CAFC: Even with Deference, PTO Misinterprets its Own Rules

PatentLawPic123In re Garner, Slip Op. 2007-1221 (Fed. Cir., Dec. 5, 2007)

Garner submitted shoddy evidence to prove an earlier invention date and the Examiner refused to declare an interference.  At the BPAI, Garner added a few additional documents to his Rule 202 priority filing.

37 C.F.R. § 41.202(d)(2) allows a BPAI judge to declare an interference accompanied with an order to prove why the junior party should “prevail on priority.”  Under the rule, “[n]ew evidence in support of priority will not be admitted except on a showing of good cause.”  Here, the BPAI excluded the additional documents as “new evidence” that should have been submitted earlier.

On appeal, the CAFC granted deference to the PTO interpretation of its rules, but still found the PTO’s interpretation erroneous.

PTO Deference: Under Star Fruits and other cases, the CAFC has repeatedly held that the PTO is granted deference in interpreting its own regulations. In Lilly v. UW, the court went on to hold that the PTO’s interpretation of its rules “will be accepted unless it is plainly erroneous or inconsistent with the regulation.”

New Evidence: The “new evidence” submitted by Garner was actually evidence already in the patent file history. Namely, he submitted the provisional application; the specification of the non-provisional; and a previously filed 131 declaration for the appealed case.  The BPAI considered those filings new evidence because they were not part of the original Rule 202 filing.

On appeal, the CAFC took issue with that evidentiary ruling — instead holding that under Rule 202(a)(5), the specifications are automatically part of the evidence to be considered. The CAFC did allow the 131 declaration to be excluded.

Despite winning the evidentiary ruling, Garner was unable to provide sufficient corroborating evidence of prior invention. He had dated photographs, but no evidence proving that his photographed machine actually worked:

“While ‘the law does not impose an impossible standard of ‘independence’ on corroborative evidence by requiring that every point of a reduction to practice be corroborated by evidence having a source totally independent of the inventor . . . [,]’ corroboration of the existence of the device is not sufficient in this case to establish corroboration of reduction to practice. It is also necessary to corroborate that the device worked for its intended purpose.” Quoting Cooper v. Goldfarb, 154 F.3d 1321 (Fed. Cir. 1998).

Thus, the CAFC affirmed the BPAI’s Judgment that Garner failed to “make a prima facie showing of priority.”


10 thoughts on “CAFC: Even with Deference, PTO Misinterprets its Own Rules

  1. 10

    ” However, I don’t recommend that any youngsters jump into the interference expert pool expecting a life time of employment. ”
    In these times of profound PTO uncertainty ; most any aspect of patent law is liable to undergo radical unforseen change overnight.
    While FTF will remove a lucrative Source $ from the practice of Patent Law ; Just look at the # Liars that will be saved from the fires of hell. But I have no inclination to parallel the practice of patent Law with the rest of the world for the reason that it is just a giant step in the wrong direction.

  2. 9

    If Rule 131 declarations and affidavits are being accepted based upon “flimsy” evidence, I suggest that the problems lies within the PTO for accepting such documents in the first place. Obviously, practitioners bear significant responsibility if what is submitted “flimsy”, but that does not prevent the PTO from characterizing it as such and refusing entry.

    As for interference practice in general, I submit that much of the confusion surrounding the process exists because few practitioners are ever exposed to the process. It is not a particularly difficult process as long as one is cognizant of the fact that evidence, and not arguments of counsel, carries the day. This is true before a court, so I have a difficult time understanding why so many rail against having to do the same before the PTO as it performs this quasi-judicial function.

    If interference practice is one of the reasons underlying why some call for patent reform by moving by a FTF system, I can think of precious few trivialities upon which to rest a case for such a cardinal change to longstanding law. Despite, in my view, the superficial appeal of certainty, I have abiding concerns for three reasons. Many basic research organizations are simply not geared for a FTF system. Their processes demand a much more thorough investigation that a FTF permits. An underlying purpose (in fact, I submit the primary purpose) of the patent system is to encourage comprehensive disclosure of inventions, and many of such inventions in the more esoteric arts are not ameanable to a race to the USPTO. Next, FTF is so deeply ingrained in our law that change to a FTF system is not an insignificant task. The issues are much more complex and demand thoughful consideration of pros and cons. I have seen many pros, virtually all of which pertain to certainty and rapidity, but I have not seen any serious discussions of cons. Finally, and as trite as it may appear to some, in my view there is a lack of fairness involved with respect to the first who conceives and proceeds diligently to an RTP.

