other than the one Congress prescribed” would “tug against the uniformity Congress sought to achieve when it enacted § 507(b).”

Supreme Court Rejects Laches as a Defense to Patent Infringement Litigation

The Supreme Court adopted a similar approach in SCA Hygiene Products v. First Quality Baby Products. In fact, Justice Samuel Alito’s majority opinion expressly states: “Petrella’s reasoning easily fits the provision at issue here.”

By a vote of 7-1, the Court concluded that a laches defense is unavailable against a claim for damages brought within Patent Act’s six-year limitations period. “Laches is a gap-filling doctrine, and where there is a statute of limitations, there is no gap to fill,” Justice Alito wrote. Citing Petrella, Justice Alito further stated that “[a]statute of limitations reflects a congressional decision that timeliness is better judged by a hard and fast rule instead of a case-specific judicial determination.” He added: “Applying laches within a limitations period specified by Congress would give judges a ‘legislation-overriding’ role that exceeds the Judiciary’s power.”    

In concluding that laches did not apply, the Supreme Court also rejected the Federal Circuit’s reliance on certain lower court precedent. “In light of the general rule regarding the relationship between laches and statutes of limitations [in our cases], nothing less than a broad and unambiguous consensus of lower court decisions could support the inference that [the Patent Act] codified a very different patent-law-specific rule. No such consensus is to be found.”

Finally, the Supreme Court also continued its trend of refusing to apply legal principles to the Patent Statute at odds with the principles applied to other federal statutes:

Indeed, it would be exceedingly unusual, if not unprecedented, if Congress chose to include in the Patent Act both a statute of limitations for damages and a laches provision applicable to a damages claim. Neither the Federal Circuit, nor First Quality, nor any of First Quality’s amici has identified a single federal statute that provides such dual protection against untimely claims.

Impact on Patent Litigation

The Court’s decision removing laches as an available defense to patent infringement favors patentees seeking damages. While targets of such suits argue that taking laches off the table will encourage patent holders to wait for damages to accumulate over several years, it is important to highlight that this decision did not eliminate the defense of equitable estoppel. The equitable estoppel doctrine may still be a defense to patent infringement actions where the patent owner had induced the defendant to commit infringements by making misleading statements upon which the defendant has relied.

Do you have any questions? Would you like to discuss the matter further? If so, please contact me, David Einhorn, at 201-806-3364.

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Scarinci Hollenbeck, LLC, LLC

Related Posts

See all
Dissolving Your Business: Essential Legal Steps to Protect Your Interests post image

Dissolving Your Business: Essential Legal Steps to Protect Your Interests

If you’re considering closing your business, it’s crucial to understand that simply shutting your doors does not end your legal obligations. Unless you formally dissolve your business, it continues to exist in the eyes of the law—leaving you exposed to ongoing liabilities such as taxes, compliance violations, and potential lawsuits. Dissolving a business can seem […]

Author: Christopher D. Warren

Link to post with title - "Dissolving Your Business: Essential Legal Steps to Protect Your Interests"
The Role of Corporate Restructuring in Mergers & Acquisitions post image

The Role of Corporate Restructuring in Mergers & Acquisitions

Contrary to what many people think, corporate restructuring isn’t all doom and gloom. Revamping a company’s organizational structure, corporate hierarchy, or operations procedures can help keep your business competitive. This is particularly true during challenging times. Corporate restructuring plays a critical role in modern business strategy. It helps companies adapt quickly to market changes. Following […]

Author: Dan Brecher

Link to post with title - "The Role of Corporate Restructuring in Mergers & Acquisitions"
Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public post image

Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public

Cryptocurrency intimidates most people. The reason is straightforward. People fear what they do not understand. When confusion sets in, the common reaction is either to ignore the subject entirely or to mistrust it. For years, that is exactly how most of the public and even many in law enforcement treated cryptocurrency. However, such apprehension changed […]

Author: Bryce S. Robins

Link to post with title - "Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public"
Understanding Chattel Paper: A Key Component in Secured Transactions post image

Understanding Chattel Paper: A Key Component in Secured Transactions

Using chattel paper to obtain a security interest in personal property is a powerful tool. It can ensure lenders have a legal claim on collateral ranging from inventory to intellectual property. To reduce risk and protect your legal rights, businesses and lenders should understand the legal framework. This framework governs the creation, sale, and enforcement […]

Author: Dan Brecher

Link to post with title - "Understanding Chattel Paper: A Key Component in Secured Transactions"
Crypto Compliance: A Comprehensive Guide post image

Crypto Compliance: A Comprehensive Guide

For years, digital assets operated in a legal gray area, a frontier where innovation outpaced the reach of regulators and law enforcement. In this early “Wild West” phase of finance, crypto startups thrived under minimal oversight. That era, however, is coming to an end. The importance of crypto compliance has become paramount as cryptocurrency has […]

Author: Bryce S. Robins

Link to post with title - "Crypto Compliance: A Comprehensive Guide"
Supreme Court and Title VII: Implications for Reverse Discrimination post image

Supreme Court and Title VII: Implications for Reverse Discrimination

Earlier this month, the U.S. Supreme Court issued a decision in Ames v. Ohio Department of Youth Services vitiating the so-called “background circumstances” test required by half of federal circuit courts.1 The background circumstances test required majority group plaintiffs pleading discrimination under Title VII of the Civil Rights Act to meet a heightened pleading standard […]

Author: Matthew F. Mimnaugh

Link to post with title - "Supreme Court and Title VII: Implications for Reverse Discrimination"

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Sign up to get the latest from our attorneys!

Explore What Matters Most to You.

Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.

Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.

Let`s get in touch!

* The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!