Regeneron Pharmaceuticals, Inc. v. Merus N.V., 864 F.3d 1343

Regeneron sued Merus for infringement of U.S. Patent No. 8,502,018 (the ’018 patent); Merus counterclaimed that the patent was unenforceable for inequitable conduct during prosecution.
Four references (Brüggemann, Wood, Taki, Zou) and certain European opposition materials (the “Withheld References”) were known to Regeneron’s prosecution team but were not disclosed to the U.S. examiner for the ’018 patent.
The district court bifurcated an inequitable-conduct bench trial into materiality (held) and intent (scheduled separately), found the Withheld References but-for material, and did not hold the scheduled intent trial.
Instead of a merits intent trial, the district court sanctioned Regeneron for extensive discovery and privilege-log misconduct during litigation and drew an adverse inference that Regeneron’s prosecutors acted with specific intent to deceive the PTO.
The district court therefore held the ’018 patent unenforceable for inequitable conduct; the Federal Circuit affirmed, accepting the materiality findings and that the adverse-inference sanction was within the district court’s discretion.

Issue	Regeneron’s Argument	Merus’s Argument	Held
Whether the Withheld References were but-for material to the ’018 patent	Not but-for material; cumulative of art the examiner considered	But-for material individually and in combination; would have prevented allowance	Court: references were but-for material and not cumulative; district court’s findings not clearly erroneous
Whether Regeneron acted with specific intent to deceive the PTO during prosecution	No direct evidence of intent; district court should have held the separate intent trial	Sanctions and discovery misconduct permit inference of intent	Court: adverse inference from litigation misconduct was permissible; district court did not abuse discretion
Whether litigation misconduct may support an adverse-inference finding as to prosecution intent	Such post-prosecution misconduct cannot substitute for proof of intent during prosecution	Litigation misconduct that conceals prosecution-era documents may justify adverse inference	Court: Sanctioning and drawing adverse inference for discovery abuse was proper under Second Circuit precedent
Whether, given inequitable conduct ruling, other claim-construction/indefiniteness issues should be resolved on appeal	Regeneron sought reversal to reach those merits issues	Merus relied on inequitable conduct defense	Court: affirmed unenforceability on inequitable conduct grounds and declined to reach remaining claim-construction/indefiniteness challenges

Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir.) (en banc) (inequitable conduct requires but-for materiality and specific intent to deceive)
Digital Control Inc. v. Charles Mach. Works, 437 F.3d 1309 (Fed. Cir. 2006) (withheld prior art that is merely cumulative is not material)
Regents of the Univ. of Cal. v. Eli Lilly & Co., 119 F.3d 1559 (Fed. Cir. 1997) (defining cumulative prior art doctrine)
Genentech, Inc. v. Chiron Corp., 112 F.3d 495 (Fed. Cir. 1997) (meaning of "comprising" as open-ended in claims)
Molins PLC v. Textron, Inc., 48 F.3d 1172 (Fed. Cir. 1995) (deliberate decision to withhold known material reference standard)
Am. Calcar, Inc. v. Am. Honda Motor Co., 768 F.3d 1185 (Fed. Cir. 2014) (review standards for materiality and intent findings)
Residential Funding Corp. v. DeGeorge Fin. Corp., 306 F.3d 99 (2d Cir. 2002) (district courts have broad discretion to impose adverse-inference sanctions for discovery abuse)
Aptix Corp. v. Quickturn Design Sys., Inc., 269 F.3d 1369 (Fed. Cir. 2001) (litigation misconduct alone cannot be a basis to render a patent unenforceable under unclean hands doctrine)
Keystone Driller Co. v. General Excavator Co., 290 U.S. 240 (1933) (distinguishing remedies for litigation misconduct from invalidating property rights)