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2686.04 Reexamination and Litigation Proceedings [Added R-2] - 2600 Optional Inter Partes Reexamination
2686.04 Reexamination and Litigation Proceedings [Added R-2]
35 U.S.C. 314 Conduct of inter partes reexamination proceedings.
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(c) SPECIAL DISPATCH.- Unless otherwise provided by the Director for good cause, all inter partes reexamination proceedings under this section, including any appeal to the Board of Patent Appeals and Interferences, shall be conducted with special dispatch within the Office.
35 U.S.C. 317 Inter partes reexamination prohibited.
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(b) FINAL DECISION.- Once a final decision has been entered against a party in a civil action arising in whole or in part under section 1338 of title 28, that the party has not sustained its burden of proving the invalidity of any patent claim in suit or if a final decision in an inter partes reexamination proceeding instituted by a third-party requester is favorable to the patentability of any original or proposed amended or new claim of the patent, then neither that party nor its privies may thereafter request an inter partes reexamination of any such patent claim on the basis of issues which that party or its privies raised or could have raised in such civil action or inter partes reexamination proceeding, and an inter partes reexamination requested by that party or its privies on the basis of such issues may not thereafter be maintained by the Office, notwithstanding any other provision of this chapter. This subsection does not prevent the assertion of invalidity based on newly discovered prior art unavailable to the third-party requester and the Patent and Trademark Office at the time of the inter partes reexamination proceedings.
35 U.S.C. 318 Stay of litigation.
Once an order for inter partes reexamination of a patent has been issued under section 313, the patent owner may obtain a stay of any pending litigation which involves an issue of patentability of any claims of the patent which are the subject of the inter partes reexamination order, unless the court before which such litigation is pending determines that a stay would not serve the interests of justice.
37 CFR 1.987 Suspension of inter partes reexamination proceeding due to litigation.
If a patent in the process of inter partes reexamination is or becomes involved in litigation, the Director shall determine whether or not to suspend the inter partes reexamination proceeding.
37 CFR 1.907 Inter partes reexamination prohibited.
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(b) Once a final decision has been entered against a party in a civil action arising in whole or in part under 28 U.S.C. 1338 that the party has not sustained its burden of proving invalidity of any patent claim-in-suit, then neither that party nor its privies may thereafter request inter partes reexamination of any such patent claim on the basis of issues which that party, or its privies, raised or could have raised in such civil action, and an inter partes reexamination requested by that party, or its privies, on the basis of such issues may not thereafter be maintained by the Office.
35 U.S.C. 311 permits a request for inter partes reexamination to be filed "at any time." Thus, requests for inter partes reexamination can be filed where the patent (for which reexamination is requested) is involved in concurrent litigation. The guidelines set forth below will generally govern Office handling of inter partes reexamination requests where there is concurrent litigation.
I. COURT ORDERED REEXAMINATION PROCEEDING OR LITIGATION STAYED FOR REEXAMINATION
Where a request for reexamination indicates that it is filed as a result of an order by a court, or that litigation is stayed for the purpose of reexamination, all aspects of the proceeding will be expedited to the extent possible. Cases will be taken up for action at the earliest time possible, and time periods set in actions may be extended only upon a strong showing of sufficient cause (see MPEP § 2665). Action on such a proceeding will take precedence to any other action taken by the examiner in the Office. See generally In re Vamco Machine and Tool, Inc., 752 F.2d 1564, 224 USPQ 617 (Fed. Cir. 1985); Gould v. Control Laser Corp., 705 F.2d 1340, 217 USPQ 985 (Fed. Cir. 1983); Loffland Bros. Co. v. Mid-Western Energy Corp., 225 USPQ 886 (W.D. Okla. 1985); The Toro Co. v. R.L. Nelson Corp., 223 USPQ 636 (C.D. Ill. 1984); Digital Magnetic Systems, Inc. v. Ansley, 213 USPQ 290 (W.D. Okla. 1982); Raytek, Inc. v. Solfan Systems Inc., 211 USPQ 405 (N.D. Cal. 1981); and Dresser Industries, Inc. v. Ford Motor Co., 211 USPQ 1114 (N.D. Texas 1981).
