General Electric Co. v. Mitsubishi Heavy Industries, Ltd.

Patent applicants have an “uncompromising” duty of candor and good faith in dealing with the PTO, which includes the duty of disclosing all known material prior art.

Opinion (Furgeson): Mitsubishi Heavy Industries (“Mitsubishi”) alleged that General Electric Company (“GE”) committed inequitable conduct during its #705 patent application for wind turbines. Specifically, GE’s application included only one piece of prior art, and omitted the entire state of the wind industry at the time. As a result, the #705 patent claims were broad and effectively meant that any wind turbine manufacturer complying with the zero voltage ride through (ZVRT) requirements of U.S. grid codes infringed the #705. In other words, by omitting the entire state of the U.S. wind industry, Mitsubishi alleged that GE deliberately led the PTO to believe that its invention was the first to successfully meet ZVRT requirements. The Federal Circuit took the position that patent rights should not be stripped away merely because the inventor failed to disclose all prior art. Innocent omissions, either by accident or because of a good faith belief that the prior art was immaterial, are legitimate possibilities. Therefore, specific intent to deceive the PTO must be proven by clearly and convincingly showing the three elements of inequitable conduct outlined in Therasense: the applicant knew of the prior art, knew it was material, and made a deliberate decision to withhold it. Because GE effectively used its attorney-client privilege to prevent discovery of any “smoking gun” documents showing deliberate intent, and because of the Federal Circuit's high burden of proof for deliberateness post-Therasense, the Court found insufficient evidence of a GE effort to deliberately deceive the PTO. As a result, the Court could not make a finding of inequitable conduct, and AFFIRMED the jury verdict in favor of GE.