Petition for Writ of Certiorari — Brennan v. Abbott Laboratories

Supreme Court brief1992

Ask Donna

What actually matters in this document.

Text

In The

Supreme Court of the United States

October Term, 1991

JOHN F. BRENNAN,

Petitioner,

VS.

ABBOTT LABORATORIES, ANDREW J. MUETTERTIES

and JOSEPH N. GENESE,

Respondents.

Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Federal Circuit,

Or, Order Of Summary Reversal

PETITION FOR WRIT OF CERTIORARI

MicHette A. THomas (P35135)

Attorney for Petitioner

SULLIVAN, Warp, Bone, TYLER &

AsHER, P.C.

1000 Maccabees Center

25800 Northwestern Highway

Post Office Box 222

Southfield, MI 48037-0222

(313) 746-0700

COCKLE LAW BRIEF PRINTING CO, (800) 2256964

OR CALL COLLECT (402) 342-2831

QUESTIONS PRESENTED

Whether the Doctrine of Collateral Attack forecloses

a party receiving priority of invention following

interference proceedings before the United States

Patent and Trademark Office from bringing a subse-

quent state tort action for abuse of process as a

remedy for pecuniary and non-pecuniary damages

caused by the other party’s intentional and tortious

abuse, corruption and perversion of the procedures

and processes of the PTO during the course of the

interference proceedings for ulterior and collateral

motives unrelated to the valid and proper award of

priority of invention.

Whether the Doctrine of Federal Preemption fore-

closes, as encroaching upon a field of exclusively

federal interest, additional remedies provided under

traditional state common law for personal injuries

caused by the tortious perversion of legitimate fed-

eral patent proceedings for improper, ulterior and

collateral purposes.

TABLE OF CONTENTS

Page

QUESTIONS PRESS mir a. ss a0saeseeeeee trees i

TABLE OF AU TIGRE lee i o545 cesses iV

OPINIONS SELAAW «3.0%. 205 seeanee eee Peak a

JURISDIC THOM ; .. «scene eee nee eee een eee aees 2

CONSTITUTIONAL, STATUTORY AND REGULA-

TORY PROVISIONS IN VOIVEGR SE oss kasecascaacas 3

STATEMENT OF THE (AS iio us cee ess 3

REASONS FOR SUMMARY REVERSAL OR GRANT-

ING OF THE WRITE... c5550ces eee ee )

CONCLUSION |... \ss.s:05 ise eae 30

APPENDIX A, OPINION OF THE COURT OF

APPEAL FOR THE FEUGBRAL, GORGails ss sass ass A-]

APPENDIX B, ORDER OF THE COURT OF

APPEALS DENYING REHEARING.............. A-26

APPENDIX C, ORDER OF THE COURT OF

APPEALS DENYING A SUGGESTION FOR

REHEARING IN SAN ...2..4.555305 eae A-28

APPENDIX D, OPINION AND ORDER OF THE

COURT OF APPEALS FOR THE SIXTH CIR-

APPENDIX E, ORDER OF THE DISTRICT COURT

GRANTING PARTIAL REMITTITUR AND

RESTRICTING THE AWARD OF PRE-JUDG-

MENT INTERES! ...sie50503000ee eee gees A-33

APPENDIX F, JUDGMENT OF THE DISTRICT

COURT ON THE JURY Wemeermiedis cesses eeee A-35

ill

TABLE OF CONTENTS - Continued

Page

APPENDIX G, ORDER OF THE DISTRICT

COURT REMANDING THE MATTER TO THE

rat ae Ce SY cde ue kes pleat A -37

APPENDIX H, DECISION BY THE BOARD ON

a Tg ag elo A-39

APPENDIX I, DECISION OF THE COMMIS-

SIONER ON REMAND...... ee nhs CADE ORF Lr ae A-50

APPENDIX J, DECISION BY THE BOARD

SEEM GT ULOCOUEOE Vc ccvvvcccncvaccceveseesess A-90

APPENDIX K, CONSTITUTIONAL PROVISIONS

re ee nod re ee ee A-131

APPENDIX L, STATUTORY PROVISIONS

Te eee rn oe hel i ee od A-132

APPENDIX M, RULES OF PRACTICE IN PATENT

ee ON a ee ake es A-138

APPENDIX N, FORMER RULES OF PRACTICE

a iS A-144

APPENDIX O, LEGISLATIVE HISTORY .......... A-146

APPENDIX P, ADMINISTRATIVE NOTICES......A-151

TABLE OF AUTHORITIES

CASES

Allied Tube & Conduit Corp. v. Indian Head, Inc., 486

ee Se ROE oe Ga enh Capen ay coer yen eeee

American Guaranty Corp. v. United States, 401 F.2d

1004 (U.S. Ct. Cl. 1968)....0 0.0... e cece cece eee.

Aronson v. Quick Point Pencil Co., 440 U.S. 257

SRE Ais ne wateveeeauan ue feet oceee 17, 18, 25,

Astoria Fed. Sav. & Loan Ass'n v. Solimino, 111 S. Ct.

Ss era ce ats Ae eat

Baker Driveaway Co. v. Bankhead Enter., 478 F. Supp.

Mh Re sy) Sr re eee

Bill Johnson's Restaurants, Inc. v. N.L.R.B., 461 U.S.

Fe! Seg ane cad eae eee anaes i

Bonito Boats v. Thunder Craft Boats, 489 U.S. 141

UN Ss onan cereus eee Eee ee Rene eks

Bowen v. American Hosp. Ass'n, 476 U.S. 610 (1986)

LK ELARRE HES Ce EOL ea R OO ee aa eet ee 19,

California Motor Transp. Co. v. Trucking Unlimited,

PO Wh De HENGE osc cone t ene cceeeecanss 13,

California v. ARC America Corp., 490 U.S. 93 (1989)

See e GaN Snare eerie ee baler e earn a ie 19,

Callanan Road Improvement Co. v. United States, 345

SRS NE MEER Man SP LES Lae Cee te ee es ee

Diamond v. Chakrabarty, 447 U.S. 303 (1980)..........

Eastern R.R. President's Conference v. Noerr Motor

Freight, Inc., 365 U.S. 127 (1961) ........... 13,

English v. General Electric Co., 496 U.S. 72 (1990)

Pe re re ene ee we re ON PE ae ae ee 18,

Florida Lime and Avocado Growers, Inc. v. Paul, 373

Fak ee NS. 6c inca so ne Oo aa Seen 18,

Page

26,

24,

TABLE OF AUTHORITIES — Continued

Page

Friedman v. Dozorc, 412 Mich. 1, 312 N.W.2d 585

Tera mr nh 58 SO cent: 15

Gilbert v. Ben-Asher, 900 F.2d 1407 (9th Cir. 1990)

cork. demied, 42 US. 077 IG. he's 2 oa awe eases 8, 11

Goldstein v. California, 412 U.S. 546 (1973) ........ 17, 18

Goodyear Atomic Corp. v. Miller, 486 U.S. 174 (1988) .19, 25

Grant, et al. v. Raymond, 31 U.S. 218 (1832).......... 18

Interstate Natural Gas Co. v. Southern Cal. Gas Co.,

209 F.20 see COU CA, THs ss vas oes eka ines 12

Jones v. Rath Packing Co., 430 U.S. 519 (1977)..... 19, 24

Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470 (1974)

neu the oe wee es RG ea ON ee 17, 18, 25, 26, 29

Lewis v. Lho, 696 F. Supp. 723 (D. D.C. 1988)........ 11

Meehan v. Michigan Bell Tel. Co., 174 Mich. App.

$36, 436 N.W20 F711 (19) coi sc ea es 16

MGA, Inc. v. General Motors, Corp., 827 F.2d 729, 3

U.S.P.Q.2d 1762 (Fed. Cir. 1987), cert. denied, 484

US. TD i oni kcdas cnc sindusanoses sevens 12

Mitchell v. Cole, 176 Mich. App. 200, 439 N.W.2d

SAD CODD) ook ose ies eeties se eee 16

Neumann v. Vidall, 710 F.2d 856 (D.C. Cir. 1983)

od é al uuke ss ae\xa00d00 cube eek eee 8, 10, 11, 16

Otter Tail Power Co. v. United States, 410 U.S. 366

(TOTS 5 5 os kc cavnPeeees creer eee eee ee eee 13

Power Lift, Inc. v. Weatherford Nipple-Up Sys., 871

F.2d 1002 (Fed. (is. TRS)... ckas Ge eee ees 25

Precision Instruments Mfg. Co. v. Automotive Main-

tenance Mach. Co., 324 U.S. 806 (1945)............. a2

Rice v. Santa Fe Elevator Corp., 331 U.S. 218 (1947) .... 19

TABLE OF AUTHORITIES - Continued

Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225

{1968) |. co vicacantcdceiessaeee eee 18

Silkwood v. Kerr-McGee Corp., 464 U.S. 238 (1984)

Js ene bees eae es eet weale ean epee ee een 18, 19, 24

Sony Corp. v. Universal City Studios, Inc., 464 U.S.

ML? (POGS) as cvsnssacaehedceeenee eee 17, 18

Spear v. Pendill, 164 Mich. 620, 130 N.W. 343 (1911) .... 15

Three Lakes Ass’n v. Whiting, 75 Mich. App. 564,

on, Be Wee GOO CRE ii ics tack onkktase eee 15, 16

Trepel v. Pontiac Osteopathic Hosp., 135 Mich. App.

261, SOO NLW.2G SO COPE i ioc cdavaciecaeeuaes 16

United Mine Workers v. Pennington, 381 U.S. 657

(PPR) . ces cs chu be eee eo hu he's 0a ker ee ee oan 13

United States v. Bass, 404 U.S. 336 (1971)..... 19, 23, 24

Universal Gym Equip. v. ERWA Exercise Equip., 827

rag i362 (req. (le. S000). . iiaciscsin sane aoe 25

Vallance v. Brewbaker, 161 Mich App. 642, 411

N.W.2d 808 (1987), appeal denied, 430 Mich. 883

‘ty | rennet ln ESN Oe 15

Will v. Michigan Dept. of State Police, 491 U.S. 58

(1900)... os ae 19, 23, 24

CONSTITUTION, STATUTES, REGULATIONS AND RULES

2 USC. § 19504 cc eee 2

2 USC. § WN... 6

3 USC. 4.12... ee 6

28 U.S.C. § 1295(a(4)(C).. 0. cece cece cece cccceecee. 6

2 USC. 6 191.......4. 4

USC. § WE. 4

Vil

TABLE OF AUTHORITIES — Continued

Page

Bk a ot Seer rey rear se 4, 6

, Eis. ae eo err rrr rae eer ee rer rr re rere res re 6

RT ae RS i | SS en Irae wr Par X

Btn! i prem ree rr errr ree hres 4, 6

gat: 2k >) Sore ee rT errr rrr errr 3

SF OF Cer 5 bins coe ee whee a cee 22

SF UF ee Pe ces bv oe cee es esky Cae ee bee ee

BF Ci Oe Ba ds kee eS es ween kp ee ee ee

ok eS RR |, Sn oe ens aa a, 2h) oe oo

ee ee errr rr Terr. 21

> Fed. Rae. 3,760 (19048) «.. «occ cic ec cecie ree ay ae

SP FOG. Bere. GO BIG CIFOG) oe 5 wa ns ve vd -sceeseses 3, 23

Se ee eS OeGy Pee erm ren es rer cere or Tre 5

A a eS Co ere e erate pri weer yl 1

Ly Re BE. eo Ss ass 3, 5, 7, 13, 14, 16,

tA wo” ee oe. Ee eer err rr a YY

LT Re ay Ok Octet eae es Neha ees 3, 18

LEGISLATIVE MATERIALS

130 Cong. Rec. H10,525 (daily ed. Oct. 1, 1984),

reprinted in 1984 U.S. Code Cong. & Admin.

i PEP r re ee Tepe TIT rere a

S. Rep. No. 1979, 82d Cong., 2d Sess., reprinted in

1952 U.S. Code Cong. & Admin. News 2394... .3, 20

S. Rep. No. 2169, 87th Cong., 2d Sess., reprinted in

1962 U.S. Code Cong. & Admin. News 3286... .3, 20

Books

Prosser & Keeton, Torts (5th ed. 1984)............ a>,

In The

Supreme Court of the United States

October Term, 1991

JOHN F. BRENNAN,

Petitioner,

VS.

ABBOTT LABORATORIES, ANDREW J. MUETTERTIES

and JOSEPH N. GENESE,

Respondents.

Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Federal Circuit,

Or, Order Of Summary Reversal

PETITION FOR WRIT OF CERTIORARI

The Petitioner, John F. Brennan, respectfully requests

that a Writ of Certiorari issue to review the Judgment and

Opinion of the United States Court of Appeals for the

Federal Circuit entered on December 27, 1991, rehearing

denied on January 27, 1991, and Suggestion for Rehearing

In Banc denied on February 7, 1992. The questions pre-

sented raise purely legal and constitutional issues.

Because the Court of Appeal’s decision is so clearly erro-

neous, this case is also appropriate for summary reversal

pursuant to Rule 16.1 of the Rules of this Court.

OPINIONS BELOW

The Opinion of the Court of Appeals for the Federal

Circuit (Appendix A, pp. A-1-25) is reported at 952 F.2d

1346 (Fed. Cir. 1991). An Order Denying Rehearing

(Appendix B, pp. A-26-27) was not reported. An Order

Denying a Suggestion for Rehearing In Banc (Appendix

C, pp. A-28-29) is reported at 952 F.2d 1346 (Fed. Cir.

1991).

The Opinion and Order of the Court of Appeals for

the Sixth Circuit transferring this matter to the Court of

Appeals for the Federal Circuit (Appendix D, pp.

A-30-32) was not reported.

The Judgment on the jury verdict entered by the

District Court for the Eastern District of Michigan

(Appendix F, pp. A-35-36) was not reported. The Order

granting partial remittitur as to the jury awards for costs

and attorney fees and restricting an award of pre-judg-

ment interest entered by the District Court (Appendix E,

pp. A-33-34) was not reported.

The Order of the District Court remanding the matter

to the Patent and Trademark Office (Appendix G, pp.

A-37-38) was not reported.

The decision by the Board of Patent Appeals and

Interferences (“Board”) upon remand by the District

Court (Appendix H, pp. A-39-49) was not reported. The

decision by the Commissioner of Patents (“Commis-

sioner”) (Appendix I, pp. A-50-89) was not reported.

The decision by the Board awarding priority to Bren-

nan (Appendix J, pp. A-90-130) is reported at 230 U.S.P.Q.

145 (Bd. Pat. App. & Int. 1986), as corrected at 230 U.S.P.Q.

560 (Bd. Pat. App. & Int. 1986).

JURISDICTION

The Judgment of the Court of Appeals (App. A p.

A-1) was entered on December 27, 1991. An Order Deny-

ing Rehearing (App. B p. A-26) was entered on January

27, 1992. An Order Denying a Suggestion for In Banc

Review (App. C p. A-28) was entered on February 7, 1992.

The jurisdiction of this Court is invoked under 28 U.S.C.

§ 1254(1).

CONSTITUTIONAL, STATUTORY AND

REGULATORY PROVISIONS INVOLVED

This case involves the following Constitutional provi-

sions, statutes, regulations, legislative history and admin-

istrative notices: U.S. Const. art. I, § 8, cl. 8, art. VI, cl. 2,

amend. I; 35 U.S.C. §§ 1, 31, 101, 131-135, 146; 37 C.F.R.

§§ 1.56 & 1.616 and former 37 C.F.R. §§ 1.257(a), 1.259,

1.287(d)(2); S. Rep. No. 1979, 82d Cong., 2d Sess.,

reprinted in 1952 U.S. Code Cong. & Admin. News 2394, ~

Rep. No. 2169, 87th Cong., 2d Sess., reprinted in 1962 U.S.

Code Cong. & Admin. News 3286, 130 Cong. Rec.

H10,525 (daily ed. Oct. 1, 1984), reprinted in 1984 U.S.

Code Cong. & Admin. News 5827; 49 Fed. Reg. 3,768

(1984) (to be codified at 37 C.F.R. §§ 1.601-1.688) (pro-

posed Jan. 30, 1984), 49 Fed. Reg. 48,416 (1984) (to be

codified at 37 C.F.R. §§ 1.601-1.688). The pertinent texts of

the foregoing are set forth in the Appendixes.

STATEMENT OF THE CASE

Petitioner Brennan seeks either an Order of Summary

Reversal or a Writ of Certiorari to the Court of Appeals

for the Federal Circuit regarding the Judgment of the

Court of Appeals which stripped the Petitioner of

$1,171,391.13 in personal injury damages awarded by the

U.S. District Court for the Eastern District of Michigan

following a jury trial on the common law theory of abuse

of process recognized under Michigan law.

The verdict in favor of Brennan is based upon the

jury’s findings that, for ulterior and collateral motives

unrelated to the valid and proper award of priority, the

Respondents tortiously perverted and abused the legiti-

mate processes of the U.S. Patent and Trademark Office

(“PTO”) during the prosecution of interference proceed-

ings. The evidence at trial established that, in 1982,

after the Respondents were caught committing fraud,

perjury and other inequitable conduct upon the PTO by

filing false statements and affidavits, they knowingly

and willfully fabricated and pursued false charges of

———————————

fraud against Brennan in an effort to coerce, harass and

frighten Brennan, his attorneys and investors and to

gain competitive advantage by preventing or delaying

Brennan’s successful use of any patented technology for

sequential administration of two or more intravenous

fluids. Notwithstanding great emotional distress and

financial hardship, Brennan did not succumb to the

Respondents’ coercive and harassing tactics and was

awarded priority of invention due to the initial fraud,

perjury and other inequitable conduct committed by the

Respondents upon the PTO.

Jurisdiction of the District Court was initially secured

by the filing of a complaint by the Respondents pursuant

to 35 U.S.C. § 146, seeking de novo review of the decision

of the Board of Patent Appeals and Interferences

(“Board”). (App. J p. A-90). The District Court also had

jurisdiction over the original action pursuant to 28 U.S.C.

§ 1338 and § 1331, as well as independent diversity

jurisdiction over compulsory counterclaims and _ third-

party claims filed by Brennan pursuant to 28 U.S.C.

§ 1332. Brennan's claims set forth state common law tort

theories of fraudulent misrepresentation, abuse of pro-

cess, and tortious interference with economic expectancy,

and, claims of violation of the federal RICO and anti-trust

Statutes.

The District Court entered a pre-trial order granting

partial summary judgment in favor of Respondents

Abbott Laboratories, Andrew J. Muetterties and Joseph

N. Genese [hereinafter collectively referred to as

“Abbott”], dismissing with prejudice the RICO and anti-

trust claims, as well as the state law claims for fraudulent

misrepresentation, and, granting summary judgment in

favor of the individual Third-Party Defendants for lack of

jurisdiction over those Defendants due to the dismissal of

the RICO count.

