Inter Partes Reexaminations: USPTO Can Only Consider References from the Request that Were Found to Raise a Substantial Question of Patentability

By Dennis Crouch

Belkin v. Kappos (Fed. Cir. 2012) (Appeal of Inter Partes Reexam No. 95/001,089)

OptimumPath’s U.S. Patent No. 7,035,281 broadly covers a wireless router with onboard authentication and is based upon an application filed in the year 2000. When Belkin filed its inter partes reexamination request, it argued that a set of four prior art references render all 32 claims unpatentable. The USPTO partially granted Belkin’s request. However, the USPTO found that only one of the four references (“Pierce”) raised a substantial new question of patentability, and the Pierce-SNQ only related to claims 1-3 and 8-10 of the ‘281 patent. The USPTO thus rejected the request as to the remaining claims 4-7 and 11-32. Further, the USPTO also rejected the notion that the four-reference combination raised a SNQ with regard to claims 1-3 and 8-10.

Belkin filed a petition to challenge the partial denial. Since the reexamination had been granted as to claims 1-3 and 8-10, Belkin only challenged the USPTO’s adverse decision regarding the other claims. That petition was duly denied. As prosecution developed, the Examiner (supported by the BPAI) determined that the lone reference (Pierce) did not actually anticipate claims 1-3 or 8-10. Further, the USPTO refused to consider the four-part combination obviousness argument that had been rejected at the request stage. The BPAI then confirmed the Examiner’s decision – holding that the Board did not have the power to now decide that the combination of references raise a SNQ of patentability because that determination is not appealable under 35 U.S.C. § 312(c).

The USPTO differentiates between petitions and appeals and according to the Board, Belkin erred by failing to timely petition to challenge SNQ determination rather doing what it did (waiting to appeal that determination after receiving an adverse examiner decision0.

Now, the Court of Appeals for the Federal Circuit (CAFC) has affirmed the Board decision – holding that

The proper course of action was for Belkin to have petitioned the Director to review the determination that the arguments relying on the [other three references] did not raise a substantial new question of patentability pursuant to 37 C.F.C. § 1.927. Belkin did not do so, and thus that decision became final and non-appealable, rendering those issues beyond the scope of the reexamination.

One problem raised by this decision by Judge Lourie and joined by Chief Judges Rader and Judge Wallach is that it conflicts with the MPEP.

MPEP § 2648 identifies a hypothetical situation parallel to Belkin’s – where an inter partes reexamination request on a particular claim is granted based upon one set of prior art but denied based upon another set of prior art. According to the MPEP, no petition challenging the partial-grant may be filed with regard to that claim and that once granted, the reexamination will consider “all prior art.”

[N]o petition may be filed requesting review of a decision granting a request for reexamination even if the decision grants the request as to a specific claim for reasons other than those advanced by the third party requester. No right to review exists as to that claim, because it will be reexamined in view of all prior art during the reexamination under 37 CFR 1.937.

MPEP § 2648. The Federal Circuit decision here considered the conflict created by the MPEP and ultimately determined that the MPEP does not carry the weight of law and thus is easily discarded. The court writes:

[T]he MPEP does not have the force of law, and is only entitled to judicial notice as the PTO’s official interpretation of statutes and regulations with which it is not in conflict. Molins PLC v. Textron, Inc., 48 F.3d 1172, 1180 n.10 (Fed. Cir. 1995).

This holding here (following Molins) becomes even more important under the AIA as the PTO has received a substantial additional amount of rulemaking authority for determining the proper methodology of conducting the array of post-grant challenge options. Here we have a re-affirmance that the USPTO’s statements in the MPEP will not be given the same deference that will be due to rules promulgated and printed in the code of federal regulations (CFR). The court noted that this decision should not be seen as offering any guidance as to how the AIA will be interpreted (since this case applies the old law regarding inter partes reexaminations).

Limit Scope of Reexamination: The court here goes on to hold that the Patent Act strictly limits the prior art that the USPTO can apply in considering challenged claims during reexamination. In particular, in the reexamination the PTO can only consider the prior art that the director found raised the substantial questions of patentability. The court writes:

In any event, in order to reconcile what may otherwise appear to be conflicting provisions, we hold that, under the statute, available prior art may only be considered to answer the specific questions of patentability found by the Director.

In a footnote, the expressly refuses to rule on a situation where the patentee amends claims or adds new claims during the reexamination. Thus, in those situations, the PTO might have the power to consider other references.

