Court Opinion

ID: 4688639
Source: CourtListenerOpinion
Date Created: 2021-05-20 17:00:45.402391+00
Date Added: 2024-06-11T08:04:49.064917
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

GILBERT P. HYATT; AMERICAN                No. 20-15590
ASSOCIATION FOR EQUITABLE
TREATMENT, INC.,                            D.C. No.
              Plaintiffs-Appellants,     2:16-cv-01944-
                                            JAD-EJY
                 v.

OFFICE OF MANAGEMENT AND                    OPINION
BUDGET; MICK MULVANEY, in his
official capacity as Director of the
Office of Management and Budget,
                Defendants-Appellees.

      Appeal from the United States District Court
               for the District of Nevada
      Jennifer A. Dorsey, District Judge, Presiding

         Argued and Submitted March 11, 2021
                  Las Vegas, Nevada

                  Filed May 20, 2021
2                         HYATT V. OMB

    Before: Jacqueline H. Nguyen, Mark J. Bennett, and
           M. Douglas Harpool, * Circuit Judges.

                   Opinion by Judge Nguyen

                          SUMMARY **

                  Paperwork Reduction Act

    The panel affirmed the district court’s summary
judgment in favor of the Office of Management and Budget
(“OMB”) in an action challenging the OMB’s determination
that certain rules and regulations were not subject to the
Paperwork Reduction Act (“PRA”).

     Plaintiffs contended that patent applicants should not
have to comply with certain U.S. Patent & Trademark Office
rules because they violated the PRA. The PRA requires
federal agencies engaged in “collection of information” to
first submit them to the OMB for approval and assignment
of a control number. Patent applicants and patent examiners
are guided by Patent Office regulations and the Manual of
Patent Examining Procedure, which impose formatting,
timing, and other procedural guidelines (the “Rules”).
Plaintiffs argued that the Rules imposed “collections of
information” within the meaning of PRA. Plaintiffs
requested that the OMB review certain Patent Office rules

    *
      The Honorable M. Douglas Harpool, United States District Judge
for the Western District of Missouri, sitting by designation.
    **
       This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
                      HYATT V. OMB                        3

because they required OMB approval and control numbers,
and OMB denied their applications.

    The panel held that the challenged Rules did not impose
“collections of information” subject to the PRA’s procedural
requirements. The panel agreed with the government that the
Rules did not impose the kinds of generalized solicitations
of information that the PRA and its regulations were
intended to cover, and they were not subject to PRA’s
approval and control number requirements.

    The panel held that even if some of the Rules imposed
“collections,” the PRA’s procedural requirements would still
not apply to virtually any of the Rules because, under
Exemption 6, the definition of “information” generally
excluded “[a] request for facts of opinions addressed to a
single person.” 5 C.F.R. § 13203(h)(6).

                       COUNSEL

Andrew M. Grossman (argued) and Mark W. DeLaquil,
Baker Hostetler LLP, Washington, D.C., for Plaintiffs-
Appellants.

Jennifer L. Utrecht (argued) and Daniel Tenny, Appellate
Staff; Nicholas A. Trutanich, United States Attorney; Civil
Division, United States Department of Justice, Washington,
D.C.; for Defendants-Appellees.
4                     HYATT V. OMB

                        OPINION

NGUYEN, Circuit Judge:

    Gilbert P. Hyatt is the named inventor on hundreds of
inter-related patent applications containing, at one point,
over 100,000 claims. See generally Hyatt v. U.S. Pat. &
Trademark Off., 797 F.3d 1374, 1377 (Fed. Cir. 2015).
Hyatt and the American Association for Equitable Treatment
(“AAET”) contend that patent applicants should not have to
comply with certain U.S. Patent & Trademark Office
(“USPTO”) rules because, they allege, the USPTO is
violating the Paperwork Reduction Act (“PRA”). The
district court disagreed and found that the challenged rules
are not subject to the PRA at all. We affirm.