On August 9, 1989, the District Court granted Bren-

nan’s Motion for Summary Judgment on the § 146 Com-

plaint and denied Abbott’s renewed Motion for Summary

Judgment.' Abbott did not appeal from the entry of the

August 9, 1989 Order.

Trial proceeded solely on Brennan’s state tort law claims

of abuse of process and interference with economic relations.

The jury ultimately returned a verdict wnich determined

that Brennan take nothing on the claim of abuse of process as

against Muetterties and Genese; that Brennan recover the

following amounts on the claim of abuse of process against

Counter-Defendant Abbott Laboratories: $250,000.00 for

attorney fees, $1,070,000.00 for emotional injuries and

$30,000.00 for out-of-pocket costs, for a total award of

$1,350,000.00. A Judgment for $1,350,000.00 with interest

thereon accruing until the date of satisfaction as permitted

by law, was entered on December 21, 1989 (App. F p. A-35).

An order was entered on February 26, 1990, which

denied both parties’ Motions for Sanctions pursuant to

Fed. R. Civ. P. 11; denied Brennan’s Motion for New Trial,

denied Abbott’s Motion for J.N.O.V. or for New Trial;

granted in part Abbott’s Motion for Remittitur as to the

awards for costs and attorney fees, only, and reduced the

total judgment to $1,171,391.13; and, finally, held that

1 The Order of August 9, 1989 also vacated the District

Court’s prior order of July 6, 1987 (App. G p. A-37) which

granted summary judgment for Abbott on the § 146 Complaint

and remanded the matter to the PTO with directions to refer

the matter to the Commissioner to consider the allegations of

inequitable conduct. On remand the Board reaffirmed the pro-

priety of its award of priority to Brennan, emphasizing that

this award was on the ancillary matter of inequitable conduct

by Abbott upon the PTO and, was not a sanction in favor of

Brennan following a finding of priority in favor of Abbott

(App. H p. A-44-49). Pursuant to former 37 C.F.R. § 1.259, the

Board referred its decision on remand to the Commissioner

(App. H p. A-48-49), who determined that, pursuant to 37

C.F.R. § 1.56 and case law precedent, the Board properly exer-

cised its authority to conclude that Abbott's conduct constitu-

ted inequitable conduct ancillary to priority. (App. [| p

A-81-88).

pre-judgment interest would not be allowed on the jury

award for attorney fees or costs, nor on the damages

awarded during periods when the case was stayed (App.

E p. A-33-34).

From the Order of Feb. 26, 1990, regarding curtail-

ment of pre-judgment interest, the Judgment of Dec. 21,

1989 with respect to the verdict of no cause for action on

the claims of tortious interference and certain pre-trial

orders, Brennan filed a Notice of Appeal with the U.S.

Court of Appeals for the Federal Circuit.

Abbott filed a Notice of Appeal with the Sixth Circuit

Court of Appeals claiming an appeal from the final order

of February 26, 1990, and the Judgment on the jury ver-

dict with respect to the claims of abuse of process.

In an Order dated June 20, 1990, the Sixth Circuit

Court of Appeals concluded that it lacked jurisdiction

over the Notice of Appeal filed by Abbott because, pur-

suant to 28 U.S.C. § 1295(a), the Federal Circuit had

exclusive jurisdiction of an appeal from a District Court

decision in a case brought pursuant to 28 U.S.C. § 146

(App. D p. A-31). However, pursuant to 28 U.S.C. § 1631,

the Sixth Circuit ordered Abbott’s Appeal transferred to

the Federal Circuit (App. D p. A-31).

Thereafter, the two appeals before the Federal Circuit

were consolidated, with Abbott designated as the Cross-

Appellant.

The Court of Appeals for the Federal Circuit has

exclusive subject matter jurisdiction over the appeals pur-

suant to 28 U.S.C. § 1295(a)(1) and § (a)(4)(C) because the

jurisdiction of the District Court was initially invoked

under 28 U.S.C. § 1338 and 35 U.S.C. § 146.

With respect to its Appeal, Abbott argued that Bren-

nan’s counterclaim for abuse of process should have been

dismissed as a matter of law because: 1) no judicial

process was involved in the interference proceedings

before the PTO; and 2) to permit separate state law tort

claims arising out of a party’s misconduct before the PTO

would deny or impair the party’s right to petition the

government or to continue adversarial proceedings. No

argument was made on the part of Abbott that remedies

afforded under the state common !aw theory of abuse of

process were preempted by former or existing federal

patent laws and regulations.

Brennan responded by contending that: 1) under

Michigan law, an abuse of process action will be sus-

tained upon a showing that a judicial, quasi-judicial or

administrative process is utilized in a properly filed

action in an effort to threaten, coerce, or harass the

opposing party; 2) the right to petition the government

does not preclude liability for threats, coercive tactics,

and the knowing and willful submission of false facts

and allegations against the opposing party during the

course of federal agency proceedings for improper pur-

poses; and 3) the jury verdict was supported by ample

evidence that the interference process was abused by

Abbott’s intentionally fabricated charges of fraud,

improper acts of coercion and harassment against Bren-

nan, and, evidence that Abbott’s baseless charges of

fraud were merely a pretext or means to extort Brennan

to withdraw his legitimate charges of fraud, or, to other-

wise gain competitive advantage by enjoying full use of

the technology at issue while causing extraordinary

delay in the issuance of Brennan’s patent, or, causing

the technology at issue to return to the public domain.

On Brennan’s Appeal, the Court of Appeals affirmed

the denial of sanctions, the dismissal of anti-trust coun-

terclaims, and the denial of a new trial on the tortious

interference counterclaim (App. A pp. A-9-17, 20-21). On

Abbott's Appeal, the Court of Appeals reversed the judg-

ment of abuse of process, and the jury’s award of dam-

ages (App. A pp. A-24-25). The issue raised in Brennan’s

Appeal regarding entitlement to additional pre-judgment

interest was deemed moot (App. A p. A-25).

When deciding to reverse the money judgment on the

jury verdict in favor of Brennan, the Court below

declined to resolve “the broad question of whether

actions in connection with federal administrative pro-

ceedings can ever provide the ‘process’ for a common law

claim of abuse of process.” (App. A p. A-21). The Court

opted instead, to resolve “the narrow issue of whether

the state tort action for abuse of process can be invoked

as a remedy for inequitable or other unsavory conduct of

parties to proceedings in the Patent and Trademark

Office” concluding that “the federal administrative pro-

cess of examining and issuing patents, including proceed-

ings before the PTO’s boards, is not subject to collateral

review in terms of the common law tort of abuse of

process.” (App. A pp. A-21-22).

In this regard, the Court of Appeals reasoned that

“[t]he PTO procedures themselves provided a remedy for

Abbott’s malfeasance” since “Brennan was awarded a

patent although the PTO found that Brennan was not the

first inventor of the subject matter.” (App. A p. A-24).

Relying on the cases of Baker Driveaway Co. v. Bankhead

Enter., 478 F. Supp. 857, 207 U.S.P.Q. 365 (E.D. Mich.

1979), and Gilbert v. Ben-Asher, 900 F.2d 1407 (9th Cir.

1990), cert. denied, 111 U.S. 177 (1990), the Court of

Appeals opined that “[a]n additional state action would

be an inappropriate collateral intrusion on the regulatory

procedures of the PTO, ‘under the guise of a complaint

sounding in tort.’” (App. A pp. A-22-25). The Court

reached this conclusion even while noting the contrary

holding in Neumann v. Vidall, 710 F.2d 856 (D.C. Cir.

1983), where the D.C. Circuit refused to dismiss a state

common law claim for abuse of process arising out of

proceedings conducted before the PTO for an anti-com-

petitive motive. (App. A p. A-24). According to the Court

of Appeals, “the better general rule is that based on

judicial disfavor of collateral attack, under the common

law, on proceedings before the PTO.” (App. A p. A-24).

Moreover, without any articulated deference to the

historic powers of the states to provide tort remedies to

compensate for personal injury, and without any analysis

of the purposes and objectives of Congress in enacting

the federal patent law and enabling federal patent regula-

tions, the Court of Appeals below concluded that a state

action for abuse of process “is contrary to Congress’

preemptive regulation in the area of patent law.” (App. A

p- A-25).

Brennan filed a timely combined Petition for Rehear-

ing and Suggestion for Rehearing In Banc. Rehearing was

denied in an order dated January 27, 1992 (App. B p.

A-26). The Suggestion for Rehearing In Banc was denied

on February 7, 1992 (App. C p. A-28).

REASONS FOR SUMMARY REVERSAL OR

GRANTING OF THE WRIT

The Petitioner Brennan brings before the Court issues

of state power and federalism of great significance to

American jurisprudence which have not been, but must

be, settled by this Court.

Without any authority and without proper analysis of

attendant constitutional, legal and policy considerations,

the Court of Appeals has declared that the doctrines of

collateral attack and federal preemption foreclose state

common law tort actions for abuse of process as a remedy

for personal injuries sustained by a private party as a

result of the tortious misconduct of another party to

proceedings before the PTO.

At best, this unprecedented decision constitutes a

monstrous transformation of a party’s constitutional

right to petition the PTO for a determination of priority

of invention into absolute immunity from tort liability

for pecuniary and non-pecuniary damages caused by

the abuse and perversion of the patent office processes

- personal injury damages which the PTO is not, and

has never been, authorized to award because Congress

and the Courts have conferred upon the PTO only the

power to fashion equitable remedies when granting or

determining patent rights.

At worst, the unprecedented decision constitutes an

unconstitutional infringement upon the historic police

powers of states to invoke traditional common law so as

to compensate victims of personal injuries caused by

intentional and tortious acts and omissions. State com-

mon law of abuse of process has coexisted harmo-

niously with federal patent protecticn for over 200

years, and, the U.S. Constitution, the federal statutes,

legislative history, regulations and regulatory history

do not support the notion that Congress intended to

preempt the historic power of states to ensure compen-

sation of tort victims.

Unless this Court acts by either summarily revers-

ing the judgment of the Court of Appeals or granting

the Writ of Certiorari to the Court of Appeals, the deci-

sion of the lower court will drastically alter sensitive

federal-state relationships, upsetting the delicate bal-

ance heretofore carefully protected and preserved by

the Constitution and by this Court.

Moreover, unless this Court acts, the decision of the

Court of Appeals will serve to promote the misuse and

perversion of the legitimate processes of the PTO and

the subversion of the integrity of that agency - and

potentially all other federal agencies —- while depriving

victims of such abuse relief only available under tradi-

tional state tort law - all to the detriment of the parties

to proceedings before federal agencies, to the federal

agencies themselves, as well as to the usual constitu-

tional balance between the states and federal govern-

ment.

I. Consideration by this Court is necessary because the

Court of Appeal’s unprecedented determination that a

state common law action for abuse of process constitutes

an improper collateral intrusion on the PTO is in direct

conflict with decisions by this Court and decisions by the

Courts of Appeals for the District of Columbia Circuit,

the Ninth Circuit, and the Federal Circuit.

A. There is clear conflict between the Court of

Appeals for the Federal Circuit and the decision of the

Court of Appeals for the District of Columbia Circuit in

Neumann v. Vidall, supra. ln Neumann, an abuse of process

action was filed by a patent applicant after a competitor

charged that the applicant had committed fraud before

the PTO and filed other proceedings with the PTO

allegedly designed to delay the issuance of the patent and

discourage potential investors. 710 F.2d at 858. The Dis-

trict of Columbia Circuit held that these allegations stated

a valid state common law cause of action for abuse of

process. Id. at 860. See also: Lewis v. Lho, 696 F. Supp. 723,

728 (D. D.C. 1988) (encouraging the submission of forged

and fraudulent documents to the FCC to gain competitive

advantages is abuse of process).

The Court of Appeals below noted, but rejected, the

holding in Neumann, and, without any supporting legal

authority, determined the “better general rule is that

based on judicial disfavor of collateral attack, under the

common law, on proceedings before the PTO” (App. A p.

A-24).

Since the Court of Appeals made no attempt to

conceal its disagreement with Neumann, supra, its opin-

ion here can be characterized as an invitation to this

Court to resolve the conflict created.

B. There is also clear conflict between the Court of

Appeals for the Federal Circuit and prior decisions by

this Court and the Ninth Circuit Court of Appeals’ deci-

sions defining and applying the doctrine of collateral

attack.

Specifically, the decision below absolutely mis-

construes the cited case of Gilbert v. Ben-Asher, supra

(plaintiff’s abuse of process claims dismissed as a collat-

eral attack upon the final decision of the Arizona Board

of Medical Examiners to revoke plaintiff's license to prac-

tice medicine because the tort claims for damages were

filed against the individual members of the Board and

indirectly challenged the Board’s final decision).

Additionally, the decision below ignores a host of

other appellate decisions narrowly defining “collateral!

attack” as questioning the validity of a judgment in a

proceeding not brought for the purpose of modifying,

setting aside, vacating or enjoining the judgment, an

attempt to avoid and defeat or evade judicial decree or to

deny its force and effect. See, e.g., Callanan Road Improve-

ment Co. v. United States, 345 U.S. 507, 512 (1952) (separate

administrative proceeding precluded where attempt

made to defeat an order of the Interstate Commerce Com-

mission), MGA, Inc. v. General Motors, Corp., 827 F.2d 729,

732, 3 U.S.P.Q.2d 1762 (Fed. Cir. 1987), cert. denied, 484

U.S. 1009 (even though an action has an independent

purpose and contemplates some other relief, it is a collat-

eral attack if it must in some fashion overrule a previous

judgment), American Guaranty Corp. v. United States, 401

F.2d 1004, 1010-11 (U.S. Ct. Cl. 1968) (bankruptcy ref-

eree’s orders not subject to modification or defeat in a

separate action filed with the District Court), Interstate

Natural Gas Co. v. Southern Cal. Gas Co., 209 F.2d 380, 385

(9th Cir. 1953) (party may not by means of a separate suit

for damages indirectly annul decisions by the Federal

Power Commission).

In this case, and unlike the cases where claims were

properly dismissed pursuant to the doctrine of collat-

eral attack, Brennan’s state law tort claims were filed

against the real parties in interest to the interference

proceedings, and not against any members, employees,

or staff of the PTO. Additionally, Brennan’s state law

tort claims did not directly or indirectly challenge the

final decision of the PTO Board awarding priority of

intervention in favor of Brennan on all counts due to

Abbott's fraud, perjury, and inequitable conduct upon

the PTO. Rather, and as the Court of Appeals itself

conceded, Brennan’s counterclaims for abuse of process

followed Abbott’s attack of the Board’s decision to

award priority of invention to Brennan via a § 146

appeal. (App. A p. A-24). Indeed, Brennan relied upon

the Board’s decision.

Most importantly, Brennan’s abuse of process

claims focused on the torts committed by Abbott upon

Brennan, separate and distinct from the inequitable

conduct committed by Abbott upon the PTO.

The Court of Appeals’ misapplication of the collat-

eral attack doctrine is in clear conflict with the prior

decisions of this Court and the Federal Circuit, as well

as the Ninth Circuit, and therefore constitutes an invita-

tion for action by this Court.

C. Finally, the Federal Circuit Court of Appeals’

analysis and application of the doctrine of collateral

attack is ripe for summary reversal or review on the

merits because the decision conflicts with prior decisions

of this Court limiting the scope of the First Amendment

right to petition.

Among the guarantees enumerated in the First

Amendment to the Constitution is the right to petition

the government for a redress of grievances. U.S. Const.

amend. I.

In the context of federal antitrust and labor laws, this

Court has developed a doctrine which exempts parties

from liability for the valid petitioning of the legislature,

courts, and administrative agencies, despite improper

motive or dilatorious incidental effect. Eastern R.R. Prest-

dent’s Conference v. Noerr Motor Freight, Inc., 365 U.S. 127,

139 (1961), United Mine Workers v. Pennington, 381 U.S.

657, 660 (1965), Bill Johnson’s Restaurants, Inc. v. N.L.R.B.,

461 U.S. 731 (1983), Otter Tail Power Co. v. United States,

410 U.S. 366, 380 (1973).

However, this Court has also developed clear lim-

itations to the exemption from liability grounded in

First Amendment protection.

Specifically within the context of administrative or

judicial processes, this Court has held that the exemption

from liability will not apply if the petitioning activities

are a “sham”, to wit, used as an integral part of illegal,

deceptive or unethical conduct which violates valid stat-

utes or common law. Noerr, supra, at 144, California Motor

Transp. Co. v. Trucking Unlimited, 404 U.S. 508, 512-15

(1972) (“there are many .. . forms of illegal and reprehen-

sible practice which may corrupt the administrative or

judicial processes and which may result in [liability])” 1d.

at 512-13; Bill Johnson’s Restaurants, Inc., supra, at 743-44

(state action for retaliatory purpose will form a basis of

liability under federal labor laws where suit is based on

false or unsubstantial claims). See also: Allied Tube & Con-

duit Corp. v. Indian Head, Inc., 486 U.S. 492, 500, n. 4

(1988). The rationale here is that First Amendment rights

may not be used as a means or pretext for abusing or

corrupting administrative or judicial processes, or sub-

verting the integrity of such processes. California Motor,

supra, at 513-15, Bill Johnson's Restaurants, Inc., supra.

In its Opinion, the Court of Appeals below relied

upon Baker Driveaway Co., supra for the proposition that

an alleged abuse of the processes of the PTO is not

remediable by a state common law tort action absent a

showing that the entire agency proceeding was a “sham”

(App. A, pp. A-22-23). The Court then determined that

Brennan neither asserted nor proved a “sham” petition,

reasoning that “[a]lthough Brennan complains of the

delay he experienced in receiving a patent after Abbott’s

false affidavit of mailing, we take notice that delay is

ubiquitous in PTO proceedings, and does not of itself

support an action for abuse of process” (App. A p. A-23).

Despite the Court of Appeals’ misreading of the

record, misapplication of Baker Driveaway, supra, and its

misplaced reference to the Noerr-Pennington doctrine, this

case did not involve allegations or proofs that the pro-

cedures established by Congress and by the Patent Office

are insufficient ways to deal with “inequitable or other

unsavory conduct” during patent contests. Nor did

recovery rest solely upon the delay in the issuance of the

patent rights to Brennan caused by Abbott’s execution of

its right to petition the PTO: Brennan never contested the

right of Abbott to file patent applications or to resist in a

proper fashion Brennan’s charges of inequitable conduct

which, following extensive proofs, were found by the

Board to be totally justified (App. J pp. A-97-123).

