In Sawstop Holding LLC v. Vidal, the Federal Circuit upheld the USPTO’s interpretation of the Patent Term Adjustment (PTA) statute that limits the availability of PTA for time spent appealing an Examiner’s rejection. The decision may lead to more scrutiny of Patent Trial and Appeal Board decisions that “affirm” an appealed rejection on the basis of “a new ground of rejection.” The decision also may encourage applicants to structure their appeals such that a favorable decision will result in a determination of patentability of at least some claims.
PTA定款
The portion of PTA statute at issue was 35 U.S.C. § 154(b)(1)(C):
[I]f the issue of an original patent is delayed due to . . .
(iii) appellate review by the Patent Trial and Appeal Board 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,
the term of the patent shall be extended 1 day for each day of the pendency of the proceeding, order, or review, as the case may be.
PTA for this type of delay is referred to as “Type C” PTA.
The District Court held that the “unambiguous language imposes two requirements: that an adverse determination of patentability be reversed, and that the application reviewed in that appeal issue as a patent as a result of that reversal.” Applying this interpretation to the prosecution history of the patents at issue, the district court held that no Type C PTA was due.
争点となっている起訴経緯
Sawstop challenged the PTA awarded to two patents, which each had a complicated prosecution history.
For U.S. Patent No. 9,522,476, Sawstop had appealed the Examiner’s rejection of claim 11 as being obvious over Figures 7–9 of Lokey, and over Figures 1–5 of Lokey in combination with Fergle. The Board agreed that the examiner had “not made the initial factual findings required to demonstrate a prima facie case of obviousness of claim 11” for the rejection as formulated, but found that “Lokey Figures 7–9 were sufficient in themselves to … render claim 11 obvious in combination with Fergle.” Instead of reversing the rejection, it “affirmed” on a “new ground of rejection.” Sawstop reopened prosecution to address the new rejection, filing a request for continued examination (“RCE”) and further amendments before the Examiner allowed claim 11 (granted as claim 1 of the ’476 patent).
The USPTO did not award any PTA to the ‘476 patent for the time spent on appeal. In response to Sawstop’s request for reconsideration, the USPTO explained that no PTA was due because “the claim was not issued under a decision in the review reversing an adverse determination of patentability” because “the claim remain[ed] under rejection after the Board decision” and “the patent only issue[d] after further prosecution.” As noted above, Sawstop challenged the PTA decision in a district court proceeding, but the District Court agreed with the USPTO on summary judgment.
For U.S. Patent No. 9,927,796, Sawstop had appealed the Examiner’s rejection of claim 1 for anticipation and provisional obviousness-type double patenting, and claim 2 for anticipation. The Board affirmed both rejections of claim 1 and reversed the rejection of claim 2. Sawstop challenged only the anticipation rejection of claim 1 in a district court proceeding, and the district reversed that rejection. As explained in the Federal Circuit decision:
On remand, the Board noted the outstanding provisional double patenting rejection, and gave Sawstop two options for allowance: Sawstop could file a terminal disclaimer or cancel claim 1 and rewrite claim 2 as an independent claim. …. Sawstop chose the latter.
Claim 2 was allowed in the next USPTO communication, but Sawstop filed an RCE to prosecute an amended version of claim 2, which was allowed in the next USPTO communication.
The USPTO awarded PTA to the ‘796 patent for the time spent appealing the rejection of claim 2, but did not award PTA for the time spent appealing the rejection of claim 1. As noted above, Sawstop challenged the PTA decision in a district court proceeding, but the District Court agreed with the USPTO’s PTA award on summary judgment. Although the District Court had reversed the appealed anticipation rejection of claim 1, because of the un-appealed obviousness-type double patenting rejection, the claim was “unpatentable both before and after the appeal.”
The Federal Circuit PTA Decision
The Federal Circuit decision was authored by Judge Linn and joined by Judges Newman and Chen.
