starStar Scientific’s Belated Victory in Patent Reexamination, Missed Opportunity?

Last week, Star Scientific’s ex parte patent reexaminations (90/009,372 & 90/009,375) were favorably terminated based upon responses filed in November of 2009.  The reexaminations are directed to Star’s patented tobacco curing technologies that are the subject of an ongoing litigation with R.J Reynolds.

The 16 month delay between the November 2009 filing and March 2011 termination was the result of a procedural dispute. I discussed this development last Spring for the purposes of illustrating the importance of filing a proper interview summary in ex parte patent reexamination. As I pointed out at that time, misguided petition practice can turn a relatively minor miscue into a much larger problem.

In June of of 2009, a Maryland jury determined that Star’s patents were invalid. The jury also found that RJR did not infringe either patent. Star appealed to the Court of Appeals for the Federal Circuit (CAFC), oral arguments were heard on January 11, 2011. In their appeal, Star is seeking a new trial, alleging that RJR tainted the jury by referencing improper evidence.

On Friday, Star issued a press release touting their patent reexamination results. But, with the CAFC appeal briefed and argued, does the reexamination have any relevance at all?

In assessing patent validity, the USPTO and federal district courts/ITC employ completely different evidentiary standards. The USPTO uses the preponderance of the evidence standard. Conversely, the courts use a clear and convincing standard. For this reason, it is much easier to prove invalidity at the USPTO relative to the courts. Logic dictates that failure to prove invalidity at the USPTO would preclude a finding of invalidity by a court. (i.e.  since the court employs a much more demanding standard). Nevertheless, the Maryland jury found these patents invalid and Star appealed to the Court of Appeals for the Federal Circuit (CAFC).

In their appeal, Star argued that the jury verdict was tainted by certain prejudicial evidence used by RJR in their closing argument. Star is asking the CAFC remand the case back to the lower court for a new trial. During oral argument in January, one judge of the panel noted that Star was seeking a “hefty remedy” based on the “one passing comment” of RJR at trial. At the time of the argument, Star’s reexaminations remained ongoing. As a result Star was left to argue that the jury’s invalidity were simply tainted by RJR’s prejudicial evidence without much in the way of supporting evidence.

Had Star’s reexaminations concluded sooner, (i.e., not delayed by 16 months of petition wrangling) Star would have had valuable evidence tending to indicate that the jury was off in their judgement, at least with respect to some of the invalidity findings. Such may have provided some much needed meat to Star’s jury poisoning theory.

The prior art in the litigation and patent reexamination are overlapping in some respects, but not all. There are also issues of public use and claim definiteness at play in the court that were not considered by the USPTO in the patent reexamination. (This is because patent reexamination is limited to patents and printed publications only.) Likewise, Star also had adverse infringement findings to contend with at the CAFC. Thus, to use a football analogy, Star’s appeal is the equivalent of a 60yd Hail Mary pass attempt.

The recently concluded patent reexaminations do not address all bases of invalidity considered by the jury, and have no bearing on the non-infringement findings at all. Still, a more timely termination might have converted the 60 yd Hail Mary to at least a 55 yder.