Instead, at the heart of this case were proofs that,

after Abbott was caught filing false affidavits of mail-

ing and committing fraud, perjury and other inequita-

ble conduct upon the patent office, Abbott then 1)

intentionally fabricated, and pursued with a vengeance,

false counter-charges of fraud against Brennan; and, 2)

issued vile threats regarding disbarment of Brennan’s

attorney. It was proven that these reprehensible actions

were taken with the motive and intent to coerce, harass,

and frighten Brennan, his attorney and investors, and to

gain unfair competitive advantage by preventing or

delaying Brennan’s successful use of the technology.

For, as a senior party and patent holder, Abbott enjoyed

exclusive use of the technology pending a final deci-

sion. Finally, it was proven that Abbott's tortious and

reprehensible actions - and not Abbott's valid exercise

of its right to petition the patent office - were the

proximate cause of Brennan’s substantial emotional and

financial damages. These were the jury’s findings!

In short, the proofs at trial established that Abbott

knowingly filed and pursued false counter-charges of

fraud as a pretext for and means of abusing and corrupt-

ing administrative processes, thereby subverting the

integrity of the PTO and, more to the point, creating

liability under state tort law. Indeed, these proofs — and

the ultimate jury award - transcend the patent system

itself, focusing instead upon the price a party must pay

under the Michigan common law of abuse of process for

perverting a legitimate governmental process for ulte-

rior, improper and collateral motives.?

2 Under established and controlling Michigan law, such

proofs of personal injuries support an award of compensatory

damages under a theory of abuse of process. Spear v. Pendill,

164 Mich. 620, 130 N.W. 343 (1911), Friedman v. Dozorc, 412

Mich. 1, 312 N.W.2d 585 (1981), Vallance v. Brewbaker, 161 Mich.

App. 642, 411 N.W.2d 808 (1987), appeal denied, 430 Mich. 883

(1988), Three Lakes Ass'n v. Whiting, 75 Mich. App. 564, 255

(Continued on following page)

Given such proofs of personal injury damage caused

by Abbott’s egregious efforts to subvert the integrity of

the patent process, this Court would not find Abbott's

liability under a theory of abuse of process precluded by

the right to petition the government protected by the

First Amendment. Allied Tube Corporation, supra; Noerr,

supra; California Motor Transp., supra; Bill Johnson's Restau-

rants, Inc., supra.

Clearly, a conflict exists between prior decisions of

this Court limiting the exemption from liability created

by the valid exercise of the First Amendment right to

petition and the unprecedented decision by the Court of

Appeals below that, notwithstanding allegations,

proofs and a jury determination that Abbott knowingly

and willfully subverted the valid processes of the PTO

by submitting and pursuing false counter-charges of

fraud for improper and collateral purposes, the First

Amendment precludes any liability under a state com-

mon law tort theory of abuse of process. This Court has

never denied a remedy to victims of tortious perversion

of administrative proceedings and therefore, the con-

trary decision of the Court of Appeals requires action

by this Court.

D. In sum, the decision of the Federal Circuit Court

of Appeals in this case squarely conflicts with the better

reasoned decision of the District of Columbia Circuit

Court of Appeals in Neumann, supra, on the question of

whether the doctrine of collateral attack forecloses an

abuse of process action under state common law as a

remedy for the tortious misconduct of a party to proceed-

ings before the PTO. Before the Court of Appeals’ deci-

sion in this case, no court had ever answered that

(Continued from previous page)

N.W.2d 686 (1977), Meehan v. Michigan Bell Tel. Co., 174 Mich.

App. 538, 436 N.W.2d 711 (1989), Mitchell v. Cole, 176 Mich.

App. 200, 439 N.W.2d 319 (1989); Trepel v. Pontiac Osteopathic

Hosp., 135 Mich. App. 361, 354 N.W.2d 341 (1984).

question in the affirmative. Moreover, the unprecedented

decision below conflicts in substance with prior decisions

by this Court, and the Circuit Court of Appeals for the

Federal and Ninth Circuits defining the proper and lim-

ited scope and application of the doctrine of collateral

attack. Finally, the unprecedented decision below directly

conflicts with prior decisions of this Court which fore-

close use of First Amendment rights as a means of avoid-

ing liability for the abuse and corruption of adminis-

trative processes and the subversion of the integrity of

such processes.

For these reasons, the case at bar is ripe for either

summary reversal or review on the merits by this Court.

II. Consideration of the case by this Court is necessary

because the Court of Appeals’ conclusion that Congress

alone may provide remedies for misconduct during pat-

ent proceedings ignores and conflicts with this Court’s

pronouncements regarding the basic principles of federal-

ism, federal preemption in general, and federal preemp-

tion in the patent area in particular.

Art. I, § 8, cl. 8 of the Constitution gives to Congress

the power “[t]o promote the Progress of Science and

useful Arts, by securing for limited Times to Authors and

Inventors the exclusive Right to their respective Writings

and Discoveries”. The objective of Art. I, § 8, cl. 8 is to

facilitate the granting of patent rights national in scope,

by eliminating the need for multiple patent applications

in every state and by providing a reward greater in scope

than any particular state may grant to promote progress

in the fields of arts and sciences. Goldstein v. California,

412 U.S. 546, 555-56 (1973); Sony Corp. v. Universal City

Studios, Inc., 464 U.S. 417, 429 (1983); Aronson v. Quick

Point Pencil Co., 440 U.S. 257, 262 (1979); Kewanee Oil Co.

v. Bicron Corp., 416 U.S. 470, 478-79 (1974); Bonito Boats v.

Thunder Craft Boats, 489 U.S. 141, 146 (1989). This objec-

tive is bolstered by acts of Congress which codify the

laws relating to the creation and enforcement of patent

rights; confer upon a federal agency the exclusive author-

ity to administer the federal patent system; and, vest

exclusive jurisdiction to hear patent and copyright cases

in the federal courts. Goldstein, supra; Sears, Roebuck & Co.

v. Stiffel Co., 376 U.S. 225 (1964).

The patent laws promote Art. I, § 8, cl. 8 by:

1) offering inventors exclusive rights for limited periods

as a reward for their creativity and research, and, as an

incentive for further efforts; 2) allowing the public access

to the products of new technology after the limited

periods of exclusive control have expired; and, 3) assur-

ing that ideas in the public domain remain there for free

public use. Kewanee, supra; Aronson, supra; Sony Corp.,

supra; Diamond v. Chakrabarty, 447 U.S. 303, 307 (1980);

Grant, et al. v. Raymond, 31 U.S. 218 (1832).

In cases too numerous to cite, this Court has held that

state law may be preempted under the Supremacy

Clause, U.S. Const. art. VI, cl. 2 where through federal

laws and/or regulations, Congress either explicitly

defines the extent to which its enactments preempt state

law, or, where Congress has implicitly supplanted state

law.

Congress is deemed to implicitly preempt state law

where federal statutes and/or regulations touch a field in

which the federal interest is so dominant that the federal

system will be assumed to preclude enforcement of state

law touching on the subject. The test here: whether com-

pliance with both federal and state law is impossible, or,

whether the state law stands as an obstacle to accom-

plishment of the full purposes and objectives of Congress.

See, e.g., Silkwood v. Kerr-McGee Corp., 464 U.S. 238, 248

(1984); English v. General Electric Co., 496 U.S. 72 (1990);

Goldstein, supra, at 561.

However, there is always a presumption against

implicit preemption.

The presumption against preemption is particularly

strong,where an attempt is made to prevent the states

from exercising their historic police powers on behalf of

their citizens, such as providing tort remedies to compen-

sate for personal injuries. See, e.g: Florida Lime and Avocado

<= —

Growers, Inc. v. Paul, 373 U.S. 132, 144 (1963), Jones v. Rath

Packing Co., 430 U.S. 519, 525 (1977). This Court has

repeatedly held that preemption will not be implied in

areas traditionally occupied by the states unless Congres-

sional intent to supersede state laws is made clear and

manifest. English, supra; Silkwood, supra; Rice v. Santa Fe

Elevator Corp., 331 U.S. 218, 230 (1947). This circumspect

view of implicit federal preemption emanates from the

recognition that, if Congress intends to alter the usual

constitutional balance between the states and federal gov-

ernment, it must make its intention to do so unmistakably

clear in the language of the statute or regulation. Will v.

Michigan Dept. of State Police, 491 U.S. 58 (1989); Bowen v.

American Hosp. Ass'n, 476 U.S. 610, 643-44 (1986); LInited

States v. Bass, 404 U.S. 336, 349 (1971).

Additionally, this Court has recognized that Congress

is understood to legislate against a backdrop of state

common law. California v. ARC America Corp., 490 U.S. 93

(1989), Astoria Fed. Sav. & Loan Ass‘n v. Solimino, 111 S. Ct.

2166 (1991), Goodyear Atomic Corp. v. Miller, 486 U.S. 174,

184-85 (1988). Moreover, this Court has repeatedly and

specifically held that state causes of action are not pre-

empted solely because they impose liability over and

above that authorized by Congress: it is entirely possible

for state common law remedies to apply where the

actionable conduct occurs in an area of exclusive federal

concern. English, supra; ARC America Corporation, supra at

105; Silkwood, supra.

In short, there is presumption against implicit fed-

eral preemption of any exercise of the historic state

police power — including the creation and enforcement

of state common law tort remedies - unless these

remedies, additional or otherwise, are expressly sup-

planted by Congress.

The Court of Appeals below did not hold that Con-

gress and/or the PTO has explicitedly preempted Peti-

tioner’s state common law tort action for abuse of

process, by inserting specific preemptive language into

the patent laws or regulations. Indeed, the federal stat-

utes and regulations as well as the legislative and regula-

tory history are silent in this regard.

Rather, the Court of Appeals apparently rested its

decision on implicit preemption under a federal fie!d

rationale, noting that “[t}]he patent grant is within the

exclusive purview of federal law” (App. A p. A-22), and,

thereafter holding that an additional state law action

providing a remedy for the Respondents’ abuse of the

patent office process “[i]s contrary to Congress’ preemp-

tive regulation in the area of patent law.” (App. A p.

A-25).

However, the Court of Appeals’ unprecedented con-

clusion in this regard directly conflicts with prior deci-

sions of this Court defining the limits of federal field

preemption, in general, and federal field preemption in

the patent field in particular.

A. First, the decision by the Court of Appeals below

conflicts in substance with decisions of this Court setting

the general parameters of federal field preemption.

A review of the text and history of patent statutes

and regulations, current and former, reveal no clear and

manifest intention on the part of Congress to preclude

additional state common law tort remedies when enact-

ing, the federal patent statutes set forth in Title 35 of the

U.S. Code nor when enabling federal patent regulations

set forth in Chapter 37 of the Code of Federal Regula-

tions. In general, these provisions only define the pro-

cedures in and responsibilities of the PTO attendant to

examination of patent applications and determination of

which party has priority of invention antecedent to the

right to exclude. See generally, S. Rep. No. 1979, 82d

Cong., 2d Sess., reprinted in 1952 U.S. Code Cong. &

Admin. News 2394-97; S. Rep. No. 2169, 87th Cong., 2d

Sess., reprinted in 1962 U.S. Code Cong. & Admin. News

3286; 130 Cong. Rec. H10,525 (daily ed. Oct. 1, 1984),

reprinted in 1984 U.S. Code Cong. & Admin. News, 5827

(App. O pp. A-146-50)

Specifically as to the state tort law remedies available

for damages caused by abuse of the processes of the

Patent Office, the text and history of the patent regula

tions, current and former, reveal no clear and manifest

intention on the part of Congress or of the Patent Office

to preclude such remedies.

37 C.F.R. § 1.563 (App. M pp. A-138-42) imposes

duties of candor, g00d faith and disclosure upon every

party, attorney and agent appearing before the PTO, and

permits the striking or rejection of patent applications

where these duties are violated or where fraud is commit

ted upon the Patent Office. This Provision relates to any

Papers or documents filed with the PTO and all proceed-

ings before the PTO. 37 C.ER. § 1.56(b)-(j) (App. M pp.

A-138-42), 47 Fed. Reg. 21,746 (1982) (to be codified at 37

C-FR. § 1.56) (App. P pp. A-151-52).

Even before the promulgation of 37 C.E.R. § 1.56, this

Court held that the “uncompromising” duties of dis

closure, candor and g00d faith are rooted in the strong

public interest in seeing that patent monopolies spring

’ § 1.56. Duty of disclosure: fraud; striking or rejection of

applications

(a) A duty of candor and good faith toward the Patent

and Trademark Office rests on the inventor, on each attorney or

agent who prepares or prosecutes the application and on every

other individual who is substantively involved in the prepara-

tion Or prosecution of the application and who is associated

with the inventor, with the assignee or with anyone to whom

there is an obligation to assign the application. All such indi.

viduals have a duty to disclose to the Office information they

are aware of which is material to the examination of the

application. Such information is material where there is a

substantial likelihood that a reasonable examiner would con-

sider it important in dec iding whether to allow the application

to issue as a patent. The duty is Commensurate with the deyree

of involvement in the preparation or prosecution of the appli-

cation.

* « *

from backgrounds free from fraud or other inequitable

conduct and that such monopolies are kept within their

legitimate scope. Precision Instruments Mfg. Co. v. Automo-

tive Maintenance Mach. Co., 324 U.S. 806, 816 (1945). There,

this Court created the patent office’s power to withhold

patent rights from a party engaging in fraud or other

inequitable conduct upon the patent office, equating this

power with that available under the equitable doctrine of

unclean hands. Id. at 814-16.4

Since 1984, 37 C.F.R. § 1.616° (App. M pp. A-142-43)

[incorporating former 37 C.F.R. § 1.287(d)(2)

4 In this particular case, the Board granted priority to

Brennan on the basis that Abbott’s inequitable conduct pre-

vented the award of priority to Abbott (App. J pp. A-123,

129-30). On remand, the Board reaffirmed its award of priority

to Brennan “[o]n the ancillary matter of inequitable conduct on

the part of Abbott.” (App. H p. A-44). Pursuant to former 37

C.F.R. § 1.259 (App. N pp. A-144-45), the Board referred to the

Commissioner its decision on the ancillary matter of inequita-

ble conduct (App. H pp. A-48-49). Relying upon 37 C.F.R.

§ 1.56 and Precision Instruments, supra, the Commissioner deter-

mined that “[t]he Board had authority to conclude that

Abbott’s conduct constituted inequitable conduct ancillary to

priority ...” because Abbott’s conduct “[w]as clearly a viola-

tion of Abbott’s duty of candor to the PTO.” (App. I'p. A-85).

> § 1.616 Sanctions for failure to comply with rules or

order.

An examiner-in-chief or the Board may impose an appro-

priate sanction against a party who fails to comply with the

regulations of this part or any order entered by an examiner-

in-chief or the Board. An appropriate sanction may include

among others entry of an order:

(a) Holding certain facts to have been established in the

interference;

(b) Precluding a party from filing a motion or a prelimi-

nary statement;

particular issue;

(Continued on following page)

eee

(App. N p. A-145)] has specifically permitted an Interference

Examiner or the Board to impose appropriate equitable sanc-

tions against a party to an interference proceeding who fails

to comply with its rules or orders. 49 Fed. Reg. 3,768 (1984)

(to be codified at 37 C.FR. §§ 1.601-88) (proposed Jan. 30,

1984); 49 Fed. Reg. 48,416 (1984) (to be codified at 37 C.ER.

§§ 1.601-88), (App. P pp. A-152-56). The PTO conducts inter-

ference proceedings solely to determine who, as between

two or more parties, shall receive priority of invention and

therefore, may receive the right to exclude under the federal

patent laws. 49 Fed. Reg. 3,768; 49 Fed. Reg. 48,416; 35 U.S.C.

§§ 131-135.

In short, when enacting 35 U.S.C. §§ 131-135 and

enabling regulations such as 37 C.F.R. § 1.56 and § 1.616,

Congress only intended to insure that patent monopo-

lies, obtained via interference proceedings, remain free

from the taint of fraud or other inequitable conduct.

These powers allow the PTO to vindicate itself of ineq-

uitable conduct practiced against it. Nothing in the text

or history of these federal statutes and regulations even

remotely suggests that Congress intended to alter the

usual constitutional balance between the states and fed-

eral government by preventing the states from exercis-

ing their historic police power on behalf of their

citizens to provide tort remedies in order to compensate

for the personal injuries of victims of abuse of the

patent process. The requisite presumption therefore:

preemption of traditional state common law theories of

abuse of process under the patent field preemption

rationale will not be implied. Will, supra; Bowen, supra;

Bass, supra.

The Court of Appeals below, without the requisite

analysis, apparently concluded that, because Congress

(Continued from previous page)

(d) Precluding a party from requesting; obtaining, or

opposing discovery; or

(e) Granting judgment in the interference.

eee ees

did not specifically include monetary damages for per-

sonal injuries among the sanctions for misconduct out-

lined in the current and former federal regulations, then

Congress obviously intended not to permit such a rem-

edy under either federal or state law.

However, such analysis is in direct conflict with the

prior decisions of this Court which compel the exact

opposite result: because Congress has left unattended

the area of remedies for personal injury damage caused

by the abuse of the patent process, the states remain

free under their traditional police powers to compensate

such tort victims because Congress would not, without

comment, remove all historically existing means of

legal recourse, reposited in state common law, for those

suffering personal injuries during the course of federal

agency proceedings designed solely to determine prior-

ity of invention. See, e.g., Silkwood, supra; English,

supra; Florida Lime and Avocado Growers, supra; Jones,

supra; Will, supra; Bowen, supra; Bass, supra. The Court

of Appeals’ determination that the “added” liability

under the state common law tort theory of abuse of

process is contrary to Congress’ preemptive regulation

in the field of patent law, also directly conflicts with

this Court’s teachings that state causes of action are not

preempted solely because they impose liability over

and above that authorized by federal statutes and regu-

lations, and, that traditional state common law remedies

apply with full force unless expressly supplanted by

Congress. English, supra; ARC America Corporation,

supra; Silkwood, supra.

Hence, this Court should now resolve the conflict

between the Court of Appeals’ decision and the decisions

of this Court by summarily reversing or reviewing on the

merits the issue of whether Congress has so occupied the

field of patent protection as to preempt all additional

state common law remedies arising from the misconduct

of parties to a patent proceeding or litigation.

B. Secondly, action by this Court is warranted

because the Court of Appeals’ decision below directly

conflicts with prior decisions of this Court and the Fed-

eral Circuit Court of Appeals outlining the extent to

which Congress has implicitly preempted state common

law in the patent field.

