The U.S. Supreme Court issued a decisive ruling today in SCA Hygiene Products Aktiebolag v. First Quality Baby Products, LLC (No. 15-927), eliminating the defense of laches in patent cases. This ruling continues the Supreme Court’s recent trend of overturning Federal Circuit precedent.
Laches is an equitable defense in which a plaintiff is barred from recovering damages due to an unreasonable delay in bringing its claim, i.e., for “sitting on its rights” too long.
The Court’s 7-1 decision followed its previous reasoning in Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. ___ (2014), which related to the applicability of laches in copyright infringement claims. In Petrella, the Court ruled that laches could not be used as a defense within the 3-year statute of limitations period set forth in the Copyright Act, and held that the equitable defense of laches could not be used to preclude legal remedies “[i]n the face of a statute of limitations enacted by Congress.”
Justice Alito, writing for the 7-justice majority (with Justice Breyer dissenting), hewed closely to the Court’s ruling in Petrella. The Court, in finding that laches and statutes of limitations both serve a similar function in preventing untimely claims, determined that in the presence of a Congressionally enacted limitations period, laches fails to apply. If Congress sees fit to enact a statute of limitations, the Court reasoned, then Congress considers “the timeliness of covered claims … better judged on the basis of a generally hard and fast rule rather than the sort of case-specific judicial determination that occurs when a laches defense is asserted.” The Court opined that “applying laches within a limitations period specified by Congress” would therefore be an exercise in judicial overreach and would usurp Congress’ judgment. Echoing Petrella, the Court found that the laches defense is a “gap-filling doctrine” only applicable to claims “‘for which the Legislature has provided no fixed time limitation.’” Thus, laches can no longer preclude recovery of damages for acts of patent infringement falling within the 6-year statute of limitations.