Federal Circuit Defines When A Prima Facie Case For Anticipation is Met

In In re. Jung, Civ. Case No. 2010-1019 (Fed. Cir. March 28, 2011), Edward K.Y. Jung and Lowell L. Wood, Jr. (collectively, “Jung”) filed U.S. Patent Application No. 10/770,072 (“’072 application”) on January 20, 2004.   On September 14, 2005, the Examiner rejected all claims of the ‘072 application as anticipated by Kalnitsky (U.S. Patent No. 6,380,571).  Among other features, the Examiner indicated that Kalnitsky disclosed “a first well-charge-well [sic] controller (340) operably coupled with said first charge pump (see Col. 5, lines 37-39 and Col. 6, lines 38-44, 64-66)” which corresponded to the recited first well-charge-level controller.  Jung responded by providing a block quote from Kalnitsky, and arguing that the “‘well-charge-level controller’ recitations of [amended] Claim 1 are different from the ‘controller 340’ recitations of [Kalnitsky], and thus controller 340 of [Kalnitsky] does not match the ‘well-charge-level controller’ of herein-amended Independent Claim 1.”  No further explanation was provided.

After the Examiner again rejected the claims, Jung appealed to the Board of Patent Appeals and Interferences.  On appeal, Jung argued that Kalnitsky’s controller 340 is a reset controller which does not “continuously adjust the control signal inputs” as does the recited well-charge-level controller.  The Board rejected this argument, noting that the argument relies upon a feature not recited in the claims and finding that the broadest construction of the reset controller performs a function encompassed by the recited well-charge-level controller.  Jung filed a Request for Rehearing on the grounds that the Board had not addressed Jung’s argument that the Examiner had not made a prime facie case for invalidity under 35 U.S.C. §102, and thus the rejection was procedurally improper under 35 U.S.C. §132.  On rehearing, the Board found that the prima facie case requirement is merely a procedural mechanism for allocating burden, and that the anticipation case was adequately addressed in the original Board decision.

On appeal from the Board, the Federal Circuit outlined how the prima facie case burden is met and its purpose.  Specifically, the Federal Circuit quoted Hyatt v. Dudas, 492 F.3d 1365, 1369 (Fed. Cir. 2007) for the proposition that “the prima facie case is merely a procedural device that enables an appropriate shift of the burden of production.”  The Federal Circuit stated that this burden is met by “adequately explain[ing] the shortcomings it perceives so that the applicant is properly notified and able to respond.” Id, at 1370.   It is only “when a rejection is so uninformative that it prevents the applicant from recognizing and seeking to counter the grounds for rejection” that the prima facie burden has not been met and the rejection violates the minimal requirements of 35 U.S.C. §132.  Chester v. Miller, 906 F.2d 1574, 1578 (Fed. Cir. 1990).

In applying this standard to the instant application, the Federal Circuit declined to require that the prima facie case requires that the Examiner provide an explanation as to the broadest reasonable interpretation of each claim term, as well as evidence “bridging the facial differences between that reasonable claim construction and the purported anticipatory reference” as argued by Jung.  Instead, the Federal Circuit found that the Examiner sufficiently notified Jung by identifying the specific element which anticipated the claim feature (i.e., the reset controller 340), as well as the column and line number explaining the functioning of the reset controller 340 as pertains to the claim feature.  In this manner, the Examiner gave sufficient notice to Jung as to allow Jung the opportunity to respond.  The Federal Circuit then noted that evidence that this notice was sufficient since Jung was able to reply and did not otherwise argue that the correlation between the controller 340 and the well-charge-level controller was not understood.  The Federal Circuit noted that there was no reason to further require the Examiner to fill any gaps between the disclosed feature and the recited feature using evidence since, once the notice requirement of 35 U.S.C. §132 is met, the burden has properly shifted to the applicant.  As such, the Federal Circuit held that “the identification of where each limitation of the rejected claims is shown in the prior art reference by specific column and line number was more than sufficient to meet this burden.”

Significance for Patent Applicants

While it is often tempting to reduce costs during prosecution by not addressing each potential defense to a rejection, Jung shows the importance of ensuring that each traversal is made during prosecution.  This is especially true if the defense is based upon a lack of a prima facie case since the entire premise of this defense is that there is not enough evidence to even respond.  Otherwise, the failure to raise the defense risks the Federal Circuit finding that the prima facie case had been met as evidenced by the applicants’ reply.  Moreover, it also shows how low the bar is for the amount of evidence needed in the context of anticipation: mere notice.  Thus, outside of issues relating to inherency, applicants need to account for Jung when contesting an anticipation rejection based solely on the Examiner’s lack of a prima facie case.

Federal Circuit Reverses BPAI Anticipation and Obviousness Rejection for Insubstantial Evidence

Also Finds Time to Appeal Begins From the Mailing Date as Opposed to Date Printed On Opinion

In In re McNeil-PPC, Inc., 91 USPQ2d 1576 (Fed. Cir. 2009), McNeil owns U.S. Patent 6,310,269, which claims a tampon for feminine hygiene with a solid fiber core, where the core is denser than the radially projecting “ribs” and the ribs are narrower at their base than at their distal end.  McNeil requested that the PTO re-examine its patent on the basis of unexamined Japanese application No. 55-168330 by Tetsu Sasaki (hereinafter “Sasaki”).  Sasaki discloses the process of making a tampon blank via stitching layers of material and then molding the blank into a finished tampon.  The Examiner rejected claims 1 and 3 as anticipated by Sasaki and claim 4 as obvious over Sasaki.  McNeil appealed to the Board of Patent Appeals and Interferences (BPAI), arguing that Sasaki failed to disclose key elements of his claim (the relative densities and coarseness of the core and ribs on the tampon, and ribs that were narrower at the base than at the proximal end).

The BPAI affirmed the Examiner’s rejection and denied McNeil’s request for a rehearing.  The date of the Board’s decision was May 30, 2008.  The date of mailing, as per the mailing sheet for the order, was June 2, 2008.  Further, the online “Transaction History” for the re-examination contains two entries both dated May 30, 2008: “Mail BPAI Decision on Reconsideration – Denied” and “Dec on Reconsideration – Denied.”  Finally, the image file wrapper (hereinafter “IFW”) lists the “Mail Room Date” of the decision as June 2, 2008.  McNeil filed the notice of appeal to this court on August 1, 2008.  The Director responded that the appeal was untimely because it was filed more than sixty days after the Board made its final decision on May 30, 2008.

Patent Owner’s Appeal was Timely As Measured from Mailing Date

Before turning to the merits of the case, the Federal Circuit addressed the issue of the timeliness of McNeil’s appeal.  The Federal Circuit first stated that it could not grant extensions of time for an appeal (citing In re Reese, 359 F.2d 462, 463 (CCPA 1966) (per curiam)).  The Court noted that Congress gave the Director authority to set the timing for an appeal in 35 U.S.C. § 142, allowing the Director to prescribe a time no less than 60 days after the date of decision during which the appellant could appeal the decision of the BPAI.  Accordingly, the Director set a time for appeal, if a request of rehearing or reconsideration had been made to the Board, as within two months after action on the request.  (37 C.F.R. § 1.304(a)(1)).

The Court held that the issue of timeliness hinged on whether the Date of Decision was the date of decision noted on the Board’s decision, or the date that the decision was mailed to the applicant.  The Federal Circuit then opined that there was little information to guide the Court as to whether to attribute meaning to the date of decision appearing on the Board’s written decision.  The Court stated that the Director failed to explain the Board’s internal procedures for issuing opinions, or whether the June 2, 2008 mailing date reflects the first time that the decision was released to the public.  The Federal Circuit did take into account an unchallenged declaration from a now-retired member of the Board Jeffrey Nase, which was presented by McNeil.