1. One line of cases stands for the proposition

that there is no clear and manifest intent on the part of

Congress in enacting the patent laws and enabling the

patent regulations to preempt all state common law

remedies resting upon the historic police powers of states

and traditionally made available to residents who allege

actionable misconduct. See: Aronson, supra (state contract

law not preempted by federal patent law so as to pre-

clude enforcement of a royalty contract) Kewanee, supra,

(state trade secret law not preempted by operation of

federal patent laws), Power Lift, Inc. v. Weatherford Nipple-

Up Sys., 871 F.2d 1082 (Fed. Cir. 1989) (state law dealing

with forfeiture of contract rights not preempted by fed-

eral patent law), Universal Gym Equip. v. ERWA Exercise

Equip., 827 F.2d 1542 (Fed. Cir. 1987) (federal patent law

did not preempt state law for damages arising out of

breach of licensing agreement).

The historic police powers of the states include the

power to compensate victims of the tort known as abuse

of process. This tort dates back as far as 1838, when the

English and American courts developed a theory to per-

mit a remedy for situations where, although legal pro-

cedures had been set in motion in proper form, with

probable cause and possibly ultimate success, these pro-

cedures had been perverted to accomplish an ulterior

purpose for which the process was not designed. Prosser

& Keeton, Torts (5th ed. 1984) § 121, at 897-900.

Congress is understood to have enacted the patent

laws and enabled the patent regulations against the back-

drop of the historic state common law tort theory of abuse

of process. ARC America Corp., supra; Astoria Fed. Sav. &

Loan Ass’n, supra; Goodyear Atomic Corp., supra.

It is absurd and irrational to conclude, as did the

Court of Appeals below, that Congress intended to pre-

empt state common law tort actions for damages stem-

ming from the abuse of the patent processes, but

intended not to preempt other state common law tort

actions and state common law contract actions touching

upon the subject of patent rights.

Without question, the decision by the Federal Cir-

cuit Court of Appeals in this case conflicts directly with

the prior decisions by this Court and by that Circuit on

the subject of federal patent field preemption, and

therefore, constitutes an invitation to this Court to

review the issue.

2. The decision by the lower appellate court also

conflicts in substance with prior decisions of this Court

defining the extent to which state common law remedies

stand as an obstacle to the accomplishment and execution

of the full purposes and objectives of Congress in enact-

ing patent laws and enabling patent regulations.

In Kewanee, supra this Court held that state protection

of trade secrets, as applied to both patentable and unpa-

tentable subject matter, did not conflict with the federal

patent laws. Id. at 482-91. In reaching its holding, the

Kewanee Court emphasized that state trade secret law and

federal patent law each has its particular and indepen-

dent role to play, that Congress has given no indication

that the operation of the state law was inconsistent with

the operation of federal patent laws, and that, until Con-

gress takes affirmative action to the contrary, states

should be free to grant protection to trade secrets. Id. In

Aronson, supra, this Court held that state contract law was

not preempted by federa! patent law so as to preclude

enforcement of a royalty agreement between a patent

applicant and a manufacturing company, because it was

not inconsistent with the aim of the federal patent system

but merely required the company to pay the consider-

ation which it promised in return for the use of a novel

device which had enabled the company to be first on the

market with the device. Id. at 262-66.

Such decisions by this Court compel the conclusion

that state common law providing compensation for per-

sonal injuries caused by the abuse of the patent process

does not clash or interfere with the objectives and

implementation of federal patent law.

First, there is no actual conflict between the tradi-

tional state common law tort theory of abuse of process

and the federal patent laws and regulations because the

state law and federal system have absolutely distinct and

independent objectives and remedies.

The equitable remedies that have been allowed the

PTO under the federal regulations or case law in situa-

tions involving fraud or other misconduct committed

upon the PTO, have always been limited to either sanc-

tions affecting the grant of patent rights or the power to

withhold such rights. In contrast, the legal remedy afforded

under state common law to the private victims of abuse of the

PTO process is redress for personal injuries separate and

distinct from the ultimate determinations by the PTO regard-

ing priority and/or patentability. For, in an abuse of process

action, focus is only upon the purpose for which the

process is used, regardless of the outcome; it is unnecess-

ary for a plaintiff to prove that the underlying proceeding

was terminated in the plaintiff’s favor. Prosser & Keeton,

Torts, supra. In other words, a party could lose on a

determination of priority of invention, and still maintain

a civil action under state common law for abuse of the

patent processes.

The object of the federal law and regulations permit-

ting the PTO to exercise its equitable powers in cases of

fraud and other inequitable conduct is to protect the public

from tainted patent monopolies. In contrast, the object of

the tort theory of abuse of process is to provide monetary

compensation for a private party injured by the abuse of any

valid judicial, administrative or other legal procedure. Prosser

& Keeton, Torts, supra.

The bottom line is that compliance with both the

federal patent system and state tort law is entirely pos-

sible and desirable. A party is certainly capable of par-

ticipating in an interference proceeding without

resorting to either fraud, perjury, inequitable conduct or

other rules violations which could affect patent rights,

or, misuse of the patent process for an improper and

collateral purpose which could affect tort liability.

Using the facts of this case as an example, Brennan’s

tort recovery was not premised upon Abbott’s decision to

pursue any and all remedies under federal patent law in

order to gain priority of invention, and thereby maintain

the exclusive right to exclude. Rather, Brennan’s state law

theory was that Abbott tortiously perverted the legiti-

mate federal patent interference proceedings to accom-

plish an end not intended by federal patent law and

regulation, to wit, to frighten off Brennan, his attorneys

and investors, as well as to delay Brennan from ever

successfully enjoying patent rights, and, as a result, Bren-

nan suffered monetary losses in the form of costs, attor-

ney fees and emotional distress.

The jury at trial found Brennan’s proofs of abuse of

process so compelling it awarded reasonable compensa-

tory damages. Such an award for personal injuries sim-

ply does not intrude upon the exclusive province of the

patent office with respect to the determinations of pri-

ority and patentability. The PTO is and always has been

without authority to issue relief capable of compen-

sating pecuniary and non-pecuniary losses — such relief

being outside the purpose, scope and language of fed-

eral patent laws and regulations, and residing instead,

within the historic purview of common law tort theories

espoused by the various states, including Michigan.

The obvious conclusion: the PTO’s exclusive authority

to administer equitable sanctions relative to patent rights

under federal law and regulation does not foreclose addi-

tional legal remedies for separate and distinct personal

injuries under state common law tort theories. This conclu-

sion is strongly suggested by this Court’s decisions in

Kewanee, supra; and Aronson, supra, and therefore, the

contrary determination by the Court of Appeals below

warrants either preemptory reversal or further review by

the issuance of a Writ of Certiorari.

Secondly, the state common law theory of abuse of

process does not stand as an obstacle to the accomplish-

ment of the full purposes and objectives of the federal

patent system. The goal of this traditional state law tort

theory is to discourage the perversion of any proper legal

proceeding for an improper and collateral purpose such as

coercion to obtain a collateral advantage, not properly

involved in the proceeding itself. Discouragement of the

tortious perversion of the federal patent system does not

impair the creative activity of inventors, does not dis-

courage any one from seeking a patent, does not deprive

the public of the use of valuable or patentable inventions,

and, does not impair public access to new technologies

after the limited period of control has expired.

Certainly, the patent policy of encouraging invention

and free competition is not disturbed by state common

law that requires interference proceedings before the PTO

be conducted fairly, without resort by any party to the

tortious misuse, abuse and perversion of the processes for

improper and collateral objectives unrelated to priority of

invention and/or patentability. Indeed, the abolition of

state law remedies for abuse of the patent process will

only discourage small, private and independent inventors

for pursuing their rights through an interference proceed-

ing because that individual would be exposed to fraud,

coercion and harassment on the part of parties such as

the respondents, without any legal recourse.

C. In sum, the state common law tort theory for

abuse of process poses no threat whatsoever to the

scheme of federal laws and regulation aimed at the pro-

motion of invention, while at the same time preserving

free competition. Congress has never acted to displace

the historic police powers of the states so as to preclude

additional legal remedies available under the traditional

tort theory of abuse of process from arising out of patent

proceedings. Nor is there any compelling federal policy

or interest which demands that this tort theory be singled

out from other common law theories such as breach of

contract, unfair trade competition, tortious interference

with economic expectancies, etc., all of which have coex-

isted harmoniously with federal patent protection for

over 200 years. Finally, compliance with federal patent

law and regulations and the state tort law of abuse of

process is not only possible, it is desirable.

This conclusion is mandated by prior decisions of

this Court, and, the Court of Appeals’ unprecedented

decision to the contrary merits, at least, further review

upon the grant of the Petitioner’s Writ of Certiorari, or,

because it is so clearly erroneous, summary reversal.

CONCLUSION

For the foregoing reasons, Petitioner John F. Brennan

respectfully requests that a Writ of Certiorari issue to

review the Judgment and Opinion of the U.S. Court of

Appeals for the Federal Circuit, or, that the Judgment and

Opinion be summarily reversed in part with the remitted

judgment on the jury verdict entered by the District

Court below reinstated and the matter then remanded to

the Court of Appeals for consideration, only, of whether

the District Court erred by precluding pre-judgment

interest on the Judgment during periods when discovery

was stayed and when the action was remanded to the

PTO and on that part of the Judgment reflecting costs and

attorney fees awarded by the jury as an element of dam-

ages for abuse of process.

Respectfully Submitted,

MicHEe.tLe A. THomas (P35135)

Attorney for Petitioner

1000 Maccabees Center

25800 Northwestern Highway

Post Office Box 222

Southfield, MI 48037-0222

(313) 746-0700

April 22, 1992

A-1

APPENDIX A

United States Court of Appeals

for the Federal Circuit

90-1268, -1424

ABBOTT LABORATORIES, ANDREW

J. MUETTERTIES and JOSEPH N. GENESE,

Plaintiffs /Cross-Appellants,

JOHN F. BRENNAN,

Defendant-Appellant.

Michael Dockterman, of Wildman, Harrold, Allen &

Dixon, Chicago, Illinois, argued for plaintiffs/cross-

appellants. With him on the brief was Joan M. Fencik.

Michelle A. Thomas, of Sullivan, Ward, Bone, Tyler,

Fiott & Asher, Southfield, Michigan, argued for defen-

dant-appellant. With her on the brief was Ronald S. Leder-

man, of counsel.

Appealed from: United States District Court for

The Eastern District of Michigan

]. Friedman

A-2

United States Court of Appeals

for the Federal Circuit

90-1268, -1424

ABBOTT LABORATORIES, ANDREW

J. MUETTERTIES and JOSEPH N. GENESE,

Plaintiffs /Cross-Appellants,

JOHN F. BRENNAN,

Defendant-Appellant.

DECIDED: December 27, 1991

Before NEWMAN, MAYER, and LOURIE, Circuit Judges.

NEWMAN, Circuit Judge.

Appellant John F. Brennan, and cross-appellants

Abbott Laboratories, Andrew J. Muetterties and Joseph

N. Genese (collectively “Abbott”), ask our review of var-

ious aspects of the judgment of the United States District

Court for the Eastern District of Michigan, including rul-

ings on certain pre- and post-trial motions.'

1 Abbott Laboratories v. Brennan, No. 86-70935 (E.D. Mich.

November 20, 1986) (Order); Abbott Laboratories v. Brennan, No.

86-70935 (E.D. Mich. November 20, 1989) (Order); Abbott Labo-

ratories v. Brennan, No. 86-70935 (E.D. Mich. December 21,

1989) (Judgment); Abbott Laboratories v. Brennan, No. 86-70935

(E.D. Mich. February 22, 1990)(Order).

A-3

Background

This case arose upon interference proceedings in the

United States Patent and Trademark Office (the “PTO”),

involving a patent application of which Mr. Brennan is

the inventor, a patent owned by Abbott Laboratories of

which Andrew J. Muetterties and Joseph N. Genese are

joint investors, and a reissue application owned by

Abbott and naming only Muetterties as inventor. The

invention of the counts of the interference is an intra-

venous delivery device for sequentially administering

two medical liquids to a patient, each at a different flow

rate.

The Board of Patent Appeals and Interferences

awarded priority of invention to Brennan. The Board held

that the Muetterties/Genese dates of conception and

reduction to practice were prior to those of Brennan, but

that because an attorney for Abbott had backdated a

request for extension of time and falsely averred that the

request had been timely made, this activity constituted

inequitable conduct, with the result that Abbot was not

awarded priority. Brennan v. Muetterties, 230 USPQ 145

(Bd. Pat. App. & Int. 1986).

Abbott brought a civil action in the district court

pursuant to 35 U.S.C. § 146,? seeking to set aside the

2 35 U.S.C. § 146. Civil action in case of interference

Any party to an interference dissatisfied with

the decision of the Board of Patent Appeals and

Interferences, may have remedy by civil action... .

In such suits the record in the Patent and Trademark

Office shall be admitted on motion of either par-

ty ... without prejudice to the right of the parties to

take further testimony... .

A-4

award of priority to Brennan. Brennan counterclaimed for

fraudulent misrepresentation, abuse of process, tortious

interference with economic relations, antitrust violations

under the Sherman and Clayton Acts, violation of the

Racketeer Influenced and Corrupt Organizations Act, and

intentional infliction of emotional distress. The district

court dismissed Brennan’s claims for antitrust and RICO

violations, intentional infliction of emotional distress, and

fraudulent misrepresentation. The court declined to dis-

miss the claims for tortious interference and abuse of

process.

Abbott then moved for summary judgment on the

issue of priority of inventorship, arguing that the Board

erred as a matter of law in awarding priority to Brennan

based on Abbott’s inequitable conduct. Abbott’s position

was that priority must be awarded to the first inventor

and that enforceability due to inequitable conduct is a

separate issue, not determinative of priority. The district

court granted summary judgment of priority of invention

to Abbott, and remanded to the Board with instructions

to refer the matter to the Commissioner of Patents and

trademarks “for the purpose of considering the allega-

tions of inequitable conduct”. On Brennan’s motion the

district court stayed trial of Brennan’s remaining counter-

claims pending the Commissioner’s decision.

Upon remand the Board issued another decision

awarding priority to Brennan due to Abbott's inequitable

conduct, apparently ignoring the district court’s contrary

judgment. Brennan v. Muetterties, Interf. Nos. 100,817 and

101,078 (Bd. Pat. App. & Int. May 27, 1988). The Board

explained that under “controlling law” the Board was

“precluded from awarding priority against both parties.”

) i

A-5

Id. at 4. The Board then referred the case to the Commis-

sioner as the district court had ordered; the Commis-

sioner deferred review on his part until after judicial

review of the Board’s award of priority to Brennan. Upon

return of the case to the district court, the parties filed

cross motions for summary judgment on the issue of

priority of invention. After a hearing, now before a differ-

ent judge, the district court granted Brennan’s motion

and denied Abbott’s; that is, the court awarded priority

to Brennan because of Abbott’s inequitable conduct. The

prior judgment in favor of Abbott was vacated and judg-

ment was entered in favor of Brennan. Abbott has not

appealed this decision, and we do not consider its merits,

or the correctness of the Board’s view of the law.

Brennan then moved for sanctions against Abbott

under Fed. R. Civ. P. 11, requesting award of costs and

attorneys fees incurred in defending the § 146 action in

the district court. Abbott cross-moved for sanctions, stat-

ing that Brennan’s counterclaims were not well-grounded

in fact or law, and that Brennan’s Rule 11 motion was

frivolous. Both sides’ motions were denied.

Trial was held to a jury on Brennan’s counterclaims

for tortious interference with economic relations and tor-

tious abuse of process during the prosecution of the

interference proceeding before the PTO. The jury

returned a verdict in favor of Abbott on the tortious

interference claim, and for Brennan on the abuse of pro-

cess claim. The jury awarded Brennan Damages of

$1,350,000 for abuse of process, designated as $1,070,000

for emotional injuries, $250,000 for attorney fees, and

$30,000 for out-of-pocket costs; all for the interference

proceeding. The district court denied both sides’ requests

A-6

for judgment n.o.v. and a new trial, and denied renewed

requests for Rule 11 sanctions. The court granted Abbott's

motion to clarify the judgment, to the extent that prejudg-

ment interest was disallowed for the period during which

the § 146 action was stayed because of the referral to the

PTO, and for two shorter periods of stay. The court

denied Abbott’s motion for remittitur of the award of

emotional damages, but remitted the award of attorney

fees to $89,439.75 and costs to $11,951.38, the actual sums

incurred.

Brennan appeals the denial of his motions for sanc-

tions under Ruie 11 and for a new trial on his counter-

claim of tortious interference with economic relations.

Brennan also appeals the dismissal of his antitrust coun-

terclaim and the grant of Abbott’s motion that affected

the amount of prejudgment interest. Abbott cross-appeals

the denial of its motion for judgment n.o.v. or a new trial

on the issue of abuse of process, and the partial denial of

its alternative motion for remiittitur.

Jurisdiction

Upon Abbott’s omission of appeal of the issue of

priority of invention, the remaining issues are either mat-

ters of state law based on pendent jurisdiction, or issues

of federal law that are not within the exclusive assign-

ment of the Federal Circuit, but that were properly

included at trial of the case. See Fed.R.Civ. P. 13,(a); see

generally 3 Moore's Federal Practice, J 13.13 (2d ed. 1983).

No issues arising under the patent law remain, and none

is referred to in the notice of appeal. We thus have

reviewed sua sponte our jurisdiction over this appeal.

A-7

Abbott’s civil action was brought under 35 U.S.C.

§ 146. The district court’s jurisdiction arose in part under

Title 35, the codification of the patent law, and thus

satisfies the requirement of:

28 U.S.C. § 1338(a). The district courts shall

have original jurisdiction of any civil action aris-

ing under any Act of Congress relating to pat-

ents. ...

All appeals in such circumstances are assigned exclu-

sively to the Federal Circuit:

28 U.S.C. § 1295(a)(1). The United States Court

of Appeals for the Federal Circuit shall have

exclusive jurisdiction -

(1) Of an appeal from a final decision of a

district court of the United States .. . if the

jurisdiction of that court was based, in whole or

in part, on section 1338 of this title... .

The path of appeals is determined by the basis of jurisdic-

tion in the district court, and is not controlled by the

district court’s decision or the substance of the issues that

are appealed. The reasons are pragmatic: to avoid creat-

ing fresh opportunities for forum shopping; to avoid

bifurcation of issues and cases at trial and on appeal; to

remove uncertainty and the abuses of procedural maneu-

vering; and, ultimately, to facilitate resolution of disputes.

Thus, the direction of appeal to the Federal Circuit

does not change during or after trial, even when the only

issues remaining are not within our exclusive assignment.

See, e.g., Technicon Instruments Corp. v. Alpkem Corp., 866

F.2d 417, 419-20, 9 USPQ2d 1540, 1541-42 (Fed. Cir. 1989)

(antitrust counterclaim sole issue on appeal); Atari, Inc. v.

