Among the bases for patent term adjustment in section 154(b) is “appellate review by the Patent Trial and Appeal Board or by a Federal court in a case in which the patent was issued under a decision in the review reversing an adverse determination of patentability” (clause (iii) of section 154(b)(1)(C)). Section 154(b)(1)(C) or the “C” provision also provides for delays due to derivation/interference proceedings or imposition of a secrecy order. The Federal Circuit recently issued two decisions on the application of the “successful” appellate review provision in section 154(b)(1)(C)(iii). The first is Chudik v. Hirshfeld, 987 F.3d 1033 (Fed. Cir. 2021), and the second is SawStop v. Vidal, 48 F.4th 1355 (Fed. Cir. 2022).
In Chudik, the applicant responded to a final rejection with a request for continued examination, and then several rounds of rejection, appeal, and reopening ensued, with the final reopening leading to an allowance of the application. The applicant felt that the examiner’s ultimate decision to allow the application after the appeal should have led to patent term adjustment as successful appellate review, despite the absence of a decision in the review by the Patent Trial and Appeal Board (Board) or a court. The Federal Circuit in Chudik, however, held that the words of section 154(b)(1)(C)(iii), “in their most natural meaning when applied to an examiner’s unpatentability ruling, require that the patent issue under a Board decision that reversed the examiner’s unpatentability ruling or under a court decision that reversed a Board unpatentability ruling in the matter.” 987 F.3d at 1039-40. Thus, since the Chudik appeal did not result in a decision by the Board or a court, the Chudik patent was not issued under a decision in the review reversing an adverse determination of patentability under the “C” provision.
Significant in Chudik is that the appeals and reopenings took place after the filing of a request for continued examination. Another basis for patent term adjustment is the failure to issue a patent within three years (section 154(b)(1)(B) or the “B” provision). This “B” provision, however, excludes time consumed by continued prosecution under section 132(b) (requests for continued examination) in determining the delay in issuing the patent under the three-year “B” provision (section 154(b)(1)(B)(i)). Absent the filing of a request for continued examination, the time consumed by the reopenings would have been considered in determining PTA under the three-year “B” provision. The filing of the request for continued examination, however, resulted in the time between the filing of the request for continued examination and the mailing of the notice of allowance not being considered under either the three-year “B” provision or the appellate review “C” provision.
The takeaway from Chudik is to be mindful of the effects that filing any request for continued examination will have on patent term adjustment under the three-year “B” provision. The Federal Circuit even felt the need to emphasize this point, stating—
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.
987 F.3d at 1041.
SawStop involved two patents. In the first SawStop patent, the appellate review resulted in a Board decision that the examiner’s rejection was inadequate, but that the claim was still unpatentable for reasons provided by the Board in a decision designated as containing a new ground of rejection. Further prosecution of the application included several amendments to the claim, including via a request for continued examination, before the application was ultimately issued. In the first patent, SawStop sought patent term adjustment based upon the Board not upholding the rejection as set forth by the examiner. The second SawStop patent involved prior art and provisional obviousness-type double patenting rejections of two claims. The Board upheld the rejections of the first claim but reversed the rejections of the second claim. SawStop commenced a civil action under section 145 (considered “appellate review” for purposes of section 154(b)(1)) and obtained a reversal of the prior art rejection of the first claim, but did not seek review of the provisional obviousness-type double patenting rejections. SawStop addressed the provisional obviousness-type double patenting remaining after the civil action by canceling the first claim (rather than filing a terminal disclaimer). In this second patent, SawStop sought patent term adjustment based upon reversal of the prior art rejection of the first claim in the civil action (the PTO accorded “C” provision patent term adjustment for the Board’s reversal of the rejections of the second claim). The Federal Circuit held that the plain language of “issued under a decision in the review” in section 154(b)(1)(C)(iii) “means that at least one claim must ‘issue under’ the mandate of the appellate decision [, which at] a minimum, . . . means that at least one claim that ‘issued’ must have been analyzed by the Board or . . . Court that issued the ‘decision in the review” and that this “statutory requirement is not met if the claim that ultimately issues differs substantively from the claim under review.” 48 F.4th at 1362. The claim in the first SawStop patent differed substantively from the claim under review by the Board (due to the subsequent amendment) and the claim in the second SawStop patent was not under review in the civil action (the claim under review was ultimately canceled). Thus, neither SawStop patent was issued under a decision in the review reversing an adverse determination of patentability under the “C” provision.
SawStop also could not take advantage of the three-year “B” provision for the delays due to this appellate review. In addition to the exclusion for time consumed by requests for continued examination, the “B” provision has an exclusion with respect to the events covered in the “C” provision, in that time consumed by appellate review (regardless of outcome), as well as time consumed by derivation/interference proceedings or imposition of a secrecy order, is not included in determining the delay in issuing the patent under the three-year “B” provision (section 154(b)(1)(B)(ii)).
One takeaway from SawStop is that it may not be enough for the Board or court decision to reverse all of the rejections of at least one claim for the appellate review to be considered “successful” for purposes of “C” patent term adjustment. Rather, under SawStop, the “C” appellate review provision requires that the claims, or at least one of the claims on appeal, be patentable such that there is no need for any substantive amendment subsequent to the Board or court decision. Thus, applicants should ensure that at least one of the claims on appeal is patentable without substantive amendment before any appeal to the Board. Another takeaway from SawStop is that applicants need to consider the possible patent term adjustment consequences before deciding to defer addressing double patenting rejections (whether provisional or not) until after the resolution of other patentability issues.
Taking Chudik and SawStop together, where patent term is important and the need for an appeal is contemplated, applicants need to prosecute the application with an eye to ensuring that claims are patentable – without the need for further substantive prosecution – before any final rejection is issued in the application. This should limit the need for any request for continued examination (RCE) before (or after) appeal, as well as the need to substantively amend the claims following a “successful” appeal to the Board or courts.