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A recent Federal Circuit decision provides answers to this question. But first, what is a laches defense? Laches is an equitable defense that arises when there is an unreasonable and inexcusable delay in bringing suit. In the context of patent infringement litigation, a laches defense may be invoked if the patent holder unreasonably delays filing suit after learning of the infringing activity. If the defense is successful, laches bars all pre-suit damages. 

In a 6-5 decision, the Federal Circuit ruled that the defense of laches may still be used to eliminate pre-suit damages for patent infringement. The Court took up the case of SCA Hygiene Products v. First Baby Products in an en banc rehearing to consider the viability of the laches defense in patent infringement suits in light of the Supreme Court’s decision in Petrella v. Metro-Goldwyn-Mayer, Inc. 

In Petrella the Supreme Court held that a laches defense “cannot be invoked to preclude adjudication of a claim for damages,” including pre-suit damages, in a claim for copyright infringement when that claim is brought within the three-year statute of limitations. The Supreme Court reasoned that the three-year statute of limitation was all that was needed to prevent an unreasonable delay in bringing suit. 

At issue in SCA Hygiene was whether the defense of laches is available to bar a claim for pre-suit damages in a patent infringement action. In a suit alleging patent infringement, the damage recovery is limited by statute such that “no recovery shall be had for any infringement committed more than six years prior to the filing of the complaint.” The Federal Circuit found that this statutory language is a statute of limitations. The court reasoned that this language limits recovery of damages, but does not preclude bringing suit. Thus, the reasoning in Petrella does not apply to patents for this reason and the defense of laches is still available to preclude recovery of pre-suit damages.

Still viable

The Federal Circuit’s decision solidifies the viability of the laches defense to preclude pre-suit damages and provides an important reminder to both patent holders and accused infringers to consider laches. Patentees should continue to incorporate the laches defense in their patent enforcement strategies.

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