The court’s analysis started with a reference to the 2021 Federal Circuit decision in Chudik v. Hirshfeld, which held that the PTA statute at issue requires that “the patent issue under a Board decision that reversed the examiner’s unpatentability ruling or under a court decision that reversed a Board unpatentability ruling in the matter.” The court also noted that a “‘reversal’ typically means the undoing by an appellate tribunal of a ruling under review. The court also cited language in Supernus Pharms., Inc. v. Iancu (Fed. Cir. 2019) for the proposition that “Type C adjustments are for delays that are . . . due to . . . successful appeals.”
(In Chudik, the rejections never reached the Board, because the Examiner reopened prosecution each time the Applicant filed an Appeal Brief.)
The Federal Circuit generally agreed with the District Court’s interpretation of the PTA statute as being in accordance with its “unambiguous language.” Thus, the Federal Circuit only reviewed the record to assess whether the “two requirements” for Type C delay were met:
- Was an adverse determination of patentability reversed?
- Did the application issue as a patent as a result of that reversal?
The ‘476 Patent Fails Both Prongs of the Type C PTA Test
With regard to the ‘476 patent, the court acknowledged that “the Board cast aside the examiner’s basis for rejecting claim 11,” but focused on the Board’s finding that claim 11 was unpatentable, “albeit for a different reason.” According to the Federal Circuit, what matters for Type C PTA is that “[t]he adverse determination of unpatentability remained before and after the appeal.” In support of this statutory construction the Federal Circuit opinion cites other PTA decisions that did not address entitlement to Type C PTA, but commented on the availability of Type C delay in their explanations of the PTA statute as a whole (i.e., dicta).
The Federal Circuit also endorsed the District Court’s second reason for denying PTA—because of the claim amendments that were made to address the new ground of rejection, the patent did not “issue as a patent as a result of” the reversal of the Examiner’s rejection. The Federal Circuit rejected Sawstop’s arguments that “the claim would not have issued but-for the successful appeal.” Instead, the Federal Circuit interpreted the PTA statute as requiring that “at least one claim that ‘issued’ must have been analyzed by the Board or District Court that issued the ‘decision in the review.’” Referring to the ‘476 patent, the court stated:
The statutory requirement is not met if the claim that ultimately issues differs substantively from the claim under review.
The ‘796 Patent Fails Both Prongs of the Type C PTA Test
Turning to the ‘796 patent, the Federal Circuit again rejected Sawstop’s individual rejection-based arguments, and reiterated that the PTA statute requires reversal of “an adverse determination of patentability,” not just a reversal of individual rejection(s). Even though the District Court reversed the anticipation rejection of claim 1, the claim remained unpatentable after the appeal because of the pending obviousness-type double patenting rejection. Thus, the first prong of the Type C PTA test was not met.
The Federal Circuit also found the ‘796 patent to fail the second prong of the Type C PTA test, because “[t]he ’796 patent, as issued, did not include claim 1 as appealed.” Rather, as noted above, Sawstop cancelled claim 1 and obtained claims based on claim 2.
The Incomplete Remedy of Type C PTA
In this decision, the Federal Circuit was not concerned that its interpretation of the PTA statute would not compensate applicants for all losses of patent term due to time spent appealing erroneous rejections. Rather than considering the legislative history or Congressional intent, the court dismissed Sawstop’s equitable arguments as “overlook[ing] the plain language of the statute.” But couldn’t a specific rejection be considered to be “an adverse determination of patentability”? Is it clear and unambiguous that Congress did not intend to award PTA for a successful appeal of an erroneous rejection unless all other rejections of a given claim are overcome by the appeal?
In support of its disregard of the equities, the Federal Circuit cited the decision in Chudik, where Type C PTA was not available because the examiner prevented appellate review by the Board. But does one unfair decision really justify another?
According to this decision, in order for Type C PTA to be available it is not sufficient to obtain reversal of specific rejections; a claim that was unpatentable prior to the appeal must be patentable after the appeal, and the claim that ultimately grants must not differ substantively from the claim on appeal. This suggests that applicants should consider structuring their appeals such that reversal of the appealed rejections will result in allowability of at least some claims.
