A new appeals court decision relating to a decade-long litigation in Florida is setting new legal standards in the realm of patent infringement, a key portion of U.S. patent law. The case concerns a competitor who had fraudently tried to sue a company over inequitable conduct and over patents he had fraudulently obtained. Based on the recent appellate decision, the case is set to begin in late July.
The lawsuit, filed in 2008, began a four-year medical device patent infringement battle between two direct competitors: Tampa Bay-based ALPS South, LLC, and the Ohio Willow Wood Company.
“The case is an extraordinary example of establishing inequitable conduct in the face of federal judicial guidelines that severely limited one’s ability to prove inequitable conduct in court,” said attorney Ronald Christaldi who is with the firm engaged Shumaker, Loop & Kendrick. “The move should signal an ability of companies to more aggressively protect their patents and crack down on fraud.”
According to Shumaker, Loop and Kendrick, the case was had been a major victory for a Florida business, ALPS South. The organization’s founder, Aldo Laghi, moved his company to St. Petersburg, Fla., in 1994 and quickly became an international industry leader in designing and manufacturing prosthetic liners, the gel suspension and cushioning interface between a prosthesis and the residual limb. The company, which operates two St. Petersburg manufacturing facilities and also conducts business in almost 50 countries, had also developed innovative electrical interfaces that pick up neural signals that allow amputees to more intuitively manipulate their prostheses.
ALPS was first targeted by a competitor in late 2004, when that company accused ALPS of patent infringement. The lawsuit threatened ALPS’ very existence, but Laghi, knowing the company had properly respected other companies’ patents, chose to fight rather than settle.
According to Christaldi, their strategy in court was made more difficult by new federal judicial standards as a result of a 2011 decision in the case of Therasense, Inc. v. Becton, Dickinson and Co. Before that decision, a judge could use his or her discretion in invalidating a patent if he or she believed the patent holder had engaged in unfair practices. In Therasense, the court limited inequitable conduct to cases in which one could prove that a patent holder’s actions were directly related to the most material evidence on the patentability of patent in dispute and that the patent holder intentionally deceived the U.S. Patent and Trademark Office.
“Before Therasense, almost everyone who was sued for patent infringement claimed inequitable conduct as a defense,” Christaldi added. “The perception of the court was the inequitable conduct defense was being abused.”