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Invalidating Issue Preclusion: Rethinking Preclusion in the Patent Context

Preclusion is a complex doctrine to apply in any given case, and patent litigation presents no exception. Ever since the Supreme Court ruled in Blonder‐Tongue Laboratories, Inc. v. University of Illinois Foundation that issue preclusion applies to prevent litigation on a patent that previously has been declared invalid in a court of competent jurisdiction, courts have applied issue preclusion summarily to end disputes over previously invalidated patents. But issue preclusion may not be an appropriate procedural tool in all such cases. In fact, analysis of a number of district court opinions demonstrates that some judges may explicitly or implicitly realize the same. This Comment both systematically analyzes the application of issue preclusion in the patent validity context from a doctrinal perspective and addresses significant practical concerns derived from the doctrinal findings. Interestingly, this analysis suggests that the Federal Circuit and most district courts are applying the law of issue preclusion incorrectly and that this practice has significant implications for litigants. Primarily, courts’ treatment of patent invalidity as a whole as a “single issue” for the purposes of issue preclusion is out of line with the application of that doctrine in other areas of civil law. Although the misapplication of issue preclusion is a moot point in most cases where a patent is adjudged invalid and that holding is maintained on appeal, it is of practical significance for simultaneous litigation over a single patent in multiple district courts. A new procedural framework is proposed to remedy the doctrinal and practical problems raised by the current application of issue preclusion in the patent validity context. Instead of entering judgment based on issue preclusion, which is inappropriate in many cases, there are substantial policy concerns favoring either applying claim preclusion, dismissing the plaintiff’s action for failure to state a claim upon which relief may be granted under Rule 12(b)(6) of the Federal Rules of Civil Procedure, or simply staying the patent litigation pending final appeal of an earlier proceeding over the same property right.