SawStop Holding LLC v. Iancu

District Court, E.D. Virginia·Decided October 26, 2020·No. 1:19-cv-01198·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA Alexandria Division SAWSTOP HOLDING LLC, ) Plaintiff, v. 1:19-cv-1198 (LMB/MSN) ANDREI IANCU, Undersecretary of Commerce for Intellectual Property and Director _) of United States Patent and Trademark Office, ) Defendant. MEMORANDUM OPINION Before the Court are plaintiff Sawstop Holding LLC’s (“plaintiff or “Sawstop”) Motion for Summary Judgment to Correct the Patent Term Adjustment for U.S. Patent 9,522,476 [Dkt. No. 16] and defendant Director Andrei Iancu’s (“defendant”) Motion for Summary Judgment [Dkt. No. 19]. The motions have been fully briefed, and finding that oral argument will not further the decisional process, the motions will be resolved on the papers submitted. For the reasons that follow, plaintiff's motion will be denied, and defendant’s motion will be granted. I. BACKGROUND A. Statutory & Regulatory Framework Before 1999, the term of a patent was 17 years, and it began to run from the date the patent issued. In part to speed up the process for patent review, the American Inventors Protection Act (“AIPA”) changed the term of a patent to 20 years, but started that time from the date the first application for the patent was filed. 35 U.S.C. § 154(a)(2). As a result of this change, delays in the United States Patent and Trademark Office’s (“USPTO”) review of an application could reduce the term of the patent which ultimately issued. To address that problem, the AIPA provides for adjustment of the patent term for “any undue delays in patent examination

caused by the PTO.” Pfizer, Inc. v. Lee, 811 F.3d 466, 468 (Fed. Cir. 2016); 35 U.S.C. § 154(b)(1). Three kinds of delay by the USPTO will result in such adjustment. The first two— involving the USPTO’s failure to respond within required deadlines to various application actions, and, with some exceptions, a delay of more than three years in issuing a patent—are not implicated in this litigation. See id. at § 154(b)(1)(A)-(B). The third, found in § 154(b)(1)(C), grants adjustments based on the time an application is pending due to derivative proceedings, secrecy orders, or appeals. As relevant to this action, the AIPA provides: “if the issue of an original patent is delayed due to ... (iii) 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, the term of the patent shall be extended 1 day for each day of the pendency of the proceeding, order, or review, as the case may be.” The USPTO regulation interpreting this statute explains that a patent term adjustment under § 154(b)(1)(C)(iii) is equal to “the number of days, if any, in the period beginning on the date on which jurisdiction over the application passes to the Patent Trial and Appeal Board ... and ending on the date of a final decision in favor of the applicant by the Patent Trial and Appeal Board or by a Federal court.” 37 C.F.R. § 1.703(e). In its published responses to comments submitted during the promulgation of § 1.703(e), the USPTO explained that “[a] ‘final decision in favor of applicant’ is understood to include any final decision of the Board of Patent Appeals and Interferences or Federal court that reverses all of the rejections of at least one claim (without subjecting the claim to a new rejection).” Changes to Implement Patent Term Adjustment Under Twenty-Year Patent Term; Final Rule, 65 Fed. Reg. 56366-01, 56376 (Sept. 18, 2000). B. Procedural History The parties agree that all relevant facts are set out in the USPTO Administrative Record (“AR”) [Dkt. Nos. 10-1, 10-2]. These agreed facts establish that plaintiff filed an application to patent “power equipment with detection and reaction systems” with the USPTO on August 20,

2010. AR85. That application was assigned serial number 12/806,829 (“829 Application”), and contained claims 1-11, of which claim | was the only independent claim. AR 193, 133-34. On September 11, 2012, the Examiner issued a Final Rejection of claims 1, 2, 5, and 9-11, finding them unpatentable as obvious under 35 U.S.C. § 103(a). AR308-314. Plaintiff appealed the Examiner’s decision to the Patent Trial and Appeal Board (“PTAB”), filing its notice of appeal on December 11, 2012. AR318. The PTAB described the appeal as involving the Examiner’s decision rejecting ... claims 1, 2, 5, and 9-11 as unpatentable over Lokey [(JUS 3,785,230, iss. Jan. 15, 1974) and Fergle (US 3,547,232, iss. Dec. 15, 1970) and claim 5 as unpatentable over Lokey, Fergle, and Yoneda (US 4,117,752, iss. Oct. 3, 1978). Claims 3, 4, and 6-8 have been withdrawn. AR366. Because plaintiff did not present arguments supporting the patentability of claims 2, 9, and 10 apart from claim 1, the PTAB focused on claim 1 to resolve claims 2, 9, and 10, and considered claims 5 and 11 separately. AR367, 372, and 374. On August 31, 2015, the PTAB issued its Decision on Appeal of the ’829 Application (“Decision”), in which it sustained the Examiner’s rejection of claims 1, 2, 9, and 10 after agreeing with the Examiner’s conclusion that these claims were obvious in light of the Lokey and Fergle patents, and were therefore unpatentable. AR365-66. It also affirmed the Examiner’s decision that claim 5 was unpatentable as obvious in light of Lokey, Fergle, and Yoneda. AR 374. As to claim 11, which is the subject of this litigation, the PTAB affirmed the Examiner’s conclusion that claim 11 was obvious and therefore unpatentable in light of the Lokey and Fergle patents, but rejected how the Examiner reached that conclusion: “We agree with Appellant that the Examiner’s modification is not a mere substitution, as it would require further modification to Lokey’s embodiment of Figures 7-9, as modified by Fergle ... Therefore, the Examiner has not made the initial factual findings required to demonstrate a prima facie case of obviousness of claim 11.”

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