Amicus Curiae Brief — Aktiebolag v. First Quality Baby Prods., LLC, 136 S. Ct. 1824 (2016) (No. 15-927)

No. 15-927

In the

Supreme Court of the United States

SCA HYGIENE PRODUCTS AKTIEBOLAG

AND SCA PERSONAL CARE, INC.,

Petitioners,

Vv.

FIRST QUALITY BABY PRODUCTS, LLC,

FIRST QUALITY HYGIENE, INC.,

FIRST QUALITY PRODUCTS, INC., AND

FIRST QUALITY RETAIL SERVICES, LLC,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals for the Federal Circuit

BRIEF OF AMICUS CURIAE THE TORO COMPANY

IN SUPPORT OF PETITIONERS

J. Derek Vandenburgh

Counsel of Record

Joseph W. Winkels

Alexander S. Rinn

CARLSON, CASPERS, VANDENBURGH,

LINDQUIST & SCHUMAN, P.A.

225 South Sixth Street, Suite 4200

Minneapolis, MN 55402

(612) 436-9600

Attorneys for Amicus Curiae

The Toro Company

Dated: February 19, 2016

2016 —- Bachmes Legal Printing @ (612) 339-9518 @ 1-900-715-3582 @ Fax (612) 337-8053

————e— SS ee re i

Table of Contents

Page

I i eniscesndssnnscnnnescssceescsretdeisustonss lil

Interest of the Amicus Curiae .............................000000 1

Summary of the Argument ........................cccccccecceeeeeee l

TE iiics ieiiscenchennheiuldesantadieursinisileaincemasiactasiitananuiaiocntietadan 3

L. SECTION 286 IS CLEAR ON THE

TIMELINESS OF DAMAGES CLAIMS AND

THERE IS NO NEED TO LOOK FOR

FURTHER TIMELINESS LIMITATIONS IN

A. The Patent Statute is Clear and

Unambiguous on the Timeliness of

SO IID on cccccccoscccccsoseccoescensceoes 3

B. There is No Need to Look for Further

Timeliness Limitations in § 282............ 5

C. The Six Year Laches Presumption is

Incompatible with § 286 .........000..0000..... 8

Il. CONGRESS’ SILENCE ON LACHES DOES

NOT DEMONSTRATE ITS INTENT TO

CODIFY THE EQUITABLE DOCTRINE’S

APPLICATION TO PATENT DAMAGES ...... 9

Il.

IV

THE COURT'S PRECEDENT INSTRUCTS

THAT LITTLE IF ANY WEIGHT SHOULD

BE GIVEN TO FEDERICO’S

COMMENTARY IN INTERPRETING THE

. EEE a 12

THE MAJORITY’S POLICY CONCERNS

ARE NOT JUSTIFICATIONS FOR LACHES

AND/OR ARE ALREADY ACCOUNTED

a cscanooe 15

THIS CASE IS OF GREAT IMPORTANCE

TO THE PATENT COMMUNITY ................. 18

EEC ae ae a CE ar Od oS 19

Li

Table of Authorities

Cases Page

A. C. Aukerman Co. v. R. L. Chaides Constr. Co.,

960 F.2d 1020 (Fed. Cir. 1992) 02.00.0000. ..ccecceceeee. 7,8

Astoria Fed. Sav. & Loan Ass'n v Solimino,

BI II, I cavounscivacoincevneracceuscessnccessosccs 10

Bonito Boats v. Thunder Craft Boats,

I, SO I oo cccccecssengancocccncenevecesescesssoesees 16

Burns v. United States,

MD TTB: TE CIID ce cceccocccccccsccccccccccccccocscsccceee. 10, 11

C.R. Bard, Inc. v. M3 Sys.,

157 F.3d 1340 (Fed. Cir. 1998) .0000000000.occ cece. 7

Camuinetti v. United States,

BE UTE, SH GIII GD nccccecceccecoscocccosccccesccccccccesccccesecesss 3

Connecticut Nat’] Bank v. Germain,

503 U.S. 249 (1992) ooo occ 3,5

De Forest Radio Tel. Co. v. United States,

er Li Lt: : ea 6

Garcia v. United States,

A469 U.S. 70 (1984) ooo. cccceccccccceeeceeeeeeeees 5,13

1}

Gustafson v. Alloyd Co.,

513 U.S. 561 (1998) ...........................00.cccccceceseeseee. 13

La. Public Serv. Comm'n v. FCC.

