United States: Regeneron Pharmaceuticals, Inc. V. Merus N.V.: The Federal Circuit Revisits The Defense Of Inequitable Conduct

In Regeneron Pharmaceuticals, Inc. v. Merus N.V., No. 2016-1346, slip op. (Fed. Cir. July 27, 2017) (hereafter, "Slip Op."), the Federal Circuit seems to have loosened the standards for finding a patentee culpable of inequitable conduct during patent prosecution. By affirming the district court's finding of inequitable conduct, the court in Regeneron condones the use of circumstantial evidence arising during litigation to infer that the patentee had specific intent to deceive the Patent and Trademark Office (PTO) during prosecution. The opinion was authored by Chief Judge Prost and joined by Judge Wallach. Judge Newman dissented.

Inequitable Conduct

"Inequitable conduct is an equitable defense to patent infringement that, if proved, bars enforcement of a patent." Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1285 (Fed. Cir. 2011). To show that an applicant engaged in inequitable conduct before the PTO, a party must show by clear and convincing evidence that "the applicant misrepresented or omitted material information with the specific intent to deceive the PTO." Id. at 1287. This analysis requires a showing of both materiality of the misrepresentation and intent to deceive. Id. The defense is most often wielded as an assertion by the accused infringer that the patent applicant knowingly withheld a material prior art reference from the PTO during prosecution.

Under Therasense, the standard for materiality is but-for materiality; "prior art is but-for material if the PTO would not have allowed a claim had it been aware of the undisclosed prior art." Id. at 1291. Prior art is not but-for material, though, if it is merely cumulative of prior art already before the PTO. See Slip Op. at 10.

To show intent, the accused infringer must establish that "the applicant knew of the reference, knew that it was material, and made a deliberate decision to withhold it." Therasense, 649 F.3d at 1290. Importantly, circumstantial evidence can suffice to prove intent. See Slip Op. at 11. "An inference of intent to deceive is appropriate where the applicant engages in a 'pattern of lack of candor,' including where the applicant repeatedly makes factual representations 'contrary to the true information he had in his possession.'" Id. (quoting Apotex Inc. v. UCB, Inc., 763 F.3d 1354, 1362 (Fed. Cir. 2014)).

The '018 Patent Dispute and the Plaintiff's Litigation Misconduct

Regeneron is the assignee of U.S. Patent Application No. 13/164,176 (the '176 application), which issued as U.S. Patent No. 8,502,018 (the '018 patent) on Aug. 6, 2013. Shortly after the '018 patent issued, Regeneron sued Merus for infringement in the Southern District of New York. Regeneron Pharmas., Inc. v. Merus B.V., 144 F. Supp. 3d 530, 537 (S.D.N.Y. 2015).

Merus denied infringement and counterclaimed that the '018 patent was unenforceable because of Regeneron's inequitable conduct before the PTO. In particular, Merus asserted that four references cited in prosecution of the parent application were material to patentability of the '176 application, and were withheld from the PTO with intent to deceive.

After a hearing on claim construction, the district court decided to bifurcate the trial, first to determine the materiality of the four withheld references, and in a later proceeding to determine whether Regeneron had the necessary intent to deceive the PTO by withholding the references. Id. at 595 n.51. In the first part of the trial, the district court determined that the withheld references were indeed material and not cumulative. Id. at 571-80. However, the second part of the trial, to determine intent, was never conducted because, according to the district court, Regeneron's litigation conduct from the outset of the trial provided sufficient evidence to establish an adverse inference of intent to deceive the PTO. See id. at 582-96.

The district court detailed at length Regeneron's "troubling" conduct, which included:

Patent Prosecution Misconduct

  • Regeneron's false assertion to the PTO that it had created the claimed transgenic mouse before Regeneron had actually done so
  • Regeneron's withholding of three references cited in a third-party submission in the parent of the '176 application, just days before the '176 application was allowed
  • Regeneron's withholding of a fourth reference, an international application that shared one common co-inventor with the '176 application

Litigation Misconduct

  • Withholding of documents in discovery
  • Refusal to provide an element-by-element identity between the accused product and the '018 claims
  • Refusal to offer a proposed claim construction
  • First concealing a prosecution-relevant memo by asserting it was privileged, and later waiving the privilege by producing parts of the memo and related papers, and finally obscuring the extent of related papers that a court order required to be produced

See id. Having considered Regeneron's trial conduct, the district court explored potential sanctions to impose against Regeneron, including allowing certain evidence into the record and precluding expert testimony. Id. at 594-95. However, the court found that none of these remedies were adequate, and decided to draw from the plaintiff's conduct an adverse inference of intent to deceive the PTO, which inevitably led to the conclusion that Regeneron had engaged in inequitable conduct in prosecuting the '018 patent. Id. at 595-96.

