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527 U.S. 150119 S.Ct.1816144 L.Ed.2d 143 142 F.3d 1447, reversed and remanded. SUPREME COURT OF THE UNITED STATES No. 98 377 Q. TODD DICKINSON, ACTING COMMISSIONER PATENTS AND TRADEMARKS, PETITIONERv.MARY E. ZURKO et al. ON WRIT CERTIORARI TO APPEALSFOR FEDERAL CIRCUIT [June 10, 1999] Justice Breyer delivered the opinion of Court. 1 The Administrative Procedure Act (APA) sets forth standards governing judicial review findings fact made by federal administrative agencies. 5 U.S.C. § 706. We must decide whether §706 applies when Federal Circuit reviews Patent Trademark Office (PTO). conclude that it does apply, use framework set in section. 2 * Section 706, originally enacted 1946, govern "Scope" court "review" of, e.g., agency factfinding (what we shall call court/agency review). It says a 3 "reviewing 4 . "(2) hold unlawful aside found to be 6 "(A) arbitrary, capricious, [or] an abuse discretion, or 7 8 "(E) unsupported substantial evidence case subject sections 556 557 this title otherwise reviewed on record hearing provided statute; 9 10 "In making foregoing determinations, whole those parts cited party ." 11 Rule Civil 52(a) appellate district judge court/court only if they are "clearly erroneous." Traditionally, standard has been considered somewhat stricter (i.e., allowing closer review) than APA's standards. K. Davis & R. Pierce, Law Treatise §11.2, p. 174 (3d ed. 1994) (hereinafter Peirce). 12 Court Appeals for believes should apply erroneous" PTO. In re Zurko, 1459 (1998) (case below). Commissioner Patents, PTO's head contrary ordinary APA apply. See Kemps, 97 1427, 1430 1431 (CA Fed. 1996); Napier, 55 610, 614 1995); Brana, 51 1560, 1568 1569 1995). 13 before us tests these two competing legal views. Respondents applied patent upon method increasing computer security. PTO examiner concluded respondents' was obvious light prior art, so denied application. 35 103 (1994 ed., Supp. III). board (the Board Interferences) upheld examiner's decision. sought Circuit, where panel treated question what art teaches as one fact, agreed with respondents factual finding 111 887, 889, n. (1997). 14 hoping definitively resolve review-standard controversy, then heard matter en banc. After examining relevant precedents, banc its legally proper. Solicitor General, representing certiorari. granted writ order Circuit's take place within APA. II 15 parties agree is "agency" constraints, at issue constitutes "agency action." 701 (defining "authority Government United States"); (applying "Scope review" provisions action"). Hence reviewing absence exception. 16 rests claim exception §559. That section "not limit repeal additional requirements recognized law." view: (1) time adoption, Customs (CCPA), predecessor, standard; (2) standards; (3) special tradition strict consequently amounted "additional requirement" under §559 trumps imposed §706. 17 Recognizing importance maintaining uniform approach action, see, Universal Camera Corp. v. NLRB, 340 474, 489 (1951); 92 Cong. Rec. 5654 (1946) (statement Rep. Walter), have closely examined uniformity. doing so, believe show more possibility heightened standard, indeed even bare preponderance their favor. Existence requirement clear. This suggested both phrase "recognized law" congressional specification "[n]o subsequent legislation held supersede modify except extent such do expressly." 559. A statutory intent legislative departure from norm clear suggests need similar clarity respect grandfathered common-law variations. meant bring uniformity field full variation diversity. would frustrate purpose permit divergence basis "recognized" ambiguous. any event, 89 cases which, according supporting amici, embody pre-APA review. App. Brief New York Intellectual Property Association Amicus Curiae 1a 6a (collecting cases), not reflect well-established factfinding, which circumstance fatally undermines conclusion. 18 all involve CCPA decision, either awarded priority several applicants. 