The Federal Circuit summarized Nase’s declaration as follows.  Historically, the date that the PTO mailed a document was the date that triggered a response period.  Before August 2006, the date decided was hand-stamped on the front of opinions.  In August 2006, the Board began to have the decision date typed on the front of opinions.  Nase found it to be unclear why the date on the opinion and the mail date differed, unless the mail room was slow or a member of the Board panel had decided to revise or reconsider the opinion over the weekend of May 31 and June 1, 2008.  Nase opined that if the PTO had intended this minor formatting change to have substantive effect, there would have been public notice of the change (which there was not).

The Court noted the PTO’s argument that it would be contrary to the language of both 35 U.S.C. § 142 and 37 C.F.R. § 1.304(a)(1) to deem the date of the decision to be the date that the order was mailed.  However, the Court dismissed this argument as superficial due to the import of the inner workings of the agency.  Rather, the Federal Circuit asserted that, based upon the evidence, only when an opinion is released to the public is it truly decided and safe from possible revision.  The Court did note that the PTO’s position was supported by the entries on the “Transaction History” page indicating that the case was decided and opinion mailed May 30, 2008.  However, the Court found that the parties do not dispute that the decision was mailed on June 2, 2008, making the “Transaction History” date both inaccurate and moot.

The Federal Circuit also dismissed the PTO’s reliance on an unpublished order, Barbacid v. Brown, 223 F. App’x. 972 (Fed. Cir. 2007).  In the opinion, the Federal Circuit held that the PTO’s failure to mail its decision to Barbacid when mailing the opinion to the other party did not abrogate the untimeliness of Barbacid’s appeal.  There, the Federal Circuit stated that “[T]he time is not measured from the date of receipt of the Board’s decision but from the date of the decision itself.” However, this Court noted that the opinion did not specify what “the date of the decision” was.  Further, the Federal Circuit noted that Barbacid’s appeal was so late that a few days would not have impacted the timeliness of his appeal. 

The Federal Circuit held that the instant appeal was timely for several reasons.  First, the Court noted that the “Transaction History” page appeared inaccurate and Nase’s declaration provided the most plausible explanation for the conflicting evidence of the action taken on by the Board in response to McNeil’s request for reconsideration.  Further, the IFW entry corroborates the fact that action was taken on June 2, 2008, instead of May 30, 2008.  Thus, the Federal Circuit held that the Board decided this case on June 2, 2008, the date of mailing, making McNeil’s appeal timely.

BPAI’s Anticipation and Obviousness Decision Not Supported By Substantial Evidence

Next, the Federal Circuit turned to the merits of the case.  The Court stated that the standard of review would be one of substantial evidence to support the Board’s determination. (citing In re Graves, 69 F.3d 1147, 1151 (Fed. Cir. 1995)).  The Federal Circuit noted, with added emphasis, that McNeil’s claim 1 (which was chosen as representative of the other claims), was for a tampon for feminine hygiene that comprised an absorbent portion having a “generally cylindrical compressed, solid fibre core from which longitudinal ribs extend radially outward,” where each of the ribs has a proximal end attached to the fibre core, “is compressed less than the fiber core, thereby having a coarser capillary structure than the fibre core,” and is separated from adjacent ribs at the proximal end “by an amount greater than such rib is separated from an adjacent longitudinal rib proximate the distal end.”

The Board had found that Sasaki taught all the limitations of claim 1.  Upon review of the Board’s findings, the Federal Circuit was unsure if the Board understood McNeil’s claim.  First, the Court observed that the Board equated McNeil’s limitation of a tampon “each of the ribs is compressed less than the fiber core, thereby having a coarser capillary structure than the fibre core” with Sasaki’s Figures 8 and 10, which the Board found to reasonably depict the ribs of a tampon “as being compressed less at their distal ends than at their ends proximal to the drawstring at the center of the drawn fiber strips.” (emphasis added by the Court).  The Court noted that the claim required the ribs to be less dense than the core, not the distal ends of the ribs to be less dense than their proximal ends. 

The Federal Circuit failed to find any evidence in Sasaki of the relative compression of any portion of Sasaki’s tampon.   The Court found that Figure 6, which showed relative compression of the strips of absorbent material, depicted a tampon blank, not a finished tampon.  The Court noted that Figures 7 and 8 of Sasaki, which depicted a finished tampon, did not disclose any evidence a core that is denser than the ribs of the tampon.  Further, the Federal Circuit stated that the PTO failed to explain how the change in shape from the tampon blank to the finished tampon necessarily made the ribs less dense than the tampon core.   The Federal Circuit noted that the Board’s initial decision stated that “compressed masses [are] formed at equal intervals along the axial line direction on the outside circumferential surface of the tampon.” However, the Court found that Sasaki made no comparison between the “compressed masses” and a core.  Further, the Court observed that it was not clear that Sasaki even disclosed a “core,” pointing to Sasaki’s Figure 8 to show that Sasaki’s tampon was composed of six ribs and no core.  The Court held that there was not substantial evidence (or even any evidence) that Sasaki disclosed ribs “compressed less than the fiber core” or “a generally cylindrical compressed, solid fibre core.”  Thus, the Federal Circuit reversed the Board’s rejections based on Sasaki.

The Federal Circuit also dismissed the PTO’s argument that McNeil waived arguments about Sasaki’s lack of a “generally cylindrical compressed, solid fibre core” and “coarser capillary structure than the fibre core.”  Specifically, the PTO asserted that it waived arguments regarding Sasaki’s lack of a core because McNeil, in its appeal brief, argued only that two key elements (relative rib compression and spacing from adjacent ribs) were missing from Sasaki.  The Federal Circuit disagreed, noting that McNeil included arguments about the core in its brief.  Thus, McNeil did not have to explicitly assert that the core was missing from Sasaki, because the brief mentioned in passing that “Sasaki does not disclose, teach, or suggest a tampon, wherein ‘each of the ribs is compressed less than the fiber core, thereby having a coarser capillary structure than the fibre core.’” (emphasis added).

The Court noted that the Sasaki figures also failed to disclose any relative coarseness of different portions.  Further, the Court stated that the lack of a core was discussed earlier in the opinion.   The Court also observed that Figure 8 showed some spacing between the bottommost ribs, and arguably disclosed spacing between other ribs.  However, the Court noted that this disclosure of Sasaki did not overcome the failing of Sasaki to teach the other features of McNeil’s invention.  The Court held that it was not clear that Sasaki disclosed “a core nor which portions of Sasaki’s tampon the Board considered to be the ribs and which the Board considered to be the core.”  The Court stated that there was not substantial evidence to support the Board’s determination that Sasaki disclosed ribs separated from each other “at the proximal end by an amount greater than” at “the distal end.” Thus, the Court reversed the Board’s rejections of claims 1, 3 and 4 for lack of substantial evidentiary support.

The Federal Circuit held that McNeil’s appeal of his rejection at the BPAI was timely because it was within two months of the date that the decision was mailed to him.  Further, the Federal Circuit reversed the Board of Patent Appeals and Interferences’ rejection of claims 1, 3 and 4 of McNeil’s re-examination application for lack of substantial evidentiary support based on the lack of the prior art’s disclosure of a fibre core, which was mentioned but not explicitly disputed by the appellant.