The Federal Circuit's Review of Inequitable Conduct

On appeal, the Federal Circuit reviewed the district court's claim construction and the finding that Regeneron engaged in inequitable conduct based on an adverse inference of intent to deceive the PTO. The court affirmed the district court's claim construction and adopted its factual findings of misconduct. See Slip Op. at 22. The only issue remaining for the three-judge panel to decide, then, was whether it was improper for the district court to draw from litigation conduct an adverse inference of intent in an inequitable conduct analysis. Id. at 35.

In answering this question, the court made clear that the district court's application of an adverse inference of intent was not simply punishing bad litigation behavior by condemning the '018 patent. Rather, the court agreed that Regeneron's pattern of "sword and shield" tactics during litigation evidenced an attempt to obfuscate prior prosecution misconduct before the PTO. Id. at 36-37. According to the majority, drawing this inference to establish the intent required of a finding of inequitable conduct was not an abuse of discretion. Id. at 37.

Judge Newman's Dissent

In a 19-page dissent, Judge Pauline Newman strongly objected to the application of litigation misconduct to infer an intent to deceive the PTO. The fact that a second trial on the element of intent was scheduled but never held weighed heavily in Judge Newman's rationale. She explained that the majority's affirmance of the district court offended "fundamental fairness and judicial process" because "no evidentiary record was developed on intent to deceive, with no testimony and no opportunity for examination and cross-examination of the witnesses." Slip Op., J. Newman dissenting, at 2-3. Judge Newman further contested the materiality of the withheld references, stating that "they are not but-for material as compared with the references" cited by the examiner. Id. at 11.

Overall, Judge Newman maintained that "[i]ntent to deceive the examiner cannot be inferred from purported litigation misconduct several years later," and that "[t]he premises of the law of inequitable conduct have not been established by clear and convincing evidence," as required under Therasense. Id. at 19.


The Federal Circuit has recognized that the defense carries a very harsh penalty: unenforceability of the entire patent. Therasense, 649 F.3d. at 1287-88. Although the standards for intent and materiality "have fluctuated over time," since Therasense courts have consistently required a showing, by clear and convincing evidence, of both prongs of inequitable conduct: materiality and intent. To some observers, Regeneron will cast doubt on this precedent and unsettle the consistency in application of inequitable conduct.

For patent prosecutors faced with multiple similar prior art references, this case cautions against assuming that the references are merely cumulative. Suppose two prior art references are material to the patentability of an application under prosecution. Reference A is of record and being considered by the PTO. The applicant is made aware of Reference B, but concludes that it is merely cumulative of Reference A and therefore elects not to disclose it. Prosecution continues, and the applicant is forced to make arguments distinguishing his invention over Reference A. In so doing, he construes Reference A as a limited disclosure that does not anticipate or render obvious his claims. The PTO allows the claims.

Later, during litigation, the infringement defendant asserts inequitable conduct because of the applicant's failure to disclose Reference B. It's clear that the reference is material, but can the plaintiff/patentee now maintain that it is cumulative? This may depend on how the applicant characterized Reference A during prosecution years earlier. Would the applicant have characterized Reference B differently than Reference A had it been asserted against the claims? Has the plaintiff/patentee now argued that Reference B is cumulative by asserting a rationale different from the rationale that established Reference A as non-invalidating during prosecution? If either answer is yes, then the defendant has a strong argument that the references are not cumulative. Thus, the safest tack for patent prosecutors is simply to disclose all known relevant art, even if it is cumulative of art already of record.

As for patent litigators, this case is another cautionary example of the risks of engaging in "sword and shield" tactics to obscure decisions made by the patent applicant during prosecution. Where certain strategic decisions were made during prosecution that could taint the patentee's litigation strategy, the best approach for litigators may be simply to come forth, explain the strategic prosecution decisions and hope for the best.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
McDermott Will & Emery
Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
McDermott Will & Emery
Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions