Section 9(a) of recently introduced H.R. 3309 (113th Congress) would repeal 35 U.S.C. 145, which provides for de novo adjudicatory judicial review of adverse decisions of the Patent and Trademark Office (“PTO” or “Agency”) in administrative appeals from examiners’ rejections of patent applications. 

No cogent justification for the pro- posed repeal of 35 U.S.C. 145, or any explanation whatsoever of what it has to  do  with  the  professed  purpose  of H.R. 3309 in addressing the perceived problem of patent troll litigation, has been forthcoming from either the Obama administration or Congress. Nor has anyone else presented a case for why this historic route of judicial recourse should be discontinued. In patent application proceedings, which are ex parte in nature, it is entirely up to the applicant who is disappointed by the Agency’s refusal to grant a patent to forego  direct  appeal to the Federal Circuit by opting for a sec- tion 145 civil action, all  the  expenses  of which (i.e., both the applicant’s  and  the Agency’s)  the  applicant   must   pay   for. Given the null effect that the fee-shifting provision in section 145 has on the USPTO’s overall budget, the relatively small number of section 145 actions that have been filed over the years by applicants who deemed it necessary to do so in order to obtain a just result, and the fact that the Justice Department – not the PTO – supplies the lawyers to defend the Agency, the proponents of the bill would be hard pressed to make more than a straw-man argument for repeal of 35 U.S.C. 145 based on burdensomeness.

The following discussion of the present bill’s antecedents is intended to provide a historical context for the present proposed legislation and to point out the dangers that it presents in the administrative / judicial interface.

Since the early days of our Republic, and as expressed in the Administrative Procedure Act, the judicial branch has been a direct recourse against wrong- ful acts and errors of federal agencies. In the field of intellectual property, de novo review by adjudication in federal district court has long been specifically enabled by the patent and trademark statutes as an avenue of judicial relief from erroneous rulings of the Patent and Trademark Office.

In non-contested (ex parte) adminis- trative proceedings, the PTO has always been averse to allowing parties appear- ing before it who are aggrieved by its actions to have recourse by civil action in district court, historically in the Dis- trict of Columbia (when the agency was located there) and now in the Eastern District of Virginia following the relocation several years ago of the Agency’s main facilities to Alexandria, VA. That aversion was manifested ten years ago in the PTO’s controversial, unauthor- ized and ultra vires rulemaking in the form of 37 C.F.R. § 1.303(d) presump- tuously aimed at the elimination of dis- trict court jurisdiction of the Agency’s decisions in ex parte patent reexami- nations requested post-November 28, 1999. Later, it resurfaced, with Con- gress’s complicity, in the Leahy-Smith America Invents Act (the “AIA”). In particular, Sec. 6(h)(2)(A) and Sec. 7(c)(1) of the AIA amend 35 U.S.C. § 141 and § 306 to bestow upon the PTO nunc pro tunc immunity from suit in patent reexaminations in Chapter 30 of title 35 U.S.C., irrespective of when the request for reexamination was filed, thereby stripping patent owners of their long- standing, fundamental, statutory right to challenge adverse decisions of the Agency in these cases by civil action in federal district court.

Moreover, the AIA introduced two new procedures for contested (inter partes)  administrative  patent  revocation (claim invalidation) proceedings, namely, “inter partes review” under Sec. 6(a) (revising Chapter 31 of title 35 U.S.C.) and “post-grant review” under Sec. 6(d) (adding new Chapter 32 of title 35 U.S.C.). New § 319 in Chapter 31 and new § 329 in Chapter 32, together with 35 U.S.C. § 141 as revised under Sec. 7(c)(1), preclude district court review of PTO decisions in these cases, which could and should have been provided for by appropriate amendment of 35 U.S.C. 146, inasmuch as that section had long provided simi- lar judicial recourse in patent interfer- ences and as it does now in “invention derivation” proceedings, introduced under 35 U.S.C. 145 as amended by Sec. 3(i) of the AIA.

Finally, Sec. 9 impairs  the  ability of PTO stakeholders to seek de novo review of Agency decisions in other types of non-contested, post-AIA cases by relocating the venue for civil actions to a multi-divisional, “rocket docket” district (E.D. Va.) in a circuit remote from that of the previous, logistically convenient forum (D.D.C.) whose administrative law jurisprudence is of unparalleled richness.

These changes do nothing to help meet the challenges facing the U.S. pat- ent system. Instead, they deliberately chip away at the patent community’s right to fair, balanced, thorough and just procedures for the administrative assessment of patentability and patent validity. That right has historically been in furtherance of Congress’s power under the U.S. Constitution to “promote the Progress of Science and useful Arts.” They do nothing to facilitate the development and enforcement of valid proprietary rights to inventions that stimulate the making of capital invest- ments that lead to further innovations. Rescinding these misbegotten provi- sions would neither be inconsistent with nor adversely affect the rest of cur- rent and future “patent reform” legisla- tion, and it would advance legitimate interests across a broad spectrum of the inventive and business communities.