24 Mar Controversial Patent Office Final Rules – Federal Circuit affirms-in-part and vacates-in-part District Court decision
The United States Court of Appeals for the Federal Circuit (“Federal Circuit”) has affirmed-in part and has vacated-in-part the District Court ruling that permanently enjoined the U.S. Patent and Trademark Office (“Office”) from implementing the Office’s new rules (“Final Rules”) relating to limitations on (A) the number of continuing patent applications that an applicant can file; (B) the number of requests for continued examination (“RCEs”) that an applicant can make as a matter of right; and (C) the number of claims that can be filed per patent application as a matter of right before triggering a requirement to submit an Examination Support Document (“ESD”).
Federal Circuit Decision
The Federal Circuit decision stems from an appeal by the Office of the decision by the United States District Court for the Eastern District of Virginia on April 1, 2008, to permanently enjoin the Office from implementing the Final Rules. The appeal to the Federal Circuit considered the consolidated suits brought by plaintiffs Smithkline Beecham Corporation (d/b/a GlaxoSmithKline) and inventor Triantafyllos Tafas. The case is now captioned Tafas v. Doll (consolidated Case Nos. 1:07-CV-846 and 1:07-CV-1008).
The Federal Circuit opinion primarily evaluated the Final Rules based on two criteria: (1) whether the Final Rules are “procedural” in nature (i.e., relating to expediting and processing patent applications) or “substantive” in nature (i.e., affecting patent applicant’s rights under the Patent Act); and (2) whether the Final Rules are consistent with the Patent Act.
First, the Federal Circuit disagreed with the District Court ruling that the Final Rules exceeded the scope of the Office’s rule-making authority. The Federal Circuit determined that the Final Rules are procedural rules, rather than substantive rules. In other words, the Federal Circuit agreed with the Office that the Final Rules are within the Office’s rule-making authority.
Second, the Federal Circuit considered the consistency of each of the Final Rules in view of the Patent Act. With regard to the Final Rule relating to the limitations on the number of continuing patent applications that an applicant can file (i.e., an applicant would be entitled to file two continuation applications as a matter of right), the Federal Circuit determined that this Final Rule is in conflict with 35 U.S.C. Section 120 of the Patent Act, and therefore is invalid.
With regard to the Final Rule relating to limitations on the number of RCEs that an applicant can make as a matter of right, the Federal Circuit determined that this Final Rule is consistent with the Patent Act. Similarly, the Federal Circuit determined that the Final Rules relating to the number of claims that can be filed per patent application as a matter of right before triggering a requirement to submit an ESD are consistent with the Patent Act.
Effect of Federal Circuit Decision
The Federal Circuit decision in Tafas v. Doll does not make a final determination regarding the disposition of the Final Rules. Rather, the decision remands the case back to the District Court for further consideration regarding additional arguments against implementation of the Final Rules. These additional arguments include whether any of the Final Rules are arbitrary or capricious, whether the Final Rules conflict with the Patent Act in ways not addressed by the Federal Circuit, whether all Office rulemaking is subject to notice and comment rule-making, whether the Final Rules are impermissibly vague, or whether the Final Rules are impermissibly retroactive.
Pending the outcome of the District Court’s consideration of the Final Rules on remand, the Final Rules remain enjoined.
Aaron Nodolf is an associate in the Intellectual Property Practice Group. Mr. Nodolf primarily focuses his practice on patent prosecution and related opinion matters, with an emphasis on mechanical and electro-mechanical technology areas. He can be reached at firstname.lastname@example.org.
The opinions expressed herein or statements made in the above column are solely those of the author, and do not necessarily reflect the views of the Wisconsin Technology Network, LLC. WTN accepts no legal liability or responsibility for any claims made or opinions expressed herein.