476 U.S. 355 (1986) 20... occ cccccccccccccccececeeceeeeeeee 12

Lamie v. United States Tr.,

540 U.S. 526 (2004) oo... c cece ccccccceececccececcceeeeeee 5

Petrella v. Metro-Goldwyn-Mayer, Inc.,

134 S. Ct. 1962 (2014) ....................cccccccescessesseoees 9, 18

Potter v. United States,

155 U.S. 438 (1894) 2000. cccccccocccccccceceeceeeeeeee 5

Quern v. Mandley,

TE 1, | 13

SCA Hygiene Products v. First Quality Baby

Products, 807 F.3d 1311 (Fed. Cir. 2015)

SI iri. es ict stcaniab eitoclensitundacheeceseapeeeodacnind passim

Sullivan v. Finkelstein,

GS TE. GF CD wien cen cccccccccccoccocccccccscccccocccossenoes 13

Util. Air Regulatory Group v. EPA,

BI Te Ge, Te GO once cnccscescccesesccscscececsececcecess 11

Whitman v. Am. Trucking Ass'ns,

i Fk. | 12

1V

Zenith Elecs. Corp. v. PDI Commun. Sys.,

522 F.3d 1348 (Fed. Cir. 2008) ...........00..00...... ret eS 7

Statutes

TED 17

os siecietipckbbomeuaebinoblans 17

I ns aregsnesiiiomnasintitenglih 6

I ee vonicsncrccsvcnnnssecnnsdsessesecoenecennnesoanh 16

nia acisrnansicoinsncieennbeboutdonsais passim

I aie abeecnnidinanalli 6,7

ici coccensncnssapdnitenitnnetiiicindbcsamiiils passim

Rules

Supreme Court Rule 37.2(a) .................0.ccccccceceeeeeeeees l

IE GIS GI IE I cence ccncccccecccsccsscsccoesesseccscees 1

Other

P J. Federico, Commentary on the New

Patent Law Codification and Revision:

Hearings on H.R. 3760 before Subcomm.

No. 3 of the H. Comm. on the Judiciary,

82d Cong. 34-40, 101-10 (June 1951) .....0.00... 14

Interest of the Amicus Curiae’

Amicus Curiae The Toro Company (“Toro”)

respectfully files this brief pursuant to Supreme

Court Rule 37 in support of Petitioner. Toro files this

brief for two reasons: (1) to further address salient

statutory interpretation issues that have not been

fully developed in the Petition that are important for

the Court to consider; and (2) it, like other prominent

patent holders and manufacturing companies, has an

interest in making sure that the clear and

unambiguous language of the patent statute actually

does what it says. Toro’s interest is based in part on

the fact that it regularly has active patent litigation.

Toro’s interest is also based in part on the fact that

one of its subsidiaries is currently a plaintiff in

patent litigation where laches has been raised as a

defense.

Summary of the Argument

The Federal Circuit in SCA Hygiene Products

v. First Quality Baby Products, 807 F.3d 1311 (Fed.

Cir. 2015) (en banc) held by a 6-5 majority that laches

can bar legal relief in patent cases, despite

longstanding precedent of this Court that the

equitable defense of laches is unavailable when a

statutory limitations period exists. The majority's

holding was based on two flawed premises: (1) that a

! Amicus Curiae Toro timely notified counsel of record for all

parties of its intent to file this brief, and counsel of record for all

parties have consented to the filing of this brief. See Supreme

Court Rule 37.2(a). No party’s counsel authored this brief in

whole or in part. No party or person other than amicus curiae

contributed money to fund preparation or submission of this

brief. See Supreme Court Rule 37.6.

]

single line in the post hoc commentary of a non-

legislator (Federico's Commentary) demonstrates

Congress’ intent to codify laches in 35 U.S.C. § 282 of

the 1952 Patent Act; and (2) that through its silence

on the matter, Congress intended to codify lower

court precedent allegedly suggesting that the

equitable doctrine of laches could specifically bar

legal relief in patent cases. In addition to those

addressed by Petitioner, Amicus Curiae Toro

addresses the following errors.