59a (1934 ed.) (granting authority over decisions); 141 (current grant Circuit). major consideration favors view consists 23 words "clear error" wrong" describe CCPA's while remainder "manifest error," might thought mean same thing. 6a. When decided many during 1930's early 1940's, authorities had begun regularity term signal review, Civ. Proc. (adopted 1937), "substantial evidence" less Stern, Review Findings Administrators, Judges Juries: Comparative Analysis, 58 Harv. L. Rev. 70, 88 (1944) (describing debates members argued against applying "precisely because give finality enjoyed 'substantial evidence' rule"). 19 Yet presence phrases conclusive. linguistic conventions were firmly established adoption today. At courts sometimes used See, Polish National Alliance 136 F.2d 175, 181 (CA7 1943); Trust Co. SEC, 131 274, 275 (CA2 1942), cert. denied, 318 786 (1943); Hall Commissioner, 128 180, 182 1942); First Bank Memphis 125 157 (CA6 1942) (per curiam); NLRB Algoma Plywood Veneer Co., 121 602, 606 1941). Other times (including appeals infringement challenging factfinding). Cornell Chase Brass Copper 157, 160 1944); Dow Chemical Halliburton Oil Well Cementing 139 473, 475 1943), aff'd, 324 320 (1945); Gordon Form Lathe Ford Motor 133 487, 496 497 (CA6), 714 Electro Mfg. Yellin, 132 979, 981 Ajax Hand Brake Superior 606, 609 Galion Iron Works Beckwith Machinery 105 941, 942 (CA3 1939). Indeed, itself least occasion explain why disturb trial court's findings. Borden's Farm Products Ten Eyck, 297 251, 261 (1936); see also, Great Atlantic Pacific Tea Grosjean, 301 412, 420 (1937) (accepting support record"). 20 Nor especially significant. Before APA, proceeded fits starts, standardization beginning after Congress began using (or like) various statutes. For example, first context Interstate Commerce Commission's findings, ICC Union 222 541, 548 (1912), though underlying statute simply authorized competent jurisdiction suspend orders Commission, §12, 36 Stat. 551. did immediately Trade Commission leeway ICC, FTC Curtis Publishing 260 568, 580 (1923), language applied, §5, 38 720 "findings commission facts, supported testimony, conclusive"). As appear often statutes, describing standards, supplying modifier "substantial" left out. Consolidated Edison 305 197, 229 (1938); Stason, "Substantial Evidence" Law, U. Pa. 1026, 1026 1028 (1941) statutes); also Dobson 489, 499 (1943) (speaking generally "theoretical practical reason[s] [crediting] decisions"). however, other 61 62 ed.). apparently remains disputed day (a dispute settle today) precisely "arbitrary, discretion" factfinding. 706(2)(E) takes "on record"); Data Processing Service Orgs., Inc. Governors Reserve System, 745 677, 683 684 (CADC 1984) (Scalia, J.) (finding no difference between capricious" factfinding.) 21 Further, opinions actually uses precise erroneous," terms signaling Most like now art. 22 time, precedent traced back Morgan Daniels, 153 120 (1894), characterized foundation later built F.3d, 1453 1454. some detail. arose out interference proceeding determine claimants inventor. "priority" favor claimant; Court, deciding "without testimony," U.S., 122, Office's claimant. turn thereby restoring 24 "What," asked Brewer "is rule control [reviewing] determination case?" Ibid. Is decision "should stand unless testimony shows beyond reasonable doubt plaintiff inventor"? Id., 123. standing "reasonable doubt" standard. (citing Cantrell Wallick, 117 689, 695 (1886), Coffin Ogden, Wall. 120, 124 (1874)). "closely point." wrote person "challenging proof. " (emphasis added). pointing quite strong," (namely "a undoubted proof"), Court's sounded "an court." wrote: 25 "But something mere appeal. application action executive departments government. new instituted conclusions reached department sustained evidence. controversy individuals once settled tribunal, entrusted power premises. well argued, statute, office every fact." 26 words, reasoned strongly proper; too strict; weaker appropriate. 27 concede could read setting said, 28 "Patent [decision] accepted controlling carries thorough conviction [I]f doubtful, control." 