Federal Holiday Treatment for Emergencies Not Unprecedented

As many recall, back on December 22nd, the USPTO's e-filing systems crashed. The outage lasted several days as the replacement of large power supplies driving the systems was time consuming. To account for the inability to file electronically during this outage (the predominant channel for accepting filings from the public), the agency issued a notice explaining that December 22nd through 24th were "considered" to be federal holidays for filing purposes. That is, any filings falling due on December 22-24th would be accepted as timely on the next business day. Given the Christmas holiday of Friday December 25th, and the following weekend, the next business day was December 28th.

Last week, Elm 3DS Innovations, sued the USPTO in the Eastern District of Virginia to enjoin the agency from conducting Inter Partes Review (IPR) of its patents. 3DS argues that the IPRs filed against it were due to be filed on December 24th by statute, and that the agency's action to extend this due date was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, and otherwise in excess of statutory jurisdiction, authority, or limitations." (complaint here)

3DS has an uphill battle.

The USPTO has consistently interpreted the relevant statute to cover non-postal emergencies. Even agencies without a statute conveying discretionary power for such emergencies have employed the same accommodation to extend statutory deadlines.

First, the USPTO, like all agencies, has the power to extend due dates that qualify for rule-based extension. The issue in the 3DS IPR scenario is the filing deadline is statutory. 35 U.S.C. 315(b). To extend statutory deadlines, treating business days as federal holidays was the USPTO's only option in the face of the e-filing crisis. For this reason, the December Notice explained:

On December 22, 2015, at approximately 7:00 pm, the United States Patent and Trademark Office (USPTO) experienced a major power outage at its headquarters in Alexandria, Virginia, resulting in damaged equipment that required the subsequent shutdown of many USPTO online and information technology systems. The USPTO is currently estimating that these systems will be impacted through at least the Federal holiday on Friday, December 25, 2015. In light of this emergency situation, the USPTO will consider each day from Tuesday, December 22, 2015, through Thursday, December 24, 2015, to be a “Federal holiday within the District of Columbia” under 35 U.S.C. § 21 and 37 C.F.R. §§ 1.6, 1.7, 1.9, 2.2(d), 2.195, and 2.196. Any action or fee due on these days will be considered as timely for the purposes of, e.g., 15 U.S.C. §§ 1051(b), 1058, 1059, 1062(b), 1063, 1064, and 1126(d), or 35 U.S.C. §§ 119, 120, 133, and 151, if the action is taken, or the fee paid, on the next succeeding business day on which the USPTO is open (37 C.F.R. §§ 1.7(a) and 2.196). A subsequent notice is anticipated to be issued as needed if the USPTO’s systems are not fully operational by Monday, December 28, 2015.

(emphasis added)

It is important to note that the USPTO did not declare December 22nd-24th as federal holidays—the USPTO plainly does not have the power to declare federal holidays. Rather, it explained the contingency plan for the e-filing crash in terms of holidays for calculating due dates. This straight-forward explanation makes sense since most filers are well aware of holiday filing rules. Thus, the critical question is whether or not, in the face of emergency, the agency has the authority to "consider" a business day as a holiday to extend statutory deadlines.

The relevant authority cited in the December Notice, 35 U.S.C. § 21 states:

35 U.S.C. 21 FILING DATE AND DAY FOR TAKING ACTION.

(a) The Director may by rule prescribe that any paper or fee required to be filed in the Patent and Trademark Office will be considered filed in the Office on the date on which it was deposited with the United States Postal Service or would have been deposited with the United States Postal Service but for postal service interruptions or emergencies designated by the Director.

(b) When the day, or the last day, for taking any action or paying any fee in the United States Patent and Trademark Office falls on Saturday, Sunday, or a Federal holiday within the District of Columbia, the action may be taken, or fee paid, on the next succeeding secular or business day.

(emphasis added)

The focus then is really on 35 U.S.C. 21(a) as the operation of holiday deadlines under 21(b) is not in dispute. That is, does the language "emergencies" relate to only postal emergencies as asserted by 3DS, or, does it confer discretion to the Director to designate other emergencies impacting filings?

Over the years the USPTO has applied 21(a) discretion to non-postal emergencies, and has distinguished non-qualifying emergencies. For example, in the days after 9-11 the USPTO appears to have construed 21(a) as conveying the power to consider a business day as a federal holiday in the face of a non-postal emergency.

The 9-11 Notice explained in relevant part::

The United States Patent and Trademark Office, as of approximately 10:30 a.m., September 11, 2001, has been closed for official business as a result of an order by the Office of Personnel Management. In the emergency situation of this day, the Patent and Trademark Office will consider September 11 a "federal holiday within the District of Columbia" under 35 U.S.C. § 21(b). Although normally the Patent and Trademark Office does not consider days on which the agency is closed for only part of the day as a federal holiday, it is making an exception for the unusual circumstances of this date.

(emphasis added)

Another emergency after 9-11 where the USPTO did not allow for extension of statutory deadlines was during the Tsunami impacting Japanese filers.

The Tsunami Notice explained in relevant part:

Since this catastrophic event occurred outside the United States and did not result in a postal service interruption in the United States Postal Service, the USPTO has no authority to designate a postal service emergency as authorized by 35 U.S.C. 21(a).

All told it appears that the Director has only designated "emergencies" under 21(a) twice in the last 15 years. Once for 9-11 and the second time this past December for the e-filing crash. As the tsunami emergency was not postal, and was outside of the U.S., it was deemed beyond the reach of the catch-all "emergencies" and the explicit postal interruption exception of 21(a). Given this history, 3DS would appear to be hard pressed to argue that the interpretation of 21(a) in the December Notice is arbitrary of capricious.

Further, other federal agencies have taken similar approaches to the unavailability of their electronic systems. For example, during the government shutdown of 2013, the National Labor Relations Board (NLRB) issued the following notice in the Federal Register:

In the event the Board's offices are closed due to a lapse in appropriated funds, documents may not be filed electronically at www.nlrb.gov. . . . . .Extensions of time for filing cannot apply to the 6-month period provided by Section 10(b) of the Act for the filing of charges, 29 U.S.C. 160(b), or to Applications for awards of fees and other expenses under the Equal Access to Justice Act, 5 U.S.C. 504. However, with respect to time computations for filing and serving charges filed pursuant to Section 10(b) or applications filed pursuant to the Equal Access to Justice Act, the Board hereby gives notice of its intention to construe the phrase “Saturday, Sunday, or a legal holiday” in its rules pertaining to filing and service, Section 102.111(a), 29 CFR 102.111(a), to encompass any day on which the Agency's offices are closed for all or any portion of the day due to lack of appropriated funds.

(emphasis added)

It does not appear that the NLRB has a companion statute to 35 U.S.C. § 21(a). For this reason, the NLRB also prudently counseled for the belt and suspenders approach (which would have saved the petitioners here a lot of grief):

Notwithstanding the foregoing, persons wishing to file a charge pursuant to Section 10(b) of the Act, and for whom the 6-month period of Section 10(b) may expire during the interruption in the Board's normal operations, are cautioned that the operation of Section 10(b) during an interruption in the Board's normal operations is uncertain. Consequently, it would be prudent to file the charge during the interruption in the Board's operations by faxing a copy of the charge to the appropriate Regional Office.

Given the discretion accorded to the Director under 21(a) to "designate emergencies," and the deference accorded to consistent agency interpretations of its governing statutes, I expect the USPTO will prevail.