by Dennis Crouch
This is a Patent Term Adjustment (PTA) case. Back before 1995, patents were awarded a term of 17-years following issuance. As part of an international negotiation and with some anti-submarine policy justifications, the US switched over to a 20-year term that starts counting days as of the application’s filing date. The 20-year term from filing date was seen as roughly equivalent to 17-years from issuance since most patent applications take about three years to issue. In the end, this kept overall patent term roughly the same. But, it also allowed for some major variability. Some patent applicants were concerned that delays by the USPTO due to backlogs or unreasonable examination practices might effectively cut into the patent term. Congress heard those concerns and created the PTA system that adds extra days to the patent term when those delays exist. 35 U.S.C. § 154(b). Unfortunately, the PTA statute is not a model of clarity and has been the subject of numerous court battles over various quirky elements.
The provision at issue in Sawstop has to do with PTA added for PTAB appeals and district court challenges. Under the law, added term is triggered by the following:
(iii) appellate review by the [PTAB] or by a Federal court in a case in which the patent was issued under a decision in the review reversing an adverse determination of patentability,
35 U.S.C. § 154(b)(1)(C)(iii).
I have written previously about Sawstop technology that covers a safety feature for power saws “that instantly stops the saw blade upon contact with flesh.” The appeal here is a consolidated appeal regarding two Sawstop patents. Sawstop is struggling because its patents are all expiring and competitors are hot-on-its-heels.
In the first case (‘476), the applicant had appealed an obviousness rejection by the examiner. The PTAB rejected the examiner’s decision, but simultaneously issued a new ground of rejection on obviousness. Thus, the ultimate conclusion was that the rejection was affirmed, albeit for different reasons. On remand, the claims eventually issued, but only after an RCE (which cut-off further PTA). After the patent issued, the owner asked for PTA associated with the PTAB appeal, but the PTO refused as did the district court.
In the appeal, the Federal Circuit has also sided against Sawstop. The rule quoted above is triggered by “a decision in the review reversing an adverse determination of patentability.” On appeal, the Federal Circuit found no reversal by the PTAB — although it did “cast aside the examiner’s basis for rejecting claim 11,” the Board simultaneously established reasoning for rejecting that same claim. The result was that the claim remained rejected. The Federal Circuit here focused on the substantive outcome — the patentee’s appeal was not successful and therefore there was no reversal.
The Federal Circuit also addressed a second element of the test — that the “patent was issued under a decision in the [appellate] review.” The court has interpreted that requirement as mandating that at least one claim considered by the PTAB have found its way into the issued patent without significant or substantive post-appeal amendments. Here, the patentee had amended the claims after the PTAB decision in order to achieve allowance. Thus, no Type-C PTA.
The second case (‘796) is a bit more complicated, the applicant had appealed rejections of claims 1 and 2 for anticipation a non-statutory double patenting (provisional). The Board issued a partial-reversal–holding that claim 1 was no good, but claim 2 was patentable. But Sawstop really wanted claim 1 and so filed a civil action with the DC District Court–and won that case. The one caveat is that the civil action focused only on anticipation and did not address non-statutory double patenting. Back at the Office, the PTAB maintained its double-patenting rejection and Sawstop was given a choice: (1) drop claim 1 or (2) file a terminal disclaimer. Sawstop chose the latter, and cancelled claim 1. But again, filed an RCE with several further amendments to other claims and the specification before eventual allowance.
The USPTO awarded PTA for the successful PTAB appeal, but refused any PTA for delay in getting the district court decision. On appeal, the Federal Circuit affirmed this analysis again on two grounds. First, although the district court did reverse the anticipation claim, it did not decide that claim 1 was “patentable.” As such, the court did not “revers[e] an adverse determination of patentability.” Sawstop had argued that – at the time – the OTDP rejection was only provisional and thus should not count. The Federal Circuit might have bought this argument if Sawstop also explained that it was somehow barred from including the issue in its Section 145 Civil Action, but Sawstop did not provide such an explanation. The second reason for agreeing with the PTO is that Claim 1 (the Subject of the District Court civil action) never issued in the patent. And, as discussed above, the court has interpreted the rule to only apply when the claim at issue in the ‘appeal’ ends up in the issued patent. Thus, no Type-C PTA for this one either.
Throughout this process, the Federal Circuit repeatedly justified its ruling as a plain language interpretation of the rule. I’ll note, however, that the court does not do so with the “appellate review” portion of the statute. A Section 145 civil action is not an appellate review of the PTAB decision, but rather separate action. See Kappos v. Hyatt, 566 U.S. 431 (2012). But, the court appears to have no trouble seeing it as an appeal in this context.
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Judge Linn wrote the decision here joined by Judges Newman and Chen. Sawstop was represented by Jared Newton and his team from Quinn Emanuel as well as David Fanning, SawStop’s inhouse counsel. Hugham Chan the E.D. Va. US Attorney’s Office argued for the Gov’t. Chan & Newton both graduated from GWU Law in 2010 & 2011 respectively. Chan is a former clerk of Judge Chen; Newton is a former patent examiner.