    Maybe international harmonization is a good thing. Maybe it is not. Nonetheless, I am not prepared to jump on the bandwagon just because “that is how everyone else does it”. That is a poor excuse.

  3. 8

    “So for those of you that oppose FTF because of concern over Chico Gholz’s and Danny Huntington’s ability to generate income, don’t worry.”

    Never heard of them and proud of it.

  4. 7

    My assessment is that even if the US goes to first to file, there will be enough interference work (involving pre-FTF cases) for the “mature” interference practioners to leverage and keep themselves busy until retirement. So for those of you that oppose FTF because of concern over Chico Gholz’s and Danny Huntington’s ability to generate income, don’t worry. I think they will be ok. And I agree that you can’t just dabble in interferences, you need to hire a specialist. I know I will if an interference issue pops up. However, I don’t recommend that any youngsters jump into the interference expert pool expecting a life time of employment.

  5. 6

    Well, well , well, the FED CIR is starting to show the type of intellectual gymnastics and creativity that one would presuppose judges of such high stature possess. I can only hope that we obtain more of these types of decisions and less of the McKesson-type of decisions. My faith in the Fed. Cir. just went up a notch.

  6. 5

    The interference bar is undoubtedly pooping itself at the prospect of the well drying up.

    But first to file is The Way.

    Reform without establishing a first to file paradigm is not reform at all.

  7. 4

    Agreed, Paul.

    While the most interesting point of this case may be the issue of deference, vel non, the larger issue is that the whole interference paradigm is such absolute idiocy. The sooner Congress moves us to a first to file, the better for everyone (except the interference lawyers).

    Multiply this case by the number of interference cases litigated over the last 2 centuries to get a quantitative picture of what lunacy in action looks like. Then multiply that result by the average cost of an interference proceeding, and adjust that figure for 2007 dollars to get a quantitative idea of why a lot of firms oppose first to file. In other words . . . go figure.

  8. 3

    The end result here is just another chapter in the long sad saga of parties or their attorneys attempting to handle interferences as if interferences were normal PTO ex parte prosecution [instead of a unique, complex, and much more litigation-like proceedure requiring expert attorneys and evidence].
    The complexity, cost, delay and uncertainty of interferences, plus the flimsy insufficent evidence of alleged 102(g) ‘prior invention’ on which most Rule 131 declarations are accepted ex parte (but not elsewhere) is one of the reasons for the pending patent reform legislation.

  9. 2

    The CAFC does NOT always give deference to PTO interpretation of its own rules. See the following IPO NEWS report of a few years ago on a prime example:
    “Federal Circuit Split 6 to 6 Refuses to Rehear Issue of Deference to USPTO — Dethmers Mfg. Co. v. Automatic Equipment Mfg. Co. 00-1114, -1130 — On June 13 the Federal Circuit on a tie 6 to 6 vote denied Dethmers’ petition for a rehearing en banc. In December 2001 a Federal Circuit three-judge panel held Dethmers’ reissue patent invalid because the company failed to identify every difference between the original and reissue claims, required not by the statute but by a USPTO rule that was in effect at the time [albiet the PTO had said it was not]. An opinion by Judge Dyk dissenting from the denial of a rehearing en banc argued that the panel decision erred in failing to pay deference to the USPTO’s interpretation of its own regulations. A dissenting opinion by Judge Linn argued that the panel failed to defer to the USPTO and also failed to recognize the statutory presumption of validity of patents.”

  10. 1

    Although it is pertinent to mention here that Garner was unable to provide sufficient corroborating evidence of prior invention. He had dated photographs, but no evidence proving that his photographed machine actually worked: that’s decision goes to garner’s favor. Its a nice study case for understanding priority date importance.

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