First, the timeliness of damages claims in

patent cases is expressly and unambiguously

addressed in 35 U.S.C. § 286. There is no legitimate

basis to read-in laches to the subtext of § 282 because

that section has meaning without laches and reading

laches into § 282 would run afoul of the plain

language of that statutory section.

Second, because Congress clearly evinced its

intent on the timeliness of damages claims in § 286,

Congress’ silence on laches cannot indicate its intent

to codify allegedly clear lower court precedent

applying the defense to bar legal relief.

Third, a _ single statement in post hoc

commentary on the 1952 Patent Act written by a non-

legislator is not legislative history, and does not shed

light on what Congress thought it was voting for in

1952. The majority's reliance on _ Federico’s

Commentary to ascertain Congress’ intention

regurding laches is error.

Fourth, the policy concerns raised by the

majority in support of its holding either do not in fact

support its position when exposed to scrutiny, or

already are addressed by the timeliness provision of

§ 286.

This case is important to the patent

community The Court already has received two

petitions for writs of certiorari on the issue of laches

in the wake of SCA. The business and legal

community has an interest in knowing that the plain

language of the patent statute will do the work it

claims to do. The majoritys holding in SCA

undermines the predictability of the law

Argument

I. SECTION 286 IS CLEAR ON THE

TIMELINESS OF DAMAGES CLAIMS AND

THERE IS NO NEED TO LOOK FOR

FURTHER TIMELINESS LIMITATIONS IN

§ 282

A. The Patent Statute is Clear and

Unambiguous on the Timeliness of

Damages Claims

Courts “should always turn first to one,

cardinal canon [of construction] before all others”

when interpreting a statute. Connecticut Nat] Bank

v. Germain, 503 U.S. 249, 253 (1992). In particular,

courts are to “presume that a legislature says in a

statute what it means and means in a statute what it

says there. When the words of a statute are

unambiguous, then, this first canon is also the last:

judicial inquiry is complete.” Jd. at 253-54 (citations

and internal quotation marks omitted); see alsv

Caminetti v. United States, 242 U.S. 470, 485 (1917)

(“It is elementary that the meaning of a statute must,

in the first instance, be sought in the language in

which the act is framed, and if that is plain the

sole function of the courts is to enforce it according to

its terms.”).

The only section in the patent statute that

expressly addresses the effect of delay in bringing

suit is 35 U.S.C. § 286, which states in unambiguous

terms: “no recovery shall be had for any infringement

committed more than six years prior to the filing of

the complaint or counterclaim for infringement in the

action.” 35 U.S.C. § 286 (emphasis added). The

meaning of § 286 with respect to the effect of delay on

patent damages could not be more clear. As the en

banc Federal Circuit held: “By its terms, § 286 is a

damages limitation.” SCA, 807 F.3d at 1321. And

by its express terms, § 286 envisions that a patentee

may bring a suit “more than six years” after

infringement begins. 35 U.S.C. § 286. In that case,

pursuant to the statute, the patentee may only

recover damages for infringement occurring within

the six-year time period preceding commencement of

suit. See id.

In contrast to § 286, nothing on the face of

§ 282 suggests any limitations on the timeliness of

patent damages. Laches has never appeared in the

patent statute and the legislative history of the

patent act does not recognize case law on laches.

2 The Federal Circuit also concluded that “because patent

infringement is a continuous tort, there 1s no relevant functional

difference between a damages limitatiun and a statute of

limitations.” SCA, 807 F.3d at 1321. Thus, there is “no

substantive distinction material tu the Petre//a analysis

between § 286 and the copyright statute of limitations

considered in Petrella.” [d.

SCA, 807 F.3d at 1337 (Hughes, T., dissenting). And

as discussed below. laches does not even make logical

sense in § 282. In the context of such facial clarity,

judicial inquiry into the meaning of these statutory

sections should proceed no further. Connecticut Nat’

Bank, 503 U.S. at °53°54. If other sources of

meaning, such as iegislative history, are to be

consulted at all, “only the most extraordinary

showing of contrary intentions from those data would

justify a limitation on the plain meaning of the

statutory language.” Garcia v. United States, 469

U.S. 70, 75 (1984) (internal quotation marks omitted).

For the reasons discussed by the dissent in SCA, the

Petitioner, and here below, the majority's reliance on

congressional silence and on a one line, post-

enactment, statement by a non-legislator cannot

qualify as the “extraordinary showing of contrary

intent[)” that is required to limit the plain meaning of

statutory language.