29 added sufficient produce mistake." 129 But emphasized today; 100 years ago. And reasoning makes 30 cases, catalogued Appendix opinion, reveal pattern. They wrong." much, little, deference And, further explanations, given, indicate court/agency, court/court, mind. 31 nearly half explains expert body, can better deal technically complex matter, deserves deference. three-fourths defer (and more) tribunals about finding. These reasons commentators long invoked justify Camera, (intraagency agreement); Link&nbhyph;Belt 311 584, 597 (expertise); Rochester Telephone States, 307 125, 145 146 (1939) Louisville Nashville 227 88, (1913) Rev., 81 82 Pierce 178 agreement). typically given deferring fact-finding lower judge. Concrete Pipe Cal., Construction Laborers Pension Southern 508 623 (1993); supra, 83 (trial advantages lie in, evaluation witness, comparative expertise). think worth noting, movement toward discussed above, 7, refer frequently technical complexity expertise marched 1946. Out 45 our sample 1929 1936, 40% (18 45) specifically referred complexity. percentage increased 57 (25 44) 1937 32 Given standard's origins, nondeterminative nature phrases, cannot rather decisions. amount requiremen[t] C. III 33 advanced policy militate First, bench bar become implies change may prove needlessly disruptive. 1457 1458. Supporting amici add remain 'settled right.' Patent, Copyright Bar District Columbia (quoting Square D Niagara Frontier Tariff Bureau, Inc., 476 409, 424 (1986)). 34 previously matter. require create disruptive readily permitting agencies depart requirements. event overstates will practice. described requiring ask mind accept" particular evidentiary "adequate conclusion." Edison, 229. "definite firm conviction" error committed. States Gypsum 333 364, 395 (1948). former latter. 477, 488 (analogizing test jury stating stressed rubber-stamping fact-finding. 490. requires meaningful review; enactment believed conducted. upshot outcome depending used. subtle fine (apart present case) failed uncover single instance conceded produced different outcome. Cf. International Brotherhood Electrical Workers 448 1127, 1142 1971) (Leventhal, J., dissenting) (wrongly believing correcting himself he "case dreamed law school professors" agency's "nevertheless" evidence"). 37 difficulty part basic similarity task, judges logic experience record, agency. attempting capture form intangible factors confidence fairness process. 489; Jaffe, Judicial Review: Evidence Whole Record," 64 1233, 1245 (1951). comparatively greater case-specific factors, finding's dependence internal influential applicable features underline that, she examine through lens patent-related properly specialized court. expertise, enabling understand play important role assuring proper theoretically 39 Moreover, means suggest somehow immunize fact-related "reasoning" 1449 1450, disagree. "arbitrary" "capricious," or, bound up record-based conclusion, evidence." E.g., SEC Chenery Corp., 80, 93 (1943). 40 Second, anomaly. An applicant seek directly indirectly obtaining direct court, §145. path second lead Gould Quigg, 822 1074, 1077 (1987). result, claims, disappointed takes; fears applicants complicated, time-consuming indirect obtain determination. 41 convinced, paths creates significant permits factfinder nonexpert calls anomaly exist insofar but nothing prevents adjusting related necessary. Fregeau Mossinghoff, 776 1034, 1038 1985) (harmonizing standards). 42 Finally, encourages creation "administrative records fully metes bounds grant" "help avoid situations matters anticipation inquires obviousness virtually unreviewable." Neither nor explained convincingly denials demands appropriate stated, circumstances 43 reasons, judgment reversed. remand proceedings consistent opinion. 