Judge Dyk’s Dissent

The dissent disagreed with the majority’s opinion with regards to timeliness only.  Specifically, it observed that the decision of the BPAI clearly stated on its face that it was decided May 30, 2008.  The dissent found that because McNeil did not appeal until August 1, 2008, two days after the regulatory period for review from a decision of May 30, 2008, the appeal was untimely filed and should not have been granted jurisdiction.   The dissent noted that the jurisdiction of the Federal Circuit is statutorily limited by the timeliness regulations of the PTO, and quoted 35 U.S.C. § 142 to show that an appeal must be filed within such time as prescribed by the Director after the date of the decision from which the appeal is taken.  The dissent also cited to the Supreme Court, which stated that statutorily limited times for filing a notice of appeal are “mandatory and jurisdictional.” Bowles v. Russell, 551U.S. 205, 127S. Ct. 2360, 2363 (2007).

Next, the dissent noted that 35 U.S.C. § 142 sets forth a time for filing the notice of appeal as within two months after action on the request for rehearing or reconsideration.  The dissent asserted that the notice accompanying the promulgation of 35 U.S.C. § 142 characterized the relevant date as the date of “decision on reconsideration.”  54 Fed. Reg. 29,548, 29,550 (July 13, 1989). The dissent then observed that the majority also correctly noted that the term “action on the request” has the same meaning in this context as “date of the decision” and that the issue was what the phrase “date of the decision” means.

The dissent then reviewed the four sources for dates referenced by the parties in the case (the date of decision on the Board’s opinion, the PTO’s online Transaction History, the IFW wrapper entry of the “Mail Room Date”, and a “mailing sheet” attached to the paper copy of the opinion when mailed to McNeil).  The first two sources refer to a date of May 30, 2008, while the last two reference June 2, 2008.  The dissent notes that the only dispute is about which of these dates represents the “date of decision” as reflected in the statute and regulations.  

The dissent held that the majority’s view that the “date of decision” is the date of mailing instead of the date of decision as clearly written on the opinion is contrary to the plain language of the regulation and against precedent interpreting the nearly identical language of 35 U.S.C. § 142’s predecessor rule.  It observed that the only reason for the majority to reject May 30, 2008 was its theoretical concern that the Board could change the decision at some point after the “Decided” date was affixed to the decision before the decision was mailed.  However, the dissent notes that no evidence of such revision exists.  Further, the plain language of the statute and regulation state that the relevant date is the “date of decision,” not the date of mailing.  In adopting these regulations and statutes, the dissent notes that both the PTO and Congress rejected the date of mailing as determinative.  The dissent then pointed to examples in which the PTO explicitly used and prescribed the mailing date as determinative for setting a time limit for action.  (citing 37 C.F.R. § 1.181(f); § 1.97(c); and § 2.105(a)).

The dissent then pointed to precedent that rejected the majority’s approach.  Specifically, the dissent cited Burton v. Bentley, 14 App. D.C. 471 (C.A.D.C. 1899), in which the Court of Appeals (a predecessor of the District Court of D.C.) addressed the time for appealing a decision of the PTO when the decision date and mailing date differed.  At that time, the prior rule required that appeals from the Patent Office “shall be taken within forty days from the date of the ruling or order appealed from, and not afterward.” (emphasis added).  The court in Burton held that the relevant date was the date that the order was made and signed by the deciding official, and that a delay in mailing the order was irrelevant to the date of decision. The Court of Appeals asserted that the terms of the rules must be allowed their “ordinary meaning and import.”  The Court held that to allow the time limit to be computed from any other act or event other than the date of the order appealed from would be violative of the rule. 

The dissent agreed with the court’s view in Burton, and provided further support for its position from In re Reese. There, the Court of Customs and Patent Appeals (a predecessor of the Federal Circuit) asserted that the “date of the decision appealed from” was the date of the decision on the petition.  In re Reese, 359 F.2d 462, 463 (CCPA 1966).  The dissent also pointed to Barbacid v. Brown, in which the Federal Circuit held in a non-precedential decision that “the time for filing the appeal to this Court is two months from the date of the decision of the Board. The time is not measured from the date of receipt of the Board’s decision but from the date of the decision itself.”  Barbacid v. Brown, 223 F. App’x 972, 973 (Fed. Cir. 2007).  The Federal Circuit rejected the mailing date as determinative of the appeal time limit, despite the appellant’s allegation that he had never been mailed a copy of the decision because of an error by the Board. 

The dissent then pointed out that the existence of any delay in mailing a decision does not impose an unfair burden on the parties because of the lengthy period for appeal and the Board’s ability to extend the time for appeal in situations where there has been excusable neglect.  (citing 37 C.F.R. § 1.304(a)(3)(ii)).  The dissent noted no allegations of inadequate time to prepare an appeal by the appellant.  Thus, the dissent held that because the date of decision in this case was May 30, 2008, the Federal Circuit did not have jurisdiction to review because of the untimely notice of appeal filed August 1, 2008, and advocated dismissal of this appeal.

Significance to Patent Applicants

For practitioners, In re McNeil-PPC presents a useful combination of practical issues.  In regards to timing for response, it is common for the date of decision (either for Board opinions as well as for office actions) to be substantially different from dates on which the opinions or office actions are mailed.  Even when receiving electronic notifications of office actions, there is generally a lag of one to three days between when the Examiner or Board has made their decision (and had their decision counted in the USPTO’s internal system), and the date on which that decision is communicated to the applicant.  The Federal Circuit In re McNeil-PPC confirmed what most practitioners had assumed (and hoped was true) in that the response dates are counted from the notification or mailing date as opposed to the date of decision.

Additionally, patent applicants should be interested in the requirements for substantial evidence as set forth in In re McNeil-PPC.  A common problem in attempting to respond to an Examiner’s action is that it is unsupported by evidence.  Without evidence, it becomes difficult to supply rebuttal evidence as opposed to simply contrary arguments.  In re McNeil-PPC provides a reminder that the USPTO is required to provide evidence in order to maintain a prima facie rejection based upon prior art.


Federal Circuit Limits BPAI’s Ability To Group Claims for a Common Ground of Rejection

In Hyatt v. Dudas, 551 F3d 1307; 89 USPQ2d 1465 (Fed. Cir. 2008), the Federal Circuit affirms the district court’s vacating of the Board of Patent Appeals and Interferences’ (BPAI) rejection of all claims in twelve of Gilbert P. Hyatt’s patent applications.  In particular, the Federal Circuit held that a “ground of rejection,” as stipulated in 37 C.F.R. §1.192(c)(7), includes both the statutory section under which a claim is rejected, and the reason why the claim does not meet that statutory requirement.

Between April and June of 1995, Hyatt filed the twelve patent applications as part of a series of continuation applications.  By the time of appeal, the twelve applications included approximately 2,400 claims.  The PTO examiner rejected all of the claims on various different grounds, including obviousness and lack of enablement.  However, the most common ground for rejection was that the claims lacked written description support under 35 U.S.C. §112, first paragraph.  Hyatt appealed the examiner’s rejections to the BPAI, discussing only twenty-one of his claims in the “Summary of the Invention” sections of his appeal briefs.  Accordingly, the BPAI selected these twenty-one claims as representative claims, affirmed the examiner’s rejections, and affirmed the rejections of the non-representative claims.

On appeal to the district court, Hyatt argued that the BPAI improperly selected the twenty-one claims as representative of the remaining claims.  The PTO, in turn, argued that the claims were properly grouped because each group was rejected under the same statutory provision (35 U.S.C. §112, first paragraph).  The district court agreed with Hyatt, holding that the BPAI failed to comply with 37 C.F.R. §1.192(c)(7) when selecting the representative claims.  Specifically, the BPAI “should not have grouped claims that have been rejected for lack of a written description unless those claims share a limitation that has been found to have not been disclosed by the specification.”

