Court Opinion

ID: 9491198
Source: CourtListenerOpinion
Date Created: 2023-08-05 14:06:37.30198+00
Date Added: 2024-06-11T17:54:34.521256
License: Public Domain

LOURIE, Circuit Judge,
with whom PAULINE NEWMAN and RADER, Circuit Judges, join, dissenting.
For reasons stated in my dissent from the panel’s decision, I also dissent from the decision of the court not to hear this case in banc. A state law claim for unfair competition that is based essentially on inequitable conduct in the Patent and Trademark Office is preempted by federal law. There already is a remedy under federal law for inequitable conduct. It is unenforceability of the patent and possible attorney fees. A state law remedy conflicts with that federal remedy.
A contrary decision frustrates federal law by placing in the hands of all the state courts, as well as all the federal regional circuits reviewing decisions of federal district courts whose jurisdiction is based on diversity of citizenship, determination whether there had been inequitable conduct and, if so, what the remedy should be for that offense. If the present panel decision is followed, the federal nature of the patent law may be splintered into a multitude of local rules, and the goal of uniform federal law, which the statute contemplates, and, in particular, this court was created to ensure, will be frustrated.
A whole new field of litigation will be opened up. State courts will be rendering judgments that may be in conflict with a federal judgment. New questions of standing will have to be settled, determining whether unfair competition and hence inequitable conduct can be raised by one not accused of inftingement. Inequitable conduct has been spoken of as a “plague” in the patent system. That plague will now infect the states. The panel’s decision is a Pandora’s box full of mischief—unnecessary, unjustified, and unwise.
Judge Clevenger’s assurances that the “sky will not fall” are not comforting. His analysis merely confirms the complexity of these issues and the depth of the morass that *1481the panel opinion creates. It is far from clear that a state cause of action based essentially on inequitable conduct is removable to federal court. Removal requires a “civil action brought in a State court of which the district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a) (1994). Do the federal district courts have original jurisdiction of an action “for inequitable conduct”? There is no such federal cause of action, perhaps not even a case or controversy. Such claims are defenses to a claim of patent infringement. Moreover, if a claim asserting unfair competition under state law is originally brought in the federal courts, a federal court will have to apply state law with uncertain consequences for uniformity of federal patent law. While federal courts apply state law all the time, e.g., in diversity cases, they should not do so when a clear case for preemption exists.
In any event, the panel opinion emphasized the “state law cause of action” and the “state court’s” role in adjudicating the dispute, Dow Chem. Co. v. Exxon Corp., 139 F.3d 1470, 1475 (Fed.Cir. 1998), rather than determining that this action “aris[es] under an Act of Congress relating to patents,” the ground relied on by the concurrence. Furthermore, contrary to the concurrence, the panel indicated that the issue of patent law “would only be ancillary to [the ‘state court’s’] central purpose ... [A] state court has authority to adjudicate patent questions so long as the action does not arise under the patent laws.” Id. at 1475.
Neither Additive Controls nor Christianson v. Colt, cited by Judge Clevenger for the proposition that state actions involving substantial questions of federal patent law will both lie in federal district courts in the first instance and be appealable to this court, is relevant to the issue of preemption. Additive Controls dealt with federal jurisdiction over a state claim for business disparagement, holding that, because the claim was based on an allegation that a patentee falsely accused the plaintiff of infringing its patent, federal jurisdiction was proper. Preemption does not appear to have been at issue, nor is it clear that this case would be precedent for placing all state unfair competition claims based on inequitable conduct in federal court. (I note that the two judges subscribing to this dissent were on the panel that decided that case.) Moreover, Christianson v. Colt did not involve a question of state versus federal jurisdiction, but one federal circuit versus another. The result of that case was that jurisdiction lay in the Seventh Circuit, not the Federal Circuit. Preemption was not at issue. Moreover, while that case did define this court’s “arising under” jurisdiction, it did not eliminate the prospect of federal courts following state law even when the basic issue is one of federal patent law. Again, there is raised the specter of nonuniform patent law. One may logically thread one’s way through the jurisdictional mess that these issues involve, but the legal framework would be much simpler if questions of ineqüitable conduct and infringement threats were not to be adjudicated under state law because of preemption. Federal law provides remedies for these offenses.
For these reasons, I believe the court should have taken this case in banc and overridden the panel’s judgment.