Hyatt loses at CAFC
The outcome:
Following decades of patent-related litigation, patent applicant Gilbert P. Hyatt submitted significant claim amendments for his U.S. Patent Application No. 08/435,938 (“the ’938 application”) in August 2015. A Patent and Trademark Office (“PTO”) examiner then issued a restriction requirement for seven of eight claims that Mr. Hyatt had selected for examination. Mr. Hyatt filed a complaint in the Eastern District of Virginia alleging, among other things, that the restriction requirement was improper, such that the PTO violated 5 U.S.C. § 706. The district court disagreed; it determined that 37 C.F.R. § 1.129 (“Rule 129”) permitted the restriction requirement for Mr. Hyatt’s ’938 application. The district court accordingly granted the PTO’s motion for summary judgment and denied Mr. Hyatt’s competing motion. Mr. Hyatt appeals. We affirm.
The law:
We review the district court’s grant of summary judgment de novo. Star Fruits S.N.C. v. United States, 393 F.3d 1277, 1281 (Fed. Cir. 2005). Summary judgment is appropriate where “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The APA provides that agency actions are unlawful if they are “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A).
The issues
Mr. Hyatt contests the application of Rule 129(b)(1)(ii) to his ’938 patent application. He argues that the applicant-action exception to the general ban on restriction requirements cannot apply to the ’938 application for two primary reasons: (I) he argues that the applicant-action exception cannot apply based on the text of Rule 129(b)(1)(ii); and (II) he asserts that applying the applicant-action exception in this case contradicts Rule 129(a) and Rule 129(b)(2). Addressing each in turn, we find neither persuasive.
AND
As a threshold matter, we first note that Mr. Hyatt’s failure to disclose his species-altering amendments can also be accurately characterized as an act of withholding. See id. (“[Mr. Hyatt] failed to disclose claims to a separate invention . . . . Withholding these claims is an action by the applicant . . . .”). And whether Mr. Hyatt’s actions are characterized as a failure to disclose or an act of withholding an entirely new species, it was that conduct of Mr. Hyatt that prevented the Examiner from entering a restriction requirement. In any case, as the PTO observes, the Manual of Patent Examining Procedure (“MPEP”) section 803.03 provides examples of inaction—including delays—that it categorizes as falling under the “actions by the applicant” exception.3 “Although the MPEP does not have the force of law, it is entitled to judicial notice so far as it is an official interpretation of statutes or regulations with which it is not in conflict.” Airbus S.A.S. v. Firepass Corp., 793 F.3d 1376, 1380 (Fed. Cir. 2015) (cleaned up). And here, the MPEP demonstrates that “the public has been on clear notice of the [PTO]’s interpretation” of the applicant-action exception. Appellees’ Br. 21. In light of the circumstances of this case, we fail to see how the application of Rule 129(b)(1)(ii) due to Mr. Hyatt’s so-called inaction was arbitrary, capricious, an abuse of discretion, or contrary to law. This also does away with Mr. Hyatt’s cause-and-effect argument because there is no cause after an effect here. As the PTO describes, and Mr. Hyatt does not rebut, Mr. Hyatt “did act prior to April 8, 1995 to actively withhold” his claim amendments.4 Id. at 24. So Mr. Hyatt’s action preceded (and resulted in) a lack of restriction requirement before April 8, 1995, making the applicant-action exception applicable. In this regard, Mr. Hyatt makes two primary arguments that Rule 129’s “actions” cannot include “inactions.” Both are unpersuasive. First, he cites cases like Defenders of Wildlife v. Andrus, 627 F.2d 1238 (D.C. Cir. 1980), and Western Watersheds Project v. Matejko, 468 F.3d 1099 (9th Cir. 2006), in an attempt to distinguish action from inaction. Appellant’s Br. 22. But, as the PTO observes, these cases are not only not binding, but they also address materially different statutory contexts. Appellees’ Br. 25–26; see Defs. of Wildlife, 627 F.2d at 1243–44 (interpreting “agency action” as used in 42 U.S.C. § 4332(C)); W. Watersheds, 468 F.3d at 