The PTO raises two issues on appeal to the Federal Circuit.  The first issue relates to the meaning of “ground of rejection” in 37 C.F.R. §1.192(c)(7), and whether the BPAI improperly selected claims to be representative of groups of claims that were rejected on different grounds.  The second issue is whether the district court’s remand requires the BPAI to consider arguments that Hyatt waived by not raising them on appeal before the BPAI.

As to the first issue, 37 C.F.R. §1.192(c)(7) states:

Grouping of claims. For each ground of rejection which appellant contests and which applies to a group of two or more claims, the Board shall select a single claim from the group and shall decide the appeal as to the ground of rejection on the basis of that claim alone unless a statement is included that the claims of the group do not stand or fall together and, in the argument under paragraph (c)(8) of this section, appellant explains why the claims of the group are believed to be separately patentable. Merely pointing out differences in what the claims cover is not an argument as to why the claims are separately patentable.

The PTO argues that a “ground of rejection” is the statutory section under which a claim is rejected.  In the present case, then, the ground of rejection is the claims’ failure to satisfy 35 U.S.C. §112, first paragraph, regardless of whether the limitation in the representative claim that lacks written description support is also present in the other claims of the represented group.  Conversely, Hyatt argues that the “ground of rejection” includes both the statutory section and the reason why the claim failed to meet that statutory requirement.

The Federal Circuit noted that, in 2002, the Federal Circuit held in In re McDaniel, that 37 C.F.R. §1.192(c)(7) “operates to relieve the [BPAI] from having to review… the myriad of distinctions that might exist among claims, where those distinctions are, in and of themselves, of no patentable consequence to a rejected claim.”  293 F.3d 1379, 1383 (Fed. Cir. 2002).  Accordingly, the Federal Circuit cited In re McDaniel in reasoning that a group of claims rejected on the same ground is one in which the differences between the claims is “of no patentable consequence to a contested rejection.”  Thus, the Federal Circuit concluded that the PTO’s interpretation of 37 C.F.R. §1.192(c)(7) is erroneous, and that a group of claims rejected under 35 U.S.C. §112, first paragraph do not share a common ground of rejection unless the claims have a common limitation that lacks written description support.

As to the second issue, the PTO argues that if its interpretation of 37 C.F.R. §1.192(c)(7) is rejected, then it will be required, on remand, to consider grounds of rejection that Hyatt failed to contest in his initial appeals to the BPAI.  The Federal Circuit, again, disagreed with the PTO, and affirmed that the rules of waiver (37 C.F.R. §1.192(a)) exempt the BPAI from considering grounds of rejection that were not contested on initial appeal.  However, while an Applicant can waive appeal of a ground of rejection, the Applicant cannot waive the BPAI’s obligation to select and consider at least one representative claim for each properly defined ground of rejection appealed.

Thus, in the present case, the BPAI must consider all grounds of rejection challenged by Hyatt without selecting a claim to be representative of a group that were rejected on different grounds.  However, the BPAI is not obligated to consider any grounds of rejection not challenged by Hyatt in his initial appeals, unless such grounds become relevant on remand.

Significance for Patent Applicants

While seemingly a narrow holding, the lesson of Hyatt is important to the extent that it demonstrates that the USPTO must reasonably comply with its rules.  Thus, even after the Federal Circuit’s holding in Tafas by which the Federal Circuit held that the USPTO has broad rulemaking authority for such procedural rules, the USPTO’s interpretations must still be within the bounds of reason.

BPAI Creates New Test for 35 U.S.C. §112

Board Finds Indefiniteness exists where Claims are Subject to Multiple Interpretations and Claims Reciting Purely Functional Relationships are Invalid for a Lack of Enablement

In Ex parte Kenichi Miyazaki, 89 USPQ2d 1207 (BPAI 2008), the appellant, Kenichi Miyazaki (Miyazaki), sought the Board’s review under 35 U.S.C. §134 of the rejection of pending claims 1-6, 13, 15-18, 26 and 31 for the Application No. 09/386,000.  The claimed invention is directed to a large printer using a paper roll.  The Examiner rejected the claims 1-6, 13 and 16-18 under 35 U.S.C. §112, second paragraph, as being indefinite with regard to the recited features of a height of the paper feeding unit and a sheet feeding area with reference to a user’s height.   

On appeal, the first issue related to whether the Appellant has shown that the Examiner erred in determining that claims 1-6, 13 and 16-18 are indefinite under 35 U.S.C. § 112, second paragraph, when reciting the height features when read in view of the specification.  The second issue related to the recitation of “sheet feeding area” and “sheet feeding area operable to feed…”  With respect to claims 13, 15, 16, 18 and 26, the issue before the Board was whether the recitation of “sheet feeding area” is too indefinite for those skilled in the art to understand what is being claimed in light of the specification.  With respect to claims 15 and 26, the issue before the Board was whether the recitation of “sheet feeding area operable to feed…” has no structural limitation and is a purely functional recitation, and thus is indefinite under 35 U.S.C. §112, first paragraph. 

BPAI Develops New Rule for Indefiniteness

The Board, in addressing the rejection of claims 1-6, 13, and 16-18, under 35 U.S.C. §112, second paragraph, held that the Federal Circuit’s rule on the definiteness requirement, with respect to post-issuance patent infringement cases, is that “[o]nly claims ‘not amenable to construction’ or ‘insolubly ambiguous’ are indefinite”  Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1347 (Fed. Cir. 2005).  The Board explained that the Federal Circuit states that such a high standard for finding ambiguity results from the statutory presumption of patent validity.  Exxon Research & Eng’g Co. V. United States, 265 F.3d 1371, 1375 (Fed. Cir. 2001). 

However, the Board held that such a rule leads to a narrow interpretation of claims that is counter to the United States Patent and Trademark Office’s standard for a broad reading for claim construction during prosecution.  The Board stated that the broader claim construction standard used during prosecution is justified because an applicant may amend claims to more precisely define the invention during the prosecution. In re Morris, 127 F.3d 1048, 1056-57 (Fed. Cir. 1997).  As such, the Board applied a new, lower standard for finding ambiguity.  Rather than “requiring that the claims are insolubly ambiguous,” the Board held that “if a claim is amenable to two or more plausible claim constructions, the USPTO is justified in requiring the applicant to more precisely define the metes and bounds of the claimed invention by holding the claim unpatentable under 35 U.S.C. §112, second paragraph, as indefinite.”  Additionally, the Board noted that while their reviewing court has not previously set forth a different standard of review for indefiniteness, with respect to pre-issuance claims versus post issuance claims, the Federal Circuit has stated that such difference may be necessary during prosecution of a patent.  Exxon Research & Eng’g Co. V. United States, 265 F.3d 1371, 1384 (Fed. Cir. 2001).  As such, the Board held that a new, lower standard was appropriate for purposes of 34 U.S.C. §112, second paragraph during prosecution. 

