Streck, Inc. v. Research & Diagnostic Systems, Inc.
659 F.3d 1186
Fed. Cir.2011Background
- Streck sued R&D for infringement of the '500, '668, and '388 patents (Ryan and Scholl inventions) in Nebraska; Johnson (R&D) contends Streck’s patents are invalid due to prior invention.
- An interference proceeding at the PTO involved Ryan, Scholl, and Johnson with earliest dates around August–October 1999; Johnson was found by the Board to have priority.
- Concurrent §146 action allowed Streck to challenge the PTO decision in district court using the PTO record plus new evidence.
- The district court admitted the PTO record and allowed live testimony, conducting de novo fact-finding on priority contrary to R&D’s position that Board findings should control if supported by substantial evidence.
- The district court found Streck’s witnesses credible, rejected Johnson's 1996 experiments as not showing actual reduction to practice, and concluded Streck had priority in favor of Ryan and Scholl; R&D appealed.
- Rule: §146 actions allow de novo review with the right to present additional evidence; burden and standard of proof differ from PTO proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| What is the governing standard of review in §146 actions? | Streck argues de novo review per Winner; broad live testimony permitted. | R&D argues Board findings should control if supported by substantial evidence. | De novo review applies. |
| Who bears the burden of persuasion in the §146 action? | Streck—burden on the later-appearing party (R&D) to prove prior invention. | R&D—burden on the party challenging priority. | Burden on R&D. |
| What is the appropriate standard of proof for priority in §146 action? | Preponderance of the evidence applies in the §146 proceeding. | Infringement prior-art standard (clear and convincing) does not apply to §146. | Preponderance of the evidence standard applied. |
| Can new evidence be considered in the §146 action, and how does it relate to PTO findings? | New evidence may be introduced to shore up evidence and expand inquiry. | New district-court evidence should not undermine Board findings absent overlap. | New evidence permissible; de novo fact-finding authorized. |
| Did Ryan (Streck) actually reduce to practice before Johnson’s date? | Ryan reduced to practice in 1997–1999, earlier than Johnson. | Johnson’s 1996 tests allegedly showed reduction to practice. | Streck established priority; Johnson’s 1996 tests did not constitute actual reduction to practice. |
Key Cases Cited
- Winner International Royalty Corp. v. Wang, 202 F.3d 1340 (Fed.Cir.2000) (de novo fact-finding in §145/146 actions; live testimony creates district-court fact-finding role)
- Agilent Technologies, Inc. v. Affymetrix, Inc., 567 F.3d 1366 (Fed.Cir.2009) (§146 scope; district court may receive newly submitted conflicting evidence)
- Koninklijke Philips Elecs. N.V. v. Cardiac Sci. Operating Co., 590 F.3d 1326 (Fed.Cir.2010) (§146 evidence and breadth of admissible new evidence to support findings)
- Dickinson v. Zurko, 527 U.S. 150 (1999) (direct-appeal standard differs from §706/§145 review; APA framework applicable on direct appeal)
- Hyatt v. Kappos, 625 F.3d 1320 (Fed.Cir.2010) (parallel proceedings; §145/146 treated similarly; live testimony allowances)