A-8

JS & A Group, Inc., 747 F.2d 1422, 1427, 223 USPQ 1074,

1077 (Fed. Cir. 1984) (en banc) (copyright issue appealed

separately). See generally Aerojet-General Corp. v. Machine

Tool Works, Oerlikon-Buehrle, Ltd., 895 F.2d 736, 741-45, 13

USPQ2d 1670, 1675-77 (Fed. Cir. 1990) (en banc) (discuss-

ing the well-pleaded complaint rule in the context of

Federal Circuit jurisdiction). Appellate jurisdiction is not

with the Federal Circuit when no well-pleaded claim

arising under the patent law is stated in the pleadings

before the district court, Christianson v. Colt Industries

Operating Corp., 486 U.S. 800, 807-10, 7 USPQ2D 1109,

1113-14 (1988), or which the patent claim is merely “tran-

sient,” Schwarzkopf Development Corp. v. Ti-Coating, Inc.,

800 F.2d 240, 245, 231 USPQ 47, 51 (Fed. Cir. 1986) (patent

counterclaim dismissed without opposition during plead-

ing stage). Accord, Unique Concepts, Inc. v. Manuel, 930

F.2d 573, 575, 18 USPQ2d 1654, 1656 (7th Cir. 1991) (juris-

diction of district court to enter judgment dismissing

patent claim “came, in part, from (a well-pleaded com-

plaint under) § 1338”).

The path of this appeal was established with the

filing of the civil action to obtain a patent in accordance

with 35 U.S.C. § 146 and, although the § 146 issue was not

appealed, this appeal of the other issues was correctly

taken to the Federal Circuit.

BRENNAN’S APPEAL

Rule 11 Sanctions

Mr. Brennan argues that the district court erro-

neously denied his request for sanctions under Fed. R.

A-9

Civ. P. 11 based on Abbott's filing of the civil action under

35 U.S.C. § 146, which Brennan states was for the purpose

of harassment, to delay Brennan’s receiving his patent

after the award of priority by the PTO, and to increase his

costs.

A district court’s Rule 11 determination is reviewed

on the standard of abuse of the trial court’s discretionary

authority. Cooter & Gell v. Hartmarx Corp., 110 S. Ct. 2447,

2460 (1990). In matters of sanctions particular deference is

owed the trial court’s discretion; for the trial judge has

viewed the matter at first hand, has considered all the

circumstances, and made assessments of credibility and

other intangibles that escape the written record. See Id.,

110 S. Ct. at 2460-61.

In this case the district court’s denial of sanctions is

well supported. The patent law authorizes any party to a

patent interference to take civil action in the district

court. 35 U.S.C. § 146. Such action is taken as of right. The

vagaries of litigation inevitably delay final resolution of

disputes. However, Congress has preserved this right of

recourse to the courts from a decision of the PTO: a

statutory right available at least since 1836. Act of July 4,

1836, § 16, 5 Stat. 117, 123-24. Absent improper purpose, a

litigant’s exercise of a statutory right of action can not be,

of itself, a sanctionable offense. See Cooter & Gell, 110 S.

Ct. at 2462 (discussing policy of not discouraging mer-

itorious appeals).

Brennan argues that Abbott’s position on the issue of

priority under 35 U.S.C. § 146 was so obviously devoid of

“merit as to warrant sanctions. However, the district judge

to whom the case was first assigned granted Abbott’s

A-10

motion for summary judgment based on Abbott’s posi-

tion that inequitable conduct by counsel can not direct

the decision of priority of invention. Although this ques-

tion is not before us for review, this is not an area in

which the law is so clear that Abbott’s challenge in dis-

trict court was “unreasonable under the circumstances.”

Century Products, Inc. v. Sutter, 837 F.2d 247, 253 (6th Cir.

1988); see also Davis v. Crush, 862 F.2d 84, 88 (6th Cir. 1988)

(the challenged pleading must be tested as of the time the

pleading was filed, not with “the wisdom of hindsight”).°

The district court’s denial of Brennan’s request for

Rule 11 sanctiens is affirmed.

Tortious Interference with Economic Relations

The jury decided the issue of tortious interference

with economic relations in favor of Abbott. Brennan

argues that the district court abused its discretion in

denying his motion for a new trial on this issue. Brennan

states that the district court committed several errors at

trial: in allowing Abbott to present the rebuttal testimony

of three experts on medical devices, when Abbott did not

disclose their identity until the day before trial; in pre-

cluding Brennan’s expert, Dr. Coffey, from giving testi-

mony on lost royalties; in excluding evidence of Abbott’s

3 We apply Sixth Circuit law on review of the district

court’s rulings on Rule 11 and other matters not within the

Federal Circuit’s exclusive purview. See Atari, Inc. v. JS & A

Group, Inc., 747 F.2d at 1438-40, 223 USPQ at 1086-87.

A-11

marketing projections for its allegedly competing prod-

uct; and in instructing the jury that it was required to

determine whether “but for” Abbott’s conduct Brennan

would not have suffered harm, instead of instructing the

jury that it need only determine whether Abbott’s con-

duct was a “substantial factor” in causing harm to Bren-

nan. We consider these issues seriatim.

1. The Rebuttal Witnesses

The Sixth Circuit practice is that “no error in the

admission or exclusion of evidence is ground for reversal

or granting a new trial unless refusal to take such action

appears to the court to be inconsistent with substantial

justice.” TCP Industries, Inc. v. Uniroyal, Inc., 661 F.2d 542,

549 (6th Cir. 1981). The Federal Circuit has expressed a

similar view. Devices for Medicine, Inc. v. Boehl, 822 F.2d

1062, 1066, 3 USPQ2d 1288, 1292 (Fed. Cir. 1987) (a trial

need be fair, but it need not be perfect). It is improper on

appeal to disturb a district court’s trial management,

absent a clear abuse of judicial discretion. Benedict v.

United States, 822 F.2d 1426, 1428 (6th Cir. 1987).

The three medical witnesses, Melissa Kraus, Edward

Hayman, and Larry Shoup, were called by Abbott in

rebuttal to testimony by Brennan’s witnesses Anna

Dugan and Leon Pedell relating to the medical efficacy of

the invention that was the subject of the patent interfer-

ence. Abbott first revealed its intention to call these wit-

nesses the day before trial. Brennan objected to the

admission of their testimony, claiming unfair surprise.

Abbott stated that the late identification of these wit-

nesses was the result of its having been surprised to learn

A-12

that Dugan and Pedell would testify on the issue of

medical efficacy.

Brennan has not shown that he was prejudiced by the

admission of this rebuttal testimony, or that there were

unfair trial tactics or procedures, or that it was inap-

propriate in rebuttal. The trial court did not abuse its

discretion in allowing the testimony of these witnesses

under the circumstances that prevailed.

2. Expert Testimony on Royalties

Brennan’s position was that he would have obtained

a patent and earned royalties on the invention at issue,

were it not for the delay caused by Abbott’s maintenance

of the interference proceeding. The district court ruled

thot Dr. Coffey could not testify as an expert on the issue

of royalties. Dr. Coffey had stated that he was not an

expert on patent royalties, and that he had no prior

experience of analyzing the market for a medical device,

or any other product. The court could well have con-

cluded that Dr. Coffey’s testimony on this issue was not

of expert dimension. See Mannino v. International Manufac-

turing Co., 650 F.2d 846, 851 (6th Cir. 1981) (“Under the

Federal Rules of Evidence, the only thing a court should

be concerned with in determining the qualifications of an

expert is whether the expert’s knowledge of the subject

matter is such that his opinion will likely assist the trier

of fact in arriving at the truth.”)

The tria! judge has broad discretion in determining

whether to admit expert testimony on any subject. Its

ruling may not be disturbed absent clear error. Lee Shops,

Inc. v. Schatten-Cypress Co., 350 F.2d 12, 17, (6th Cir. 1965),

—_

A-13

cert. denied, 382 U.S. 980 (1966). We discern no abuse of

discretion in this refusal to allow Dr. Coffey to testify as

an expert on the royalties Brennan would have earned.

3. Abbott’s Sales Projections

Brennan states that the district court erred in exclud-

ing evidence relating to Abbott’s sales projections for an

intravenous delivery device that Abbott was developing

at the time of the patent interference. Brennan sought this

evidence to establish Abbott’s motive for tortiously inter-

fering with Brennan’s business expectations. Abbott

argued that this device was one of several being consid-

ered by Abbott, and that the profit projections were not

realized, and were speculative. The district court ruled

that this evidence was not relevant because, inter alia, the

documents did not show that the Abbott and Brennan

proposed devices were similar. The court also expressed

concern that allowing this evidence would create the risk

of relitigating priority of invention, which issue had

already been decided.

When balancing probative value against possible

prejudice, the trial court has broad discretion. See Fed. R.

Evid. 403; Finch v. Monumental Life Ins.Co., 820 F.2d 1426,

1432 (6th Cir. 1987). A trial court’s admission or exclusion

of evidence on grounds of relevance is reviewed for

abuse of discretion. Clarksville-Montgomery County School

System v. United States Gypsum Co., 925 F.2d 993, 999 (6th

Cir. 1991). Excluded evidence is viewed in the light most

favorable to its proponent, giving the “evidence its maxi-

mum reasonable probative force and its minimum reason-

able prejudicial value.” Laney v. Celotex Corp., 901 F.2d

A-14

1319, 1320 (6th Cir. 1990) (quoting 1 J. Weinstein & M.

Berger, Weinstein’s Evidence § 403[03] (1982)). The review-

ing court, in order to reverse such a decision made at

trial, must be firmly convinced that a prejudicial mistake

was made. Schrand v. Federal Pacific Electric Co., 851 F.2d

152, 157 (6th Cir. 1988). We do not have that conviction.

The trial court’s ruling will not be disturbed.

4. Jury Instructions on Tortious Interference

Brennan asserts that the district court erroneously

and inconsistently instructed the jury as to the proper

standard of causation of damages from the tort of inter-

ference with economic relations. The court told the jury:

Before Mr. Brennan can prevail on either

claim, he must prove by a preponderance of the

evidence any damages sustained were prox-

imately caused by the Defendants’ actions.

Proximate cause is an act which, in the nat-

ural and continuous sequence, directly produces

the harm without which the harm would not

have occurred.

* * *

When more than one act or factor may be

the cause of the harm, it is necessary to deter-

mine whether, but for the Defendants’ acts,

Plaintiff would not have suffered any harm.

= * *

If the Defendants’ conduct was not a sub-

stantial factor in causing a third party not to

enter into a relationship or continue a relation-

ship with Mr. Brennan, the Defendants cannot

be found responsible for Mr. Brennan’s failure to

A-15

enter into a relationship or continue a relation-

ship.

The conduct of the Defendants was not a

substantial factor in causing the Plaintiff’s loss if

reasonable men and women would not regard it

as a cause of loss.

Mr. Brennan argues that the “but for” instruction (in the

third quoted paragraph) is inconsistent with the “sub-

stantial factor” instruction (in the fifth paragraph), which

Brennan asserts is the correct standard. This inconsis-

tency, Brennan states, is reversible error requiring a new

trial. Brennan had raised this objection to the district

court, and thus the issue is properly before us. Fed. R.

Ch. F Si.

In reviewing the jury charge for correctness and ade-

quacy, the jury instructions are viewed as a whole. How-

ard v. Chesapeake and Ohio Ry. Co., 812 F.2d 282, 287 (6th

Cir.), cert. denied, 484 U.S. 820 (1987). “Each instruction

must be considered in connection with others of the

series referring to the same subject.” Clarksville-Montgom-

ery County School System, 925 F.2d at 1003.

Generally, a charge that contains an inaccurate

or ambiguous statement does not constitute

reversible error if the inaccuracy or ambiguity is

unlikely to misiead the jury. In considering

whether an isolated clause in the jury instruc-

tions is likely to have misled the jury, a review-

ing court must consider the entire charge. Thus,

the critical inquiry is whether the instructions as

a whole provide the jury with sufficient guid-

ance concerning the issues to be tried.

A-16

~——-Teal. E.I. du Pont de Nemours & Co., 728 F.2d 799, 802 (6th

Cir. 1984) (citations omitted).

Commentators have explained that the “but for” and

“substantial factor” standards of causation generally

yield identical results:

Except in the classes of cases indicated [not here

~tetevant], no case has been found where the

defendant’s act could be called a substantial

factor when the event would have occurred

without it; nor will cases very often arise where

it would not be such a factor when it was so

indispensable a cause that without it the result

would not have followed.

Prosser & Keeton, Torts, at p. 268 (5th ed. 1984) (footnotes

omitted); see generally Restatement (2d) of Torts, § 431,

comment a (1965) (explaining the distinction between

substantial cause in the legal sense and cause in the

“philosophic” sense). Michigan courts have treated the

substantial factor test as the more rigorous:

Causation in fact includes more than a simple

“but for” relationship between the negligent act

and the damage. The negligence must also be a

“substantial factor” in producing the injury.

Derbeck v. Ward, 178 Mich. App. 38, 443 N.W.2d 812, 814

(1989) (discussing causation in fact as an element of prox-

imate cause).

Applying this guidance, and viewing the instructions

in context and in their entirety, Clarksville-Montgomery,

supra, we conclude that the trial court did not mislead the

jury on the factors to be considered and the law to be

applied, and that Mr. Brennan was not prejudiced by the

A-17

jury instructions. The court did not abuse its discretion in

denying Brennan’s motion for a new trial on this ground.

The Antitrust Counterclaim

Mr. Brennan argues that the district court erred in

dismissing his counterclaim for violation of the Clayton

and Sherman Acts. Inter alia, Brennan had alleged that

Abbott, by continuing to prosecute the interference and

by filing the § 146 action after having engaged in inequi-

table conduct, was attempting to monopolize commerce

in the subject matter of the contested invention.4

In determining whether to dismiss a claim pursuant

to Fed. R. Civ. P. 12(b) (6), the district court accepts as

true all of the factual allegations of the complaint. Appel-

late review is on the same basis. Kerasotes Michigan The-

atres, Inc. v. National Amusements, Inc., 854 F.2d 135, 136

(6th Cir. 1988), cert. dismissed, 490 U.S. 1087 (1989). Dis-

missal under Rule 12(b) (6) is appropriate “if it is clear

that no relief could be granted under any set of facts that

* Section 2 of the Sherman Act, 15 U.S.C. § 2, prohibits

monopolization or attempts to monopolize:

Every person who shall monopolize, or attempt to

monopolize, or combine or conspire with any other

person or persons, to monopolize any part of the

trade or commerce among the several States, or with

foreign nations, shall be deemed guilty of a fel-

Section 4(a) of the Clayton Act, 15 U.S.C. § 15(a), provides for

civil action for treble damages for violation of the antitrust

laws.

A-138

could be proved consistent with the allegations.” Lamb v.

Phillip Morris, Inc., 915 F.2d 1024, 1025 (6th Cir. 1990), cert.

denied, 111 S. Ct. 961 (1991) (quoting Hishon v. King &

Spalding, 467 U.S. 69, 73 (1984)).

In an antitrust action “the complaint need only allege

sufficient facts from which the court can discern the

elements of an injury resulting from an act forbidden by

the antitrust laws.” Kerasotes Michigan Theatres, 854 F.2d at

136 (quoting Newman v. Universal Pictures, 813 F.2d 1519,

1522 (9th Cir. 1987), cert. denied, 486 U.S. 1059 (1988)). The

elements of a claim for attempted monopolization, as

elaborated by tne Sixth Circuit, are: (1) a specific intent to

monopolize; (2) anti-competitive conduct; and (3) a dan-

gerous probability of success. Arthur S. Langenderfer, Inc.

v. S.E. Johnson Co., 917 F.2d 1413, 1431 (6th Cir. 1990), cert.

denied, 112 S. Ct. 51, 112 S. Ct. 247 (1991); White & White,

Inc. v. American Hosp. Supply Corp., 723 F.2d 495, 506-07

(6th Cir. 1983) (citing Lorain Journal Co. v. United States,

342 U.S. 143, 153 (1951)).

Brennan asserts that the allegations of his antitrust

claim state a cause of action in accordance with Walker

Process Equipment, Inc. v. Food Machinery and Chemical

Corp., 382 U.S. 172, 147 USPQ 404 (1965). In Walker Process

the Court held that maintenance and enforcement of a

patent procured by knowing and willful fraud may meet

the intent and conduct elements of violation of the Sher-

man Act, provided that the ability to lessen or destroy

competition, including market power in the relevant mar-

ket, can also be shown. 382 U.S. at 173, 177-78, 147 USPQ

at 405, 407. Brennan asserts that market power is pre-

sumed from the presence of a patent.

A-19

A patent does not of itself establish a presumption of

market power in the antitrust sense. Walker Process, 382

U.S. at 178, 147 USPQ at 407 (considering, inter alia,

whether there are non-infringing substitutes for the pat-

ented device); American Hoist & Derrick Co. v. Sowa &

Sons, Inc., 725 F.2d 1350, 1367, 220 USPQ 763, 776 (Fed.

Cir.), cert. denied, 469 U.S. 821 (1984) (“patent rights are

not legal monopolies in the antitrust sense of that word”).

The commercial advantage gained by new technology

and its statutory protection by patent do not convert the

possessor thereof into a prohibited monopolist. See gener-

ally United States v. Grinnell Corp., 384 U.S. 563, 570-71

(1966) (distinguishing the willful acquisition or mainte-

nance of monopoly power from “growth or development

as a consequence of superior product, business acumen,

or historic accident.”) The patent right must be “coupled

with violations of § 2”, and the elements of violation of

§ 2 must be met. Walker Process, 382 U.S. at 177-78, 147

USPQ at 407; see Hartford-Empire Co. v. United States, 323

U.S. 386, 406, 64 USPQ 18, 28 (1945) (discussing differ-

ences between “legitimate use and prohibited abuse” of

patent rights).

Determination of whether the patentee meets the

Sherman Act elements of monopolization or attempt to

monopolize is governed by the rules of application of the

antitrust laws to market participants, with due consider-

ation to the exclusivity that inheres in the patent grant.

See Loctite Corp. v. Ultraseal, Ltd., 781 F.2d 861, 876-77, 228

USPQ 90, 100-01 (Fed. Cir. 1985) (discussing relationship

between the patent and the antitrust laws). In Jefferson

Parish Hospital District No. 2. v. Hyde, 466 U.S. 1, 37 n.7

(1984), Justice O’Connor wrote in concurrence:

A-20

A common misconception has been that a

patent or copyright, a high market share, or a

unique product that competitors are not able to

offer suffices to demonstrate market power.

While each of these three factors might help to

give market power to a seller, it is also possible

that a seller in those situations will have no

market power: for example, a patent holder has

no market power in any relevant sense if there

are close substitutes for the patented product.

