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Monday, November 25, 2013

Patent Reexamination Produces Extra-Innings Win in Seesaw Infringement Battle

Meredith L. Ainbinder

By Meredith Ainbinder. A member of our Litigation Practice Group

This past July, the Federal Circuit delivered a ruling that has defendants in patent infringement lawsuits, business executives and attorneys exploring new ways to wield patent reexaminations as a weapon in hotly contested patent fights.
 
Baxter and Fresenius have been engaged in years of tough competition and a long, tortuous litigation concerning hemodialysis machines. Their lawsuit came to a surprising close when the Federal Circuit determined that a late-in-the-game invalidation of Baxter’s patent claims in the PTO stripped Baxter of a string of wins in the litigation.

While reexamination itself has long been an arrow in the quiver of a company accused of patent infringement in district court, it was previously thought that a reexamination proceeding would affect an ongoing lawsuit only if the trial judge stayed the matter pending the PTO’s determination or if the reexamination was completed before rulings issued on infringement and validity.

In Fresenius v. Baxter, both the district court and the Federal Circuit had already ruled that Fresenius infringed Baxter’s valid patent, but the question of a proper damages award was still the subject of ongoing appeals. For that reason, the Federal Circuit held that the matter had not been finally decided. It thus took into consideration the PTO’s belated invalidation of the patent claims and dismissed the lawsuit.

For Baxter and Fresenius, the devil was in the details. The lawsuit was filed in 2003. In 2007, the district court determined that certain Baxter patents were valid and infringed by Fresenius. The case went up on appeal. In 2009, the Federal Circuit affirmed the district court’s ruling on validity of one patent, but reversed on two others. The Federal Circuit then remanded the case to the district court to reconsider remedies in light of the changed ruling on the patents actually infringed. (more)

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