Patent Litigation Strategy

Declaratory Judgment

How accused infringers proactively challenge patents — before being sued.

Quick Answer

A declaratory judgment (DJ) action under 28 U.S.C. § 2201 lets a company facing patent threats file suit first — seeking a court ruling that a patent is invalid, not infringed, or unenforceable — before the patent owner sues. Since MedImmune v. Genentech (S.Ct. 2007), even a licensee still paying royalties has standing to challenge the patent.

The Statute

28 U.S.C. § 2201 — The Declaratory Judgment Act

The Declaratory Judgment Act allows any party in a "case of actual controversy" within a federal court's jurisdiction to seek a declaration of rights and other legal relations. In patent law, the controversy is typically: the patent owner asserts the patent against a specific product/method, and the accused infringer disputes validity or infringement.

Historically, courts required an accused infringer to show a "reasonable apprehension of suit" — which meant stopping the accused activity to eliminate the threat and establish DJ standing. MedImmune, Inc. v. Genentech, Inc. (S.Ct. 2007) eliminated that requirement. The Court held the "actual controversy" requirement is satisfied by the totality of the circumstances — whether the dispute is "definite and concrete, touching the legal relations of parties having adverse legal interests."

Post-MedImmune, the Federal Circuit applies the "all circumstances" test: Was there a direct threat by the patent owner? Did it identify specific patents and products? A cease-and-desist letter alone typically suffices. A vague warning or industry-level licensing campaign may not — courts look at specificity and directness.

What DJ Can Seek

Invalidity, Non-Infringement, and Unenforceability

§ 102 Anticipation

Prior art discloses every limitation of the asserted claim. Attack each element with specific prior art references.

§ 103 Obviousness

Combination of prior art makes the claim obvious. KSR flexible standard; secondary considerations apply.

§ 101 Eligibility

Alice/Mayo: abstract idea or natural phenomenon without significantly more. File Rule 12(b)(6) motion early.

§ 112 Invalidity

Written description, enablement (Amgen standard), indefiniteness (Nautilus reasonable certainty), best mode.

Non-Infringement

Claim construction + accused product comparison. Literal infringement or doctrine of equivalents analysis under Festo.

Unenforceability

Inequitable conduct (Therasense but-for materiality + specific intent to deceive), patent misuse, unclean hands.

A key DJ advantage over IPR: district court DJ actions can challenge § 101 subject matter eligibility and § 112 written description/enablement — grounds unavailable in IPR (which is limited to §§ 102/103 documentary prior art). Many software and business-method patents are most vulnerable on § 101 grounds, making DJ the preferred vehicle.

Workflow

DJ Action Step-by-Step

Triggering Event

Patent owner sends cease-and-desist letter, files suit in another jurisdiction, or makes licensing demand citing specific patents.

Standing Analysis

Confirm 'actual controversy' under MedImmune: threatening conduct + specific patents + accused product/process. No longer requires stopping conduct.

Venue Selection

Choose favorable district with personal jurisdiction over patent owner. D. Delaware (patent owner incorporated there) and N.D. Cal. are common.

DJ Complaint Filed

Complaint seeks declaration of invalidity (§§ 102/103/101/112) and/or non-infringement. File first to choose forum before patent owner's ITC or district court filing.

First-to-File Advantage

Under 28 U.S.C. § 1400(b), the first-filed rule often controls which case proceeds. DJ plaintiff's first-filed case may result in transfer of later-filed patent owner suit.

Parallel IPR Strategy

File IPR petition within 1 year of service of any infringement complaint. DJ + IPR attack on both § 101/§ 112 (district court) and §§ 102/103 (PTAB) simultaneously.

Comparison

DJ vs. IPR vs. PGR

Feature	DJ Action	IPR	PGR
Forum	Federal District Court	PTAB (USPTO)	PTAB (USPTO)
Grounds	§§ 101/102/103/112 + non-infringement	§§ 102/103 only (documentary)	All invalidity grounds
Timing	Any time — actual controversy	Within 1 year of complaint	Within 9 months of grant
Patent type	Any U.S. patent	Any U.S. patent	AIA patents only (post-March 2013)
Standing required?	Yes — actual controversy	No	No
Estoppel on loss?	Collateral estoppel (final judgment)	Grounds raised or could have raised	Grounds raised or could have raised
§ 101 challenge?	Yes	No	Yes
§ 112 challenge?	Yes	No	Yes
Cost	$500K–$5M+ (discovery)	$30K–$150K typical	$30K–$150K typical
Timeline	18–36+ months to trial	12–18 months to FWD	12–18 months to FWD

FAQ

When can you file a declaratory judgment action for patent invalidity?

Under MedImmune v. Genentech (S.Ct. 2007), you need an 'actual controversy' — a reasonable apprehension of suit based on the patent owner's conduct (cease-and-desist letter, infringement claim, licensing demand). You no longer need to actually stop your conduct to establish standing, overruling the old 'reasonable apprehension of suit' test from Medimmune.

Can a licensee in good standing file a declaratory judgment action?

Yes — MedImmune (2007) held that a patent licensee who continues paying royalties under a license agreement can still challenge the patent's validity. The license does not preclude DJ standing. The case arose when MedImmune paid royalties under protest while simultaneously suing for a declaration that the patent was invalid.

What is the difference between a DJ action and an IPR petition?

A DJ action is filed in federal district court and can seek both invalidity (all § 102/103/101/112 grounds) and non-infringement on the same claims. An IPR is a PTAB administrative proceeding limited to §§ 102/103 documentary prior art, must be filed within 1 year of complaint service, and results in estoppel on grounds raised or reasonably could have been raised. DJ can challenge § 101 and § 112 which IPR cannot.

Can the patent owner dismiss a DJ action by promising not to sue?

Not easily post-MedImmune. In Benitec Australia v. Nucleon (Fed. Cir. 2007), an unconditional covenant not to sue removes standing. But a narrow, revocable, or product-specific covenant may not eliminate the case or controversy. Courts look at whether any controversy remains; a broad unconditional covenant-not-to-sue directed at the specific products divests jurisdiction.

Where can a DJ action for patent invalidity be filed?

After TC Heartland v. Kraft Foods (S.Ct. 2017), the patent owner (plaintiff in the original suit, now defendant in DJ) must be subject to personal jurisdiction in the chosen district. Since the accused infringer is the DJ plaintiff, venue for the DJ plaintiff is broad — any district where the patent owner is subject to personal jurisdiction. DJ plaintiffs often choose favorable courts like D. Delaware or N.D. Cal.