Wednesday, April 18, 2012

A Second Bite Of The Patent Apple

The Supreme Court ruled today that inventors whose patent applications are denied by the PTO, and by its Board of Patent Appeals and Interferences, can either appeal the denial to the Federal Circuit or can institute a new civil action in the district court against the PTO Director. In Kappos v. Hyatt, the Supreme Court expressly permits a do-over by allowing a patent applicant to present new evidence in a district court proceeding, and requiring the district court to review all evidence de novo.

For these reasons, we conclude that there are no limitations on a patent applicant’s ability to introduce new evidence in a §145 proceeding beyond those already present in the Federal Rules of Evidence and the Federal Rules of Civil Procedure. Moreover, if new evidence is presented on a disputed question of fact, the district court must make de novo factual findings that take account of both the new evidence and the administrative record before the PTO.

The basis of today's Supreme Court decision is §145 of the Patent Act, permitting a patent applicant who is refused a patent registration by the Board of Patent Appeals and Inferences to either appeal the administrative denial to the Federal Circuit or to maintain a new action against the PTO Director.

35 U.S.C. 145 Civil action to obtain patent.
An applicant dissatisfied with the decision of the Board of Patent Appeals and Interferences in an appeal under section 134(a) of this title may, unless appeal has been taken to the United States Court of Appeals for the Federal Circuit, have remedy by civil action against the Director in the United States District Court for the District of Columbia if commenced within such time after such decision, not less than sixty days, as the Director appoints. The court may adjudge that such applicant is entitled to receive a patent for his invention, as specified in any of his claims involved in the decision of the Board of Patent Appeals and Interferences, as the facts in the case may appear, and such adjudication shall authorize the Director to issue such patent on compliance with the requirements of law. All the expenses of the proceedings shall be paid by the applicant.

This opportunity to retry in district court a case, with new evidence and de novo review, is certainly rare. But today's decision may open the litigation floodgates for inventors whose patent applications are denied by the PTO administrative process. That is, rather than appeal directly to the Federal Circuit -- which is not permitted to receive new evidence or to evaluate the record de novo -- the inventor can now bring a new proceeding with new evidence, obtain independent and de novo review, and thereafter seek appellate review with the Federal Circuit based on the new evidence and new argument. In effect, the administrative proceeding before the PTO will become mere trial preparation for the more significant district court case.

1 comment:

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