Applicant's Actions that Potentially Delay Prosecution Are Sufficient to Reduce Patent Term Adjustment: Federal Circuit | Practical Law

Applicant's Actions that Potentially Delay Prosecution Are Sufficient to Reduce Patent Term Adjustment: Federal Circuit | Practical Law

In Gilead Sciences, Inc. v. Lee, the US Court of Appeals for the Federal Circuit affirmed the US District Court for the Eastern District of Virginia's decision holding that the Patent Term Adjustment (PTA) period for a patent may be reduced when an applicant's conduct has the potential to result in prosecution delay even when there is no actual delay.

Applicant's Actions that Potentially Delay Prosecution Are Sufficient to Reduce Patent Term Adjustment: Federal Circuit

by Practical Law Intellectual Property & Technology
Published on 02 Mar 2015 • USA (National/Federal)
In Gilead Sciences, Inc. v. Lee, the US Court of Appeals for the Federal Circuit affirmed the US District Court for the Eastern District of Virginia's decision holding that the Patent Term Adjustment (PTA) period for a patent may be reduced when an applicant's conduct has the potential to result in prosecution delay even when there is no actual delay.
On February 26, 2015, the US Court of Appeals for the Federal Circuit affirmed the US District Court for the Eastern District of Virginia's decision in Gilead Sciences, Inc. v. Lee and held that, under 35 U.S.C. § 154(b)(2)(C), any Patent Term Adjustment (PTA) period for a patent may be reduced when an applicant's conduct had the potential to result in prosecution delay even when there is no actual delay caused by applicant's conduct concerning that patent (No. 2014-1159, (Fed. Cir. Feb. 26, 2015)).
Gilead owns US Patent No. 8,148,374 ('374 patent) for which the USPTO granted a PTA period because of certain USPTO delays in the prosecution of the application for the '374 patent. However, the USPTO reduced this period because, after responding to a restriction requirement and while waiting for the USPTO to issue a first office action on the merits, Gilead filed a supplemental information disclosure statement (IDS).
The USPTO noted that Gilead's filing of the supplemental IDS constituted a failure to engage in reasonable efforts to conclude prosecution of the application as set out by 37 C.F.R. § 1.704(c)(8). The USPTO rejected Gilead's argument that since the filing of the supplemental IDS did not cause any actual delay, the PTA period should not have been reduced.
Gilead appealed to the district court but it found that Gilead had not shown that the USPTO's interpretation of the statute was unreasonable.
The Federal Circuit affirmed the district court after conducting a 2-step Chevron analysis (Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984)) and concluding that:
  • Congress had not addressed the precise question at issue in this case of whether a failure to engage in reasonable efforts to conclude prosecution requires conduct that actually causes delay, noting the statute's:
    • plain language; and
    • legislative history.
  • The USPTO's interpretation and application of the statute is reasonable because:
    • the statute's broad language demonstrates that Congress intended the USPTO to use its expertise to identify applicant behavior that demonstrates a lack of reasonable efforts to conclude prosecution;
    • even where the applicant's behavior does not delay the issuance of the applicant's patent, the behavior may interfere with the USPTO's processing of the applications of other applicants; and
    • the filing of a supplemental IDS adds to the list of documents the USPTO must consider and makes it difficult for the USPTO to meet the statutorily-mandated time requirements stipulated in the statute.