We do not reach the issue of what prior art references the PTO may or may not consider during reexamination in response to an amended or substituted claim.

The problem with this holding on the “statute” is that the court does not actually identify the statutory provision that lead to its conclusion. I suppose that the best statute on point is Section 312(c) that limits the appeal of SNQ determinations. If we allow a requester to force the consideration of additional references by appealing to the BPAI – then that begins to look like an appeal of the SNQ determination. That seems to be a fairly weak argument and perhaps that is why the court did not spell it out.

For its part, the Board was likely thinking of this case as an important stake-in-the-ground to limit the scope of the new post grant review regimes (that the Board is handling directly rather than the CRU). The importance is evidenced by the fact that the case was decided by an expanded 5-judge panel which included Board Vice-Chief Judge James T. Moore and Judge Allen MacDonald as added members.

33 thoughts on “Inter Partes Reexaminations: USPTO Can Only Consider References from the Request that Were Found to Raise a Substantial Question of Patentability

  1. 33

    Night, which is what I said.  You seem to suggest that the PTO had the right to support their position at any time on appeal with new evidence.  That, sir, is contrary to law.

  2. 31

    “If Administrative Law Judges at the Board…”

    They’re not administrative law judges. Their knowledge of administrative law is actually rather non-existent.

  3. 30

    Yeah, Ned, but the examiner didn’t “lose” at the PTAB, he was affirmed by a trio of legal ignoramuses. The patent owner had to go through the expense of a Fed. Cir. appeal just to get the PTO, by way of the Solicitor’s office, to acknowledge that the rejections based on Official notice were complete bullsh!t. Applicants and patent owners shouldn’t have to appeal to the Fed. Cir. to force the examiners and the APJ’s to provide evidence to support factual findings, or in the absence of the evidence to withdraw the rejections.

  4. 27

    Examiners should be forbidden from relying on Official notice. David Boundy and the IEEE advocate such a position.

  5. 26

    “Waiver? –> IF the examiner has the right to produce the evidence and you do not challenge when you have the opportunity to do so.”
    I asked for a cite to case law or a rule. Waiver applies to arguments not made during the Appeal Brief but made in a Reply Brief or a Request for Rehearing. There is no waiver of arguments during the pre-appeal stage of examination.

    “If the examiner tries to introduce new evidence, he can be stopped by petition per the new rule.”
    Imprecise … he cannot be “stopped.” He’ll be required to designate the new evidence as a new grounds. Nothing prevents the USPTO from presenting new evidence at any time during the examination of a patent application — however, the law does require that applicant has a fair chance to respond to this new evidence (i.e., via the designation of a new grounds of rejection).

  6. 25

    “The PTO loses because by rule they have no evidence.” And because the APJ’s are unbelievably ignorant of the law. The Solicitor acknowledged that the affirmance of those rejections was wrong. Maybe it’s time for some remedial administrative law classes for the entire PTAB. Couldn’t hurt.

  7. 23

    The examiner took Official notice in the 10/2/08 FR, the patentee called bullsh!t on the examiner, and demanded evidence, in the 11/3/08 response (pages 46-47), and the examiner “maintained” the Official notice in the 2/6/09 Advisory Action (page 6) (where the examiner “maintains” that “the taking of Official Notice that the features recited…are well-known in the art and would have been either inherent or obvious modifications or design choices”) (lulz, I guess you can’t expect too much understanding of the law from a Georgetown grad).

  8. 21

    1. Waiver? –> IF the examiner has the right to produce the evidence and you do not challenge when you have the opportunity to do so.  The sole exception to this is if the examiner uses official notice in the second or final OA.  Then one has a statutory right to appeal and the examiner might be stuck since he cannot introduce new evidence.
    2. If the examiner tries to introduce new evidence, he can be stopped by petition per the new rule.


  9. 20

    Ned, see the recent decision in In re Abbot Diabetes Care Inc. (2011-1516, -1517), which was an appeal from the BPAI’s affirmance in control no. 90/007,910. See page 39 (of 140) of the appeal brief, where the appellant specifically cited Rule 104(c)(2). It is an appealable issue.

    The Solicitor’s office withdrew the rejections that the BPAI affirmed on Official notice. Pretty much an acknowledgement that the rejections were total cr#p and that the APJ’s are unbelievably ignorant of the law.

  10. 19

    “AFAIK, one cannot introduce new evidence during the appellate process.”