B. There is No Need to Look for Further

Timeliness Limitations in § 282

The majority in SCA endeavored to find laches

implicitly present in § 282, despite the clear statutory

language of § 286, discussed above. SCA, 807 F.3d at

1321-23. Perhaps the only instance where this could

be appropriate would be if § 282 (or a subportion

thereof) would lack meaning without reading laches

into that section. See Potter v. United States, 155

U.S. 438, 446 (1894) (statutory language “cannot be

regarded as mere surplusage; it means something’);

cf Lamie v. United States Tr., 540 U.S. 526, 536

(2004) (when two ways exist to read a statute, one in

which a term is surplusage but the text is plain, and

the other in which a term is nonsurplusage but the

j

3 |

text is ambiguous, courts “should prefer the plain

meaning since that approach respects the words of

Congress”). Here, § 282 dues not require that laches

hide in its subtext in order for the section to have

meaning.

Though the majority does not specify where in

§ 282 it believes laches must reside, the only place

laches could possibly exist is in § 282(b)(1). SCA, 807

F.3d at 1335 (Hughes, T., dissenting). That section

states: “Defenses.—The following shall be defenses in

any action involving the validity or infringement of a

patent and uhall be pleaded: (1) Noninfringement,

absence of liability for infringement’ or

unenforceability.” 35 U.S.C. § 282(b)(1).

Section 282(b)(1) has meaning and is well-

understood in the law without needing to read-in

laches. The first defense listed, noninfringement,

clearly has meaning without reading-in laches: there

is no infringement, for example, if one did not make,

use, offer to sell, sell, or import any product or

process meeting all the limitations of a claim of a

patent. See 35 U.S.C. § 271(a).

The second half of § 282(b)(1) envisions two

situations in which there may be infringement, but

there is an inability to recover: “absence of liability

for infringement” and “unenforceability ” 35 U.S.C. §

282(b i). Like the “noninfringement” clause, it is

similarly unnecessary to read-in laches to ensure this

second clause has meaning. For example, regarding

“absence of liability for infringement,” one could

infringe the claims of a patent, but be given

permission to do so either by express or implied

lheense. Eig. De Forest Radio Tel. Co. v. United

6

States, 273 U.S. 236, 241-42 (1927) (a license, express

or implied, for a covered use of a patent is “a complete

defense against a suit for infringement”). With a

license, there would be infringement, but an absence

of liability. Similarly, “unenforceability” has meaning

without having to read-in laches. For example, a

patent can be unenforceable if there was inequitable

conduct at the patent office or in the instance of

patent misuse. Ey. Zenith Elecs. Corp. v. PDI

Commun. Sys., 522 F.3d 1348, 1367 (Fed. Cir. 2008)

(inequitable conduct); C.R. Bard, Inc. v. M3 Sys., 157

F.3d 1340, 1372 (Fed. Cir. 1998) (patent misuse).

Laches is unnecessary to give this clause meaning.

Not only is it unnecessary, reading laches into

§ 282(b)(1) would also run counter to the plain

meaning of the statute. Laches clearly does not make

logical sense under the “noninfringement” provision

of §282(b)(1), because the typical case of laches

presumes infringement. See, e.g, A. C. Aukerman

Co. v. R. L. Chaides Constr. Co., 960 F.2d 1020, 1034

(Fed. Cir. 1992) (“The six years for laches begins with

a patentee’s knowledge of infringement and counts

forward.”). Laches also does not make logical sense

under the “absence of liability for infringement” or

“unenforceability” provisions, because even when

laches is found under existing law, a patentee

typically can recover for post-suit damages. SCA, 807

F.3d at 1333 (“Whereas estoppel bars the entire suit,

laches does not. a patentee guilty of laches

typically does not surrender its right to an ongoing

royalty”). In other words, laches does not result in

an “absence of liability,” nor does it render the patent

“unenforceable.” Although damages may be limited

under the application of laches, damages are azot

absent, and the patent remains enforceable with

respect to post-suit damages and other equitable

relief, such as the grant of an injunction.

C. The Six Year Laches Presumption is

Incompatible with § 286

The six year laches presumption prescribed by

the Federal Circuit is also incompatible with § 286.