1106–08 (interpreting “agency action” as used in 16 U.S.C. § 1536(a)(2)). Second, Mr. Hyatt seemingly contends that applying the applicant-action exception to the ’938 application contradicts the SAA.5 Although Mr. Hyatt fails to explicitly direct us to the SAA language he refers to, he appears to rely on the SAA’s statement that the general ban on restriction requirements for transitional applications does not apply “if there has not been at least one [PTO] action due to actions by the applicant.” H.R. Doc. No. 103-316, at 1006. His argument seems to depend on reading this SAA language as saying that the applicant-action exception applies only when the applicant’s actions “prevent [the] PTO from taking any action in a given application.” Appellant’s Br. 22–23 (emphasis in original). And under this reading, in Mr. Hyatt’s view, the applicant-action exception cannot apply here because the PTO issued several actions in examining Mr. Hyatt’s ’938 application prior to making the restriction requirement. See Oral Arg. at 24:04–30. Mr. Hyatt’s reading of that SAA language, though, restricts it beyond its plain terms. The SAA does not say that the general ban on restriction requirements for transitional applications does not apply only if there has been no PTO action due to actions by the applicant. The SAA simply says that the general ban does not apply if the applicant’s actions prevent “at least one [PTO] action.” H.R. Doc. No. 103-316, at 1006. And like the PTO, we see no inconsistency between the applicant-action exception and the SAA.6 That the PTO “has not made a requirement for restriction,” as described in the applicant-action exception, is an example of “one [PTO] action” that has not been taken, as stated in the SAA. Indeed, rather than point to an inconsistency, the portion of the SAA that Mr. Hyatt seemingly relies on appears to mirror Rule 129. Rule 129(b)(1)(ii) states that the applicant-action exception applies when “[t]he examiner has not made a requirement for restriction . . . due to actions by the applicant.” 37 C.F.R. § 1.129(b)(1)(ii) (emphasis added). The SAA similarly instructs that that same general ban on restriction requirements “does not apply if . . . there has not been at least one [PTO] action due to actions by the applicant.” H.R. Doc. No. 103-316, at 1006 (emphasis added). And as previously discussed, the Examiner was unable to issue a restriction requirement for the ’938 application within the relevant time frame “due to” Mr. Hyatt’s “actions.”
Following decades of patent-related litigation, patent applicant Gilbert P. Hyatt submitted significant claim amendments for his U.S. Patent Application No. 08/435,938 (“the ’938 application”) in August 2015. A Patent and Trademark Office (“PTO”) examiner then issued a restriction requirement for seven of eight claims that Mr. Hyatt had selected for examination. Mr. Hyatt filed a complaint in the Eastern District of Virginia alleging, among other things, that the restriction requirement was improper, such that the PTO violated 5 U.S.C. § 706. The district court disagreed; it determined that 37 C.F.R. § 1.129 (“Rule 129”) permitted the restriction requirement for Mr. Hyatt’s ’938 application. The district court accordingly granted the PTO’s motion for summary judgment and denied Mr. Hyatt’s competing motion. Mr. Hyatt appeals. We affirm.
The law:
We review the district court’s grant of summary judgment de novo. Star Fruits S.N.C. v. United States, 393 F.3d 1277, 1281 (Fed. Cir. 2005). Summary judgment is appropriate where “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The APA provides that agency actions are unlawful if they are “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A).
The issues
Mr. Hyatt contests the application of Rule 129(b)(1)(ii) to his ’938 patent application. He argues that the applicant-action exception to the general ban on restriction requirements cannot apply to the ’938 application for two primary reasons: (I) he argues that the applicant-action exception cannot apply based on the text of Rule 129(b)(1)(ii); and (II) he asserts that applying the applicant-action exception in this case contradicts Rule 129(a) and Rule 129(b)(2). Addressing each in turn, we find neither persuasive.
