By Jason Rantanen
Odyssey Logistics and Technology Corporation v. Iancu (Fed. Cir. 2020) Download opinion
Panel: Lourie, Reyna and Hughes (author)
Some of my biggest head-scratchers when I studied administrative law in law school were the timing rules for bringing challenges under the Administrative Procedures Act. It wasn’t because of a lack of comprehension, but instead due to the way these rules can block off judicial review of agency action. Individually the timing rules make sense, but collectively they produce a Three Bears-type situation: the timing of challenges has to be just right, or the challenge will get tossed for being either too early or too late.
This case involves two challenges to actions taken by the PTO and one challenge to a set of rules published by the PTO in 2011. The first two challenges were dismissed as two early and the third was too late.
Count I involved a request for rehearing by the relevant Technology Center Director following the Patent Trial and Appeal Board’s (PTAB) reversal of the examiner’s objections to Odyssey’s application. The request for rehearing was filed about five months after the PTAB decision. Odyssey challenged the propriety of the request on procedural grounds at the PTO, which were rebuffed, and then filed a challenge in the Eastern District of Virginia before the PTAB issued its decision on the substantive merits raised by the rehearing. The Federal Circuit affirmed the district court’s holding that there was not yet a “final agency action” under the APA. Nor did the Federal Circuit see this as a situation involving an abusive use of agency rules to delay proceedings that justified compelled action by the court.
In Count II, Odyssey challenged what it argued were new grounds for rejection by the examiner. However, the PTAB had not yet issued a decision at the time Odyssey brought the challenge. The result: dismissal for non-finality. Odyssey argued that the district court should have instead dismissed on mootness grounds, but the Federal Circuit said that wasn’t necessary: “[A] federal court has leeway to choose among threshold grounds for denying audience to a case on the merits….The district court did not err by “tak[ing] the less burden-some course.” Slip Op. at 11.
The final count was a challenge to certain amendments that the PTO made to its rules on practice for ex parte appeals in 2011. Odyssey argued that these amendments were facially invalid–that the regulations were unlawful generally. However, 28 U.S.C. § 2401 bars claims that are not brought within 6 years of the date the action accrues. Odyssey argued that the relevant triggering date was the effective date of the regulation (January 23, 2012) rather than the date it was published in the Federal Register (November 22, 2011), but the Federal Circuit disagreed: under both Fourth and Federal Circuit law, the relevant date for substantive facial challenges is the date of publication. Substantive facial challenges are different from “as applied” challenges, which accrue as of “the time of an adverse application of the decision against the plaintiff.” Id. at 13, quoting Hyatt v. U.S. Pat. & Trademark Off., 904 F.3d 1361, 1372 (Fed. Cir. 2018). The result was that Odyssey’s challenge, which was filed in district court on January 23, 2018, was time-barred by § 2401.
Edit: Shortly after I posted this, counsel for appellant contacted me to inform me that the statement “Odyssey challenged the propriety of the request on procedural grounds at the PTO, but then filed a challenge in the Eastern District of Virginia before the PTAB ruled on the request for rehearing” was incorrect: in fact, the lawsuit was filed after the petition for rehearing was granted but before the PTAB had issued a decision on the merits on the substantive issues raised by the rehearing. I’ve changed the above post to specifically refer to the “decision on the substantive merits raised by the rehearing.” I also made a few other edits to clarify the issue raised in Count I.