Collateral estoppel applies to non-identical claim if difference does not materially alter invalidity; summary judgment of no inequitable conduct inappropriate

Federal circuit reverses summary judgment of no inequitable conduct while affirming summary judgments of invalidity due to collateral estoppel and obviousness. The case had been stayed pending resolution of ex parte reexaminations of the patent. During the stay, the plaintiff/patentee Ohio Willow had asserted a related patent against a third party, but lost after summary judgment of obviousness.

Wood Company v. Alps South, LLC, __ F.3d __ (Fed. Cir. Nov. 15, 2013) (Dyk, Bryson, REYNA) (S.D. Ohio: Frost) (3 of 5 stars)

Collateral Estoppel: Applying Federal Circuit law rather than regional circuit law, the federal circuit affirmed the district court's summary judgment that plaintiff was collaterally estopped from contesting the obviousness of certain claims, even though the language of the claim which was invalidated in the other litigation was not identical to the claims in the present case. "Our precedent does not limit collateral estoppel to patent claims that are identical .... If the differences between the unadjudicated patent claims and adjudicated patent claims do not materially alter the question of invalidity, collateral estoppel applies." Slip op. at 11.

Obviousness: The federal circuit affirmed summary judgment that other asserted claims not subject to estoppel were obvious, rejecting Ohio Willow's argument that the district court had failed to identify a sufficient reason for combining references. The federal circuit noted that the "common sense" of skilled artisans could demonstrate obviousness. Slip op. at 14. The court also rejected Ohio Willow's proffer of "secondary considerations" attacking obviousness.

Inequitable Conduct: Reversing the district court, the federal circuit held that a reasonable fact-finder could have determined that Ohio Willow intentionally withheld or misrepresented certain material facts during reexamination when the BPAI disregarded the testimony of a fact witness because there was insufficient corroborating evidence. With respect to materiality, the federal circuit refused to require corroboration for every point of evidence, and instead applied an eight-factor rule of reason analysis to the circumstantial evidence presented by Alps. This analysis led the court to conclude, in light of standard for summary judgment, that a genuine issue of facts existed on the question of materiality. The federal circuit’s holding on the intent prong focused on circumstantial evidence that could, when viewed in a light most favorable to non-moving party, "support a finding of intent that is the single most reasonable inference to be drawn from the evidence at this stage of the proceedings." Slip op. at 30. Having found questions of fact in both the materiality and intent prongs of the inequitable conduct analysis, the federal circuit remanded for further proceedings.