AND
As a threshold matter, we first note that Mr. Hyatt’s failure to disclose his species-altering amendments can also be accurately characterized as an act of withholding. See id. (“[Mr. Hyatt] failed to disclose claims to a separate invention . . . . Withholding these claims is an action by the applicant . . . .”). And whether Mr. Hyatt’s actions are characterized as a failure to disclose or an act of withholding an entirely new species, it was that conduct of Mr. Hyatt that prevented the Examiner from entering a restriction requirement. In any case, as the PTO observes, the Manual of Patent Examining Procedure (“MPEP”) section 803.03 provides examples of inaction—including delays—that it categorizes as falling under the “actions by the applicant” exception.3 “Although the MPEP does not have the force of law, it is entitled to judicial notice so far as it is an official interpretation of statutes or regulations with which it is not in conflict.” Airbus S.A.S. v. Firepass Corp., 793 F.3d 1376, 1380 (Fed. Cir. 2015) (cleaned up). And here, the MPEP demonstrates that “the public has been on clear notice of the [PTO]’s interpretation” of the applicant-action exception. Appellees’ Br. 21. In light of the circumstances of this case, we fail to see how the application of Rule 129(b)(1)(ii) due to Mr. Hyatt’s so-called inaction was arbitrary, capricious, an abuse of discretion, or contrary to law. This also does away with Mr. Hyatt’s cause-and-effect argument because there is no cause after an effect here. As the PTO describes, and Mr. Hyatt does not rebut, Mr. Hyatt “did act prior to April 8, 1995 to actively withhold” his claim amendments.4 Id. at 24. So Mr. Hyatt’s action preceded (and resulted in) a lack of restriction requirement before April 8, 1995, making the applicant-action exception applicable. In this regard, Mr. Hyatt makes two primary arguments that Rule 129’s “actions” cannot include “inactions.” Both are unpersuasive. First, he cites cases like Defenders of Wildlife v. Andrus, 627 F.2d 1238 (D.C. Cir. 1980), and Western Watersheds Project v. Matejko, 468 F.3d 1099 (9th Cir. 2006), in an attempt to distinguish action from inaction. Appellant’s Br. 22. But, as the PTO observes, these cases are not only not binding, but they also address materially different statutory contexts. Appellees’ Br. 25–26; see Defs. of Wildlife, 627 F.2d at 1243–44 (interpreting “agency action” as used in 42 U.S.C. § 4332(C)); W. Watersheds, 468 F.3d at 1106–08 (interpreting “agency action” as used in 16 U.S.C. § 1536(a)(2)). Second, Mr. Hyatt seemingly contends that applying the applicant-action exception to the ’938 application contradicts the SAA.5 Although Mr. Hyatt fails to explicitly direct us to the SAA language he refers to, he appears to rely on the SAA’s statement that the general ban on restriction requirements for transitional applications does not apply “if there has not been at least one [PTO] action due to actions by the applicant.” H.R. Doc. No. 103-316, at 1006. His argument seems to depend on reading this SAA language as saying that the applicant-action exception applies only when the applicant’s actions “prevent [the] PTO from taking any action in a given application.” Appellant’s Br. 22–23 (emphasis in original). And under this reading, in Mr. Hyatt’s view, the applicant-action exception cannot apply here because the PTO issued several actions in examining Mr. Hyatt’s ’938 application prior to making the restriction requirement. See Oral Arg. at 24:04–30. Mr. Hyatt’s reading of that SAA language, though, restricts it beyond its plain terms. The SAA does not say that the general ban on restriction requirements for transitional applications does not apply only if there has been no PTO action due to actions by the applicant. The SAA simply says that the general ban does not apply if the applicant’s actions prevent “at least one [PTO] action.” H.R. Doc. No. 103-316, at 1006. And like the PTO, we see no inconsistency between the applicant-action exception and the SAA.6 That the PTO “has not made a requirement for restriction,” as described in the applicant-action exception, is an example of “one [PTO] action” that has not been taken, as stated in the SAA. Indeed, rather than point to an inconsistency, the portion of the SAA that Mr. Hyatt seemingly relies on appears to mirror Rule 129. Rule 129(b)(1)(ii) states that the applicant-action exception applies when “[t]he examiner has not made a requirement for restriction . . . due to actions by the applicant.” 37 C.F.R. § 1.129(b)(1)(ii) (emphasis added). The SAA similarly instructs that that same general ban on restriction requirements “does not apply if . . . there has not been at least one [PTO] action due to actions by the applicant.” H.R. Doc. No. 103-316, at 1006 (emphasis added). And as previously discussed, the Examiner was unable to issue a restriction requirement for the ’938 application within the relevant time frame “due to” Mr. Hyatt’s “actions.”
posted by Lawrence B. Ebert at 2:42 PM
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