Source: http://www.jdsupra.com/legalnews/arqule-v-kappos-enjoy-your-weekend-or-79052/
Timestamp: 2016-07-27 11:57:22
Document Index: 286561946

Matched Legal Cases: ['§ 21', '§ 1', '§ 21', '§ 1', '§ 1', '§ 1', '§ 154', '§ 154', '§ 21', '§ 154', '§ 154', '§ 21']

ArQule v. Kappos: Enjoy Your Weekend, or What a Difference a Day (or Two or Three) of PTA Can Make | McDonnell Boehnen Hulbert & Berghoff LLP - JDSupra
ArQule v. Kappos: Enjoy Your Weekend, or What a Difference a Day (or Two or Three) of PTA Can Make
ArQule, Inc. v. Kappos, 793 F. Supp. 2d 214 (D.D.C. 2011)
A few years ago we had provided some cautionary advice relating to the dichotomy between a timely filed response in accordance with 35 U.S.C. § 21(b), and a delayed response pursuant to 37 C.F.R. § 1.704(b). 35 U.S.C. § 21(b) allowed an applicant to take an extra day or two or three (until the next business day) to file a response to a 3-month action without requiring an extension of time fee, yet under 37 C.F.R. § 1.704(b), those extra days would be regarded as applicant delay for patent term adjustment ("PTA") purposes (see "Patent Term Adjustment: 37 C.F.R. § 1.704(b)'s Three-Month Provision"). For example, if the USPTO issued a non-final rejection, and the 3-month response deadline fell on a Saturday, the applicant could still timely file the response on the following Monday, but those extra two days would be counted against any PTA awarded for the patent. And so, we cautioned that it would be wise to pay close attention to the true 3-month deadline date, and respond by then, in order to maximize patent term adjustment.
Fast forward, and our advice has changed. Now we recommend that you enjoy your weekend and/or holiday, and not worry about filing the response until the next business day. Under ArQule v. Kappos, those extra days will not be regarded as applicant delay for the purposes of a patent term adjustment determination.
In ArQule, the plaintiff had been awarded a PTA of 1,127 days for U.S. Patent No. 7,713,969 ("the '969 patent," entitled "Compositions and Methods for Treatment of Cancer") due to USPTO delay. The total of "A" + "B" delay, less overlap, was 1,128 days, but ArQule was charged with one day of applicant delay, based on a response that was filed 3 months and 1 day after its mailing date, the 3-month deadline falling on Veterans Day (with the response being timely filed the next day). At that time, the USPTO, in calculating PTA, followed the literal language 37 C.F.R. § 1.704(b), which incorporates the language of 35 U.S.C. § 154(b)(2)(C)(ii) and states that "an applicant shall be deemed to have failed to engage in reasonable efforts to conclude processing or examination of an application for the cumulative total of any periods of time in excess of three months that are taken to reply to any notice or action by the Office making any rejection, objection, argument, or other request" (emphasis added).
Its petitions with the USPTO to correct the PTA (to remove the one-day applicant delay) having been denied, ArQule filed suit in the District Court of the District of Columbia (the appropriate court under 35 U.S.C. § 154 as it stood at the time). On cross motions for summary judgment, ArQule argued that the provisions of 35 U.S.C. § 21(b) ("[w]hen the day, or the last day, for taking any action or paying any fee in the United States Patent and Trademark Office falls on Saturday, Sunday, or a Federal holiday within the District of Columbia, the action may be taken, or fee paid, on the next succeeding secular or business day") were to be applied to 35 U.S.C. § 154(b)(2)(C)(ii), and the USPTO took the opposite position. The Court granted ArQule's motion for summary judgment and denied the USPTO's, finding the meaning of 35 U.S.C. § 154(b)(2)(C)(ii) to be plain and clear in referring to an action that applicants must take, and as such, the "any action taken" provision of 35 U.S.C. § 21(b) applied to this aspect of PTA calculations. The USPTO did not appeal the District Court's finding.
For its part, the USPTO has been largely silent on the implications of this case (the sole reference to the ArQule case on the USPTO website is within a recent Federal Register publication on the revision of PTA provisions relating to appellate review), which indicates that ArQule will be followed for those provisions. However, a discussion had by this Patent Docs contributor with a representative from the Office of Patent Legal Administration (OPLA) confirmed that the Office is indeed applying ArQule to its PTA determinations -- sort of. The OPLA representative was not sure if the software used by the USPTO to calculate PTA had been updated to reflect the ArQule holding, and a cursory review of a small sampling of recently issued patents suggests that is has not. Therefore, in the example noted at the start of this post, the applicant would likely receive a PTA calculation that reflected a deduction of 2 days of PTA due to applicant delay. In order to have those days of PTA rightfully reinstated, it would be necessary to file a petition for reconsideration of the patent term adjustment, citing the ArQule case. The OPLA representative advised that such a petition would be granted.
In some instances, it may not be worth the effort and expense to petition for the additional one or two or three days of patent term. But in others, recapturing those days could translate into significant revenue. For example, according to an IMS Health report entitled "Top U.S Pharmaceutical Products by Spending," sales of Pfizer's Lipitor® in the U.S. amounted to $7.7 billion dollars in 2011. Doing some simple math, that translates to approximately $21M in sales daily. When viewed in that light, one or two or three days of additional patent term would have a significant impact, and would be well worth the pursuing.
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