Enter to open, tab to navigate, enter to select
District Court Reaches Opposite Conclusion on Same Patent Term Adjustment Question Decided Months Earlier
Practical Law Legal Update 4-523-9216 (Approx. 4 pages)
District Court Reaches Opposite Conclusion on Same Patent Term Adjustment Question Decided Months Earlier
by PLC Intellectual Property & Technology
| Published on 01 Feb 2013 • USA (National/Federal) |
In Exelixis, Inc. v. Kappos, the US District Court for the Eastern District of Virginia determined that the US Patent and Trademark Office properly refused to grant Patent Term Adjustment (PTA) for the period after the applicant filed a Request for Continued Examination (RCE) where the RCE was filed more than three years after the original patent application filing date. This decision is directly contrary to the district court's decision in an earlier case involving the same parties.
Key Litigated Issue
The key issue before the US District Court for the Eastern District of Virginia was whether Section 154(b)(1)(B) of the Patent Act requires that no Patent Term Adjustment (PTA) be provided for the time from the applicant's Request for Continued Examination (RCE) filing until the patent issues when the RCE is filed more than three years after the patent application's filing date.
Background
This case arises from a dispute between Exelixis, Inc. and the US Patent and Trademark Office (USPTO) over the USPTO's final PTA calculation for one of Exelixis' patents, U.S. Patent No. 8,067,436 (the '436 patent).
Subsection 154(b)(1) of the Patent Act governs the determination and measurement of PTA and describes three broad categories of delays that will result in the extension of a patent term:
- "A" delays, which extend the patent term if the USPTO fails to carry out certain acts during examination of the patent application within prescribed timeframes.
- "B" delays, which extend the patent term on a day-for-day basis for each day after the end of the three-year period beginning on the patent application's filing date.
- "C" delays, which extend the patent term on a day-for-day basis for each day of the pendency of an interference or appeal or is subject to a secrecy order.
(35 U.S.C. § 154(b)(1).)
Exelixis sued David J. Kappos, in his capacity as the Director of the USPTO, claiming that the USPTO improperly calculated the B-delay by depriving it of PTA for the time between Exelixis' RCE filing and the issuance of the '436 patent. Specifically, Exelixis argued that the USPTO should have awarded it additional PTA for either the entire period between the RCE filing and the patent issuance, which is an additional 160 days of PTA, or this period but less the period between the notice of allowance and the patent issuance, which is an additional 152 days of PTA.
The parties filed cross-motions for summary judgment with the district court.
Outcome
In its January 28, 2013 opinion, the district court agreed with the USPTO, granting summary judgment in its favor.
The Time Between Filing an RCE and Notice of Allowance
While agreeing that Section 154(b)(1)(B) provides that filing an RCE tolls the guaranteed three-year time period when the RCE is filed before the expiration of that three-year period, Exelixis argued that the statute is limited to this effect because it did not also explicitly state that the filing of an RCE after the three-year period had any effect on the B-delay.
The district court concluded that the USPTO's rules denying PTA for the time period during which an RCE was under consideration, regardless of whether the RCE was filed before or after the three-year period, was a reasonable interpretation of the statute and its legislative history because there was no reason to treat RCEs differently based on when they were filed. Further, the district court pointed out that Congress intended that an applicant should not be penalized by delay attributable to the USPTO, but should also not benefit if the delay was requested by or otherwise caused by the applicant. The district court also noted that this interpretation avoids the absurd result of treating an RCE filed before the termination of the three-year period differently than one filed afterwards.
The district court's decision on this issue is contrary to the conclusion the district court reached in an earlier decision involving another patent owned by Exelixis. For more information on that decision, see Legal Update, District Court Determines that USPTO Improperly Reduces Patent Term Adjustment.
The Time Between Notice of Allowance and Issuance
The district court also upheld the USPTO's decision to deny any B-delay PTA for the period between the notice of allowance and patent issuance. Exelixis argued that this period is distinguishable from the period between the RCE filing and the notice of allowance because it began after:
- The USPTO had already informed Exelixis that its application had been allowed.
- The period that was consumed by USPTO review of the RCE.
The district court rejected Exelixis' argument. It concluded that applicants who file RCEs before receiving notices of allowance are different from applicants who receive notices of allowances without filing an RCE since filing an RCE causes a delay solely based on the applicant's failure to file an application fit for a notice of allowance. Therefore, all USPTO proceedings following an RCE filing, including the routine processing that precedes patent issuance, are the result of the continued examination, not any delay or error by the USPTO and PTA for this period should be denied.
Practical Implications
This decision is noteworthy because it upheld the USPTO's rules denying PTA for the time period during which an RCE was under consideration, regardless of whether the RCE was filed before or after the three-year B-delay period, even though the same court reached the opposite conclusion months earlier. It is likely that Exelixis will appeal this decision to the Court of Appeals for the Federal Circuit to resolve this conflict.