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 In a 7-1 decision, the justices said SCA Hygiene Products AB, based
in Stockholm, did not unreasonably delay in filing a lawsuit
accusing First Quality Baby Products of copying its patented adult
diapers.
The ruling is a blow to technology, pharmaceutical and other
companies frequently targeted in patent lawsuits, including many
brought by so-called "non-practicing entities" (NPEs) which buy and
assert patents but do not make their own products.
In a jointly filed brief supporting Great Neck, New York-based First
Quality's position, Google Inc, Samsung Electronics Co Ltd and more
than a dozen other companies said NPEs often delay bringing a claim
until a patents become more valuable through the defendants' labors.
The so-called laches defense allowed judges to dismiss cases in
which the plaintiff was determined to have strategically delayed
their claims.
But Justice Samuel Alito said in the majority opinion on Tuesday
that the motives behind the delay are irrelevant as long as the
patent owner's lawsuit was filed within the six-year time limit from
the date when its patent is first infringed.
“When Congress enacts a statute of limitations, it speaks directly
to the issue of timeliness and provides a rule for determining
whether a claim is timely enough to permit relief,” Alito wrote.
Justice Stephen Breyer wrote in a dissenting opinion that he
believed Congress intended to allow the laches defense when it
created the modern-day patent system in the 1950s.
The ruling reverses a September 2015 decision by the U.S. Court of
Appeals for the Federal Circuit.
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Michael Risch, a law professor at Villanova University School of
Law, said the ruling was not unexpected, based on a similar 2014
decision banning the defense in copyright cases.
Ashok Ramani of Keker Van Nest & Peters, a patent lawyer not
involved in the case, said the ruling would have had more impact on
NPEs if it had come out five years ago. The Supreme Court has
already clamped down on the NPE business model in recent years
through prior rulings that have limited both damages in patent cases
and the types of ideas that can be patented, he said.
The case is SCA Hygiene Products Aktiebolag v. First Quality Baby
Products, LLC, 15-927, at the U.S. Supreme Court.
(Reporting by Jan Wolfe; Editing by Anthony Lin and Jonathan Oatis)
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