II. FEDERAL COURT DECISION KNOWN TO EXAMINER AT THE TIME THE DETERMINATION ON THE REQUEST FOR REEXAMINATION IS MADE
If a Federal Court decision on the merits of a patent is known to the examiner at the time the determination on the request for inter partes reexamination is made, the following guidelines will be followed by the examiner:
(A) The Third Party Requester Was Not a Party to the Litigation. When the initial question as to whether the art raises a substantial new question of patentability as to a patent claim is under consideration, the existence of a final court decision of claim validity in view of the same or different art does not necessarily preclude the presence of a new question. This is true because of the different standards of proof and claim interpretation employed by the District Courts and the Office. See for example In re Zletz, 893 F.2d 319, 322, 13 USPQ2d 1320, 1322 (Fed. Cir. 1989) (manner of claim interpretation that is used by courts in litigation is not the manner of claim interpretation that is applicable during prosecution of a pending application before the PTO) and In re Etter, 756 F.2d 852, 225 USPQ 1 (Fed. Cir. 1985) (the 35 U.S.C. 282 presumption of patent validity has no application in reexamination proceedings). Thus, while the Office may accord deference to factual findings made by the court, the determination of whether a substantial new question of patentability exists will be made independently of the court's decision on validity, since the decision is not controlling on the Office. A non-final holding of claim invalidity or unenforceability will also not be controlling on the question of whether a substantial new question of patentability is present. Only a final holding of claim invalidity or unenforceability (after all appeals) is controlling on the Office. In such cases, a substantial new question of patentability would not be present as to the claims held invalid or unenforceable. See Ethicon v. Quigg, 849 F.2d 1422, 7 USPQ2d 1152 (Fed. Cir. 1988).
(B) The Third Party Requester Was a Party to the Litigation. Final Holding of validity: The provisions of 37 CFR 1.907(b) apply. Where a final decision was entered against a party in a Federal Court civil action (arising in whole or in part under 28 U.S.C. 1338) that the party did not sustain its burden of proving invalidity of a patent claim in suit, that party and its privies may not request inter partes reexamination of any such patent claim on the basis of issues which that party or its privies raised or could have raised in the civil action. Further, an inter partes reexamination already requested by that party, or its privies, on the basis of such issues will not be maintained by the Office, i.e., the proceeding will be terminated. Note, however, that the statute does not preclude an ex parte reexamination by the same third party requester. In view of the above, when the examiner is aware that the third party requester was a party to previous Federal Court litigation as to the patent for which inter partes reexamination has been requested, the examiner must determine:
(1) Was the Federal Court decision adverse to the third party requester as to at least one claim of the patent?
(2) Was the Federal Court decision a final decision, after all appeals?
(3) Is the issue being raised in the reexamination request the same issue as was raised in the Federal Court during the civil action, or an issue that the third party requester could have raised in the Federal Court during the civil action?
- If the answer to each of questions (1)-(3) is "yes" for all claims in the proceeding, then the inter partes reexamination must be terminated. In such a case, the TC Director will prepare a decision discussing the above considerations (1)-(3) and vacating the reexamination proceeding.
- If the answer to all of questions (1)-(3) is "yes" for one or more (but not all) of the claims in the proceeding; those claims will not be treated. The examiner's action will point out the claims not treated and the reason why, i.e., a discussion of the above considerations (1)-(3). The guidelines set forth above in subsection II.(A) will be used for the claims remaining.
- If the answer to question (1) or to question (3) is "no" for all claims, then the examination of the reexamination proceeding will proceed without any discussion on the record of considerations (1)-(3), using the guidelines set forth above in subsection II.(A).
- If, for any claim, the answer to both of questions (1) and (3) is "yes", but the answer to question (2) is "no", then examination of the reexamination proceeding will proceed using the guidelines set forth above in subsection II.(A). The examiner's action will contain a discussion of considerations (1)-(3). If the examiner subsequently becomes aware that the Federal Court decision has become final, reexamination of the affected claims must be discontinued. If all claims are affected, the reexamination will be vacated by the TC Director as discussed above.
