SKGF_Advisory_Federal Circuit Issues Decision in TAFAS v. Doll_2009


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SKGF_Advisory_Federal Circuit Issues Decision in TAFAS v. Doll_2009

  1. 1. March 20, 2009 Federal Circuit Issues Decision in TAFAS v. DOLL The United Stated Court of Appeals for the Federal Circuit issued its opinion today in Tafas v. Doll. This case was an appeal by the United States Patent and Trademark Office of a U.S. District Court decision which had invalidated and permanently enjoined USPTO rules regarding claims, continuation applications, and Requests for Continuing Examination (RCEs) on the grounds that the rules package was substantive and therefore outside of the USPTO’s rulemaking authority. The Federal Circuit, instead, concluded that the rules package was procedural and within the USPTO’s authority. Nonetheless, the Federal Circuit found that the revisions to 37 C.F.R. § 1.78, limiting the number of continuation filings allowed as a matter of right to two, was inconsistent with the statutory mandate of 35 U.S.C. §120, which states that later filed applications “shall have” the benefit of the priority date of an earlier filed application provided certain conditions are met. However, with respect to the the rules limiting the number of claims and the number of RCEs that can be filed, the District Court’s decision invalidating these rules was vacated and remanded for further consideration. WHAT HAPPENS NOW? While this might well spell trouble for patent prosecution in the future, nothing happens for the time being. At the very least the USPTO would have to republish the rules package in the Federal Register and set a new date for implementation. The rules, however, were implemented in 2007 to reduce the enormous backlog of applications at the USPTO. In the meantime, the current economic crisis has reduced the USPTO’s workload and fee income to the extent that they have a hiring freeze in place. Reimplementing these rules might only exacerbate the problem. So maybe the PTO will not reimplement them right now. In addition, the validity of the rules on claims and RCEs was not affi rmed by the Federal Circuit; instead, the Federal Circuit vacated the District Court’s grant of Summary Judgment that these rules were invalid, and remanded to the District Court for further proceedings. In doing so, Judge Prost summarized additional issues for the court to consider, including whether the rules were arbitrary and capricious, whether the rules confl ict with the patent statutes in other ways not considered by the Federal Circuit, and whether the rules were impermissibly vague or retroactive. Finally, the opinion issued today was issued by a three-judge panel. Of the three, only two, Judges Prost and Bryson, joined in the decision, and they disagreed on certain aspects of the analysis. The third, Judge Rader, while agreeing that the revisions to rule 78 were invalid, dissented to the rest of the decision, arguing that the rules were substantive, and thus beyond the USPTO’s authority. The parties to the appeal now have the opportunity to petition to have the case heard en banc, i.e., by the entire panel of Federal Circuit judges. If such a petition were to be granted, today’s three judge panel decision might be overturned.
  2. 2. SUMMARY OF THE RULES TO BE RECONSIDERED ON REMAND Limits to RCE Practice - The rulemaking as published in August of 2007 would have amended 37 C.F.R. § 1,114 to limit the filing of requests for continued prosecution (RCE), as of right, to one per application family. For currently filed applications, if an RCE had already been filed in the series, then that would have been the one RCE that would be allowed under the new rules. Thus the rules were retroactive in that regard. Further RCEs would have required a showing that the subsequent continuation application was being filed “to obtain consideration of an amendment, argument, or evidence that could not have been submitted during the prosecution of the prior-filed application.” Since this rule was promulgated to work in concert with the now-invalid rules limiting continuations, even if the USPTO attempts to reinstate the revised Rule 114, it would have to be amended to comport with an applicant’s right to file an unlimited number of continuations. Limits to the Number of Claims - The rulemaking as published in August of 2007 would have limited the number of claims that could be pending in nonprovisional applications to 5 total independent claims and 25 claims total. Filing of claims in excess of this number would have required the applicant to file an “Examination Support Document” documenting that a search had been completed and explaining how the claims were patentable over the art. Importantly, this limitation in claim number would not only apply to a single application. Under Rule 75, commonly-owned copending applications containing claims found to be patentably indistinct by the USPTO would collectively only be permitted to contain 5 independent and 25 total claims. Further, absent a showing why two or more applications should exist, the rules would provide the USPTO with the authority to require elimination of the indistinct claims from all but one application. WHAT IS SKGF DOING? In the coming days SKGF will be conducting a detailed analysis of today’s decision, and will be providing you with additional advisories. We will also monitor subsequent proceedings at the USPTO, the District Court, and the Federal Circuit, and will provide updates should new developments occur. MIND + MUSCLE Sterne, Kessler, Goldstein & Fox P.L.L.C. 1100 New York Avenue, NW Washington, DC 20005