    In “theory,” yes. However, it happens all the f’ing time. Moreover, the rules permit the BPAI to do so if they designate a new grounds (although most panels work under the “theory” that designating new grounds of rejection is optional). The new appeal rules also put in a provision that allows appellant to petition if the examiner enters a new grounds in the Examiner’s Answer and did not designate it as such – why would the USPTO put that new provision in if that wasn’t a well-known problem?

    “the applicant MUST challenge the examiner during examination to support his official notice.”
    Wrong, wrong, wrong, wrong, wrong, wrong, wrong. Applicants can raise ANY new issue in their appeal. If you can cite to me a patent rule or case law that says otherwise, I would like to see it. FYI – the MPEP doesn’t count.

    Also, a proper challenge requires nothing more than “show me the evidence.”

    An examiner taking “official notice” of anything is simply an admission that he/she is too lazy to do their job. In today’s age of ‘the world’s knowledge at your fingertips,’ there is no excuse for not finding factual support for alleged “notorious” facts. If these facts are so notorious, it should take all of about 1 minute to find a reference that supports the alleged notorious fact. If the Examiner cannot find it after 5 minutes of searching, then a think that is a prima facie case that the fact wasn’t notorious. Official Notice may have had a legitimate purpose 40 years ago when it was much harder to search for information, but those days are long over. Official Notice is a dinosaur that should go extinct at the USPTO.

    From my personal experience, Official Notice is abused by the USPTO far more than it is used for legitimate purposes.

  11. 18

    do so if they designate a new grounds (although most panels work under the “theory” that

  12. 17

    I think the best approach is to always petition from an improper decision on a request for reexamination; when final PTO action is rendered, then appeal any adverse decisions; that way the Board will not be able to point fingers by saying “you should have petitioned because we have no jurisdiction on appeal”. Having said that, the Court got it wrong in this case. Examiners should never have their hands tied. Once reexamination is granted, an Examiner can do a search and use additional prior art. Why can’t that additional prior art come from the requester? Same with the Board. The Board can reverse an Examiner’s decision and go out and do a search of the prior art or use unapplied art of record and make a new rejection (they seldom do nowadays, but they used to in the past). If Administrative Law Judges at the Board can use prior art not considered by the Examiner, why not art cited by the Requester. If new claims are presented and the Examiner fails to make an indefiniteness rejection for example, the Board can make their own new 112 rejection. Bottom line: Requesters should be limited to relying on prior art that raises a substantial new question of patentability (ex parte) or likelihood that Requester will prevail in reexamination (inter partes). The same limitation should not apply to examiners or Board Judges. For them, the entire body of prior art should be available. It goes to show you that Judges do get it wrong at times. Hopefully they will have an opportunity to correct themselves.

  13. 16

    Night, if the board want new evidence introduced, they must reopen prosecution.  That is the point.  The board cannot supplement the record with new evidence and decide the case based on it without allowing the applicant a full and fair opportunity to challenge it.  That smacks of lack of due process.


  14. 15

    "However, if the taking of official notice is challenged on appeal and the Examiner doesn't provide evidence, the Examiner automatically loses."
    This is where your argument needs nuance.
    AFAIK, one cannot introduce new evidence during the appellate process.  The Board is not the examiner and the examiner cannot or should not be able to supplement the record with new evidence.  The examiner must win on the record.  Ditto the applicant.
    If the examiner needs to introduce new evidence, he should reopen prosecution.  However, I think he should be prevented from doing so if he was properly challenged during after a rejection to support his contentions (citing the rule that requires him to do so).  If the examiner is permitted to blow off request for support without any real consequence, he will have the incentive to do so.
    However, the applicant MUST challenge the examiner during examination to support his official notice.  If he fails to do so, it is too late to do so on appeal.


  15. 14

    The guy needs to get booted out into the private sector instead of those insulated, bubble wrapped govn’t jobs. I think we’d see a rapid “evolution” of his views on IP as he struggled to build something.

  16. 13

    Wow, that paper is so far afield of reality that I don’t even want to take the time to look at it.

    They and Lemley, Moore, Stern, etc. should get together for a beer fest where they congratulate each other in a circule with one arm.

  17. 12

    Ned, you obviously don’t know what you are talking about. The board can reject using new evidence.
    I am too lazy to look up the rule. The board can also just raise new grounds and reject for anything they want.

    As for official notice: the rules require the applicant to traverse the rejection the first time it is raised, if the examiner ignores it and doesn’t bring any evidence, then it would just would still be a rejection that would be appealable. I am not sure if you could file a petition. I don’t think so. I think your recourse is to appeal the rejection and complain to the art unit director that the examiner is not following the MPEP.

