Does a price quote constitute an offer of sale, thereby invoking the on-sale bar of Section 102 of the patent statute? That is the question presented in a petition filed with the U.S. Supreme Court on July 6, 2022.
In 2013, petitioner Larry Junker sued Medical Components Inc. and Martech Medical Products Inc. for infringement of his patent for catheter insertion design, U.S. Design Patent No. D450,839. A jury found the patent infringed and awarded Junker $1.25 million. The Federal Circuit, however, reversed the judgment, finding that the patent was unenforceable because it was offered for sale more than a year before Junker applied for the design patent, thereby triggering the on-sale bar of Section 102. In his petition, Junker maintains that the so-called offer was actually a price quote, and that the CAFC panel’s finding of an offer is contrary to the law and established precedent.
In February 2022, the CAFC panel held in a precedential opinion that a 1999 letter that included pricing information sent by Junker’s former business associate to Boston Scientific – allegedly without Junker’s knowledge or authorization – was not a preliminary negotiation and therefore could not constitute an offer for sale. The panel noted that the letter was sent in response to a request by Boston Scientific and contained payment terms, shipping conditions and bulk pricing options, which the panel said are typical of commercial contracts. As such, according to the CAFC, the letter met the requirement of an offer of sale.
Since the on-sale bar of Section 102 of the patent statute prohibits patents for inventions that were commercially sold or offered for sale more than a year before filing a patent application, the appeals panel held Junker’s patent was unenforceable.
Junker disputes the ruling by the panel and further argues that Junker’s former business associate, who violated a non-disclosure agreement with Junker, also infringed the patent. According to Junker’s petition, “[t]he on-sale bar should not invalidate a patent on the actions of an individual having no right to sell and in violation of a non-disclosure agreement,” and should not apply when third parties undertake actions beyond the inventor’s knowledge and control that result in the patent being invalidated. Junker’s petition further requests the Court to address “the distinction between a price quotation and a commercial offer for sale,” saying “commercial chaos” could ensue if price quotes are determined to constitute offers for sale.
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Richard A. Catalina, Jr. is a senior partner and Chair of the Intellectual Property and Complex Litigation Department of Jardim, Meisner and Susser, P.C. Mr. Catalina specializes in litigating patent, trademark, trade secret and related Lanham Act disputes, and inter partes proceedings before the Patent Trial and Appeal Board. Mr. Catalina has been practicing law for more than 33 years and has litigated more than one hundred matters in federal and state courts across the U.S, as well as inter and ex partes matters before the Trademark Trial and Appeal Board and the Patent Trial and Appeal Board.
