Patent Term Calculations: District Courts Split on PTA Calculations; Revive Focus on Deference to PTO Determinations

By Dennis Crouch

Exelixis v. Kappos (Exelixis II) (E.D. Va. 2013)

We now have a district court split on post-RCE patent term adjustment. This decision – siding with the PTO – arises from a second Exelixis case and will be called Exelixis II (Brinkema, J.) In Exelixis I, Judge T.S. Ellis sided with the patentee in finding that the PTO was improperly under-calculating the patent term owed to patentees who had filed a request-for-continued examination during the course of prosecution. Exelixis v. Kappos, — F. Supp. 2d —, 2012 WL 5398876 (E.D. Va. Nov. 1, 2012), as amended Nov. 6, 2012. In the parallel caes of Novartis AG v. Kappos, — F. Supp. 2d –, 2012 WL 5564736 (D.D.C. Nov. 15, 2012), Judge Huvelle adopted the reasoning of Judge Ellis in siding with the patentee. Those decisions basically held that "once the three year clock has run, PTA is to be awarded on a day for day basis regardless of subsequent events." The PTO has argued that an RCE stops the running of the PTA clock.

In her newly released opinion, Judge Brinkema has sided with the PTO in holding that "'any time consumed by continued examination of the application requested by the applicant under section 132(b)' (via the filing of an RCE) does not count toward that three-year period." Quoting 35 U.S.C. §154(b)(1)(B). Exelixis I is already on appeal to the Federal Circuit and part II may be there soon as well.

The PTA statute is poorly written and thus both sides offer reasonable interpretations. In that type of scenario the most important factor is often whether deference is given to the agency's statutory interpretation. Here, Judge Brinkema determined that the PTO's interpretation of its statute should be accorded Skidmore deference because the PTO's interpretation is a "reasonable conclusion as to the proper construction of the statute." Quoting Cathedral Candle Co. v. U.S. Int'l Trade Comm'n, 400 F.3d 1352 (Fed. Cir. 2005). In that case, Judge Bryson wrote "we believe the Supreme Court intends for us to defer to an agency interpretation of the statute that it administers if the agency has conducted a careful analysis of the statutory issue, if the agency's position has been consistent and reflects agency-wide policy, and if the agency's position constitutes a reasonable conclusion as to the proper construction of the statute, even if we might not have adopted that construction without the benefit of the agency's analysis." Of course, that case was not a patent case. And the Federal Circuit has appeared much less willing to offer deference to USPTO decisions.

Read the new opinion here: /media/docs/2013/01/gov.uscourts.vaed.280154.31.0.pdf.

20 thoughts on “Patent Term Calculations: District Courts Split on PTA Calculations; Revive Focus on Deference to PTO Determinations

  1. “Judge Brinkema is arguing that RCEs are applicant delay – even thought the USPTO has NEVER provided this in the applicant delay rule (37 CFR 1.704″

    If Ellis & Huvelle’s interpretation prevails, perhaps it’s time that they did.

  2. The PTO changed the way RCE’s are handled (reclassifying them as amendments on the examiners’ dockets to continuations) because they thought their interpretation of section 154 was correct. They were wrong. As they have been about their interpretation of section 154 numerous times before.

  3. Consider this, when the PTO changed how RCE’s are handled on the examiner’s docket (creating the current RCE backlog) did they not make this delay one caused by the PTO?

  4. The in ability to figure out when a patent term starts and when a patent expires are yet another inscrutable piece of patent information. Consider that an influential patent blog with its patent intelligentsia following debating a Patent Term Calculation issue.

    Why not just use the USPTO Patent Term Calculator? It guarantees patent attorneys employment for life.

    link to wayfinderinklings.blogspot.com

  5. There is a substantive difference between evaluating patents under the law, and evaulating what the law that you operate under “really means.”

    I definitely recognize a semantic difference between those two concepts. But what’s the “substantive” difference?

    I’m genuinely curious.

  6. Judge Brinkema is being loose here with the statute and rules. Applicant delay is treated under 154(b)(2)(C), and the USPTO makes very clear in the MPEP that the rule promulgated under 154(b)(2)(C) is 37 CFR 1.704. RCE’s are treated separately by 35 USC 154, i.e., under 35 USC 154(b)(1)(B), and the USPTO makes very clear in the MPEP that the rule promulgated under this section of the statue is 37 CFR 1.703.

    Judge Brinkema is arguing that RCEs are applicant delay – even thought the USPTO has NEVER provided this in the applicant delay rule (37 CFR 1.704). I don’t think it is correct for the USPTO and Judge Brinkema to start mixing and matching the statue and the rules like this.

    If the USPTO really wants RCEs to be applicant delay – they could try to add it to 37 CFR 1.704. Although, arguably they shouldn’t be able to do so, given that a different portion of 35 USC 154 was crafted to deal with RCEs.

  7. Some years ago, I raised the issue of how the PTO was construing the then 102(e) in connection with PCTs.

    Briefly, the PTO maintained:

    1. The prior art date of a patent issuing on a international application was its national stage date.

    2. The prior art date of a patent issuing on a 111(a) application that claimed the benefit of the filing date of an international application was its international filing data (approximately 18 months earlier).

    3. If a continuation application issued from a national stage application, it be prior art as of the international filing date while its parent would only have the national stage date.

    4. In either case, if the international case claimed the benefit of an earlier-filed US application, that date was ignored for all prior art purposes — this regardless of case law under 102(g) that held that such was prior art because it was constructively reduced to practice in the US and not abandoned, etc., by it subsequent patenting in the US.

    In response to my “petitions” they maintained their legal position, but undertook reform of 102(e). Their efforts are still not entirely satisfactory, nor is their interpretation of the law.

    But, during this process I discovered that the PTO had drafted the statutes in question and the PTO policy was determined by the very people who drafted the statutes. What this tells me is this: the statute in question here was drafted by the PTO. If there is an ambiguity, they are the last people to be given deference lest they in the future intentionality draft ambiguous statutes to essentially rule by edict.

  8. I am not so sure that Congress did not pass the text by the PTO for comment.

    That doesn’t mean the PTO drafted the document, any more than we “drafted” all the PTO rules and fee increases that are circulated to the public for comment.

    In any event, there is no such thing as a construction “in favor” of the PTO. The amount of PTA awarded to a patent does not cost or benefit the PTO in any way. It’s simply a question of whether the PTO has arrived at the correct interpretation of the statute.

  9. Dennis, I am not so sure that Congress did not pass the text by the PTO for comment. In fact, I would find it unbelievable if someone were to say that Congress would not pass the text by the PTO.

    More than likely, the PTO drafted the statuted and forwarded on to congressional staff.

  10. Nice (and of course off-base) trolling MM.

    There is a substantive difference between evaluating patents under the law, and evaulating what the law that you operate under “really means.”

    In your hurry to troll me, You have (once again), departed from rationality.

    Here sir, is your head back.

    MM Troll FAIL

  11. I wonder if the record of incorrect Office attempts at evaluating law (including Taffas and Wyeth do (or should) play a factor here.

    Good point. Don’t forget to mention all the PTO examination mistakes that the Federal Circuit is asked to fix.

    Perhaps the “clear and convincing” standard for invalidating patents can be eliminated while the Federal Circuit is the mood to complain about deferring to the USPTO’s “expertise”.

  12. Thanks Prof. Crouch.

    I wonder if the record of incorrect Office attempts at evaluating law (including Taffas and Wyeth do (or should) play a factor here.

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