In applying this standard, the Board noted that claim 1 doesn’t state a positional relationship between the user and the printer.  Specifically, it is not clear if the printer is on the ground or on a stand or if the user is standing on the ground or sitting in a chair.  The Board further stated that with the many possible combinations of the relative positions between user and the printer in claim 1 “does not, in fact, impose a structural limitation on the height of the paper feeding unit of the claimed printer.”  Moreover, the Board found that the Applicant’s specification does not impose a clear relational position upon the language of claim 1.  As such, the Board declined “to read the preferred embodiment depicted in Figure 1 into the claim, because the language is broader than the embodiment, and the preferred embodiment implies that other embodiments may satisfy the claim.”  With the language of independent claims 3 and 4 being broader than claim 1, the Board stated that such claims do not impose a limitation as to the structure and positional relationship and are indefinite as well. 

With respect to claims 16 and 18, though such claims include language that the printer is “substantially at ground level,” there is no clarity as to where the user is standing or positioned, and as such, are indefinite. 

While claim 13 recited that both the user and the printer are “substantially at ground level,” the Board found that it is unclear what “sheet feeding area” means in the claim and consequently agreed with the Examiner’s rejection on new grounds set forth in the appeal decision.  Under the new grounds for rejection, the Board found that claims 13, 15-18, 26 and 31 are rejected for being indefinite.  Because there are two possible meanings for “sheet feeding area,” the first being the space where the paper roll is loaded and a cover member above the space, with the cover member having a space where paper can be placed to be fed into the printer.  The second ordinary meaning of “sheet feeding area” is the area of the printer that feeds paper into the printer, which the Board states to be the cover member in the present application.  The Board stated that “neither the Specification, nor the claims, nor the ordinary meanings of the words provides any guidance as to what the Appellant intends to cover with this claim language,” and consequently finds “sheet feeding area” to be ambiguous. 

BPAI Applies Halliburton to Functional Claim Limitation

With respect to claims 15, 26 and 31, the Board entered as a new ground for rejection that the recitation of “sheet feeding area operable to feed…” is a functional recitation and doesn’t impose a limitation on structure.  Under this new ground, the claims were invalid under 35 U.S.C. §112, first paragraph for violating the Halliburton rule, named after Halliburton Oil Well Cementing Co. v. Walker, 329U.S. 1, 71 USPQ 175 (1946). 

Specifically, the Board first found that, since the word “means” does not appear in the claim, the Board assumed that the Appellant did not intend to invoke 35 U.S.C. §112, sixth paragraph.  Further, because the Appellant still has the opportunity to amend the claims to invoke 35 U.S.C. §112, sixth paragraph, the lack of structure in the claims does not rebut the presumption that 35 U.S.C. §112, sixth paragraph, does not apply, and therefore, the Board held that claims 15 and 26 do not require claim interpretation under 35 U.S.C. §112, sixth paragraph.  As a result, the Board held that the claim element “sheet feeding area operable to feed…” is purely functional.

The Board voiced two USPTO concerns regarding purely functional claim elements that the Applicant does not limit via 35 U.S.C. §112, sixth paragraph.  First, the Board stated that the USPTO is concerned that such claims are indefinite under 35 U.S.C. §112, first paragraph.  Second, the Board stated that the USPTO is concerned that such “unlimited purely functional claiming may reasonably be construed to encompass any and all structures for performing the recited function, including those which are not what the applicant invented.”  For these reasons, the Board held that the Supreme Court’s Halliburton decision is applicable to claims reciting purely functional claim language when the claims are unlimited by either (1) the application of 35 U.S.C. §112, sixth paragraph, or (2) the additional recitation of a structure. 

Moreover, as the claims are not means plus function claims and otherwise lacked structure, the Board found them invalid under 35 U.S.C. §112, first paragraph, by finding that there is a prohibition on “purely functional” claim language having no structure limitation.  The Board held that the Supreme Court had previously found purely functional limitations to be invalid under 35 U.S.C. §112, first paragraph.  Halliburton Oil Well Cementing Co. v. Walker, 329U.S. 1, 71 USPQ 175 (1946).  It was due to this Halliburton rule that Congress created 35 U.S.C. §112, sixth paragraph to allow functional claiming.  Thus, the Board found that the Halliburton rule was still in force for claims not invoking 35 U.S.C. §112, sixth paragraph.  Since claims 15 and 26 did not recite structure and were purely functional in nature, claims 15 and 16 violated the Halliburton rule and were unpatentable under 35 U.S.C. §112, first paragraph, for lack of enabling disclosure commensurate with the scope of the claims. 

In summary, the Board affirmed the Examiner’s rejection of claims 1-6, 13 and 16-18 and entered new ground for the rejection of claims 13, 15-18, 26 and 31. 

Significance to Patent Owners

In Ex parte Kenichi Miyazaki, BPAI created new test for 35 U.S.C. §112 to require applicants to ensure language not reasonably capable of dual meanings.  While nominally useful in regards to helping clarify the claims, the decision, if followed, would encourage Examiners to find multiple unreasonable interpretations of claims, and force the applicants to narrow their claims or prove that only one interpretation is reasonable.  Moreover, the Board did not address how both interpretations at issue were “reasonable” as would be understood by one of ordinary skill in the art, and appeared solely to rely on the specification and the claims without establishing the skill or knowledge of those in the art.  Additionally, in attacking functional limitations, the Board is signaling that it will attempt to reign in broad claiming of the type normally exemplified by functional limitations. However, the Board does not appear to address the obvious reality that such limitations, if truly broad, will read on prior art and will be narrowed through ordinary prosecution.  Thus, the new rule applied by the Board, especially outside of a prior art rejection, will encourage piecemeal examination without improving the quality of the resulting patent.

Federal Circuit Finds That Subsequent Applications Must be Filed as a Divisional Applications For 35 U.S.C. §121 Exclusion

In Pfizer, Inc. v. Teva Pharms. USA, Inc., No. 2007-1271 (Fed. Cir. March 7, 2008), Pfizer filed an application for a broad range of non-steroidal anti-inflammatory drugs (NSAIDs) that could selectively inhibit the COX-2 enzyme.  Traditional NSAIDs, such as aspirin, ibuprofen, and naproxen, inhibit the cyclooxygenase (COX) enzyme in the body.  The COX enzyme produces molecules associated with pain and inflammation (COX-2) as well as molecules associated with the gastrointestinal tract (COX-1).  Since the traditional NSAIDs inhibited both enzymes, these drugs tended to have gastrointestinal side effects ranging from minor stomach aches to serious ulcers.  The application contained claims directed to the compounds, compositions using the compounds, and methods of using the compounds.

The patent examiner issued a restriction requirement, identifying the compound claims, the composition claims, and the method claims as directed to patentably distinct subject matter.  The patent examiner also required Pfizer to elect a species.  Pfizer elected to prosecute the generic compound claims as well as the species related to the compound celecoxib.  The elected claims were allowed, and the patent issued as Patent No. 5,466,823 (the ‘823 patent).

Pfizer also filed several continuation application claiming benefit to the ‘823 patent application, of which two were at issue in the case before the Federal Circuit.  One, which issued as Patent No. 5,563,165 (the ‘165 patent), was a divisional and included the restricted composition claims.  The other, which issued as Patent No. 5,760,068 (the ‘068 patent), was a continuation in part (CIP) application and included the restricted method claims.  

Teva, a generic drug manufacturer, filed an Abbreviated New Drug Application (ANDA) with the FDA directed toward celecoxib capsules.  In the ANDA, Teva asserted that the ‘823, ‘165, and ‘068 patents were invalid.  Pfizer responded by filing an infringement suit.  After a bench trial, the District Court found in favor of Pfizer, rejecting Teva’s obviousness, double patenting, best mode, and inequitable conduct defenses.  Teva appealed, arguing that the District Court’s double patenting, best mode, and inequitable conduct rulings were erroneous.

