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How unclean hands doomed patent infringement claims
Small children can get their hands dirty in many ways. A patent case involving a dining mat for kids illustrates how the legal doctrine of unclean hands can similarly sully legitimate infringement claims.
The nitty gritty
Eazy-PZ (EZPZ) owned a utility patent and a design patent on dining mats for toddlers. Its competitor Luv N’ Care (LNC) filed a lawsuit seeking a declaratory judgment that both patents were invalid, unenforceable and not infringed. EZPZ filed counterclaims for patent infringement.
Following discovery, the trial court found the utility patent was invalid because existing mat designs made EZPZ’s patent claims obvious. Before the court issued its ruling, though, the U.S. Patent and Trademark Office issued a re-examination certificate confirming the claims’ patentability.
However, after a trial, the court found that the unclean hands doctrine barred EZPZ from obtaining relief on its counterclaims for infringement. EZPZ appealed this determination to the U.S. Court of Appeals for the Federal Circuit.
Messy business
The unclean hands doctrine applies when a party’s misconduct has an “immediate and necessary” connection to relief sought in court. An appellate court will review the totality of the misconduct and can affirm on any grounds adequately supported by the evidence. In addition, the appeals court isn’t limited to the bases the trial court relied on in finding unclean hands.
The trial court in this case found that EZPZ failed to disclose patent applications related to one of the patents to LNC until well after the close of discovery and the period for motions to dismiss. In some instances, EZPZ revealed the information only when required by court order. The court found no good faith justification for the delay.
EZPZ also tried to block LNC’s efforts to discover EZPZ’s prior art searches. And its witnesses repeatedly gave purposefully evasive testimony during depositions and at trial, including repeatedly providing false testimony directly contradicted by other contemporaneous evidence. All of this, the appeals court said, supported the trial court’s finding.
According to the appeals court, the misconduct bore the requisite connection to EZPZ’s infringement claims. For example, the failure to disclose the prior art searches undermined LNC’s ability to press its invalidity and unenforceability arguments.
Down in the dirt
In the end, the appeals court concluded that EZPZ’s misconduct rose to the level of unconscionable acts, enhancing its litigation positions and undermining those of LNC. The trial court, therefore, didn’t err in blocking EZPZ from seeking relief for alleged patent infringement.