See generally W. Montgomery, The Presumption of Economic

Power for Patented and Copyrighted Products in Tying

Arrangements, 85 Colum. L. Rev. 1140, 1150-51 (1985) (“the

existence of a patent or a copyright provides little, if any,

evidence of supernormal profits, barriers to entry, con-

sumer preferences, or absence of adequate substitutes. It

thus does not dispose of the question whether a product

has market power”). Analysis under the rule of reason

takes into consideration the policy underlying the patent

grant and the national interest served; for the public

purpose of the patent grant as an incentive to inventions,

investment, and disclosure, is achieved solely by the stat-

utory right to exclude. See generally W. Bowman, Patent

and Antitrust Law 1-14 (1973).

The Sixth Circuit has rejected “any absolute pre-

sumption of market power for copyright or patented

product”. A.I. Root Co. v. Computer/Dynamics, Inc., 806

F.2d 673, 676 (6th Cir. 1986) (discussing precedent in light

of policy, economics, and the realities of the marketplace).

Absent a presumption of market power, Brennan alleged

insufficient facts to satisfy the elements of an antitrust

violation. Lamb, 915 F.2d at 1025 (requiring allegations of

facts). Allegations of legal conclusions are insufficient to

a —————

A-21

withstand a motion to dismiss. Chapman v. City of Detroit,

808 F.2d 459, 465 (6th Cir. 1986).

The district court correctly held that Brennan failed

to state a cause of action under the Sherman Act. The

dismissal of Brennan’s antitrust counterclaims is

affirmed.

ABBOTT’S CROSS-APPEAL

Abbot appeals the judgment entered upon the jury

finding of abuse of process, including the damages

awarded for emotional distress.

Abbott argues that Brennan’s counterclaim for abuse

of process should have been dismissed as a matter of law,

because no judicial process was involved in the interfer-

ence proceedings before the United States Patent and

Trademark Office, and because PTO proceedings are not

subject to collateral attack under state law. The district

court had denied Abbott’s motion for dismissal, ruling

that the premises of the tort of abuse of process under

Michigan law had been met. We review de novo the cor-

rectness of the district court’s determination of state law.

Salve Regina College v. Russell, 111 S. Ct. 1217, 1221 (1991).

We need not decide the broad question of whether

actions in connection with federal administrative pro-

ceedings can ever provide the “process” for a common

law claim of abuse of process. Before us is the narrow

question of whether the state tort action for abuse of

process can be invoked as a remedy for inequitable or

A-22

other unsavory conduct of parties to proceedings in the

Patent and Trademark Office. We conclude that it can not.

The patent grant is within the exclusive purview of

federal law. Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225,

231 n.7, 140 USPQ 524, 527 n.7 (1964). Although certain

traditional state law concerns may properly be raised

when patent rights are litigated, see Bonito Boats, Inc. v.

Thunder Craft Boats, Inc., 489 U.S. 141, 154-56, 9 USPQ2d

1847, 1853-54 (1989) (such concerns including, inter alia,

deceptive simulations of trade dress, trade secret protec-

tion, and misappropriation of proprietary information),

the issue at bar relates directly to administrative proceed-

ings before the PTO Board of Patent Appeals and Interfer-

ences.

Prior judicial consideration of this question is sparse.

In Baker Driveaway Co., Inc. v. Bankhead Enterprises, Inc.,

478 F. Supp. 857, 207 USPQ 365 (E.D. Mich. 1979), the

district court held that the filing of a protest against a

patent application in the PTO did not support a state

action for abuse of process. The court observed that the

actions complained of occurred before a federal agency,

and remarked that “the freedom of the public to petition

the government . . . will not be curtailed without some

extraordinary showing of abuse”, id. at 859, 207 USPQ at

367, citing California Motor Transport Co. v. Trucking Unlim-

ited, 404 U.S. 508 (1972); Eastern Railroad Presidents Confer-

ence v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961); and

United Mine Workers v. Pennington, 381 U.S. 657 (1965).

This reasoning supports the conclusion that an asserted

abuse of process before the Patent and Trademark Office

is not remediable by state action in tort, at least unless it

is shown that the entire federal agency action was a

A-23

“sham”, the word of Noerr, 365 U.S. at 144. Such a show-

ing, Or assertion, was not here made. Although Brennan

complains of the delay he experienced in receiving a

patent after Abbott’s false affidavit of mailing, we take

notice that delay is ubiquitous in PTO proceedings, and

does not of itself support an action for abuse of process.

The court in Baker Driveaway observed that the plain-

tiffs were not challenging the way the proceeding before

the PTO was handled, but instead were challenging the

motives for its institution. This observation provided

another reason for the court’s dismissal of the count, for

under Michigan law the tort of abuse of process requires

that “one must be challenging the way that some pro-

ceeding is handled rather than the motives for its institu-

tion.” Id. at 860, 207 USPQ at 367, citing Rowbotham v.

D.A.1.1.E., 69 Mich App. 142, 244 N.W.2d 389 (1976).

While Brennan states that his challenge is indeed to the

way Abbott handled the interference proceeding before

the PTO, and not to Abbott’s motives, that is contrary to

his presentation.

The Baker Driveaway court also discussed the policy

of allowing the administrative agency to decide matters

properly before it, and declined to create a new system of

judicial overview of actions before the PTO. This reason-

ing accords with that expressed in Gilbert v. Ben-Asher,

900 F.2d 1407 (9th Cir. 1990), cert. denied, 111 S.Ct. 177

(1990), wherein the Ninth Circuit affirmed the dismissal

of an abuse of process claim in which the plaintiff chal-

lenged a ruling of the state Board of Medical Examiners

revoking his medical license. The court in Gilbert

observed that the administrative ruling was subject to

judicial review, that no such appeal had been taken, and

A-24

thus that the issue on which the abuse of process claim

was grounded had “already been litigated and decided”.

Id. at 1411. Although Brennan’s claim before the adminis-

trative agency had been decided in his favor, and thus

was not appealable by him, that is not grounds for pro-

viding another forum for litigating issues arising from the

administrative process.

The only authorities cited by Brennan in support of

this action do not relate to analogous administrative pro-

ceedings. E.g., Friedman v. Dozorc, 412 Mich. 1, 312

N.W.2d 585 (1981); Meehan v. Michigan Bell Telephone Co.,

174 Mich. App. 538, 436 N.W.2d 711, 726 (1989); Vallance

v. Brewbaker, 161 Mich. App. 642, 411 N.W.2d 808, 810

(1987). We note, however, the holding in Newmann v.

Vidal, 710 F.2d 856 (D.C. Cir. 1983), wherein the court

refused to dismiss a claim for abuse of process in the PTO

when the basis was an anticompetitive motive. We

believe that the better general rule is that based on judi-

cial disfavor of collateral attack, under the common law,

on proceedings before the PTO.

We conclude that the federal administrative process

of examining and issuing patents, including proceedings

before the PTO’s boards, is not subject to collateral

review in terms of the common law tort of abuse of

process. The PTO procedures themselves provided a rem-

edy for Abbott’s malfeasance.> An additional state action

would be an inappropriate collateral intrusion on the

regulatory procedures of the PTO, “under the guise of a

complaint sounding in tort”, in the words of Gilbert v.

> Brennan was awarded a patent although the PTO found

that Brennan was not the first inventor of the subject matter.

2 Eo —eE

A-25

Ben-Asher, 900 F.2d at 1411, and is contrary to Congress’

preemptive regulation in the area of patent law. Bonito

Boats, supra.

The judgment of abuse of process is reversed, as is

the award of damages therefor.

Summary

On Mr. Brennan’s appeal, the denial of sanctions

under Rule 11, the dismissal of the antitrust counter-

claims, and the denial of a new trial on the tortious

interference counterclaim, are affirmed. On Abbott’s

cross-appeal, the judgment of abuse of process, and the

award of damages therefor, is reversed. Other issues

raised on this appeal, such as prejudgment interest, are

mooted.

No costs.

AFFIRMED IN PART, REVERSED IN PART

A-26

APPENDIX B

United States Court of Appeals for the Federal Circuit

90-1268

ABBOTT LABORATORIES, ANDREW

J. MUETTERTIES and JOSEPH N. GENESE,

Plaintiffs-Appellees,

Vv.

JOHN F. BRENNAN,

Defendant-Appellant.

ORDER

(Filed Jan. 27, 1992)

Before NEWMAN, Circuit Judge, MAYER, Circuit Judge,

LOURIE, Circuit Judge.

A petition for rehearing having been filed in this

case,

UPON CONSIDERATION THEREOF, it is

ORDERED that the petition for rehearing be, and the

same hereby is denied.

The suggestion for rehearing in banc is under consid-

eration.

The mandate will issue on February 3, 1992.

FOR THE COURT,

Dated: January 27, 1992 /s/ Francis X. Gindhart

Francis X. Gindhart

Clerk

cc: MICHELLE A. THOMAS

MICHAEL DOCKTERMAN

A-27

ABBOTT LAB V BRENNAN, 90-1268

(DCT -— 86-70935)

ee ee ae ae a a a a a a a a oo

Note: Pursuant to Fed. Cir. R. 47.8, this order is not

citable as precedent. It is a public record.

he he ae ae ae a ea a oe a a a a a a a AA AAA AAA EH EH

A-28

APPENDIX C

United States Court of Appeals for the Federal Circuit

90-1268

ABBOTT LABORATORIES, ANDREW

J. MUETTERTIES and JOSEPH N. GENESE,

Plaintiffs-Appellees,

JOHN F. BRENNAN,

Defendant-Appellant.

ORDER

(Filed Feb. 6 1992)

A suggestion for rehearing in banc having been filed

in this case,

UPON CONSIDERATION THEREOF, it is

ORDERED that the suggestion for rehearing in banc

be, and the same hereby is, declined.

FOR THE COURT,

/s/ Francis X. Gindhart

Francis X. Gindhart

Clerk

Dated: February 6, 1992

cc: MICHELLE A. THOMAS

MICHAEL DOCKTERMAN

ABBOTT LAB V BRENNAN, 90-1268

(DCT — 86-70935)

f 5

A-29

SESS SESE SESE ESE SEES EEE EEE EERE EEE EEE EEE EEE EEE EEE EEE EEE EE EE

Note: Pursuant to Fed. Cir. R. 47.8, this order is not

citable as precedent. It is a public record.

A-30

APPENDIX D

No. 90-1379

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Abbott Laboratories;

Plaintiff Counter

Defendant-Appellant,

Andrew J. Muetterties; Joseph

N. Genese,

Plaintiffs Counter

Detendants

ORDER

(Filed Jun. 20, 1990)

John F. Brennan,

Defendant Counter

Plaintiff-Appellee

BEFORE: MILBURN and NELSON, Circuit Judges; and

LIVELY, Senior Circuit Judge.

me eee eee ee”

This matter is before the court on a motion to dismiss

which presents the question of whether jurisdiction in

this appeal is properly with this Court or the Court of

Appeals for the Federal Circuit.

The plaintiff/counter-defendant, Abbott Laborato-

ries, has appealed judgment for the defendant/counter-

plaintiff, John F. Brennan. Brennan appealed the same

judgment and certain pretrial and post-judgment rulings

to the Federal Circuit Court of Appeals. Brennan has

moved for dismissal of this appeal on grounds that the

Federal Circuit has exclusive jurisdiction pursuant to 28

U.S.C. § 1295(a). Abbott filed a response in opposition,

ee,

A-31

and Brennan replied. Subsequent to theses filings, the

Federal Circuit issued an order denying Abbott’s motion

to dismiss Brennan’s appeal in that Court. Brennan has

filed a supplemental memorandum in support of his

motion to dismiss with this Court, and Abbott has

responded.

Upon review and consideration we conclude that this

Court lacks jurisdiction in this appeal. Pursuant to 28

U.S.C. § 1295(a) the Federal Circuit has exclusive jurisdic-

tion in an appeal from matters arising “in whole or in

part” from 28 U.S.C. § 1338(a), or in an appeal from a

district court decision in a case brought under 28 U.S.C.

§ 146. In this case the district court’s jurisdiction was

initially invoked by a complaint seeking review of a

patent law claim. Accordingly, jurisdiction to hear the

appeal is with the Federal Circuit. Christianson v. Col!

Industries, 486 U.S. 800 (1988).

Although this Court lacks jurisdiction, when an

appellate court “finds that there is a want of jurisdiction,

the court shall, if it is in the interest of justice, transfer

such action or appeal to any other court in which the

action or appeal could have been brought at the time it

was filed or noticed. .. . ” 28 U.S.C. § 1631. Accordingly,

this action shall not be dismissed, but shall be transferred

to the Federal Circuit.

It is therefore ORDERED that this appeal is trans-

ferred to the Federal Circuit Court of Appeals. The defen-

dant’s request for costs and attorneys’ fees is denied. The

A-32

Clerk shall take all appropriate steps to transfer this

appeal to the Federal Circuit.

ENTERED BY ORDER OF THE COURT

/s/ Leonard Green, Jr

Clerk

A-33

APPENDIX E

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

ABBOTT LABORATORIES,

ANDREW J. MUETTERTIES and

JOSEPH N. GENESE, jointly and

severally,

inti Civil Action

ree No. 86-70935

™ Hon. Bernard A.

JOHN F. BRENNAN, Friedman

Defendant.

ORDER

This matter having come before the court on Abbott's

motion to clarify judgment, Brennan’s motion for sanc-

tions, Abbott’s motion for sanctions, Brennan’s motion

for new trial, and Abbott’s motion for judgment N.O.V.,

new trial and/or remittitur, a hearing having been held

on February 22, 1990, counsel for all parties being pre-

sent, the court otherwise being fully informed in the

premises, for the reasons stated on the record,

IT IS HEREBY ORDERED that Abbott’s motion to

clarify judgment is granted to the following extent: pre-

judgment interest is not allowed on the jury award for

attorney's fees or for costs, or on the damages awarded

during periods when the case was stayed. Prejudgment

interest shall be awarded on the damages, for the periods

when the case was not stayed, at an annual rate of 12%

pursuant to M.C.L. § 600.6013(4). Postjudgment interest is

A-34

allowed pursuant to 28 U.S.C. § 1961(a) at an annual rate

of 7.66%.

IT IS FURTHER ORDERED that Brennan’s motion for

sanctions is denied.

IT IS FURTHER ORDERED that Abbott’s motion for

sanctions is denied.

IT IS FURTHER ORDERED that Brennan’s motion for

new trial is denied.

IT Is FURTHER ORDERED that Abbott’s motion for

judgment N.O.V., or for a new trial is denied.

IT Is FURTHER ORDERED that Abbott’s motion for

remittur is denied as to the award for emotional injuries,

but granted as to the awards for costs and attorney fees.

Costs are remitted to $11,951.381; attorney fees are remit-

ted to $89,439.75.

SO ORDERED.

/s/ Bernard A. Friedman

BERNARD A. FRIEDMAN

U.S. District Judge

Dated: FEB 26 1990

1 BAF as per phone 2/26/90 4:45 from BOTH - BAF

A-35

APPENDIX F

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

ABBOTT LABORATORIES,

ANDREW J. MUETTERTIES and

JOSEPH N. GENESE, jointly and

severally,

<a Civil Action

— No. 86-70935

Vv. Hon. Bernard A.

JOHN F. BRENNAN, Friedman

Defendant.

JUDGMENT ON JURY VERDICT

This action came on for trial before the court and a

jury, and the claims having been duly tried and the jury

having duly rendered its verdict,

IT IS HEREBY ORDERED that on the claim of inter-

ference with economic relations, the counter-plaintiff,

John F. Brennan, take nothing, that this claim be dis-

missed on the merits, and that judgment be entered for

the counter-defendants, Abbbott [sic] Laboratories,

Andrew J. Muetterties and Joseph N. Genese.

IT IS FURTHER ORDERED that on the claim of abuse

of process, the counter-plaintiff, John F. Brennan, take

nothing as against the counter-defendants, Andrew J.

Muetterties and Joseph N. Genese, and that this claim be

dismissed on the merits as to them.

A-36

IT IS FURTHER ORDERED that on the claim of abuse -

of process, the counter-plaintiff, John F. Brennan, recover

from the counter defendant, Abbott Laboratories, the sum

of $250,000.00 for attorney fees, the sum of $1,070,000.00

for emotional injuries, and the sum of $30,000.00 for out-

of-pocket costs, for a total award of $1,350,000.00, with

interest thereon accruing until the date of satisfaction as

permitted by law.

Assessment of costs, if sought by any party, shall be

governed by Fed. R. Civ. P. 54.

/s/ Bernard A. Friedman

BERNARD A. FRIEDMAN

U. S. District Judge

Dated: DEC 21 1989

A-37

APPENDIX G

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

ABBOTT LABORATORIES,

ANDREW J. MUETTERTIES

and JOSEPH N. GENESE, No. 86 CV 70935 DT

Plaintiffs and Judge George E. Woods

Counter-Defendants

JOHN F. BRENNAN,

Defendant and

Counter-Plaintiff,

ORDER

At a session of said Court, held

in the U.S. District Court

Detroit, Michigan

on: JUL 6 1987, 1987

PRESENT Hon. George E. Woods

George E. Woods

This Court being fully advised in the premises, hav-

ing considered the motions for summary judgment filed

by plaintiffs/counter-defendants Abbott Laboratories,

Andrew J. Muetterties and Joseph N. Genese, pursuant to

A-38

Rule 56 of the Federal Rules of Civil Procedure, for the

reasons stated in open court on July 2, 1987,

IT IS HEREBY ORDERED:

1. Plaintiffs’ motion for summary judgment on its

complaint pursuant to 35 U.S.C. § 146 is granted. The

matter is remanded to the Patent and Trademark Office

with directions to refer the matter to the Commissioner of

Patents pursuant to Rule 259, 35 C.F.R. § 1.259, for the

purpose of considering the allegations of inequitable con-

duct.

2. Counterdefendants’ motion for summary judg-

ment on the counter-complaint is denied.

Dated: JUL 6 1987

ENTER: /s/ George E. Woods

United States District Judge

A-39

APPENDIX H

Paper Nos. 160 and 102 JRRB/ljz

MAILED

MAY 27 1988

PAT & T.M. OFFICE

BOARD OF PATENT APPEALS

AND INTERFERENCES

In re Interference Nos.

100,817 and 101,078

Brennan . On Remand

Muetterties (et al)

Muetterties et al

The Honorable Commissioner of Patents

and Trademarks

Sir:

These interferences have been remanded to “the Pat-

ent and Trademark Office with directions to refer the

matter to the Commissioner of Patents pursuant to Rule

259, 35(sic, 37) C.E.R. 1.259, for the purpose of consider-

ing the allegations of inequitable conduct” from the

United States District Court for the Eastern District of

Michigan, Southern Division (No. 86 CV 70935 DT,

ORDER, Paper No. 198). In Paper No. 236, entitled MEM-

ORANDUM OPINION AND ORDER DENYING DEFEN-

DANT’S MOTION FOR REHEARING, the Court, after

denying Brennan’s motion for a rehearing, stated “[t]he

case is hereby remanded to the Board with directions that

it make a rule 259 reference to the Commissioner.” The

A-40

remand reached the Board on December 2, 1987 (Interfer-

ence No. 100,817, Paper No. 158) but was only brought to

the attention of this panel of the Board on May 16, 1988.