See Aukerman, 960 F.2d at 1037 (discussing the

laches presumption). The laches “clock” starts to run

when a patentee “knew or reasonably should have

known” of the alleged action being accused of

infringement. /d. at 1032. Thus, in the typical laches

scenario, it would be almost impossible to take full

advantage of the six year damages period expressly

allowed for by § 286 without raising a presumption of

laches. A patentee would have to file suit exactly six

years after a company begins making, selling, using

or importing a patented device (or process) to recover

six years of past damages. Obviously, there is

nothing wrong with filimg suit before the six year

mark. However, if a patentee filed suit six years and

one day after commencement of infringement, laches

would be presumed and the patentee may forfeit al!

past damages. It is a very strange thing for there to

be such a stark discontinuity in one’s ability to

recover for a continuous tort. See SCA, 807 F.3d at

1321 (“patent infringement is a continuous tort”).

The six year presumption makes it almost impossible

to realize the full scope of § 286—an illogical result.

There are, of course, instances where an

accused infringer’s activity is sufficiently hidden such

that it cannot be said that a patentee “should have

known” about such activity, but such instances of

secret infringement are by far the exception rather

than the rule. It is not reasonable to conclude that by

expressly allowing for six years of past damages in

§ 286, Congress only intended that this apply to

claims addressing secret or hidden infringement.

The patent statute is plain on its face

regarding the timeliness of patent damages claims,

there is no need to look for laches in § 282 to give the

section meaning, reading-in laches to § 282 is

inconsistent with the plain language of that section,

and the six year laches presumption is incompatible

with § 286. Nothing about the actual language of the

patent statute suggests that laches can bar claims for

legal relief.

II. CONGRESS’ SILENCE ON LACHES DOES

NOT DEMONSTRATE ITS INTENT TO

CODIFY THE EQUITABLE DOCTRINE’S

APPLICATION TO PATENT DAMAGES

The Court’s clear and longstanding precedent

instructs that, when Congress has chosen to codify a

limitations period, laches cannot bar claims for legal

relief. Pet’rs’ Cert. Br. at 22; see, e.g, Petrella v.

Metro-Goldwyn-Mayer, Inc., 134 S. Ct. 1962, 1973-74.

(2014). As discussed above, and as held by the

Federal Circuit, § 286 is such a limitations period in

the patent statute. SCA, 807 F.3d at 1321.

Nonetheless, the Federal Circuit found that in 1952

Congress must have codified case law indicating that

laches could preclude recovery of legal damages in

patent cases. /d. at 1326-29. The sole basis for such

a departure from this Court's precedent was

congressional! silence.

Q

The Federal Circuit relied heavily on the canon

of construction that “[w]hen a statute covers an issue

previously governed by the common law. we must

presume that Congress intended to retain the

substance of the common law.” /d. at 1324 (alteration

in original). The majority notes that this applies only

where “Congress has failed expressly or impliedly to

evince any intention on the issue” addressed by the

common law. /d. (quoting Astoria Fed. Sav. & Loan

Ass'n v. Solimino, 501 U.S. 104, 110 (1991)). But on

the timeliness of claims for past damages in patent

cases, Congress explicitly stated its intention—and

the Federal Circuit acknowledged this. /d. at 1321.

In light of the Court’s decision in Petrella, the

Federal Circuit in SCA recognized that “[iJn § 286,

Congress provided a six-year time period for recovery

of damages. § 286—a damages-barring time

provision—invokes Petre/la's logic at least as much

as, and perhaps more than, a statute of limitations.”

SCA, 807 F.3d at 1321. Thus, by the Federal

Circuit's own acknowledgement, Congress has

evinced its intention on the timeliness of damages

claims in patent suits. This alone should have

precluded the Federal Circuit from relying on the

canon of construction that permits the codification of

common law through Congressional silence. The

majority should have found no use in analyzing the

common law's application of laches to patent

damages—Congress had spoken on the issue of

timeliness via statute.

Moreover, while the Federal Circuit majority

based its holding on congressional silence, this Court

has cautioned that “not every silence is pregnant.”

Burns v. United States, 501 U.S. 129, 136 (1991).

10

In some cases, Congress intends silence

to rule out a particular statutory

application, while in others Congress’

silence signifies merely an expectation

that nothing more need be said An

inference drawn from congressional

silence certainly cannot be credited when

it is contrary to all other textual and

contextual evidence of congressional

intent.

