A recent Supreme Court decision has eliminated one potential defense to damages in patent lawsuits. In March, the Supreme Court reversed a lower-court ruling based on a defense of laches. The doctrine of laches is a common defense which allows a party to defend a lawsuit by establishing that the plaintiff did not act within a reasonable period of time, and therefore is not entitled to monetary relief.
To some extent, this is common sense: if someone owes you money, but it takes you ten years to get around to suing, they can probably argue that you waited an unreasonable amount of time.
In SCA Hygiene Products Aktiebolag v. First Quality Baby Products, LLC, 580 U.S. _ (2017), SCA learned that First Quality was infringing its patent in 2003, but did not sue until 2010. Given this delay, First Quality asserted a laches defense.
Lower courts agreed with First Quality’s claim that SCA had waited an unreasonable period of time to make its claim for damages. However, the Supreme Court reversed, noting that the patent law expressly allows monetary damage claims for up to six years after patent infringement has taken place. Because the patent statute provided a 6-year statute of limitations, no laches defense is available.
In its decision, the Supreme Court affirmed that laches is a “gap-filling doctrine,” not intended to override existing law. The intention is to maintain checks and balances and avoid handing courts the power to override Congress.
Although the laches defense in no longer available against patentees seeking monetary damages, it is not eliminated from patent cases completely. Laches is still available to defend against claims for equitable relief, such as injunctions and cease-and-desist orders.
There’s also still the defense of equitable estoppel in cases where one party acted in a misleading manner, e.g., knowingly concealed important facts from the other party, and the other party relied on the plaintiff’s misleading conduct by, e.g., investing in the production of infringing products.
The Supreme Court decision has several broad implications. First, it may increase the number of patent cases involving expired patents. Second, it essentially affirmed that wherever Congress has established a clear statute of limitations for recovery of damages, the statute of limitations applies, not laches.
Finally, if you’re concerned about trademarks, you can breathe easy. Trademarks are governed by the Lanham Act, which does not have an express statute of limitations. Thus, laches may still serve as a defense to a claim for trademark infringement.
Image Credit
To some extent, this is common sense: if someone owes you money, but it takes you ten years to get around to suing, they can probably argue that you waited an unreasonable amount of time.
In SCA Hygiene Products Aktiebolag v. First Quality Baby Products, LLC, 580 U.S. _ (2017), SCA learned that First Quality was infringing its patent in 2003, but did not sue until 2010. Given this delay, First Quality asserted a laches defense.
Lower courts agreed with First Quality’s claim that SCA had waited an unreasonable period of time to make its claim for damages. However, the Supreme Court reversed, noting that the patent law expressly allows monetary damage claims for up to six years after patent infringement has taken place. Because the patent statute provided a 6-year statute of limitations, no laches defense is available.
In its decision, the Supreme Court affirmed that laches is a “gap-filling doctrine,” not intended to override existing law. The intention is to maintain checks and balances and avoid handing courts the power to override Congress.
Although the laches defense in no longer available against patentees seeking monetary damages, it is not eliminated from patent cases completely. Laches is still available to defend against claims for equitable relief, such as injunctions and cease-and-desist orders.
There’s also still the defense of equitable estoppel in cases where one party acted in a misleading manner, e.g., knowingly concealed important facts from the other party, and the other party relied on the plaintiff’s misleading conduct by, e.g., investing in the production of infringing products.
The Supreme Court decision has several broad implications. First, it may increase the number of patent cases involving expired patents. Second, it essentially affirmed that wherever Congress has established a clear statute of limitations for recovery of damages, the statute of limitations applies, not laches.
Finally, if you’re concerned about trademarks, you can breathe easy. Trademarks are governed by the Lanham Act, which does not have an express statute of limitations. Thus, laches may still serve as a defense to a claim for trademark infringement.
Image Credit