In addition to District Court Paper Nos. 198 and 236

referred to above, the following papers filed in the Dis-

trict Court action, and deemed pertinent to this matter by

the parties, have been forwarded to the Patent and Trade-

mark Office (PTO):

No. 154 NOTICE OF HEARING; PLAINTIFFS’ MOTION .

FOR SUMMARY JUDGMENT; MEMORANDUM OF LAW

IN SUPPORT ABBOTT LABORATORIES’ MOTION FOR

SUMMARY JUDGMENT

No. 165 DEFENDANT JOHN BRENNAN’S RESPONSE

TO PLAINTIFFS‘ MEMORANDUM OF LAW IN SUPPORT

OF ABBOT LABORATORIES’ MOTION FOR SUMMARY

JUDGMENT

No. 175 PLAINTIFFS’ REPLY MEMORANDUM IN SUP-

PORT OF PLAINTIFFS’ MOTION FOR SUMMARY JUDG-

MENT

No. 200 MOTION FOR REHEARING

No. 209 EXHIBITS IN SUPPORT OF BRENNAN’S

MOTION FOR REHEARING

No. 221 DEFENDANTS’ RESPONSE TO BRENNAN’S

MOTION FOR REHEARING

No. 223 SUPPLEMENTAL MEMORANDUM IN SUP-

PORT OF REHEARING

No. 238 TRANSCRIPT OF HEARING BEFORE THE

HONORABLE GEORGE E£. WOODS, UNITED STATES

DISTRICT JUDGE JULY 2, 1987

The above papers are attachments to Paper No. 100 in

Interference No. 101,078.

A-41

Interference No. 100,817 was initially declared

involving an application of Brennan and a patent to

Muetterties et al. The Muetterties et al patent is assigned

to Abbott Laboratories (Abbott). During the early stages

of that interference, Brennan filed a MOTION BY JUNIOR

PARTY FOR AWARD OF PRIORITY IN VIEW OF FRAUD

BY SENIOR PARTY AND BRIEF IN SUPPORT THEREOF

(Interference 100,817, Paper No. 24). The Commissioner

in considering a petition filed by Muetterties et al from

the Patent Interference Examiner’s denial of a request for

reconsideration of the Examiner’s denial of a request for

extension of time merely noted that since the petition had

been filed a number of other papers had been filed

among which was Brennan’s above referred to motion. At

the end of the decision the Commissioner noted that

questions of fraud arising in an interference are ancillary

to priority and are treated by the Board of Patent Interfer-

ences (Interference No. 100,817, Paper No. 42). The Bren-

nan motion was considered by a panel of the Board of

Patent Interferences and deferred to final hearing (Inter-

ference No. 101,817, Paper No. 43).

Thereafter, Muetterties et al filed a motion to add two

reissue applications to the interference — one in the names

of both original applicants and one in the name of Muet-

terties sole (Interference 101,817, Paper No. 48). The Pri-

mary Examiner granted the motion to add the Muetterties

et al reissue application to the ‘817 interference and

stated that a new Interference would be deciared involv-

ing the Muetterties sole reissue application (Interference

No. 101,817, Paper No. 54). Thus, Interference No. 101,078

was declared involving the same Brennan application, the

same Muetterties et al patent and a reissue application of

A-42

Muetterties (sole). Like the patent, the reissue applica-

tions are assigned to Abbott.

A question ancillary to priority is defined “as a ques-

tion which, if decided in favor of the party raising the

question, would necessarily result in a judgment against

his opponent.” II Rivise and Caesar, Interference Law and

Practice, Section 251, Page 1009 (Michie Co. 1943). In Jenks

v. Knight, 90 F.2d 654, 33 USPQ 601 (CCPA 1937), where

Jenks admitted he was not the first inventor, the Court

stated at 33 USPQ 604:

If there is any estoppel, it would operate in

favor of Jenks and so far as this record shows,

notwithstanding the admission of Jenks, if

Knight was estopped from claiming the inven-

tion, Jenks might well be awarded priority.

Under these circumstances, we hold that the

question of estoppel presented is one ancillary

to the question of priority and that we should

review this part of the board’s decision. For the

reasons stated, the motion to dismiss is denied.

In Norton v. Curtiss, 433 F.2d 770, 167 USPQ 532 (CCPA

1970), the Court held that a party who is guilty of fraud

on the PTO loses standing as a party to the interference

and the “question is clearly one which is ancillary to

priority.” (167 USPQ 536). In Langer v. Kaufman, 465 F.2d

915, 175 USPQ 172 (CCPA 1972), the Court held the

Board’s refusal to rule on the charge of fraud on the basis

that it lacked jurisdiction over the validity of the Kauf-

man patent was erroneous since the question was ancill-

ary to priority. (175 USPQ 176).

In deciding the ancillary question of fraud raised by

Brennan, the Board at final hearing awarded priority to

A-43

Brennan in both interferences on the ground that an

attorney for Abbott had engaged in inequitable conduct

during the course of the interference. That decision, if not

appealed or if affirmed on appeal, would result in can-

cellation of the claims of the Muetterties et al patent

corresponding to the counts by operation of law and

would constitute a final refusal by the PTO of the claims

in the reissue applications corresponding to the counts

pursuant to 35 USC 135(a). Since that decision disposed

of the interferences, there was no need to go further and

consider the evidence related to inventive acts such as

conception, reduction to practice and/or diligence per-

formed by or on behalf of the parties. However, the Court

in Tofe v. Winchell, 645 F.2d 58, 209 USPQ 379 (CCPA 1981)

stated at 209 USPQ 384:

As a final matter, we endorse the procedure

by the board indicated by the report of the

proceedings in Steierman v. Connelly, 192 USPQ

433 (Bd. Pat. Intf. 1975), modified, 192 USPQ 446

(Bd. Pat. Intf. 1976), in which the board made a

decision on the ancillary issue of fraud and a

decision on the issue of date priority but for the

issue of fraud.'4 By following this practice, the

board will enable this court to address all facets

of the issue of priority, should this matter be

appealed. (footnote omitted).

Accordingly, we considered the evidence submitted

by the parties relative to their respective inventive acts

and determined that Muetterties/Muetterties et al would

have prevailed but for the issue of fraud or inequitable

conduct. In view of the holding in Sheffner v. Gallo, 515

F.2d 1169, 185 USPQ 726 (CCPA 1975), we were precluded

from awarding priority against both parties. See also

A-44

Morgan v. Hirsh, 728 F.2d 1449, 221 USPQ 193 (Fed. Cir.

1984).

In the District Court, Abbott moved for summary

judgment stating that we had found that Abbott was

entitled to priority but awarded priority to Brennan as a

sanction against their attorney’s inequitable conduct (No.

154, page 6). However, a reading of our decision clearly

shows that we awarded priority to Brennan on the ancill-

ary matter of inequitable conduct on the part of Abbott,

and thus we did not have to reach the question of date

priority. A number of cases where inequitable conduct

has been held to be ancillary to priority, including Norton,

supra., and Langer, supra., were cited by Brennan in his

reply to the-motion for summary judgment (No. 165, page

8). Abbott notes that the Board in Lund v. Bentley, 188

USPQ 9 (Bd.Pat.Int. 1974) referred the matter to the Com-

missioner under 37 CFR 1.259 (No. 154, page 7, footnote

5). In that case the Board awarded priority of invention to

the senior party on the basis that the junior party had

committed inequitable conduct during the interference.

That holding by the Board constituted a final refusal by

the PTO of the claims in the junior party’s application

corresponding to the counts pursuant to 35 USC 135(a).

The recommendation to the Commissioner under Rule

259 was for consideration of the question of precluding

the junior party from receiving a patent at all even as to

subject matter not involved in the interference.

We note that the District Court apparently equated

the Brennan motion for priority on the ground of fraud

by Abbott, and a corresponding motion by Abbott, to be

petitions to strike an application of the type referred to in

the Commissioner’s Notice of August 11, 1980 (No. 238,

A-45

page 12). However, there was nothing said in the Brennan

motion about striking an application (Interference No.

100,817, Paper No. 241). The motion requested an award

of priority on the ground of intentional fraud on the part

of an Abbott attorney. On the subject of petitions, we note

that in Myers v. Feigelman, 455 F.2d 596, 172 USPQ 580

(CCPA 1972) and in Reddy v Dann. Comr. Pats., 188 USPQ

644 (CCPA 1976) the Court stated that the Commis-

sioner’s decision on petition is not binding on either the

Board or the Court.

Abbot states, in effect, on page 8 of the motion for

summary judgment that a party can practice an unlimited

amount of fraud on the PTO during the course of an

interference and the party will still prevail if it can show

that it made the invention first because 35 USC 135(a)

only gives the Board the authority to award priority to

the first inventor. However, as pointed out above, the

Board decides not only questions of priority but also

questions ancillary to priority including fraud or inequi-

table conduct as was pointed out on page 7 of Brennan’s

reply (No 165) to the motion for summary judgment. In

Tofe, supra., the question of the best mode requirement of

35 USC 112, Ist paragraph, was added to the list of

matters which have been held to be ancillary. In a concur-

ring opinion, Chief Judge Markey stated at 209 USPQ

384-385:

I concur in the view that the best mode

issue must be held ancillary to priority. | do so

solely on the basis of a perceived need for con-

sistency in the law.

Over the years, this court has continually

expanded the list of issues it has considered

A-46

ancillary to priority, for example, (1) whether an

application was altered after its execution. Van-

denberg v. Reynolds, 44 CCPA 873, 877, 242 F.2d

761, 764, 113 USPQ 275, 277 (1957); (2) right to

make a count, Stalego v. Heymes, 46 CCPA 772,

774, 263 F.2d 334, 335, 120 USPQ 473, 475 (1959);

(3) fraud, Norton v. Curtiss, 57 CCPA 1384, 1389,

433 F.2d 779, 783, 167 USPQ 532, 536 (1970); (4)

interference in fact, Nitz v. Ehrenreich, 537 C.2d

539, 543, 190 USPQ 413, 416 (CCPA, 1976); (5)

best mode when claiming benefit under 35 USC

120, Weil v. Fritz, 572 F.2d 856, 866, 196 USPQ

600, 608 (CCPA 1978); (6) patentable distinct-

ness, Hester v. Allgeier,_ _ F.2d __, __, USPQ

__, (CCPA, 1981).

The considerations here set forth do not

appear to have been argued to the court in its

“ancillary to priority” cases.

Hindsight is always easy, but in retrospect it

does not appear that the court could as well

have held none of the listed issues ancillary to

priority. [t could have interpreted the statute, 35

USC 135, as meaning only what it says, that is,

that “The question of priority of invention,” and

only that question, “shall be determined by a

board of patent interferences.” That holding

would have kept interference practice simple,

by maintaining a clear line of distinction

between a naked determination of who was first

to invent! and a determination of who, if any-

one, was entitled to a patent.

In a very real sense, the court’s “ancillary to

priority” holdings have been directed to “who

shall decide.” Issues such as support for a count,

interference in fact, and patentable distinctness,

could have been viewed as required preliminary

A-47

decisions, that is, as ancillary not to priority but

to the very existence of an interference. The

decision on such issues could have been left to,

or referred by the board back to, the examiner.

Issues touching defects in an application, such

as whether an application was belatedly altered,

fraud in the application, and whether an appli-

cant disclosed the best mode known to him at

the time of filing, could have been viewed as

governing the right to a patent and referred by

the board to the Commissioner, or left for later

decision by the examiner, who “will” consider

such questions “after judgment on priority.”

Rule 259.2

Whether an application is defective is criti-

cal, not just ancillary, to the right to a patent. It

may also be viewed as involved in the require-

ment that there by at least two application (or

an application and a patent) available for inter-

ference, that is, as going to the jurisdiction of

the board. Thus defects in an application may be

ancillary to an interference. Only a very broad

definition of the term “ancillary,” however, can

support the view that defects in an application

related to, or are “ancillary” to the question of

who was the first to make the invention.

Rule 259 appears, in somewhat ambiguous

terms, to render numerous matters ancillary to

priority and therefore decidable by the board of

interferences. It says “The Board of Patent Inter-

ferences may *** direct the attention of the

Commissioner to any matter not relating to pri-

ority which may have come to their notice, and

which in their [sic] opinion establishes the fact

that no interference exists, or that there has been

irregularity in declaring the same, or which

A-48

amounts to a bar to the grant of a patent to

either of the parties. * * * ” If the board is to

arrive at an “opinion” on the matters listed in

Rule 259, it would seem that it must fully con-

sider those matters. That the Rule describes

such matters as not “relating” to priority would

appear to indicate that such matters are not

“ancillary” to priority. At the same time, how-

ever, the Rule’s indication that the board “may”

direct such matters to the Commissioner estab-

lishes that it need not do so. Coupled with the

Rule’s reference to the board’s reaching an

“opinion” that a matter “establishes the fact

that” certain conditions are true, the board’s

discretion to refer or not refer would appear to

include discretion to decide that matter. (foot-

notes omitted)

In addition, this Board on occasion awards priority to the

second inventor when the first inventor is deemed to

have suppressed or concealed the invention, Lutzker v.

Plet, F.2d ___, 6 USPQ2d 1370 (Fed. Cir. 1988), or the

first inventor is guilty of inequitable conduct, Cebalo v.

Driscoll, 5 USPQ2d 1495 (Bd.Pat.App. & Int. 1984), and in

cases where derivation is established, the Board awards

priority even though only one party actually made the

invention, Davis v. Reddy, 620 F.2d 885, 205 USPQ 1065

(CCPA 1980). Thus, when the Board “awards priority” it

issues a judgment which finally disposes of the claims of

the losing party corresponding to the counts.

In the above interferences we awarded priority to

Brennan which thereby disposed of the claims of Muet-

terties/Muetterties et al corresponding to the counts;

however, in view of the directions of the United States

A-49

District Court for the Eastern District of Michigan, South-

ern Division (No. 198 and 236), we feel constrained to

refer the matter to the Commissioner. A-copy of our

decision at final hearing (Interference No. 100,817, Paper

No. 146) is attached hereto.

/s/ Donald D. Forrer BOARD OF

Donald D. Forrer PATENT APPEALS

Examiner-in-Chief AND

INTERFERENCES

/s/ Stanley M. Urynowicz, Jr.

Stanley M. Urynowicz, Jr.

Examiner-in-Chief

/s/ James R. Boler

James R. Boler

Examiner-in-Chief

)

A-50

APPENDIX I

UNITED STATES PATENT AND TRADEMARK OFFICE

BEFORE THE COMMISSIONER OF PATENTS AND

TRADEMARKS

In re Muetterties et al.

Serial No. 06/397,791

Filed: July 16, 1982

For: Reissue of Patent

No. 4,256,104

In re Muetterties

Serial No. 06/397,792

Filed: July 16, 1982

For: Reissue of Patent

No. 4,256,104

DECISION DEFERRING

CONSIDERATION OF

BOARD’S REFERRAL

UNDER RULE 259

(Mailed Jul. 28, 1988)

ee ee eee ee ee”

A. Introduction

The above-identified applications, along with Muet-

terties et al. U.S. Patent No. 4,256,104 (hereinafter “the

Muetterties patent”) and Brennan patent application

Serial No. 06/055§,725 (“the Brennan application”), were

involved in consolidated Interferences No. 100,817 and

No. 101,078 (the ” *817” and “” ’078” interferences).! Dur-

ing these interferences, Muetterties and Muetterties et al.

1 These interference proceedings were conducted under

the “old” interference rules, 37 C.F.R. §§ 1.201-1.288 (1984),

which applied to all interferences declared prior to February

11, 1985, the effective date of the “new” interference rules, 37

C.F.R. §§ 1.601-1.688 (1985). 49 Fed. Reg. 48, 416 (Dec. 12, 1984).

A-51

were represented by their assignee, Abbott Laboratories

(“Abbott”). In a decision dated January 8, 1986, the Board

of Patent Appeals and Interferences (“Board”) of the U.S.

Patent and Trademark Office (“PTO”) awarded priority to

Brennan on the basis of inequitable conduct by an Abbott

attorney during the early stages of the ’817 interference,

when it involved only the Muetterties patent and the

Brennan application. Specifically, the Board awarded pri-

ority to Brennan as to all counts in both interferences

because the Abbott attorney had engaged in inequitable

conduct by (a) back-dating a certificate of mailing on a

request for an extension of time for filing Abbott’s pre-

liminary statement so as to make it appear that it had

been timely filed and (b) filing a false affidavit to the

effect that the request had been timely served on Bren-

nan. The Board further found that but for Abbott’s ineq-

uitable conduct, Abbott would have been entitled to

priority as to all counts in both interferences.

Abbott brought suit for review of the Board decision

under 35 U.S.C. § 146 in Abbott Laboratories v. John F.

Brennan, No. 86-CV-0935-DT (E.D. Mich., S. Div.) (here-

inafter “the Michigan action”). In an order entered Sep-

tember 15, 1987, the Michigan court held that the Board

did not have the authority to award priority to Brennan

based on Abbott’s conduct and remanded the interfer-

ences to the Beard with instructions to make a recommen-

dation to the Commissioner under 37 C.ER. § 1.259

(1984)? regarding possible sanctions for Abbott’s conduct.

2 § 1.259 (1984) Recommendation by Board of Patent Inter-

ferences.

(Continued on following page)

A-52

For the reasons set forth below, following a detailed

discussion of the underlying facts, the Board had author-

ity to award priority to Brennan based on the ancillary

issue of Abbott’s inequitable conduct. Thus, consider-

ation of the above applications pursuant to the Board’s

referral under § 1.259 is being deferred until judicial

review of the Board’s decision in the interferences has

been completed.

B. The Interference Proceedings in the PTO

On February 10, 1982, the ‘817 interference was

declared involving the Brennan application, filed July 18,

1979, and the Muetterties patent, which issued March 17,

1981, on application Serial No. 06/016,461 (filed February

28, 1979).

The declaration of interference stated that the due

date for preliminary statements was April 11, 1982. How-

ever, since the 11th fell on a Sunday, a statement filed as

late as Monday, April 12, would have been timely.

(Continued from previous page)

The Board of Patent Interferences may, either

before or concurrently with their decision on the

question of priority, but independently of such deci-

sion, direct the attention of the Commissioner to any

matter not relating to priority which may have come

to their notice, and which in their opinion establishes

the fact that no interference exists, or that there has

been irregularity in declaring the same, or which

amounts to a bar to the grant of a patent to either of

the parties for the claim or claims in interference. . . .