The Federal Circuit reversed the District Court with respect to the double patenting issue, but upheld the best mode and inequitable conduct rulings.  The Federal Circuit’s reasoning with respect to the double patenting revolved around the wording of 35 U.S.C. § 121.  This section grants the PTO the authority to issue restriction requirements in patent applications.  However, the patent application cannot be used against divisional applications arising from the restriction requirement.  Similarly, divisional applications from the same parent cannot be used against one another.

Here, the ‘068 patent was a CIP, not a divisional, of the ‘823 patent. Therefore, the Federal Circuit held that the ‘823 patent could be used as prior art against the ‘068 patent for double patenting. Id. at 15.  The Court noted that, prior to the 1952 Patent Act, the PTO routinely rejected divisional applications that arose out of restriction requirements.  35 U.S.C. § 121 was intended to prevent this practice, and referred exclusively to divisional applications, as opposed to other types of applications.  At the time the 1952 Patent Act was filed, the difference between divisional applications and other types of applications was well known.  Therefore, the Court held that, if Congress had intended other types of applications to benefit from 35 U.S.C. § 121’s safe harbor, Congress would have used different terminology.  Instead, Congress chose to limit the safe harbor in 35 U.S.C. § 121 to divisional applications.  Given the specific use of the term “divisional application” in § 121, the Federal Circuit concluded that the safe harbor is only applicable to divisional applications.  Id. at 14.  Since the ‘068 patent, however, was a CIP, not a divisional, and since 35 U.S.C. § 121 is limited to divisional applications, and the ‘068 application was not a divisional application, the safe harbor of 35 U.S.C. § 121 did not apply.

With the safe harbor of 35 U.S.C. § 121 removed, the ‘068 patent could not survive an obviousness type double patenting rejection.  The ‘068 patent is directed to a method of using the compositions disclosed in the ‘125 patent.  According to Federal Circuit precedent, claims to methods of using a compound are not patentably distinct from claims to the compound itself.  Id. at 15 (citing Geneva Pharms., Inc. v. GlaxoSmithKline PLC, 349 F.3d 1373, 1385-86 (Fed. Cir. 2003)).  Applying precedent, the Federal Circuit held that the ‘068 patent was invalid on the grounds of obviousness-type double patenting over the ‘125 patent.

The Federal Circuit upheld the District Court’s dismissal of Teva’s best mode and inequitable conduct claims.  Id. at 21.  Teva argued that Pfizer failed to disclose that the inventors preferred COX-2 selectivity, and that the COX-2 selectivity could affect the dosage of the compounds and compositions recited in the ‘823 and ‘125 patents.  However, the claims at issue in the ‘823 and ‘125 patents were directed to only one embodiment, which was disclosed in the specification.  Although the preference for COX-2 selectivity could affect the preferred dosage of the compounds/compositions, dosages were disclosed in the specification, and no evidence supported the conclusion that the inventors preferred a non-disclosed dosage.  Without such evidence, the Federal Circuit upheld the District Court’s finding of validity.

Finally, Teva argued that Pfizer was guilty of inequitable conduct for failing to disclose two patent applications filed by Merck.  Id. at 21-24.  These patent applications disclosed compounds having a different heterocyclic core, a significant distinction recognized by the PTO itself.  According to the testimony of one of the inventors of celecoxib, the inventors did not believe that the compounds disclosed in the Merck applications were material, because the Merck applications were directed toward compounds having a different heterocyclic core than celecoxib.  This testimony, together with evidence that the two patent applications were disclosed in several hundred other patent applications filed by Pfizer (including patent applications related to compounds having the same heterocyclic core), provided compelling evidence to support Pfizer’s explanation for the failure to disclose the references.  In light of the testimony, the Federal Circuit concluded that the District Court did not err in dismissing the inequitable conduct claims.

Significance for Patent Applicants

Pfizer presents a clear case of putting form over substance.  In Pfizer, there was no debate as to whether the method claims were restricted and therefore not eligible for inclusion in the original application.  However, the failure to appropriately categorize the subsequent application as a divisional was fatal to Pfizer’s ability to avoid an obviousness-type double patenting rejection.  As such, it is important for applicants to ensure that, where relying on exclusions and exceptions utilizing specific labels such as the exclusions offered by 35 U.S.C. §121, applicants follow both the letter and the spirit of the labels required to provide said protection.

Federal Circuit Finds Priority Documents Are Not New Evidence For Purposes of Interference

In In re Harold Garner, Civ Case. No. 2007-1221 (Fed. Cir. December 5, 2007), Calvin F. Quate and David Stern (collectively Quate) are the inventors of U.S. Patent No. 6,480,324, and Harold R. Garner is the inventor of U.S. Application Serial No. 09/998,341.  Quate is the senior party in an interference proceeding between U.S. Patent No. 6,480,324 and U.S. Application Serial No. 09/998,341, and Garner is the junior party based on the effective filing date.  Garner’s patent application was initially rejected based on the filing date of Quate.  Garner attempted to establish a prior reduction to practice for his invention in his 2001 declaration that included:  photos of the device he built before the filing date of that prior art reference and a lab notebook that allegedly showed that the device worked.  John Fondon’s declaration executed on Oct. 20, 2005 was also submitted in a later filing. The evidence was submitted under Rule 131. Continue reading

Federal Circuit Finds Improper Incorporation By Reference Prevented Claiming Priority To Parent Appplication

In Zenon Environmental, Inc. v. United States Filter Corporation, Civ Case No. 2006-1266, -1267 (Fed. Cir. November 7, 2007), Zenon is the owner of U.S. Patent No. 6,620,319 (hereinafter referred to as the ‘319 patent).  The ‘319 patent relates to water treatment and filtration systems, and in particular, to the use of vertical skeins having fibers that filter organic material and which are cleaned using air bubbles of a predetermined size which are provided by a gas distribution system.  The ‘319 patent was designated as a continuation of multiple applications in a chain, including U.S. Patent No. 5,910,250 (hereinafter referred to as the ‘250 patent).  The ‘250 patent was designated as a continuation in part of U.S. Patent No. 5,639,373 (hereinafter referred to as the ‘373 patent).  The ‘373 patent described vertical skeins and a gas distribution system, and the ‘319 patent claims the same gas distribution system described in the ‘373 patent.

The ‘250 patent incorporated the subject matter of the vertical skeins in the ‘373 patent by reference as follows:

The vertical skein is not the subject matter of this invention and any prior art vertical skein may be used. Further details relating to the construction and deployment of a most preferred skein are found in the parent U.S. Pat. No. 5,639,373, and in Ser. No. 08/690,045, the relevant disclosures of each of which are included by reference thereto as if fully set forth herein.

No further details on the vertical skein or the gas distribution system in the ‘373 patent are disclosed in the ‘250 patent.  Moreover, the entire disclosure of the ‘373 patent was not incorporated by reference, but only those portions related to the skein itself. 

U.S. Filter is a competitor of Zenon in the field of water treatment and filtration systems, and Zenon accused U.S. Filter of infringement of, among other patents, the ‘319 patent. 

U.S. Filter asserted a defense of invalidity due to the ‘319 patent not being entitled to the priority date of ‘373 patent, and was thus anticipated by the ‘373 patent.  The District Court denied U.S. Filter’s motion for summary judgment on the basis of invalidity, but granted U.S. Filter’s motion for summary judgment on the basis of non-infringement. 