    But, in the end, an official notice is a rejection and thus appealable.

  18. 11

    “The views expressed are those of the individual authors and do not necessarily reflect official positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, or the Board of Governors.”

    These authors are completely clueless about patents and the patent system. In just browsing the paper, I have seen statement after statement that reflects what happens when you have non-attorney, non-engineer, economists write about something they know little about — they sound like fools.

    In doing a little research, these yo-yos wrote a bok “Against Intellectual Monopoly” back in 2008 and Boldrin has been ranting against IP for at least 10 years. You would hope that after 10 years, this guy would learn something about IP — apparently not.

  19. 10

    “On appeal, the board knows the examiner is right on his facts, but an A hole on his duties. Do they give the applicant a patent if the so-called improved carburetor is old on the grounds that it is not established that cars have chassis, etc.”

    First off, as 6 would be more than happy to point out, the BPAI does not grant patents. The BPAI affirms/reverses rejections. An examiner can reopen prosectuion — even after being reversed. Also, if the BPAI knows of evidence to support a rejection, that can designate a new grounds of rejection. As such, all your strawmen aren’t grounded in reality.

    The reality of the situation is that the Examiner has to establish a prima facie case. This includes making findings of fact. The USPTO is governed by the APA, which requires findigs of fact be supported by substantial evidence. Official Notice is NOT evidence — it is an efficiency mechanism by which NOTORIOUS facts can be officially noticed.

    However, if the taking of official notice is challenged on appeal and the Examiner doesn’t provide evidence, the Examiner automatically loses. Under Ex parte Frye, the Examiner is not given any deference and all arguments are considered anew. The Examiner wins if the preponderance of the evidence is with the Examiner(i.e., the Examiner’s evidence > Applicants’ evidence)(a tie goes to applicant). However, where the Examiner’s evidence = zero, the Examienr’s evidence cannot ever be > than Applicants’ evidence. This is why Applicant doesn’t have to present any evidence whatsoever.

  20. 8

    This case highlights the world we will all be living in for the next 5-10 years as the PTO’s rules and the like under AIA come under scrutiny. There is much uncertainty and ambiguity that will take years to resolve. Perhaps some more attention needs to be focused on corrective and/or clarifying legislation (where needed). I can live with change–it’s the uncertainty that gives me stress.

  21. 7

    Can the BPAI do the examiner's job and cite evidence in his support?  

    They may, but I don't think that complies with the rules.  The BPAI determination must be on the record established by the examiner.

  22. 6

    Your example is ridiculous Ned, as you just painted the picture of something that if it did happen, the court itself would take official notice of (and any decent patent attorney would not advance as his argument in the first place).

    Try to keep it real.

  23. 5

    anon, can the board supply the evidence that the examiner did not supply? What if they know the unsupported evidence is in fact notorious. For example, the claim is to an improved car comprising an improved carburetor in combination with a chassis, a drive shaft and two axles. Assume the examiner said it was well known that cars had a chassis, a drive shaft and two axles. You challenge the examiner to prove his case. He refuses. On appeal, the board knows the examiner is right on his facts, but an A hole on his duties. Do they give the applicant a patent if the so-called improved carburetor is old on the grounds that it is not established that cars have chassis, etc.


  24. 4

    On appeal, what is the Board to do but order the examiner to support his official notice with evidence.

    Wouldn’t the more likely scenario be that the Board simply rules against the examiner for failing to do his job (and thus not making his case)?

  25. 2

    This reminds of the conversation I recently had concerning official notice. The rules allow one to challenge the examiner to provide proof. If you don’t ask him to provide proof, can you say on appeal that he has not established the facts he relied on in his official notice? I think not. If you do challenge him under the rule and he fails to comply, is your remedy by petition or by appeal?

    I think, by petition. The examiner’s failure to follow the rules seems to me to be problem. On appeal, what is the Board to do but order the examiner to support his official notice with evidence. But that is the province of the Director, not of the board.

  26. 1

    MPEP § 2648 identifies a hypothetical situation parallel to Belkin’s

    That’s actually not a parallel situation. It refers to petitioning for review of the grant of a request for reexam, whereas Belkin’s petition would have been for review of the rejection of a request for reexam. Looks like the Court didn’t bother reading the MPEP either.

    The distinction makes sense, if you think about it. Once a SNQ has been found, the patentee should have to address the question head-on, rather than petitioning to avoid dealing with it. If an SNQ has not been found, there’s no real harm in making sure.

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