44 So ordered. APPENDIX OPINION Pre-APA Cases Reciting "Clear" "Manifest" Error Standard 46 Referring Technical Complexity/Agency Expertise Agreement (Disagreement) Agency 47 Stern Schroeder, P. A. 670, 674, 515, 517 (1929) 48 Ford, 893, 894, 525, 526 (1930) 49 Demarest, 904, 906, 895, 896 50 Wietzel, 1079, 1082, 669, 671 Anhaltzer, 1181, 1184, 657, 658 (1931) 52 Dorer Moody, 1188, 1190, 388, 389 53 Hornsey, 1222, 1224, 911, 912 54 Rowe Holtz, 970, 974, 468, 470 471 (1932) Fessenden, 1048, 1050 1051, 56 670 Martin Friendly, 1182 1183, 421, 422 Dubilier, 809, 815, 374, (1933) Alden, 1083, 1084 1085, 65 136, 137 59 Farmer Pritchard, 1096, 1101, 165, 168 60 1170, 1175, 271, 274 Angell Morin, 1018, 1024, 69 646, 649 (1934) Daley Trube, 964, 971, 308, 312 63 Coast Dubbs, 1023, 1031 1032, 734, 739 Bryson Clarke, 719, 721, 720, 722 Brand Thomas, 1053, 1055, 96 301, 302 (1938) 66 Creed Potts, 1084, 1089, 317, 321 67 Cassidy, 1282, 1285, 93, 95 68 Krebs Melicharek, 1362, 1365 1366, 479 Parker Ballantine, 799, 804, 101 220, 223 (disagreement) 70 Reed Edwards, 901, 550, 552 71 Hill Casler, 930, 932, 102 219, 221 72 Tears Robinson, 1391, 1392, 104 813, 814 73 Bertsch, 760, 763 764, 107 828, 831 74 Wuertz, 1039, 1046, 110 854, 857 (1940) 75 Kaplan, 1072, 1075, 672 76 Prahl Redman, 937, 940, 1021 77 815 816, 1014, 1016 (1942) 78 Stacy, 972, 135 232, 233 79 Poulsen McDowell, 1006, 1011, 267, 270 80 Pinkerton Stahly, 723, 728, 144 881, 885 Engelhardt, 1244, 1251, 764 McDonald, 1099, 1102, 802, 804 84 Hermans, 1211, 1212, 386, 387 85 Batcher, 1275, 1278, 461, 463 86 Carlton, 1105, 190, 192 87 Farnsworth Brown, 740, 749, 208, 214 Ubbelhode, 1042, 453, 456 Cohen, 876, 880, 924, 926 90 Ruzicka, 1165, 1169, 150 553 (1945) 91 Allbright, 152 984, 986 Within Beidler Caps, 703, 705, 123 94 690, 696 697, 518, 521 522 Janette Folds, 879, 361, 362 Moulton, 891, 892, 359, 360 Banner, 1086, 1090, 692 Walter, 982, 983, 724, 724 99 Pengilly Copeland, 1143, 1145, 995, 996 Thompson Pettis, 755, 757, 420, 421 Kochendorfer, 761, 763, 418, 419 Dickerman, 766, 768, 877 Bennett Fitzgerald, 1201, 1202, 917, 918 Doherty, 1280, 952, 953 Murray, 767 540, 541 106 Breer, 929, 931, 485, 486 Robbins Steinbart, 1069, 378, 379 108 Henry Harris, 1092, 1096 1097, 864, 866 109 Fageol Midboe, 1117, 1122, 867, 870 Gamble Church, 1146, 762 Fawick, 953, 956, 127 112 Evans Clocker, 960, 137, 113 Bloch, 1180, 268, 269 114 Snyder, 722, 493, 495 115 Osgood Ridderstrom, 1176, 1182, 191, 195 116 Urschel Crawford, 727, 730, 510, 511 Marine Wright, 946, 948 949, 996, 997 (1935) 118 Berman Rondelle, 1049, 1052, 845, 847 119 Tomlin Dunlap, 1108, 1114, 731 Lasker Kurowski, 1253, 1256, 132, 134 Taylor, 709, 711, 706 122 Adamson, 726, 729 717, Adams Stuller, 865, 870, 403, 406 Ellis Maddox, 1045, 314 Kauffman Etten, 1134, 134, 126 Kindelmann Morsbach, 1344, 1349, 796, 799 800 King Young, 762, 771, 663, Meuer Schellenger, 1430, 1434, 952 McBride Teeple, 961, 789, 797, 130 Vickery Barnhart, 578, 581 Shumaker Paulson, 1136, 1138, 686, 688 Paulson Hyland, 1150, 1152, 695, 697 Dreyer Haffcke, 116, Schmidt, 773, 777, 673, 676 Hamer White, 1186, 1189, 987, 990 Kenyon Platt, 748, 752, 1009 138 Beall Ormsby, 959, 967, 154 668 Rehnquist, dissenting Chief whom Kennedy Ginsburg join, dissenting. 140 whether, ago, (PTO) undisputed until today's placed PTO.* thus my view, since plain text intended raising minimum lowering existed time. ultimately codified §559, "[n]othing diminish constitutional rights Pub. 404, 79th Cong., 237, 244 (1946). therefore turns identified establishing demanding created determination, I defer, general today, Article charged appeals. unanimous procedures. reason reject sensible plausible resolution issue. ante, 4, original §12 impose sort statement rule" common law. expressly stated predated "otherwise unaffected Act. If law," certainly said not. notion §559's separate textual statutes superseding modifying "expressly," 559 nontextual antecedent supplemented. There tension whatsoever goals preserving rigorous ensuring future implication supplementary dissent Appeals. Notes *. appears acquiesced interpretation almost Br. Pharmaceutical Research Manufacturers America applicability patentability

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