In reviewing whether the ‘319 patent was entitled to the priority date of the ‘373 patent, the Federal Circuit quoted the test from Lockwood v. Am. Airlines, Inc., 107 F.3d 1565, 1571 (Fed. Cir. 1997) as being “each application in the chain leading back to the earlier application must comply with the written description requirement of 35 U.S.C. § 112.”  In the context of subject matter which is incorporated by reference, the Federal Circuit held that “the host document must identify with detailed particularity what specific material it incorporates and clearly indicate where that material is found in the various documents,” and in determining whether the material has been properly incorporated by reference, “the standard of one reasonably skilled in the art should be used to determine whether the host document describes the material to be incorporated by reference with sufficient particularity.”  Cook Biotech Inc. v. Acell, Inc., 460 F.3d 1365, 1376 (Fed. Cir. 2006) (quoting Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d 1272, 1282 (Fed. Cir. 2000)). 

In applying this test, the Federal Circuit held that the incorporation by reference did not encompass all of the ‘373 patent, but only that portion which “pertains to the details relating to the construction and deployment of a vertical skein.”  While Zenon argued that the gas distribution system disclosed in the ‘373 patent would be understood by one skilled in the art as being a detail of the vertical skein incorporated by reference in the ‘250 patent, the Federal Circuit disagreed since the ‘373 patent drew a distinction between the vertical skein and the gas distribution system. 

This distinction was found in the claims, which claimed the vertical skein without the gas distribution system, and by consistently referring to the gas distribution system as a separate element from the vertical skein in the specification.  Further, the intervening ‘250 patent disclosed a different gas distribution system than that disclosed in the ‘373 patent such that, in the context of the limited incorporation by reference in the ‘250 patent, the gas distribution system of the ‘373 patent was not included in the ‘250 patent.  As such, the Federal Circuit held that one of ordinary skill in the art would not have understood that the gas distribution system of the ‘373 patent was a mere detail of the vertical skein incorporated by reference in the ‘250 patent. 

Since the vertical skein was the only portion of the ‘373 patent which was incorporated by reference in the ‘250 patent, the ‘250 patent did not include the subject matter of the gas distribution system described in the ‘373 patent.  As such, the ‘319 patent could not rely on the intervening the ‘250 patent as disclosing the gas distribution system of the ‘373 patent for purposes of claiming priority back to the ‘373 patent.  Therefore, the gas distribution system in the ‘373 patent was available as prior art as applied against the ‘319 patent.  As such, the Federal Circuit reversed the District Court and found the claims of the ‘319 patent invalid in view of the ‘373 patent.

Significance to Patent Applicants

In general, while it is permissible to incorporate subject matter by reference, it is a better to practice to ensure that such material is physically copied into the specification in order to ensure that there is obvious support for the subject matter.  Moreover, where a new continuation is required and it is unclear whether the incorporation by reference of a prior application is usable, patent owners should consider filing reissue applications for existing patents resulting from the prior patent application to ensure that a result such as that in Zenon is avoided.

Federal Circuit Rejects Patent Office’s Interpretation of Flexible To Include Rigid to be Unreasonable and Not Creditable

In In re Buszard, 84 USPQ2d 1749 (Fed. Cir. 2007), applicants’ invention is directed to a flexible polyurethane foam used in a flame retardant composition.  The Examiner rejected the claims as anticipated in view of Eling et al., which describes a rigid foam that is made flexible through crushing.  The Board of Patent Appeals and Interference (BPAI) affirmed the Examiner, and the applicants appealed the BPAI decision on the grounds that the Examiner’s interpretation of the term “flexible” cannot encompass “rigid.” 

In reviewing the BPAI decision, the Federal Circuit held that, under the Administrative Procedure Act, 5 U.S.C. ‘706, all decisions from the BPAI are reviewed to determine if the Board’s decision is supported by substantial evidence. Dickinson v. Zurko, 527U.S. 150, 165 (1999).  Moreover, for purposes of anticipation, the record must show that all limitations in the claim are met by a single reference where the claims are given their broadest reasonable interpretation.

In reviewing the record and the claims, the Federal Circuit noted that both parties agree that “a person of ordinary skill in the field of polyurethane foams knows that a flexible foam and a rigid foam have different chemical structures and are produced from different chemical reactants.”  However, on appeal, the Solicitor argued that such a distinction is not relevant since, “when a rigid foam is mechanically crushed, the chemical bonds are broken and the product is the same as the flexible product of a flexible foam reaction mixture.”  However, the Federal Circuit was unable to find, in the record, where this rejection was previously discussed or what evidentiary support there was for this interpretation.  As such, the Federal Circuit held that the late presentation of this ground of rejection, which is not supported by the record, “was proposed without support or citation, and without opportunity for Buszard to refute it” and was “not sufficiently creditable to warrant further consideration.”

Moreover, the Federal Circuit also found that such an interpretation was contrary to the broadest reasonable interpretation of the claims in light of the specification.  According to the Federal Circuit, “[n]o matter how broadly ‘flexible foam reaction mixture’ is construed, it is not a rigid foam reaction mixture.”  Therefore, the Federal Circuit found the BPAI’s equating of rigid and flexible to be not supported by the record, and reversed the Board’s decision on those grounds.

Significance for Patent Applicants

While the Examiner is generally required to take the broadest reasonable interpretation, it is important to ensure that the Examiner’s interpretation is truly reasonable. Moreover, such interpretations must be supported by the evidence of record, as the Federal Circuit emphasized in In re Buszard. As such, it is possible to challenge the Examiner’s interpretation using the Administrative Procedures Act as in In re Buszard, or by providing counter evidence as to the true meaning to one of ordinary skill in the art.  In either case, an attack on the reasonableness needs to focus on what evidence exists in the record which supports the applicant’s definition in order to prevail against an Examiner’s overly broad interpretation.

Federal Circuit Denies Foreign Priority Benefit Due to Difference in Applicant

In Boston Scientific Scimed, Inc. v. Medtronic Vascular, Inc. and Eric Martin, 83 USPQ2d 1669 (Fed. Cir. 2007),Boston Scientific Scimed (“Scimed”) appeals a district court grant of summary judgment denying Scimed the priority benefit of an earlier-filed European patent application.  In particular, Scimed points to the European application for the subject matter at issue in an interference proceeding between Scimed, Medtronic Vascular, Inc. (“Medtronic”), and Eric C. Martin.  The issue on appeal is whether an applicant for U.S. patent is permitted “to benefit from the priority of a foreign application previously filed by an entity that was not acting on behalf of the U.S. applicant at the time of filing” of the foreign application.  The Federal Circuit holds that the applicant is not permitted to benefit from the priority of the foreign application where there is a difference in applicants.

Scimed, Medtronic, and Martin are each assignees of differentU.S.patent applications covering the same invention (“An apparatus for reinforcing a bifurcated lumen…”).  The Scimed patent application was filed at the U.S. Patent and Trademark Office on June 5, 1995 by inventors Andrew Cragg and Michael Drake (collectively “Cragg”).  The Medtronic patent application was also filed at the U.S. Patent and Trademark Office on June 5, 1995 by inventors Thomas Fogarty, Timothy Ryan, and Kirsten Freislinger (collectively “Fogarty”).  Martin’s patent resulted from an application filed on August 19, 1994.  The Board of Patent Appeals and Interferences initially gave Cragg the benefit of the filing date (February 9, 1994) of a European patent application filed by MinTec SARL (“MinTec”), a French company.  At the time that the European application was filed, “no legal relationship existed between MinTec and Cragg, nor was MinTec acting on behalf of Cragg.”  Meanwhile, Fogerty was accorded the benefit of a patent application filed on June 8, 1994.