Id. The inference from congressional silence in the

majority's opinion is contrary to both the text and

context of the patent statute.

First, as discussed above, the text of the patent

statute is clear on the timeliness of patent damages

claims. Section 286, the single clearest statement of

congressional intent on the timeliness of damages

claims, expressly limits past patent damages to six

years and says nothing about laches. 35 U.S.C. § 286.

Section 282 is facially silent on the issue. 35 U.S.C.

§ 282.

Second, even if some timeliness rule could be

read-in to the subtext of § 282, the clear limitations

period of § 286 would inform § 282. SCA, 807 F.3d at

1336 (Hughes, T., dissenting); see Util. Aur

Regulatory Group v. EPA, 134 S. Ct. 2427, 2441

(2014) (“[T]he words of a statute must be read in their

context and with a view to their place in the overall

statutory scheme.”). Otherwise, the sub-textual rule

of § 282 would conflict with the clear limitations

period in § 286. As correctly noted by the dissent,

“provisions of a statute should be read so as not to

11

create a conflict.” SCA, 807 F.3d at 1336 (Hughes, T..,

dissenting) (quoting La. Public Serv. Comm'n v. FCC.

476 U.S. 355, 370 (1986)).

Furthermore, the dissent rightly notes that the

House and Senate Reports from 1952 explain that the

language of § 282 was meant to be changed to state

defenses in more general terms, but the substance of

§ 282 was not to be materially changed. SCA, 807

F.3d at 1336 (Hughes, T., dissenting). The dissent

also rightly notes that no pre-1952 act suggests that

laches was meant to bar claims for legal relief. and

“nothing in the _ legislative history _ reflects

congressional recognition of any pre-1952 case law on

the subject of laches, let alone approval of such case

law as went beyond what the pre-1952 statutes

authorized on their face.” /d. at 1336-37. In light of

the actual legislative history reflecting an intent to

not materially change the substance of § 282, it does

not make sense to take Congress’ silence on laches as

indicative of its intent to codify it in the subtext of

§ 282.

Congress’ silence cannot be so powerful to

override this Court’s longstanding precedent and the

text and context of the 1952 patent statute: Congress

does not “hide elephants in mouseholes.” Whitman v.

Am. Trucking Ass’ns, 531 U.S. 457, 468 (2001).

Ill. THE COURTS PRECEDENT INSTRUCTS

THAT LITTLE IF ANY WEIGHT SHOULD

BE GIVEN TO FEDERICO’S COMMENTARY

IN INTERPRETING THE PATENT STATUTE

Petitioner correctly states that “the Federal

Circuit relied heavily on a few words in the 1954

12

Federico Commentary” to support its holding that

laches can bar legal damages in patent cases. Pet’rs’

Cert. Br. at 21. The words of Federico’s Commentary

clearly are not the words of the patent statute, nor

are they even legislative history. They are the post

hoc commentary of a non-legislator.

After-the-fact statements by commentators

“are not a reliable indicator of what Congress

intended when it passed the law, assuming

extratextual sources are to any extent reliable for this

purpose.” Gustafson v. Alloyd Co., 513 U.S. 561, 579

(1995). Indeed, even “post hoc observations by a

single member of Congress carry little if any weight.”

Quern v. Mandley, 436 U.S. 725, 736 n.10 (1978); c.f

Garcia, 469 U.S. at 76 (explaining that committee

reports are the most authoritative legislative history,

and eschewing casual statements of a single member

of Congress). The relevance of legislative history to

the interpretation of a statute, to the extent it has

any, is to elucidate what members of Congress

believed they were voting for. Gustafson, 513 U.S. at

579; Sullivan v. Finkelstein, 496 U.S. 617, 631 (1990)

(Sealia, J., concurring in part).

By this standard, Federicos Commentary

cannot be considered legislative history, and should

be given little if any weight in interpreting the 1952

Patent Act. Mr. Federico was never a member of

Congress, and his Commentary was not published

until after the 1952 Patent Act was enacted. See

Pet’rs’ Cert. Br. at 21; P _ J. Federico, Commentary on

the New Patent Act, 35 U.S.C.A 1 (West 1954).

Federico's Commentary was not even available to

members of Congress while they debated the 1952

13

Patent Act. It cannot inform what members of

Congress believed they were voting on.