Final Holding of invalidity: A final holding of claim invalidity or unenforceability (after all appeals) is controlling on the Office. In such cases, a substantial new question of patentability would not be present as to the claims held invalid or unenforceable. See Ethicon v. Quigg, 849 F.2d 1422, 7 USPQ2d 1152 (Fed. Cir. 1988). Where all claims are affected, the reexamination will be vacated by the TC Director. A non-final holding of claim invalidity or unenforceability, however, will not be controlling on the question of whether a substantial new question of patentability is present.
(C) Specific Situations.
For a discussion of the policy in specific situations where a Federal Court decision has been issued, see MPEP § 2642.
III. REEXAMINATION WITH CONCURRENT LITIGATION BUT ORDERED PRIOR TO FEDERAL COURT DECISION
In view of the statutory mandate to make the determination on a request for reexamination within 3 months, the determination on the request based on the record before the examiner will be made without awaiting a decision by the Federal Court. It is not realistic to attempt to determine what issues will be treated by the Federal Court prior to the Court's decision. Accordingly, the determination on the request will be made without considering the issues allegedly before the Court. If reexamination is ordered, the reexamination generally (see discussion immediately below) will continue until the Office becomes aware that a court decision has issued. At such time, the request will be reviewed in accordance with the guidelines set forth below.
In Ethicon v. Quigg, 849 F.2d 1422, 7 USPQ2d 1152 (Fed. Cir. 1988), the Court of Appeals for the Federal Circuit stated the following as to the Office's authority to stay a reexamination process pending the outcome of a Federal District Court case where invalidity is an issue:
"Whatever else special dispatch means, it does not admit of an indefinite suspension of reexamination proceedings pending conclusion of litigation. If it did, one would expect to find some intimation to that effect in the statute, for it would suggest the opposite of the ordinary meaning. But there is none."
"The Commissioner. has no inherent authority, only that which Congress gives. It did not give him authority to stay reexaminations; it told him to conduct them with special dispatch. Its silence about stays cannot be used to countermand that instruction."
The Ethicon case was decided as to ex parte reexamination, for which 35 U.S.C. 305 dictates in its last sentence:
"All reexamination proceedings under this section, including any appeal to the Board of Patent Appeals and Interferences, will be conducted with special dispatch within the Office."
For inter partes reexamination, however, 35 U.S.C. 314 states:
"Unless otherwise provided by the Director for good cause, all inter partes reexamination proceedings under this section, including any appeal to the Board of Patent Appeals and Interferences, shall be conducted with special dispatch within the Office."
35 U.S.C. 314 provides for inter partes reexamination the clause "Unless otherwise provided by the Director for good cause" which clause is not present in 35 U.S.C. 305 for ex parte reexamination. Accordingly, where there is good cause for the Director of the USPTO to suspend (stay) reexamination proceedings pending the conclusion of litigation, a suspension will be effected. A "good cause" might be present, for example, where there is an issue that cannot be decided in the reexamination proceeding but affects the resolution of the proceeding. Another example is where there is an issue common to the litigation and the reexamination that can best be decided in court due to the availability in court of discovery and subpoena power (e.g., an issue heavily dependent on presentation of conflicting/contested evidence by the two parties). If the examiner believes there is good cause to suspend (stay) reexamination proceedings, the case should be brought to the Office of Patent Legal Administration (OPLA) for consideration of such by a Reexamination Legal Advisor (RLA).
It should be noted that if, pursuant to 35 U.S.C. 318, a court stays litigation as to the patent being reexamined, action in the reexamination proceeding would not be suspended. This is so because action in the reexamination proceeding would be needed to resolve the "issue of patentability of any claims of the patent which are the subject of the inter partes reexamination order" set forth in 35 U.S.C. 318.
IV. FEDERAL COURT DECISION ISSUES AFTER INTER PARTES REEXAMINATION ORDERED
Pursuant to 37 CFR 1.985(a), the patent owner in an inter partes reexamination proceeding must promptly notify the Office of any Federal Court decision involving the patent.
Upon the issuance of a holding of claim invalidity or unenforceability by a Federal Court, reexamination of those claims will continue in the Office until the decision becomes final. A non-final Court decision concerning a patent under reexamination shall have no binding effect on a reexamination proceeding.