—

A-53

On April 16, 1982, the PTO received a “Request for

Extension of Time” from an attorney for Abbott, repre-

senting Muetterties et al. This request bore a certificate of

mailing, signed by the attorney, indicating that the

request was being deposited with the U.S. Postal Service

on April 12, 1982. The stated reason for the requested

extension was simply that the “attorney of record in the

above-identified interference has been out of state for a

period of two weeks.” The request concluded with the

statement that “[a] copy of this request is being sent to

counsel for Brennen [sic].”

In a decision mailed April 22, 1982, a patent interfer-

ence examiner denied the request on the ground that

“[t]he motion fails to contain a detailed showing of facts

to explain why the time which elapsed since the interfer-

ence was declared was insufficient to permit the prepara-

tion and filing of [a] preliminary statement by the moving

party and it fails to justify the entirety of the extension

sought.”

On April 23, 1982 (mail room date: April 21), the

Board received from Brennan a “Brief in Support of

Motion in Opposition to Request for Extension of Time,”

acc>mpanied by supporting declarations and exhibits,

wherein Brennan opposed the requested extension of

time on several grounds. One of the grounds was that

although the request for an extension of time bore a

certificate of mailing date of April 12, 1982, “it may well

have been either backdated or not deposited with the

United States Postal Service on that date.”

On April 26, 1982, the Board received a “MOTION BY

MUETTERTIES, ET AL. FOR RECONSIDERATION OF

A-54

THE DECISION OF THE EXAMINER DENYING MUET-

TERTIES, ET AL. MOTION FOR EXTENSION OF TIME,”

accompanied by an affidavit by Abbott’s attorney, in

which the attorney explained that the principal reason for

the request “was [his] extensive absence . . . from the

offices of Abbott Laboratories during the period set for

response, and, concurrently, extensive periods of absence

of the inventors . . . from Abbott Laboratories during this

same period.” He also provided the dates and reasons tor

these absences. It was also aileged that the attorney “had

an extensive calendar during the period set for response,

which . . . made it more difficult to respond in a timely

manner.” citing in particular the negotiation and drafting

of three licensing agreements during this period.

In a decision mailed May 21, 1982, the patent interfer-

ence examiner again denied Abbott’s request for addi-

tional time, citing three grounds: (1) the request did not

include a certification of the manner in which Brennan

had been served, as required by 37 C.F.R. § 1.247, (2) the

request apparently was not deposited with the U.S. Postal

Service on April 12, and (3) the showing by Abbott did

not establish diligence by Muetterties et al. in attempting

to file their preliminary statement.

On June 7, 1982, Brennan filed a “Motion by Junior

Party for Award of Priority in View of Fraud by Senior

Party and Brief in Support Thereof,” based on the

allegedly false certification of Muetterties’ request for an

extension of time. This was followed on July 27, 1982, by

a “Motion by Muetterties et al. For Judgment and Award

of Priority based on Fraud by Brennan,” the alleged fraud

consisting of the obliteration of a postage meter stamp on

an exhibit.

A-55

On June 8, 1982, Abbott filed a petition to the Com-

missioner, in which it contended that the interference

examiner’s denial of its request for an extension was “an

abuse of discretion under the facts.” In a decision dated

September 21, 1982, the petition was granted, holding

that (1) it was improper for the interference examiner to

object to the form of the certificate of service in his

decision on reconsideration when he did not raise this

issue in his initial decision, (2) the interference examiner

should not have accepted Brennan’s arguments concern-

ing falsification of the certificate of mailing without fur-

ther investigation, and (3) the showing submitted with

Abbott’s motion for reconsideration should have been

accepted as sufficient under 37 C.F.R. § 1.246.3

Regarding the motions of both parties for an award

of priority based on alleged fraud by the other party, the

decision stated:

As indicated in the Commissioner’s Notice of

August 11, 1980, 998 O.G. 8,4 questions of fraud

° § 1.246 (1984) Late papers.

A motion or other paper belatedly filed will not

normally be considered except upon a showing,

under oath or in the form of a declaration (§ 1.68), of

sufficient cause as to why such motion or paper was

not timely presented... .

4 Petitions in Interference Cases

to Strike Applications for

Alleged Violations of 37 C.F.R. § 1.56

Not infrequently a party in an interference will

file a petition requesting the Commissioner to enter

(Continued on following page)

A-56

arising in an interference are ancillary to prior-

ity and are treated by the Board of Patent Inter-

ferences.

(Continued from previous page)

an order under 37 C.F.R. § 1.56(d) striking from the

files a patent application involved in an interference.

The issues raised by such a petition have been deter-

mined to be ancillary to priority within the meaning

of 37 C.F.R. § 1.258(a). See e.g., Norton v. Curtiss, 57

CCPA 1384, 433 F.2d 779, 167 USPQ 532 (1970); Lan-

ger v. Kaufman, 59 CCPA 1261, 465 F.2d 915, 175

USPQ 172 (1972). Hence, the issues may be consid-

ered by the Board of Patent Interferences at final

hearing if properly and timely presented.

The normal disposition of a petition to strike an

application involved in an interference is to dismiss

the petition, without prejudice to renewal following

termination of the interference. Such a disposition

allows the parties to develop the issues before the

Board of Patent Interferences. If the party filing the

petition ultimately prevails in the interference, fur-

ther action on the petition may be unnecessary.

Should action on the petition be necessary, the Com-

missioner has the benefit of the view of the Board of

Patent Interferences on the issues.

Under present practice, the Board of Patent

Interferences generally will hold a petition to strike

an application involved in an interference until the

time for opposition has expired. The file is then

forwarded to the Commissioner, where the petition

is normally disposed of as indicated in the preceding

paragraph. This practice is time consuming and

needlessly delays the interference.

(Continued on following page)

A-57

Accordingly, the interference is remanded

to the Board for appropriate action concerning

these motions.

Subsequent to this decision, on July 16, 1982, Abbott

tiled the ‘791 and ‘792 reissue applications and moved to

add them to the ‘817 interference. The ’791 reissue appli-

cation was added to the ’817 interference and a second

interference, i.e., the ‘078 interference, was declared

involving the ‘792 reissue application, the Muetterties

patent and the Brennan application.

In addressing the matter of the conduct by Abbott’s

attorney in its decision on priority, dated January 8, 1986.

the Board said it considered his testimony “to the effect

that he prepared and placed the Request in the Abbott

mailing system on April 12, 1982 to be incredible” and

(Continued from previous page)

In order to prevent such delays, in the future the

Patent Interference Examiner is authorized to enter

an order dismissing a petition to strike an applica-

tion involved in an interference, without prejudice to

renewal of the petition after termination of the inter-

ference. The petition should be dismissed imme-

diately upon receipt, without Suspension of the

interference.

Petitions to strike an application not involved in

an interference will continue to be handled in the

Office of the Assistant Commissioner for Patents in

the manner previously announced.

SIDNEY A. DIAMOND,

Dated: Aug. 11, 1980. Commissioner of Patents

and Trademarks

A-58

found that he “prepared the Request (BX 2) no earlier

than April 13, 1982 and back-dated the Certificate of

Mailing to April 12, 1982 and falsely stated in his affi-

davit (BX 11) that the Request had been mailed in a

‘timely manner.’” After holding that either the back-

dating or the false affidavit would be sufficient to consti-

tute inequitable conduct, the Board concluded that “nei-

ther Muetterties nor Muetterties et al. can be awarded

priority in these interferences.”

The board also found that the evidence failed to

establish any inequitable conduct by Brennan.

After awarding priority to Brennan based on fraud

by Abbott’s attorney, the Board, although not required to

do so, went on to address the question of who would

have been entitled to priority in the absence of the inequi-

table conduct by Abbott’s attorney. The Board found that

“Muetterties would, on the basis of inventive acts alone,

[have been] entitled to priority as to all of the counts in

the ‘078 interference.” As for the ‘817 interference, the

Board found that Muetterties, on the basis of its earlier

filing date, would have been entitled to priority as to all

of the counts.

C. The Michigan Action

1. Abbott’s motion for summary judgment

In its “MEMORANDUM OF LAW IN SUPPORT OF

ABBOTT LABORATORIES’ MOTION FOR SUMMARY

JUDGMENT” (“Memo.”), filed in the Michigan action,

Abbott argued that “[d]espite finding that Abbott was the

first and true inventor, the Board awarded priority to

A-59

Brennan as a sanction against Abbott for ‘inequitable

conduct’ by an Abbott attorney during the interference”

(Memo. at 2). According to Abbott, the old interference

rules “did not give the Board the authority to deny prior-

ity as a sanction for inequitable conduct” (Memo. at 6).

While the Board was authorized under the old interfer-

ence rules to impose sanctions for failure to comply with

a discovery order issued by the Board, 37 C.ER.

§ 1.287(d)(2),5 “[a]ny other allegedly inequitable conduct

was to be referred to the Commissioner of Patents [and

Trademarks] for appropriate action after the Board ful-

filled its obligation to determine priority. 37 C.F.R. § 1.259

(1982),” citing Lund v. Bentley, 188 USPQ 9 (Bd. Pat. Int.

1974), and Norton v. Curtiss, 433 F.2d 779, 167 USPQ 532

(CCPA 1970).!

> § 1.287 (1984) Discovery.

(d)(2) Any failure to comply with an order under

the provisions of paragraph (c) of this section may be

considered by the Board of Patent Interferences as

[a] basis for applying appropriate restrictions against

the party failing to comply, for holding certain facts

to have been established, and in an appropriate case

for awarding priority against him, or for taking such

other action as may be deemed appropriate.

basis of a false § 1.204(c) affidavit submitted vy Lund et al. first

awarded priority to Bentley before it referred the Lund et al.

application to the Commissioner under § 1.259 for consider-

ation of further action (i.e. striking the application) under

§ 1.56. 188 USPQ at 16.

(Continued on following page)

A-60

Abbott further noted that 37 C.F.R. § 1.223(c)” pro-

vided a specific sanction for failure to file a preliminary

statement, i.e., testimony will not be received to prove

(Continued from previous page)

In the Norton interference, Norton charged that Curtiss

committed fraud on the PTO during ex parte prosecution of his

application and that, as a result of this fraud, the Curtiss

application should be stricken under § 1.56 and priority

awarded to Norton. The Board, however, concluded that there

was no adequate basis for holding that Curtiss committed any

fraud on the PTO. In considering whether the Board should

have instead referred the question of fraud to the Commis-

sioner for his consideration, the court stated:

We find the action taken by the Ass’t Commissioner

in his decision on the initial petition to strike, citing

the probability that the board would necessarily con-

sider many of the matters relevant to the fraud ques-

tion, and enjoining that body to make an appropriate

recommendation under Rule 259 if it found fraud to

exist, was tantamount in its effect to a direct delega-

tion of the responsibility to make any further find-

ings regarding the question of fraud. We find no

problems with such delegation. The board fully dis-

posed of all questions relating to the fraud issue.

Since that issue is a necessary preliminary to any

finding that the application should be stricken, the

board’s decision was obviously determinative of the

question. As such, it is within our jurisdiction to

review.

7 § 1.223 (1984) Effect of statement.

statement, testimony will not be received subse-

quently from him to prove that he made the inven-

tion at a date prior to his effective filing date. . .

A-61

that he made the invention prior to the effective filing

date (Memo. at 7), and argued that “the Board could have

restricted Abbott’s proofs and referred any inappropriate

conduct relating to the preliminary statement to the Com-

missioner.”§ Furthermore, Abbott argued that if a party

files a late preliminary statement without leave, either he

may be allowed to file it (as was authorized by the

Commissioner in the present case) or he may be restricted

to his filing date under 37 C.ER. § 1.223(c) (Memo. at 7).

Abbott also cited Standard Oil Co. v. Montedison,

S.p.A., 540 F.2d 611, 191 USPQ 657 (3d Cir. 1976), as

standing for the proposition that “it is the function of the

Board to determine which party is the first and true

inventor. Any fraud or inequitable conduct during the

interference proceeding will not change that fact, and

must be referred to the Commissioner pursuant to Rule

259.9

* Note, however, that since § 1.223(c) Says that “testimony

will not be received,” it does not appear to give the Board

discretion to receive testimony in the absence of a preliminary

statement.

9 Standard Oil was an appeal, in an action under 35 U.S.C.

§ 146, from a district court order denying a motion by Standard

Oil for leave to amend the complaint to add new charges

against Montedison based on unpatentability, misjoinder of

inventors and fraud, issues which had not been raised before

the Board during the interference proceeding in the PTO.

Rather than holding that the Board must refer issues of fraud

to the Commissioner under § 1.259, the Third Circuit in fact

Stated that the Board itself may consider fraud in determining

priority in an interference proceeding:

(Continued on following page)

A-62

Finally, Abbott argued that the current authority of

the Board to award judgment against a party guilty of

(Continued from previous page)

Fraud in prosecuting a party’s case in an interference

proceeding may obviously affect the Board’s deter-

mination of priority and may, therefore, be raised

before the Board [citing Norton v. Curtiss and Langer

v. Kaufman, supra]. If so raised it may, of course, also

be raised in the § 146 suit in the district court.

540 F.2d at 616 & n.9, 191 USPQ at 661 & n.9. Furthermore, the

court stated:

We note that the Board of Patent Interferences itself

has taken the position that it should consider only

those issues of fraud which relate to priority. See

Poole v. Sugaya v. Iwabuchi, 182 U.S.P.Q. 571

(Pat.Off.Bd. of Pat.Int.1974). It may be that the Board

is empowered to consider other issues of fraud as

being ancillary to priority, as the Court of Customs

and Patent Appeals appears to have held [citing

Norton v. Curtiss and Langer v. Kaufman]. This we

need not here decide.

540 F.2d at 617, 191 USPQ at 662.

Regarding the actual issue in Standard Oil, which was

whether the district court could consider an issue of fraud

raised for the first time in a § 146 action, the Third Circuit said

that “in appropriate circumstances the district court may, in

such an action, in the exercise of a sound discretion, permit an

issue of fraud which infected the Board’s determination to be

raised though it was not raised in the interference proceeding.”

Id., 191 USPQ at 661. However, the court continued,

[w]e do not regard the discretionary power of

the district court to permit an issue of fraud to be

raised for the first time in a § 146 action as extending

to issues of fraud which are not involved in the

(Continued on following page)

A-63

inequitable conduct was newly created with the adoption

of § 1.6161° of the new interference rules, which among

other things empowers the Board to award judgment in

the interference against a party who fails to comply with

the regulations or any order of the Board (Memo. at 9-10).

As noted by Abbott, in the correlation table published

(Continued from previous page)

interference proceeding itself. for it is only fraud

which may have affected the determination by the

board of the factual issue of priority of invention,

i.e., the question as to which of the parties involved

in the interference actually first used the device or

process of the invention, which could have any effect

on the determination by the board of that historical

fact.

ld. (Footnote Omitted.)

10§ 1.616 (1985) Sanctions for failure to comply with

rules or order.

An examiner-in-chief or the Board may impose

an appropriate sanction against a party who fails to

comply with the regulations of this part or any order

entered by an examiner-in-chief or the Board. An

appropriate sanction may include among others

entry of an order:

(a) Holding certain facts to have been estab-

lished in the interference:

(b) Precluding a party from filing a motion or a

preliminary statement;

testing a particular issue;

(d) Precluding a party from requesting, obtain-

ing, Or Opposing discovery; or

(e) Granting judgment in the interference.

ia ie

A-64

with the new rules § 1.616 is described as “new,” while

old § 1.287(d)(2), concerning sanctions for failure to com-

ply with a discovery order, is indicated as corresponding

to new § 1.616. 49 Fed. Reg. at 48,450. Furthermore, Abbott

stated that in the “Analysis of Comments,” published

with the new rules, the PTO explained that the power to

enter sanctions is being created because “[t]here are cases

where sanctions are warranted.” 49 Fed. Reg. at 48,438.

Thus, Abbott argued, it is clear that prior to February 11,

1985, the effective date of the new rules, the Board lacked

the authority “to enter judgment as a sanction for inequi-

table conduct during an interference proceeding.”

The relief requested by Abbott was that the sanction

be vacated and priority awarded to Abbott (Memo. at

12-13).

2. Brennan’s response

Brennan, in its “DEFENDANT, JOHN BRENNAN’S

RESPONSE TO PLAINTIFFS’ MEMORANDUM OF LAW

IN SUPPORT OF ABBOTT LABORATORIES’ MOTION

FOR SUMMARY JUDGMENT” (“Resp.”), argued that

“parties have a duty of candor and good faith toward the

Patent and Trademark Office [which] is codified in 35

U.S.C. § 1.56” and that violations of 37 C.F.R. § 1.56" are

11 In April 1982, when Abbott’s attorney filed the request

for an extension of time which is the basis for the Board's

finding of inequitable conduct, § 1.56 read in pertinent part as

follows:

§ 1.56 (1981) Duty of disclosure; striking of applica-

tions.

(Continued on following page)

A-65

ancillary to priority within the meaning of 37 C.FE.R.

§ 1.258(a)!2 (Resp. at 8), citing Norton v. Curtiss, supra;

Langer v. Kaufman, supra; Lund v. Bentley, supra; and J.P.

Stevens & Co. v. Lex Tex Ltd., 747 F.2d 1553, 223 USPQ 1089

(Fed. Cir. 1984), cert. denied, 474 U.S. 822 (1985). 13

Brennan conceded that “[u]nder former case law and

Patent Office procedure, claims of inequitable conduct or

fraud were referred to the Commissioner for his

(Continued from previous page)

files if: (1) Signed or sworn to in blank, or without

actual inspection by the applicant; or

(2) Altered or partly filled in after being signed

Or sworn to.

(d) An application shall be stricken from the

files if it is established by clear and convincing evi-

dence that any fraud was practiced or attempted on

the Office in connection with it or that there was any

violation of the duty of disclosure through bad faith

Or gross negligence.

12§ 1.258 (1984) Matters considered in determining

priority.

(a) In determining priority of invention, the

Board of Patent Interferences will consider only pri-

ority of invention on the evidence submitted, and

matters ancillary thereto. .. .

13 1.P. Stevens, a patent infringement case, includes an

extensive discussion of the duty of disclosure with respect to

ex parte prosecution of a patent application. It does not, how-

ever, address the question of whether fraud and inequitable

conduct are ancillary to priority in an interference proceeding.

A-66

decision,” but argued that the Commissioner in his

Notice of August 11, 1980, 998 Official Gazette 8 (Sept. 9,

1980), “authorized the Board of Patent Interferences to

henceforth consider these issues at the final hearing”

(Resp. at 8-9).!4

After noting that for the above reasons alone the

Board was justified in awarding priority based on inequi-

table conduct, Brennan further argued that the Commis-

sioner in his

This text is long and has been trimmed here. Open the source document for the complete record.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.