Assignor Estoppel is Alive and Well after Minerva v. Hologic

The Supreme Court clarified the doctrine of assignor estoppel in its June 29^th Minerva v. Hologic opinion.[1]  In doing so, the Court vacated the Federal Circuit’s opinion estopping Minerva from arguing that Hologic’s patent is invalid.[2]

The technology underlying this case arose in the 1990’s when Csaba Truckai, now CEO of Minerva, invented a device for treating abnormal uterine bleeding that relied upon a moisture-permeable applicator head to destroy certain targeted cells in the uterine lining.  Mr. Truckai assigned related pending patent applications and any future continuations to his company Novacept, Inc. which were ultimately acquired by Hologic, Inc.[3]  Truckai went on to found Minerva and continued improving his technology, eventually patenting a new device relying on a moisture-impermeable applicator head.  In an effort to stop Minerva from competing against it, Hologic filed a continuing application with broadened claims drawn to an applicator head without regard to whether it was moisture-permeable or impermeable.[4]  This allowed Hologic to take the position that its claim reads on Minerva’s new technology even though Hologic’s specification contained no support for Minerva’s moisture-impermeable applicator head.  Lacking support in the specification, the claim would be invalid under Section 112(a) but would still appear on its face to read on Minerva’s product.  Hologic sued Minerva for patent infringement, and Minerva naturally argued that the broadened claim is invalid under Section 112(a) for lack of support in the specification.[5]  Hologic countered that Minerva is estopped from arguing invalidity under the doctrine of assignor estoppel.  In its appeals to both the Federal Circuit and the U.S. Supreme Court, Minerva argued that assignor estoppel should be either abolished or significantly narrowed.  Neither court obliged.  However, the Supreme Court ultimately found that the Federal Circuit’s formulation of assignor estoppel is in conflict with principles of equity.[6]

In short, assignor estoppel prevents unfair dealing in patent transactions where an assignor conveys a patent and then later argues that it was never valid.  The law imputes an implied warranty of validity upon the assignor.  Having implicitly assured the assignee that it is buying a valid rather than worthless patent, it cannot later contradict itself.  Allowing the assignor to take a contradictory position would permit it to benefit from its breach of warranty, first financially from sale of the patent, and then competitively because the patent is invalid.

The classic assignor estoppel scenario is where a patentee sells its issued patent to a competitor, continues to practice the technology and, when sued, he argues that the patent is invalid.  However, the facts of the Minerva v. Hologic case differ from the classic example in two critical respects.  First, Minerva’s owner, Truckai, assigned a patent application rather than an issued patent, and second the patent that Hologic asserted against Minerva resulted from claims that were broadened in continuing applications long after Truckai’s assignment.  Mr. Truckai could not possibly warrant the validity of claims that had not even been written at the time he made the assignment.

According to the Federal Circuit, under their precedent, it is not relevant that Truckai’s applications were still pending at the time of the assignment or that a downstream assignee might broaden them to the extent of being invalid.[7]  That Truckai broadly assigned his applications and all downstream continuing applications is enough to mechanically invoke assignor estoppel.  The Federal Circuit suggested that, while this is an unfortunate outcome, it is acceptable because Minerva is still permitted to introduce prior art evidence narrowing Hologic’s claim so that Minerva’s product might be outside its scope.  In other words, Minerva might still successfully defend the infringement claim despite being estopped from raising an invalidity defense.

The Supreme Court disagreed, reasoning that the “equitable basis of assignor estoppel defines its scope: the doctrine applies only when an inventor says one thing (explicitly or implicitly) in assigning a patent and the opposite in litigating against the patent’s owner.”[8]  Vacating the Federal Circuit’s opinion, the Court remanded the case to address what the Federal Circuit thought irrelevant: whether Hologic’s new claim is materially broader than the ones Truckai assigned thereby obviating assignor estoppel and allowing an invalidly defense.[9]  Regardless of the Federal Circuit’s conclusion, it is clear that assignor estoppel is alive and well, and that it is to be applied only as equity requires.

[1] Minerva Surgical, Inc. V. Hologic, Inc., et al., No. 20-440, Slip Opinion (June 29, 2021).

[2] Hologic, Inc. v. Minerva Surgical, Inc., 957 F.3d 1256 (2020).

[3] In August 1998, Mr. Truckai assigned his interest in U.S. Patent Application No. 09/103,072, an application from which the 9,095,348 patent claims priority.  In February 2001, Mr. Truckai assigned his interest in U.S. Patent Application No. 09/710,102, an application from which the 6,872,183 patent claims priority.

[4] Hologic, 957 F.3d at 1268 (referring to the ‘348 patent).

[5] Hologic asserted U.S. Patent Nos. 6,872,183 and 9,095,348.

[6] Minerva Surgicals, No. 20-440, Slip Opinion at 6.

[7] Hologic, 957 F.3d at 1268 citing Diamond Scientific Co. v. Ambico, Inc., 848 F.2d 1220 (1988).

[8] Minerva Surgicals, No. 20-440, Slip Opinion at 5.

[9] Id. at 16.