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In re Construction Equipment

BY Dervis Magistre
February 28, 2012

If the Federal Circuit affirms a lower court verdict holding a patent not invalid over a prior art reference, may the losing party ask the Patent Office to invalidate that patent via re-examination over the same prior art reference? In the case of In re Construction Equipment, 665 F.3d 1254 (Fed. Cir. 2011), the Federal Circuit answered yes, raising important issues bearing on the scope of the re-examination statute, the finality of judgments, and the relationship between the Patent Office and the federal judiciary under the separation of powers doctrine of the Constitution.

Factual History

Construction Equipment Company (“CEC”) owns U.S. Patent 5,234,564 (the '564 patent), which is “directed to a vehicle for screening rocks and plant matter ' based on size from, for example, soil or dirt at a construction site.” Construction Equipment, 665 F.3d at 1254-55. A request for ex parte re-examination was filed in January 2007. Although the request did not name the third-party requester, the opinion states “CEC claims that the request was initiated by a company called Powerscreen International Distribution Ltd. (“Powerscreen”).” Id. at 1255 n.1. In litigation between CEC and Powerscreen that ended in 2000, Powerscreen had failed on appeal to overturn a final judgment of infringement of the '564 patent. Id. At issue in the re-examination was prior art that Powerscreen had unsuccessfully asserted against the validity of the '564 patent in the prior litigation. Id. at 1261 (Newman, J., dissenting). According to the 2-1 majority opinion, the claims at issue in the re-examination of the '564 patent were invalid over the prior art because “CEC's alleged invention consists entirely of combining known elements that, while possibly new, was nevertheless obvious and therefore unpatentable.” Id. at 1256.

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