As the majority recognizes, Mr. Federico did

provide testimony before the House Committee on the

Judiciary in 1951 during the hearings on H.R. 3760—

an early draft of the 1952 Act. SCA, 807 F.3d at

1322-23; see Patent Law Codification and Revision.

Hearings on H.R. 3760 before Subcomm. No. 3 of the

H. Comm. on the Judiciary. 82d Cong. 34-40, 101 10

(June 1951) (statements of P.J. Federico, Examiner in

Chief, U.S. Patent Office) (hereinafter “Statements of

Federico”). Unlike his Commentary, this testimony

actually was available to members of Congress at the

time they voted on the 1952 Act and might shed light

on what members thought they were voting for.

However, Mr. Federico said nothing about laches

during this testimony. See Statements of Federico at

34-40, 101 10. He even addressed the very section of

the bill that turned into § 282, but he merely said

that the defenses listed therein were meant to be

stated more generally without “changing the

substance materially.” Jd. at 108.

Significantly, in other instances when the new

Patent Act was meant to codify law that until that

time had only existed as common law through the

courts, Mr. Federico explicitly said so in this

testimony to Congress. /d. at 38-39. For example,

regarding the non-obviousness requirement of § 103,

Mr Federico told the Committee: “Section 103 does

something attempted for the first time in our statute,

and that is to write down a condition which exists in

the law and has existed for well over 100 years, but

only by decisions of the courts.” Jd at 38. In this

actual legislative history of the 1952 Patent Act,

14

laches was not mentioned by Mr. Federico, nor did he

refer to any intent to codify common law relating to

laches.

Mr. Federico was undoubtedly influential in

drafting the 1952 Patent Act, but his post hoc

Commentary sheds no light on what members of

Congress actually thought they were voting for. At

best, his Commentary represents his own opinions

about what the law was meant to do—this is not

reflective of the intent of Congress. See Federicu

Commentary at “Authors Note” (“[I]Jt should be

understood that the paper contains some opinions

and views of the writer even though not always

labeled as such.”) In light of the plain text of the

statute, and especially in light of Mr. Federico’s

testimony to members of Congress during their

consideration of the bill, it is erroneous for the

majority to essentially base its holding in SCA on a

single statement in Federico’s post hoc Commentary.

IV THE MAJORITY’S POLICY CONCERNS ARE

NOT JUSTIFICATIONS FOR LACHES

AND/OR ARE ALREADY ACCOUNTED FOR

BY § 286

After studying Federico’s Commentary and the

congressional silence on laches, the majority in SCA

justified its holding that laches can bar legal relief

despite the damages limitation of § 286 based on

several policy considerations. As noted by the

dissent, it is the job of Congress to account for

competing policy concerns when crafting patent

legislation. SCA, 807 F.3d at 1342 (Hughes, T.,

dissenting). It is not the role of the Federal Circuit to

undermine Congress’ judgment, by shaping the law

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based on its own, current assessment of the policy

landscape. /d.; see Bonito Boats v. Thunder Craft

Boats, 489 U.S. 141, 143, 163-68 (1989) (questioning

the Federal Circuit's analysis that the policies behind

federal patent laws were not threatened by a state

law prohibiting direct molding for the duplication of

unpatented articles, noting that Congress should

make such determinations, and despite consideration

of similar bills, Congress had refused to enact such a

law).

In any event, each of the policy concerns raised

by the majority are either not really justifications for

laches, or they already are accounted for by the

damages limitation in § 286. First, the majority

notes that companies (such as in the medical device

industry) may spend large sums of money to develop

products and shepherd them through the regulatory

process only to have a patentee sue six years later

seeking the most profitable six years of revenues.

SCA, 807 F.3d at 1330. The theory here appears to

be that if the company were only told of its

infringement sooner, such damages could be avoided.

This example is an illogical justification for

laches. As an initial matter, in such an expensive

endeavor a company is likely to undertake a patent

clearance process. In any event, companies do not

regularly broadcast their research and development

efforts to the world. And § 271(e)(1) of the patent

statute states that it is not an act of infringement to

make, use, offer to sell, or sell a patented invention

solely for uses reasonably related to obtaining

necessary regulatory approval. 35 U.S.C. § 271(e)(1).

