Judges: Michel, Newman (dissenting), Mayer, Lourie (concurring), Rader, Schall, Bryson, Gajarsa, Linn, Dyk (concurring), Prost, Moore (dissenting)

[Appealed from Board]

In In re Comiskey, No. 06-1286 (Fed. Cir. Jan. 13, 2009), the Federal Circuit, sitting en banc, granted rehearing for the limited purpose of vacating the original judgment entered on September 20, 2007, reported at 499 F.3d 1365 (Fed. Cir. 2007), and allowing the merits panel to issue a revised opinion. The per curiam en banc order was accompanied by a concurrence by the original panel members, Judge Dyk (author), Chief Judge Michel, and Judge Prost; a concurrence by Judge Lourie; a dissent by Judge Moore; and a dissent by Judge Newman.

In a concurring opinion filed with the order denying further rehearing, the merits panel defended its affirmance of the PTO’s rejections on alternative grounds. Judge Dyk, joined by Chief Judge Michel and Judge Prost, argued that the panel’s reliance on SEC v. Chenery Corp., 318 U.S. 80 (1943), was proper, citing several instances in which the Federal Circuit and other reviewing courts had invoked the power to affirm an agency decision on alternative grounds. The concurrence maintained that the § 101 issue was fully briefed on appeal at the Court’s invitation and that addressing the issue of § 101 was both desirable and appropriate.

In his concurrence, Judge Lourie concurred in the Court’s decision to deny the petition for further rehearing en banc. According to Judge Lourie, not only are Comiskey’s method claims unpatentable under § 101, but the system claims also fail to recite statutory subject matter. Judge Lourie also concurred in the panel’s decision to vacate the issued opinion and remove language that was contrary to law.

Judge Moore, joined by Judges Newman and Rader, dissented from the denial of a broader rehearing en banc, arguing that the panel erred by introducing a new ground of rejection (§ 101) and failing to consider the only ground for rejecting the claims decided below and appealed by the parties (§ 103). Judge Moore criticized the panel’s reliance on Chenery and maintained that the power to decide new legal issues on appeal from agency action is limited to cases in which the agency’s ground was erroneous. According to Judge Moore, the panel here cannot justify its decision by arguing that it avoided a wasteful remand because it did not consider whether the PTO’s § 103 rejection of the claims was erroneous. Although the PTO and the applicant spent nearly a decade fighting over the obviousness of the system claims, Judge Moore noted that the Court refused to consider whether the system claims were obvious and instead remanded for the PTO to consider whether the claims are directed to patentable subject matter. Judge Moore also found puzzling that the panel decided that the process claims are directed to unpatentable subject matter, but remanded the machine claims to the PTO to consider whether they are directed to patentable subject matter. Judge Moore noted that the Court has a long line of precedent that holds that machine claims are patent eligible subject to the Supreme Court’s exceptions to patentability. Accordingly, Judge Moore stated that the Court should take Comiskey en banc to review its creation of broad appellate authority to decline to address the bases provided by any agency for its actions and instead decide a legal ground of its choosing.

Finally, Judge Newman filed a separate dissent from the denial of a full rehearing en banc to address the panel’s perceived misinterpretation of 35 U.S.C. § 101. According to Judge Newman, the panel’s rejections under § 101 perpetuate a broad and ill-defined exclusion of business method patents. Judge Newman wrote that the panel’s disparate treatment of the method and system claims was unsupported by statute or policy and that the Court’s holding cast a cloud over thousands of issued patents and pending patent applications. (The full text of the order is available on the Federal Circuit’s website as Dkt. # 06-1286o.pdf.)