USPTO Reminds Patent Practitioners Regarding Their Duty Of Disclosure Obligations (And Inequitable Conduct)

When I tell my law students about their future fiduciary duties to clients, I sum them up as loyalty and confidentiality,  but that is not the whole story.  This is because lawyers have other enumerated duties to clients, courts, and the profession as a whole.

However, patent attorneys have another duty that could be correlated to a lawyer’s duty to the court—that is the duty of candor and good faith in dealing with the USPTO.  The question often asked is whether the duty of loyalty to a client trumps the duty of candor.  Earlier this summer, the USPTO attempted to bring to focus an issue I have spoken about recently in a number of CLEs—the impact of the duty of disclosure on patent applicants (and their patent practitioners) in highly regulated industries.  The USPTO issued a notice earlier this summer reminding practitioners of this obligation.  See 87 FR 45764.

Duty of Disclosure & Government Agencies

The duty of disclosure applies to matters pending before the USPTO and extends broadly to “[e]ach individual associated with the filing and prosecution of a patent application” and “[e]ach individual associated with the patent owner in a reexamination proceeding.” 37 CFR 1.56(a) and 1.555(a).  In other words, it applies to both the client and the practitioner.  However, Belcher Pharm. v. Hospira, Inc., 11 F.4th 1345 (Fed. Cir. 2021) clarified the landscape on what should be disclosed to the USPTO.  In a panel that included Judges Reyna, Taranto, and Stoll, affirming a finding of inequitable conduct, the Court noted the materiality prong was achieved by way of the lower court holding two claims obvious in light of prior references including a supposed withheld piece of information.  To the intent prong, the Court noted that Belcher Pharmaceuticals’ Chief Science Officer was keenly aware the captured pH range was known in the art, and that his company had gone back to that range solely as a means to obtain FDA approval because it had been a seemingly approved range by the FDA.

Why Does This Matter?

Many of you may be lost here—why does this matter? The Chief Science Officer specifically asserted during prosecution that a specific pH range was a critical innovation.  According to the lower Court, that statement was false.  Let’s rewind for second.  The Chief Science Officer claimed he was involved in the prosecution of the patent, as well as of the NDA.  During the prosecution of the patent, the Chief Science Officer argued that a specific pH range was novel and critical innovation.  Meanwhile, the pH range was actually one used in prior art (and approved by the FDA) that was supposedly withheld from the USPTO.  Of course, the lower Court also noted credibility issues in testimony.

The USPTO’s Commentary

The Federal Circuit case cited above involves a Chief Science Officer who is not a patent practitioner, yet this issue is important to our practitioner-readers.  This is not only because we want high-quality patents and happy clients, but also because of the warning issued by the USPTO.  The USPTO states, in the notice, that “each party presenting a paper to the USPTO, whether a practitioner or non-practitioner, has a duty to perform an inquiry that is reasonable under the circumstances.” (emphasis added).  Moreover, as related to the Belcher Pharmaceuticals’ case, the USPTO states that parties “should ensure that the statements made to the USPTO and other Government agencies, or any statements made on their behalf to other Government agencies regarding the claimed subject matter, are consistent.”

Conclusion

Practitioners should be hyper-aware of their duty of disclosure obligations, but also should be mindful that they ask the right questions.  It appears that the USPTO is issuing a notice by expanding their view of Rule 56 and stating that practitioners must verify client statements prior to submitting them to the USPTO.  While there may be challenges under the Administrative Procedure Act, it is a good lesson for practitioners pay attention and ask questions.  Whether your client has a matter before the FDA or some other government agency, be mindful of what they submit, and tell them the importance of having their patent counsel review such submissions for compliance with their obligations to the USPTO.

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