In a decision addressing the jurisdiction of the U.S. Patent and Trademark Office (USPTO) to institute inter partes reexamination proceedings, the U.S. Court of Appeals for the Federal Circuit held that inter partes reexamination is available for “any patent that issues from an original application”—i.e., any “utility, plant and design applications, including first filed applications, continuations, divisionals continuations-in-part, continued prosecution applications and national stage phase of international applications” - filed in the United States on or after November 29, 1999. Cooper Technologies Co., v. Jon W. Dudas, Director, USPTO and Thomas & Betts Corp., Case No. 08-1130, (Fed. Cir., Aug. 19, 2008) (Linn, J.).
Cooper Technologies filed a suit against Thomas & Betts (T&B), alleging infringement of U.S. Patent No. 6,984,791 (which matured from the ’683 application filed on April 14, 2003) and which claimed priority back to June 20, 1994 through a string of ancestor applications. T&B filed a request for inter partes reexamination of the ’791 patent. The request was granted and the USPTO issued an office action concluding that claims 1-30 were invalid. Cooper then filed a petition to terminate the inter partes reexamination proceeding, arguing that the ’791 patent did not issue from an “original application” (as that phrase is used in the American Inventor’s Protection Act of 1999—AIPA) filed on or after November 29, 1999.
In the AIPA, Congress created the inter partes reexamination procedure, stating that:
“[T]his subtitle and the amendments made by this subtitle shall take effect on the date of the enactment of this Act [November 29, 1999] and shall apply to any patent that issues from an original application filed in the United States on or after that date.”
The USPTO’s Official Gazette “notice” interpreted the phrase “original application” as follows:
“The phrase “original application” is interpreted to encompass utility, plant and design applications, including first filed applications, continuations, divisionals, continuations-in-part, continued prosecution applications (CPAs) and the stage of international applications. … Therefore, the Optional Inter Partes Reexamination Procedure is applicable to patents which issue from all applications (except for reissues) filed on or after November 29, 1999. …”
After the USPTO denied the petition to terminate, Cooper sought review of that decision in district court with T&B appearing as an intervener. Cooper argued that the PTO’s interpretation of the term “original application” was arbitrary, capricious and contrary to law and that the USPTO implementation constitutes improper rule making. Cooper sought declaratory relief, as well as an injunction directing the USPTO from undertaking similar inter partes reexaminations.
The district court concluded that the USPTO had correctly interpreted the term “original application” to be any application filed on or after November 29, 1999, and that its notice was not arbitrary, capricious, an abuse of discretion or otherwise not in accordance in the law.
The Federal Circuit affirmed, concluding that the USPTO’s interpretation was reasonable and entitled to Chevron deference because the USPTO is charged with administering statutory provisions relating to “the conduct of proceedings in the Office.” The Court then proceeded to review the USPTO position using the two-step Chevron analysis: whether Congress had directly spoken to the precise issue and if not, whether the agency’s interpretation is based on a permissible construction of the phrase at issue.
Contrary to the district court’s finding, the Federal Circuit found that Congress had not spoken directly to the precise phrase in issue, in that the term “original application” has no settled meaning either in the Manual of Patent Examining Procedure (MPEP) or Federal Circuit case authority. Turning to the second step of the Chevron analysis, the Court gave the Patent Office’s construction “particular weight” and concluded that the agency’s interpretation was permissible. The Court noted that the fact that Congress did not amend the term “original application” when it modified the AIPA in 2002 suggests that it agreed with the Patent Office’s interpretation—as the Court presumed that Congress had knowledge of the Patent Office’s interpretation.
Practice Note: A party challenging the Patent Office’s interpretation of a statutory phrase has a heavy burden to establish that the interpretation was unreasonable or contrary to the Congressional intent.