Microsoft v. i4i – The Supreme Court Keeps the Clear and Convincing Standard


In the Microsoft Corp. v. i4i, the Supreme Court had to determine whether the burden of proof for parties alleging patent invalidity should be changed from a clear and convincing standard to a preponderance of the evidence standard.  Yesterday, the Court unanimously decided no!!  Garth M. Dahlen, Ph.D., Partner at Birch, Stewart, Kolasch & Birch, LLP, sent in this article discussing  the decision and possible ramifications.

Yesterday in Microsoft v. i4i __ U.S. __ (2011)(Sotomayor, J.), opinion below, i4i Ltd. v. Microsoft Corp., 589 F.3d 1246 (Fed. Cir. 2009)(Prost, J.), the Supreme Court gave a unanimous decision affirming the Federal Circuit’s interpretation of 35 U.S.C. §282 requiring clear and convincing evidence for an invalidity defense.

The statute at issue was 35 U.S.C. §282 which states:

A patent shall be presumed valid…. The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.

Since its formation in 1982, the Federal Circuit has consistently required that invalidity be proven by clear and convincing evidence (C+C).  Microsoft, relying in part on dictum in KSR,[1] had asked the Court to reduce the evidentiary standard to preponderance of evidence (POE) at least in situations where the PTO had not considered the prior art now being asserted against the patent claims. Based on the language of the question presented by Microsoft in its briefs, Microsoft was asking the court to make one of the following two possible rulings:

(1)  Reverse the Federal Circuit’s decision and lower the standard to POE in all circumstances; or

(2)  Reverse the Federal Circuit’s decision and create a binary standard where POE is used when asserted prior art has not been considered by the PTO and C+C is used when asserted prior art has been considered by the PTO.[2]

Speaking for the Court, Justice Sotomayor stated unequivocally, “We reject both contentions.” With respect to the binary standard, the Court stated, “Indeed, had Congress intended to drop the heightened standard of proof where the evidence before the jury var­ied from that before the PTO – and thus to take the un­usual and impractical step of enacting a variable standard of proof that must itself be adjudicated in each case, … we as­sume it would have said so expressly [in the statute].”

Statutory Interpretation Principles

The Court took the position that Congress prescribed the governing standard of proof (C+C) in codifying section 282 back in 1952. Using statutory interpretation principles, the Court found that the term “presumed valid” had a settled meaning in the common law which was codified in section 282.

A decision relied on by the Court in ascertaining the settled meaning of the term “presumed valid” was the RCA case.[3] Quoting from the RCA case, “there is a presumption of validity, a presumption not to be overthrown except by clear and cogent evidence.” In the RCA case, Justice Cardozo traced nearly a century of case law to find that “one ‘common core of thought and truth’ unified the decisions: ‘[O]ne otherwise an infringer who assails the validity of a patent fair upon its face bears a heavy burden of persuasion, and fails unless his evidence has more than a dubious preponderance.’” (The Court quoting RCA).

Speaking for the Court, Justice Sotomayor went on to state, “The common-law presumption, in other words, reflected the universal understanding that a preponderance standard of proof was too ‘dubious’ a basis to deem a patent invalid.” Thus, the Court was of the opinion that the term “presumed valid” in section 282 was a codification of the then settled meaning at common law that the “defendant raising an invalidity defense bore ‘a heavy burden of persuasion,’ requiring proof of the defense by clear and convincing evidence.” (The Court quoting RCA).

During oral arguments, and in Microsoft’s briefs, Microsoft tried to limit the holding of RCA to relate only to oral testimony to substantiate priority of invention claims and that this argument had already been disputed at the PTO (a case of stare decisis).  In response to Microsoft’s assertion, the Court stated, “Squint as we may, we fail to see the qualifications that Microsoft purports to identify in our cases.”

Juries may be Instructed to Give Deference to PTO Decision-Making

The Court adopted the Federal Circuit practice[4] of giving deference to PTO decision-making while retaining the clear and convincing evidence standard of proof across the board. This is the “commonsense principle that … new evidence supporting an invalidity defense may ‘carry more weight’ in an infringement action than evidence previously considered by the PTO.” (Justice Sotomayor quoting Judge Rich in the American Hoist decision).

The Court did not go so far as to endorse a particular formation for a jury instruction, but did state that “the jury may be instructed to evaluate whether the evidence before it is materially new, and if so, to consider that fact when determining whether an invalidity defense has been proved by clear and convincing evidence.” As such, the amount of deference would turn on whether the evidence is materially new.

First Concurrence

Justice Breyer (joined by Justice Scalia and Justice Alito) gave a concurring opinion which began with the statement “I join the Court’s opinion in full.” This concurrence was written for the purpose of making it clear that the “standard of proof applies to questions of fact and not to questions of law.”

Second Concurrence

Justice Thomas gave a concurring opinion wherein he stated his belief that, contrary to the majority opinion, the term “presumed valid” did not have a settled meaning in the common law which could have been codified in section 282. Nevertheless, he agreed with the outcome of the Court since the heightened standard of proof was the common-law rule which was not altered by the codification of section 282.


In conclusion, patent holders should be tipping their hats to i4i’s attorney, Mr. Seth Waxman, for winning his case so decisively.

Also, the good people at the PTO should look at this case as a well-deserved pat on the back. The Court has viewed Judge Rich’s opinion in the American Hoist case with favor, and as such, subsumed within the Court’s opinion is Judge Rich’s declaration that the presumption of validity of patents was a common law presumption based on “the basic proposition that a government agency such as the [PTO] was presumed to do its job.” Slip opinion at 3.

[1] KSR International Co. v. Teleflex Inc., 550 U.S. 398, 426 (2007).

[2] There was fear in the patent community that the Court would adopt the binary standard. This binary standard would be fraught with practical problems, such as having the courts decide whether an Examiner has “considered” the reference during prosecution that is now being asserted in an invalidity defense. Justice Sotomayor noted this impracticality in footnote 10.

[3] Radio Corp. of America v. Radio Engineering Laboratories, Inc., 293 US 1 (1934).

[4] American Hoist & Derrick Company v. Sowa & Sons, Inc., 220 USPQ 763 (Fed. Cir. 1984).


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One Response to “Microsoft v. i4i – The Supreme Court Keeps the Clear and Convincing Standard”

  1. patent_litigation says:

    I’m quite pleased that the Justices defied pundits’ predictions and issued this ruling — I always thought i4i had the stronger arguments, not to mention many years of tradition and precedent on its side. Moreover, I think there’s a decent argument that a strong presumption of validity is indicated in the Constitution; and, on a policy note, in countries with weaker patent rights, there lurks always the danger that well-funded entities can use that lesser standard to bankrupt patentees, or even to deprive them of their IP altogether. Thank you, SCOTUS; well done.

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