Background
Agfa Corporation owned patents on computer-to-plate printing technology — a digital pre-press process used in commercial printing. Agfa sued Creo Products for patent infringement. At trial, Creo raised the affirmative defense of inequitable conduct, arguing that Agfa had intentionally withheld material prior art from the U.S. Patent and Trademark Office during prosecution of its patents.
The prior art at issue included several competing printing systems — including Creo’s own Platesetter 3244, Barco’s LithoSetter, and Gerber’s Crescent/42 — all of which Agfa’s engineers had detailed knowledge of. Despite this knowledge, Agfa did not disclose these systems to the patent examiner, and in some instances made arguments to the examiner that the Agfa engineers knew to be inconsistent with the capabilities of these competing products.
Agfa argued it was entitled to a jury trial on the inequitable conduct defense, asserting that the Seventh Amendment guaranteed a jury right because inequitable conduct bore on the legal (not equitable) question of validity. The district court disagreed, conducted a bench trial on inequitable conduct, found the patents unenforceable, and Agfa appealed.
The Court’s Holding
The Federal Circuit affirmed on both issues. First, the court confirmed that inequitable conduct is an equitable defense — rooted in the patentee’s conduct before the PTO — not a legal one. Because equity does not entitle either party to a jury trial, the district court properly conducted a bench trial on inequitable conduct even while jury issues (like infringement and validity) were reserved for the jury. This ruling confirms that trial courts have discretion to separate inequitable conduct from other issues and try it in a bench proceeding.
On the merits, the court upheld the finding of inequitable conduct. The materiality threshold was met because the withheld prior art systems were reasonably likely to affect the patent examiner’s decision to grant the patents — and might have prevented issuance entirely. Intent to deceive could be inferred from the pattern of conduct: Agfa’s own internal documents showed detailed awareness of the competing products, yet they were never disclosed, and Agfa made prosecution arguments inconsistent with its own engineers’ knowledge of those products.
Judge Newman dissented, arguing that the majority applied the inequitable conduct doctrine too broadly and that the evidence of intent was insufficient to meet the clear-and-convincing standard required for such a serious sanction — the complete unenforceability of all asserted patents.
Key Takeaways
- Inequitable conduct is an equitable defense; neither party has a Seventh Amendment right to a jury trial on this issue, and district courts may conduct a bench trial on it.
- The duty of candor to the PTO requires disclosure of known material prior art; failure to disclose known competing products that could affect patentability constitutes inequitable conduct.
- Intent to deceive can be inferred from a pattern of selective disclosure and affirmative misrepresentations during prosecution.
- A finding of inequitable conduct renders the entire patent unenforceable — a drastic remedy that courts have increasingly scrutinized after the Federal Circuit tightened the doctrine in Therasense v. Becton Dickinson (2011).
- Patent applicants and prosecutors bear the risk of allowing any withheld prior art to infect the entire patent if intent to deceive is later found.
Why It Matters
Agfa v. Creo illustrates the “plague” of inequitable conduct that the Federal Circuit itself has criticized for being raised too frequently in patent litigation. The case came during a period when inequitable conduct was a common defense — defendants routinely argued that any omission from prosecution was intentional — and when the doctrine’s broad application could strip a patent of all enforceability for a single disclosure failure.
The case’s procedural holding on bench trials for inequitable conduct remains important guidance for district courts structuring complex patent trials. Its substantive inequitable conduct analysis reflects the pre-Therasense era doctrine, when intent could be more readily inferred from circumstantial evidence. Since Therasense (2011), the Federal Circuit has significantly tightened the doctrine, requiring more specific evidence of specific intent to deceive — making Agfa v. Creo an important historical benchmark in the evolution of the inequitable conduct defense.