Ambivalence in Equivalents: Problems and Solutions for Patent Law s Doctrine of Equivalents

AuthorM. Aminthe Broussard
Pages119-139

Page 119

I would like to thank Russel O. Primeaux and Warner J. Delaune for graciously sharing their knowledge of patent law with me.

Introduction

In 1988, Horst Saalbach began a lawsuit involving the infringement of two patents owned by his Long Island robotics company, Festo Corporation. Today, after 15 years of continual litigation, including two trips to the United States Supreme Court, his case is still not resolved. In May of 2002, the Supreme Court issued its decision in Festo Corporation v. Shoketsu Kinzoku Kogyo Kabushiki Company, Limited1(known as SMC2), vacating a controversial Court of Appeals decision and remanding the case once again for further proceedings. Saalbach, a naturalized U.S. citizen who escaped communist East Germany when he was seventeen, continues this fight because of his belief in the principles of the Constitution.3 He has the resources to persist because Festo Corporation is a $1.5 billion company with 10,000 employees worldwide.4

However, Festo represents perfectly a serious flaw in the patent system today. The policy of patent law involved, the Doctrine of Equivalents, has caused at least as many problems in the last twenty years as it has solved. Applying the doctrine is problematical for courts because, as Festo itself demonstrates, it does not allow for precise boundaries. The Supreme Court has described problems with the doctrine,5 and the Court of Appeals for the Federal Circuit has gone so far as to call application of the doctrine "unworkable."6 This policy is also costly for litigants as the cases involved tend to be closely contested and, like Festo, are sometimes appealed for years.7 Since relatively few Page 120 patent holders can afford the one million dollar average cost of patent litigation,8 the rights of many patent holders are effectively diminished.

This note argues that a solution to this problem is for Congress to eliminate the Doctrine of Equivalents. Such legislation may seem at first to be controversial, and it may not have been an optimal solution twenty years ago, but it is feasible today. The doctrine was considered an important equitable solution when first introduced by the Supreme Court some 150 years ago,9 but it has since become outdated and unnecessary. The sheer volume of patent applications makes reform of the system especially desirable. In late 1999, the six-millionth patent was granted in the United States. At the present rate of filing this number will double in only sixteen years.10 Eliminating the doctrine of equivalents is therefore needed to increase judicial efficiency by clarifying claim interpretation, thus bringing certainty and predictability to the patent process. Since a patent is a contract, the doctrine can be replaced with traditional common law rules of contract interpretation. This proposed legislation would not be applied retroactively, so it would not impact the present owners of unexpired patents.

Part I of this note provides a background of patent principles, including the doctrine of equivalents and its counterpart, prosecution history estoppel. Part II introduces the procedural history of Festo, leading up to the highly anticipated Supreme Court decision issued in 2002, analyzes the Court's holding and reasoning, and summarizes recent developments in the case. Part III shows that the Court's decision in Festo opened the door for congressional action to eliminate the doctrine of equivalents and discusses the rationale and benefits of such legislation.

I Patent Law-;An Overview
A The Patent Process

A patent is a contract between an inventor and the government.11An inventor applies for his patent by making claims to the United Page 121 States Patent and Trademark Office (PTO).12 These claims form the basis of the inventor's legal protection. They are his property and can be quite valuable.13 The patentee is given what can become a monopoly over his invention for "limited times,"14 as granted by the Constitution.15 He has the exclusive right to manufacture, use, and sell the patented device, or simply to prevent others from doing so.16

The process of interaction between the PTO examiner and the inventor is called the prosecution history.17 During this process, the patent examiner either allows or rejects the inventor's claims. Rejected claims may then be amended by the inventor, and the patent examiner will then either allow or reject the amended claims.18 These negotiations last on average about eighteen months19 and can include an interview with the examiner.20 Receiving a patent is not a simple task, and patent attorneys must have scientific and/or technical backgrounds and special certification to write patent applications.21

In exchange for receiving a patent, an inventor must disclose his invention to the public.22 This is the public notice requirement, and it promotes the "progress of science"23 by allowing others to see exactly what has been patented and to improve upon it.24 Patent laws protect both pioneering inventions and technological improvements made by others on existing patented devices.25 Each type of invention is vital to the advancement of technology. A pioneering invention is one that performs a function never before achieved, such as the phonograph or the laser.26 More than 90% of all patented inventions, however, are simply advances over existing technology27 as is the Page 122 robotics device which is the subject of the Festo controversy.28 Such "design-arounds" are essential to progress because when a device is made better or cheaper without infringing existing patents, the public benefits. This benefit is made possible by the public notice requirement.

The essence of patent law, therefore, is a balancing of two competing interests-;the inventor's right to control his work versus society's right to use it. If the patent holder is given too much protection, a fear of infringing by competitors discourages innovation, so the public suffers. With too little protection, copycats flourish. In either case, with less incentive to innovate, the effect is exactly the same.29 Courts are largely responsible for balancing these interests, and the patent community has watched them struggle to strike the right balance between these competing issues for many years.30

B Patent Rights as Property Rights

A patent creates a property right in an invention which is analogous to a real property right.31 Like real property, patents can be sold, or "rented" through licensing, and the fees generated are royalties.32 The patent owner can also prevent "trespassers" from using his property with the threat or the act of a lawsuit. What a patent owner actually owns are his claims-;the verbal descriptions of his invention.33 These legally define the invention in the same way that a metes and bounds description in a property deed describes the property conveyed by the deed.34 Claims become part of the public domain and therefore must be clearly written so that Page 123 the patent holder knows what he owns and so that "the public should know what he does not."35

When a patent application is filed with the PTO, an examiner will search through the pertinent literature to determine if the invention is really new, useful, and not obvious.36 The body of technical information available to the public to determine these facts is known in the trade as "prior art."37 A patent application is typically rejected the first time it is examined because it usually does not fully conform to the requirements of the Patent Act.38 Often, the PTO examiner will require that at least one claim is changed, usually with the effect of narrowing it. When a claim is narrowed, the inventor is said to have "surrendered" some of the territory he originally requested (to continue the real property analogy). But since the inventor may not be able to get a patent without making the requested changes, he usually does so.39

When a claim is amended, a question sometimes arises as to whether the original claim should receive the same protection from infringement as does the final one. For example, if an inventor states in his original application that the process he wants to patent functions in "a large pH range," the examiner may require him to narrow that range to avoid a conflict with the prior art.40 If the inventor complies by amending the claim to state that the process works in solutions with a pH of "approximately 6.0 to 9.0," does the inventor then lose the right to a process that works at a pH of 5.0?41In other words, how broadly should claims be interpreted? On the one hand, effective patent protection would require claims to be read broadly enough to encompass the work envisioned by the inventor. The notice function, on the other hand, requires a narrow reading so Page 124 that the words retain their meaning and the public can clearly ascertain what is protected. Two doctrines were created by the courts to attempt to deal with these divergent ends-;the Doctrine of Equivalents and Prosecution History Estoppel.

C The Doctrine of Equivalents

An inventor is protected not only against literal infringement of his patent, but also against "knock-offs," instances where a copyist attempts...

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