After a motion was filed attacking the priority benefit granted to Cragg, the Board recanted its initial finding and ruled that because neither Cragg nor Drake had assigned their rights to MinTec until after MinTec had filed its European application, Cragg was not entitled to priority benefit under 35 U.S.C. 119.  The district court upheld the Board’s ruling, and the Federal Circuit reviewed the district court’s grant of summary judgment.  35 U.S.C. 119 reads:

“An application for patent for an invention filed in this country by any person who has, or whose legal representatives or assigns have, previously regularly filed an application for a patent for the same invention in a foreign country which affords similar privileges in the case of applications filed in the United States or to citizens of the United States, or in a WTO member country, shall have the same effect as the same application would have if filed in this country on the data on which the application for patent for the same invention was first filed in such foreign country…”

The Federal Circuit was bound by a previous decision, Vogel v. Jones, 486 F.2d 1068 (CCPA 1973), which held that “119 gives rise to a right to priority that is personal to theUnited States applicant.”  Thus, according to the Federal Circuit, the applicant for aU.S. patent may benefit from the priority of a foreign application only if the foreign application was filed by applicant or on the applicant’s behalf. 

Scimed argued that Vogel does not require the foreign applicant to have been acting on behalf of theU.S.applicant at the time of filing of the foreign application.  That is, Scimed asserts that whenever the two inventions are the same, irrespective of the identity of the applicant(s) of the foreign application, theU.S.applicant is permitted to benefit from the earlier foreign filing date.

The Federal Circuit disagreed, holding that even the presence of a common assignee is not sufficient to establish a right of priority.  That is, an application made by an assignee in a foreign country on behalf of a first inventor is irrelevant to a second inventor’s right of priority for an application made by the same assignee in theU.S.on behalf of the second inventor.  The Federal Circuit therefore construes 119(a) to require “that a nexus exist between the inventor and the foreign application at the time the foreign application was filed.”  Accordingly, the Federal Circuit explicitly holds that a foreign application may only form the basis for priority of aU.S.application if the foreign application was filed by either theU.S.applicant or by someone acting on behalf of theU.S.applicant at the time the foreign application was filed.

Federal Circuit Finds Board Cannot Rely on Own Expertise As Evidence In Contested Proceedings

In Brand v. Miller, 487 F.3d 862; 82 U.S.P.Q.2d 1705 (Fed Cir. 2007), Brand and Miller were involved in an interference related to a method of cutting veneer from logs.  Generally, to produce veneer, logs are first cut lengthwise into pairs of fitches, and each pair is mounted into a “staylog” of a veneer cutting machine.  Each flitch is mounted using “dogs”, which hold the veneer in place on the rotating staylog and allow the veneer to be cut from the rotating flitch.  Because each flitch is tapered due to the shape of the tree, conventional machines required that the butt ends be removed to have a roughly uniform shape. 

The invention in dispute centered on a machine which removes veneer from a tapered flitch, thus not requiring the removal of the butt end of the flitch.  Robert Brand, inventor for U.S. Patent Application No. 09/377,120 (the ‘120 application), and Thomas Miller, inventor for U.S. Patent No. 5,865,232 (the ‘232 patent), used a new type of dog to mount the tapered flitch onto the staylog.  Since the ‘120 application and the ‘232 patent contained the same claim, an interference was declared.

During the interference, Miller was the junior party and the Board denied Miller’s attempt to show an earlier invention date.  As such, Miller claimed that Brand derived the ‘232 patent from Miller’s earlier work.  Miller claimed that he had shown Brand a drawing of his work (exhibit MX2001) at a meeting on October 12, 1994, which was before Brand’s conception date, that did not show any dogs or holes in the flitch for receiving the dogs.  Miller also produced a fax (exhibit MX2002), which was sent to Brand on October 7, 1994 and shows a “bugle-headed screw dog.”  However, the only evidence indicating that Brand was informed of how the MX2001 and MX2002 drawings should be used together to form the invention was from Miller’s uncorroborated testimony. 

The Board rejected this testimony, but still found derivation based upon its own reasoning that “one skilled in the art … would have recognized [the] suitability [of the bugle-headed screw dogs] for securely supporting a tapered flitch in the position depicted in [MX2001].”  There was no support in the record, and the Board instead merely stated that “[t]he ability of the bugle-headed screw dogs to tightly clamp the flitch would have been readily apparent.”  In the alternative, and also without support in the record, the Board held that there was derivation because the MX2001 drawing alone showed the needed positions of the tapered flitch relative to a veneer-cutting knife since it was “clear that the position of the flitch is due to the fact that the dogging holes have different depths” and since “it is apparent that the flitch [not shown in the MX2001] is supported [in the required position].”

On appeal, the Federal Circuit analyzed the court’s findings under the Administrative Procedures Act, 5 U.S.C. §554 and §556-57, as required under the Supreme Court’s decision in Dickinson z. Zurko, 527 U.S. 150 (1999).  Citing In re Gartside, 203 F.3d 1305 (Fed. Cir. 2000), the Federal Circuit noted that most PTO proceedings are not “formal adjudications” governed by 5 U.S.C. §556-57 because most PTO proceedings allow applicants to obtain a new trial, de novo, under 35 U.S.C. §§145-146.  However, the Federal Circuit held that most PTO proceedings are still governed by judicial review as set forth in 5 U.S.C. §§701-706.  After reviewing the various review standards set forth in 5 U.S.C. §706, and noting that all reviews of Board actions are required by 35 U.S.C. §144 to be appeals “on the record,” the Federal Circuit held that the review was under 5 U.S.C. §706(2)(E).  The standard under 5 U.S.C. §706(2)(E) requires a determination of whether the agency decision was “unsupported by substantial evidence in a case subject to sections 556 and 557 of this title or otherwise reviewed on the record of an agency hearing provided by statute.”

Based upon this review, the Federal Circuit reviewed the Board’s findings to determine if the record revealed substantial evidence to justify the Board’s conclusions about derivation.  First, the Federal Circuit noted that, especially in a contested proceeding like an interference, the record must be closed.  Citing the Supreme Court in Baltimore & Ohio R.R. Co. v. Aberdeen & Rockfish R.R. Co., 393 U.S. 87, 92 (1968), the Federal Circuit held that an agency cannot rely on its own expertise in a contested case because, without evidence, any administrative decision “would become lost in the haze of so-called expertise.”  The Federal Circuit also noted that the interference proceedings themselves highlight the importance of an administrative record.  Based upon these rules of law and the regulations of the United States Patent and Trademark Office, the Federal Circuit held that agency expertise cannot substitute for evidence to meet the substantial evidence standard.  The Federal Circuit explicitly noted, however, that it is reserving judgment of “the extent to which the Board in ex parte proceedings is so limited.” 

Based upon this determination, Federal Circuit held that the Board’s reliance on its expertise was improper and that, other than Miller’s uncorroborated testimony that the Board also rejected, there was no evidence to show how one of ordinary skill in the art would have understood the drawings MX2001 and MX2002 or to show whether there was a communication regarding how the invention should be practiced.  Instead, the Board improperly substituted its expertise to fill in these gaps, and did not “anchor in the record” its conclusions.  As such, the Federal Circuit reversed the Board’s decision.

Impact on Patent Prosecution

While Brand explicitly only reflects contested proceedings and the need for evidence in such proceedings for purposes of review under the Administrative Procedures Act, it is likely that similar logic would be followed during ex parte prosecution.  Therefore, Brand is consistent with the above decisions relating to obviousness and the need for evidence (as opposed to unsupported conclusory statements) to substantiate a rejection.