Where an inter partes reexamination proceeding is currently pending and a final Federal Court decision issues after all appeals, the reexamination proceeding is reviewed to see if no substantial new question of patentability remains (as to one or more claims) due to holding of claims invalid, and to determine whether the provisions of 37 CFR 1.907(b) apply as a result of a decision in a civil action arising in whole or in part under 28 U.S.C. 1338.
A final Court holding of invalidity/unenforceability is binding on the Office. Upon the issuance of a final holding of invalidity or unenforceability, the claims held invalid or unenforceable will be withdrawn from consideration in the reexamination. The reexamination will continue as to any remaining claims. If all of the claims are finally held invalid or unenforceable, the reexamination will be vacated by the TC Director as no longer containing a substantial new question of patentability and the reexamination will be terminated. If not all claims were held invalid, a substantial new question of patentability may still exist as to the remaining claims. In such a situation, the remaining claims would be examined; and, as to the claims held invalid, form paragraph 26.80 should be used at the beginning of the Office action.
¶ 26.80 Claims Held Invalid by Court, No Longer Being Reexamined
Claims [1] of the [2] patent are not being reexamined in view of the final decision of [3]. Claims [1] were held invalid by the [4].
Examiner Note
1. In bracket 1, insert the claims held invalid.
2. In bracket 2, insert the patentee (e.g., Rosenthal, Schor et al).
3. In bracket 3, insert the decision (e.g., ABC Corp. v. Kery Fries, 999 USPQ2d 99 (Fed. Cir. 1999) or XYZ Corp. v. Jones, 999 USPQ2d 1024 (N.D. Cal. 1999)).
4. In bracket 4, insert the name of the court (e.g., the Court of Appeals for the Federal Circuit, or the Federal District Court).
The issuance of a final Court decision (in a civil action arising in whole or in part under 28 U.S.C. 1338) upholding validity during an inter partes reexamination, where the person who filed the request was a party to the litigation, will have the effect that the Office will discontinue examination of all claims affected by the holding of validity. If the provisions of 37 CFR 1.907(b) apply such that all of the claims in the reexamination proceeding cannot be maintained, the order to reexamine is vacated by the TC Director, and reexamination is terminated. If the provisions of 37 CFR 1.907(b) apply to some of the claims, but not all of the claims in the proceeding; those claims to which 37 CFR 1.907(b) applies will not be treated. The examiner's action will point out the claims not treated, and the reason why those claims cannot be maintained in the reexamination under 37 CFR 1.907(b). Action will be given on the remaining claims. Note that the provisions of 37 CFR 1.907(b) cannot be waived since they track the statute, 35 U.S.C. 317.
The issuance of a final Court decision upholding validity during an inter partes reexamination, where the person who filed the request was not a party to the litigation, will have no binding effect on the examination of the reexamination. This is because the Court stated in Ethicon v. Quigg, 849 F.2d 1422, 1428, 7 USPQ2d 1152, 1157 (Fed. Cir. 1988) that the Office is not bound by a court's holding of patent validity and should continue the reexamination. The Court noted that District Courts and the Office use different standards of proof in determining invalidity, and thus, on the same evidence, could quite correctly come to different conclusions. Specifically, invalidity in a District Court must be shown by "clear and convincing" evidence, whereas in the Office it is sufficient to show non-patentability by a "preponderance" of the evidence. Since the "clear and convincing" standard is harder to satisfy than the "preponderance standard," a court's holding of patent validity is not controlling. Deference will, however, ordinarily be accorded to the factual findings of the court, where the evidence before the Office and the court is the same. If sufficient reasons are present, claims held valid by the court may be rejected in reexamination.
V. LITIGATION REVIEW AND CRU APPROVAL
In order to ensure that the Office is aware of prior or concurrent litigation, the examiner is responsible for conducting a reasonable investigation for evidence as to whether the patent for which reexamination is requested has been, or is, involved in litigation. The investigation will include a review of the reexamination file, the patent file, and the results of the litigation computer search by the Scientific and Technical Information Center (STIC). If the examiner discovers, at any time during the reexamination proceeding, that there is litigation or that there has been a Federal Court decision on the patent, the fact will be brought to the attention of a Reexamination Legal Advisor (RLA) of the Central Reexamination Unit (CRU) prior to any further action by the examiner. The RLA will provide the examiner with guidance as to compliance with Office policy where there is concurrent litigation.
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