Federal Circuit Says Mistaken Belief Required for Reissue Error

17 June 2014 PharmaPatents Blog

In In re Dinsmore, the Federal Circuit held that the reissue process could not be used to correct an alleged defect in a terminal disclaimer between patents that were not commonly owned, because there had been no “mistaken belief” to support a reissue error within the meaning of the statute. This case underscores the limits of the reissue process and highlights the care that should be taken with terminal disclaimers.

The Patents at Issue

The patents at issue were U.S. Patent 7,236,568, which named Mark Dinsmore and David Caruso as inventors and which was assigned to twX, LLC, and U.S. Patent 6,658,086, which named Mark Dinsmore as the sole inventor and which was assigned to Carl Zeiss.

During prosecution, the application that was granted as the ‘569 patent was rejected under the doctrine of obviousness-type double patenting over the ‘086 patent. The rejection was overcome by submitting the USPTO’s terminal disclaimer form, which includes the following provision required by 37 CFR § 1.321(c):

any patent so granted on the instant application shall be enforceable only for and during such period that it and the prior patent are commonly owned.

The Reissue Application

Dinsmore and Caruso applied for a reissue application of the ’568 patent under 35 USC § 251, initially seeking to remove the recorded terminal disclaimer without substituting a new one or amending any of the claims. The reissue declaration identified as the error upon which the reissue was based the fact that the ‘568 patent and ‘086 patents were not commonly owned.

The USPTO Examiner denied the reissue application “because the error which is relied upon . . . is not an error upon which a reissue can be based.” After pursuing other strategies to no avail, Dinsmore and Caruso appealed to the USPTO Patent Trial and Appeal Board, which upheld the Examiner stating:

[The] voluntary and intentional filing of a terminal disclaimer to overcome a non-statutory obviousness-type double patenting rejection during prosecution of the original patent is not an “error” correctible by reissue under 35 U.S.C. § 251.

The Federal Circuit Decision

The Federal Circuit decision was authored by Judge Taranto and joined by Judges Bryson and Hughes.

According to the Federal Circuit decision, Dinsmore and Caruso argued on appeal that

[B]ecause the ’568 and ’086 patents are not and never have been commonly owned, the recorded terminal disclaimer was “an ineffective, invalid terminal disclaimer” and its filing therefore was an “error” within the meaning of the reissue statute, 35 U.S.C. § 251.

The Federal Circuit disagreed that “the recorded terminal disclaimer was ineffective or invalid,” finding, “That assertion, however, is simply incorrect in the most straightforward sense.” The court noted that there was nothing defective about the terminal disclaimer. Rather, the real problem for the appellants was that the terminal disclaimer “did not produce a patent they could actually enforce by themselves (without common ownership) and that they erred in producing that result.” The court found that to be “an insufficient basis for reissue” because “[i]t is ultimately no more than a statement of a now-regretted choice, because the applicants identify no cognizable false or deficient understanding of fact or law that underlay the choice.”

The court focused on the “error” requirement of the reissue statute, 35 USC § 251:

Whenever any patent is, through error, deemed wholly or partly inoperative or invalid, by reason of a defective specification or drawing, or by reason of the patentee claiming more or less than he had a right to claim in the patent, the Director shall, on the surrender of such patent and the payment of the fee required by law, reissue the patent for the invention disclosed in the original patent, and in accordance with a new and amended application, for the unexpired part of the term of the original patent. No new matter shall be introduced into the application for reissue.

The court stated that precedent indicates that whether there was an “error” generally turns on whether “deficient understandings, by the applicants or their agents, gave rise to the patenting choice that reissue is being invoked to correct.” On the other hand, where there was no misunderstanding, reissue applications have been “held inadequate as being no more than an effort to reverse a later-regretted choice made in obtaining the original patent.”

In this case, the appellants had not alleged any “mistaken belief” regarding the obviousness-type double patenting rejection or common ownership. Because they were ”ultimately seeking simply to revise a choice they made, not to remedy the result of a mistaken belief,” the court held that “[t]heirs is not an error remediable under the reissue statute.”

The Limits of Reissue and Dangers of Terminal Disclaimers

This case underscores the limitations of the reissue process, and serves as a reminder that not all “errors” are correctable by the reissue process. This case also highlights the court’s willingness to hold applicants to the decisions they make during prosecution, be it reflected in claim language, arguments that give rise to estoppel, or even the filing of a terminal disclaimer that makes a patent unenforceable from its grant date.

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