Wednesday, September 29, 2021

In re Vivent: CAFC notes: Agency action that “departs from established precedent without a reasoned explanation [is] arbitrary and capricious.” Fred Beverages, Inc. v. Fred’s Cap. Mgmt. Co., 605 F.3d 963, 967 (Fed. Cir. 2010)

The AIA is interpreted by the CAFC.

“[I]n the post-AIA world, a patent can be reexamined either in federal court during a defense to an infringement action, in an ex parte reexamination by the Patent Office, or in the suite of three postissuance review proceedings before the Patent Trial and Appeal Board.” Return Mail, Inc. v. U.S. Postal Serv., 139 S. Ct. 1853, 1860 (2019). Often, parties use multiple pathways to challenge validity. For example, an accused infringer may challenge validity both in district court and in an inter partes review (IPR), one of the three post-issuance review proceedings.

This case requires us to determine when one pathway, ex parte reexamination, is available to a requester who has repeatedly tried to use another pathway, IPR, to forward the same arguments. By statute, the Patent Office must find a “substantial new question of patentability” before ordering reexamination, 35 U.S.C. § 303(a), and it may deny reexamination when “the same or substantially the same prior art or arguments previously were presented to the Office,” 35 U.S.C. § 325(d).1 While the ex parte reexamination in this case was based on substantial new questions of patentability, the Patent Office abused its discretion and acted arbitrarily and capriciously under § 325(d). Thus, we vacate and remand with instructions for the Patent Office to dismiss.2

New question of patentability??

To order reexamination, the Patent Office must identify a “substantial new question of patentability.” 35 U.S.C. § 303(a). Vivint challenges the Patent Office’s outcome on that score, which is a question of law that we review without deference. See In re Swanson, 540 F.3d 1368, 1381 (Fed. Cir. 2008) (“[T]he ultimate question of whether the reexamination is based on a substantial new question of patentability . . . remains a question of law.”).4 Vivint argues that, because the ex parte reexamination request repackaged arguments in the ’091 petition, it did not present a new question of patentability. We do not agree.

The broader statutory context, however, clarifies that a question of patentability is new until it has been considered and decided on the merits. See, e.g., Home Depot U.S.A., Inc. v. Jackson, 139 S. Ct. 1743, 1748 (2019) (“[T]he words of a statute must be read in their context and with a view to their place in the overall statutory scheme.”). The Patent Office has discretion to deny an ex parte reexamination request that raises an argument that has been previously presented to it: In determining whether to institute or order a proceeding under . . . [§ 303(a)] . . . , the Director may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office. 35 U.S.C. § 325(d) (emphasis added). That discretion would be meaningless if a question of patentability was not new simply because it had been previously presented to the Patent Office. Therefore, more is required for a question of patentability to no longer be new; the Patent Office must have considered and decided that question on the merits.


Second, the Patent Office never considered or decided the questions of patentability raised in the ’091 petition. To be sure, the ’091 petition presented several questions of patentability, two of which were identical to questions raised in the ex parte reexamination request. But the Patent Office may deny institution without resolving any questions of patentability. See, e.g., 35 U.S.C. § 325(d). And that is precisely what the Patent Office did in the ’091 Decision; it relied on’s abusive filing practices to deny institution. The Patent Office did not decide the questions of patentability raised in the ’091 petition. Instead, it found’s serial filing to amount to an abuse of process and, therefore, refused to address the merits of the patentability arguments. Thus, we hold the ex parte reexamination in this case was based on substantial new questions of patentability.


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