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Supreme Court Axes Laches: Major Change, But Modest Impact
Today on IPcopy we have a summary courtesy of Wolf, Greenfield & Sacks, P.C. of a significant patent decision in the U.S. Supreme Court (SCA Hygiene Products v. First Quality Baby Products, LLC).
On Tuesday March 21, 2017, the Supreme Court issued a 7-1 decision in SCA Hygiene Products v. First Quality Baby Products, LLC, ruling that laches—the notion that a plaintiff prejudiced a defendant by waiting too long to sue—cannot be invoked as a defense against a claim for patent infringement damages that accrued prior to the date of the suit. Explaining that a laches defense would undermine the Patent Act’s statute of limitations for damages, the Supreme Court relied heavily on its analogous copyright decision from 2014, Petrella v. Metro-Goldwyn-Mayer, Inc., to overrule a 6-5 en banc decision from the Federal Circuit.
SCA is a favorable decision for patent owners, but is unlikely to have a profound impact on patent litigation. Laches defenses were always difficult to prove except in the most extreme situations—situations in which the separate doctrine of equitable estoppel remains available. SCA will likely be most significant in cases where the patent owner never actually communicated with the defendant before the suit but instead silently waited a long time to sue, perhaps until sales of an accused product are greatest, significantly prejudicing the defendant in the process (e.g., as a result of significant investments in the accused products or important evidence becoming unavailable). Even in those cases, the defendant may still cite laches as a reason to deny injunctive relief. (more…)