By the time a medical device company. for example,

brings a product to market that might actually

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constitute patent infringement, the company already

has invested large sums of money—suing within six

years of the product’s introduction to market does not

change that fact.

Second, the Federal Circuit alludes to the large

volume of suits brought by non-practicing entities,

noting that “it is often impractical for companies to

determine which claims have merit.” SCA, 807 F.3d

at 1330. This concern is simply irrelevant to laches.

Laches addresses the timeliness of claims, not their

merits.

Third, the majority is simply wrong when it

claims that “[ilndependent invention is no defense in

patent law, so without laches, innovators have no

safeguards against tardy claims.” /d Innovators

have § 286, which limits the extent to which a

patentee can recover for claims filed more than six

years after infringement began. Additionally.

independent invention can act as a defense to the

extent such acts qualify as invalidating prior art

under 35 U.S.C. § 102(a).5

Finally, the majority notes that amici in the en

banc case “overwhelmingly supportled] retaining

laches in patent law.” SCA, 807 F.3d at 1340. It is

true that more amici supported retaining laches than

not, but many of those amici were companies who are

regular patent infringement defendants. It is not

3 Prior to the enactment of the American invents Act (AIA) in

2011, 35 U.S.C. § 102(g) also allowed for independent invention

to serve as a defense. The concept codified in prior § 102(g) has

limited relevance under the AIA's first-to-file rule, but it was

present in the 1952 Act and existed for more than sixty years

until the enactment of the AIA.

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surprising that such companies would support a

measure that could absolve them of some liability.

Notably, however, two prominent amici with a much

more disinterested view based simply on a reading of

the law (the American Intellectual Property Law

Association and a group of prominent patent law

professors), argued that laches should not be found to

bar claims for legal relief in light of Petrella. See

Brief for Am. Intellectual Property Law Assoc. as

Amicus Curiae Supporting Neither Party, SCA

Hygiene Prods v. First Quality Baby Prods., 807 F.3d

1311 (Fed. Cir. 2015) (No. 2013-1564); Brief for Law

Professors as Amici Curiae Supporting Appellants,

SCA Hygiene Prods v. First Quality Baby Prods., 807

F.3d 1311 (Fed. Cir. 2015) (No. 2013-1564).

Vv THIS CASE IS OF GREAT IMPORTANCE TO

THE PATENT COMMUNITY

The Federal] Circuit sitting en banc decided the

SCA case by the narrowest of margins: 6-5. There

was sharp disagreement between the majority and

the dissent. Though the Federal Circuit has spoken

on the applicability of laches to bar legal relief, many

in the broader patent community still seek clarity in

light of the Court’s ruling in FPetrel/a. Notably, the

Court already has received two petitions for writs of

certiorari, challenging findings of laches in light of

Petrella. Pet’'rs’ Cert. Br.; Petition for Writ of

Certiorari, Medinol Ltd. v. Cordis Corp., No. 15-998

(2016). The regularity with which laches is claimed

as a defense in patent cases suggests that that Court

should expect many more similar petitions.

Finally, the broader patent community has two

additional general interests in the Court hearing this

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case. First, the patent community has an interest in

knowing that the plain language of the patent statute

will do the work it claims to do. In other words, they

have an interest in the predictability of the patent

law The Federal Circuit’s holding in SCA

undermines the predictability of the law

Second, the broader patent community has an

interest in making sure that the patent law remains

as uniform as possible with the broader civil, common

law This Court routinely warns against patent

exceptionalism in the civil law for good reason. When

the patent laws reflect the tried-and-true principles

of the broader civil law, innovators and business

decision makers have more trust in the usefulness

and validity of the patent system, and both parties

and legal practitioners can rely on predictability in

the law

Conclusion

For all these reasons, the Court should grant

SCA’s petition for a writ of certiorari, and reverse the

Federal Circuit's en banc decision.

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Respectfully submitted,

J. Derek Vandenburgh

(Counsel of Record)

Joseph W Winkels

Alexander S. Rinn

CARLSON, CASPERS, VANDENBURGH,

LINDQUIST & SCHUMAN, P.A.

225 South Sixth Street, Suite 4200

Minneapolis, MN 55402

Tel: 612-436-9600

Fax: 612-436-9605

E-mail:

dvandenburgh@carlsoncaspers.com

Counsel for Amicus Curiae

The Toro Company

Dated: February 19, 2016

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