On February 8, in Chudik v. Hirshfeld, the Federal Circuit upheld the USPTO’s denial of patent term adjustment for time while four notices of appeal were pending. Because the examiner reopened prosecution after each notice of appeal, the appeals never proceeded to the Patent Trial and Appeal Board (PTAB). The delay consequently did not qualify for patent term adjustment as an appeal that overturned the rejection (“C-delay”). The application further did not qualify for patent term adjustment based on prosecution taking longer than three years (“B-delay”), because the applicant had filed a request for continued examination before filing the first notice of appeal.
The applicant, Dr. Chudik, filed the patent application in 2006. After receiving a final rejection, Dr. Chudik filed a request for continued examination (RCE), though an appeal was available. Almost three years later, the examiner issued a non-final rejection. Upon receiving another final rejection, Dr. Chudik filed a notice of appeal, followed by an appeal brief. In response, the examiner reopened prosecution and issued another claim rejection. Dr. Chudik continued prosecuting the case, filing three more appeals. In response to each of these appeals, the examiner reopened prosecution rather than allowing the appeal to continue to the PTAB. Finally, after the fourth notice of appeal had been filed, the examiner withdrew the rejections and the application ultimately issued after pending at the USPTO for 11½ years.
In light of the lengthy pendency, Dr. Chudik petitioned for additional patent term, which the USPTO denied. After that effort failed, Dr. Chudik filed a complaint against the USPTO director in the district court. But the district court held that the USPTO’s approach was reasonable, leading Dr. Chudik to file his Federal Circuit appeal. Dr. Chudik’s appeal challenged the USPTO’s patent term adjustment calculation, arguing that he was entitled to an additional 655 days for the time his four notices of appeal were pending. Under 35 U.S.C. § 154(b)(1)(C) patent owners may seek an adjustment for “delays due to . . . appeals,” including “appellate review by the [PTAB] . . . in a case in which the patent was issued under a decision in the review reversing an adverse determination of patentability.” This is known as “C-delay.”
Applying its regulations, the USPTO had determined that C-delay was not applicable because, in each of the four appeals filed by Dr. Chudik, jurisdiction never passed to the PTAB because the examiner reopened prosecution. The USPTO further reasoned that in each of the four appeals, there was no PTAB or court decision reversing an adverse determination of patentability.
Dr. Chudik argued that “appellate review” in the statute refers to the entire process of review by the PTAB beginning with filing the notice of appeal. He further argued that the statutory language regarding “a decision in the review reversing an adverse determination of patentability” includes an examiner’s own decision through reopening of prosecution to undo a final rejection.
The Federal Circuit concluded that regardless of the degree of deference applied to the USPTO regulations, the best interpretation of the statutory language is the interpretation that the USPTO adopted and applied. The court ultimately agreed with the USPTO’s decision to deny Dr. Chudik the requested C-delay.
The court noted, and the parties agreed, that B-delay under 35 U.S.C. 154(b)(1)(B) would have been available for the time from when the notice of appeal was filed until the examiner reopened prosecution, except Dr. Chudik had filed an RCE rather than appealing the final rejection. Filing the RCE triggered a statutory exclusion to B-delay under 35 U.S.C. 154(b)(1)(B)(i).
The Federal Circuit, recognizing the implications of this decision, concluded their opinion with the following cautionary notice to patent applicants: “The unavailability of B-delay for nearly two years (655 days) of delay in the PTO illustrates what applicants should understand when deciding whether to request a continued examination rather than take an immediate appeal. The potential benefit of immediate re-engagement with the examiner through such continued examination comes with a potential cost.”
As the Federal Circuit decision highlights, applicants should consider the potential costs associated with filing a RCE rather than filing an appeal in response to a final rejection. As illustrated in this case, filing an RCE may result in the loss of patent term for delays by the USPTO that the applicant will not be able to recover.
For more information on this ruling, please contact Fitch Even attorneys Amanda L. O’Donnell or Zachary Van Engen, authors of this alert.
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