    Congress passed the PRA to reduce the burden imposed
on the public when federal agencies seek information from
private individuals. The PRA requires federal agencies
engaged in “collections of information” to first submit them
to the Office of Management and Budget (“OMB”) for
approval and an assignment of a control number. The PRA
applies only to those “collections” seeking information by
way of identical questions or requirements imposed on ten
or more people. And collections of things other than
“information” also need not receive OMB approval. For
example, in keeping with the Congress’s focus on
collections imposed on ten or more people, the PRA and its
regulations      expressly      exclude       individualized
communications from the PRA’s requirements.

    Against this backdrop, the USPTO examines thousands
of patent applications every year. The USPTO’s patent
applications impose identical questions and disclosure
requirements on ten or more people and are therefore subject
to the PRA and bear OMB control numbers. After the initial
                      HYATT V. OMB                         5

submission, though, every patent application takes a unique
path.       Many require extensive back-and-forth
communications with USPTO patent examiners. These
subject-matter experts correspond with each applicant
concerning a particular patent application, asking for or
commenting on specific deficiencies in that application.
Applicants sometimes must respond, and in other instances
can optionally provide additional information.         This
dialogue is tailored toward clarifying, amending, or
correcting the application as it winds toward a final
determination. Along the way, the applicant and examiner
are guided by USPTO regulations and the Manual of Patent
Examining Procedure (“MPEP”), which impose formatting,
timing, and other procedural guidelines.

    Hyatt and AAET argue that because these regulations
and rules (the “Rules”) apply to all patent applicants and
allow for or require the submission of information, the Rules
impose “collections of information” within the meaning of
the PRA. According to Hyatt and AAET, patent applicants
need not follow the Rules because the USPTO is violating
the PRA by failing to obtain OMB approval and a control
number each time the USPTO makes a request to an
applicant during the back-and-forth communications process
concerning a particular patent. OMB rejected this view and
determined that the Rules are not subject to the PRA. Hyatt
and AAET challenge OMB’s determination as arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with law in violation of the Administrative
Procedure Act (“APA”). We hold that the challenged Rules
do not impose “collections of information” subject to the
PRA’s procedural requirements. Indeed, the PRA and the
regulations expressly exclude from coverage individualized
communications just like those between a patent examiner
6                     HYATT V. OMB

and a patent applicant. We therefore affirm the district
court’s grant of summary judgment in favor of OMB.

               I. LEGAL FRAMEWORK

A. The Paperwork Reduction Act

    The PRA seeks to reduce the burden imposed on the
public when the federal government engages in certain
“collections of information.” 44 U.S.C. § 3501(1). Any
collection of information that is subject to the PRA must be
approved by OMB and assigned an OMB control number.
Id. § 3512(a).

    As relevant here, a federal agency conducts a “collection
of information” when it

       obtain[s], caus[es] to be obtained, solicit[s],
       or require[es] the disclosure to third parties or
       the public, of facts or opinions . . . regardless
       of form or format, calling for . . . answers to
       identical questions posed to, or identical
       reporting or recordkeeping requirements
       imposed on, ten or more persons . . . .

Id. § 3502(3). This includes collections that are “mandatory,
voluntary, or required to obtain or retain a benefit” and “any
requirement or request for persons to obtain, maintain,
retain, report, or publicly disclose information.” 5 C.F.R.
§ 1320.3(c).

    “Information” is “any statement or estimate of fact or
opinion.” 5 C.F.R. § 1320.3(h). There are ten enumerated
categories “generally” exempt from being defined as
“information,” except that “OMB may determine that any
specific item constitutes ‘information.’” Id. Most relevant
                          HYATT V. OMB                               7

here, Exemption 6 excludes from the definition of
“information” “[a] request for facts or opinions addressed to
a single person.” Id. § 1320.3(h)(6).

    Under the PRA, any person may ask OMB “to review
any collection of information conducted by or for an agency”
to determine if the collection is covered by the PRA and
requires a control number. 44 U.S.C. § 3517(b). OMB must
respond to any non-frivolous request, id. § 3517(b)(1), and
if it determines that the agency has been conducting an
unapproved collection of information, it may take
“appropriate remedial action, if necessary,” id. § 3517(b)(2).

B. The Patent Application Process

    The USPTO is authorized to promulgate regulations
governing the granting and issuing of patents. 35 U.S.C.
§§ 2(a)(1), (b)(2)(A). The patent application process begins
when a patent application is submitted using one of several
uniform applications approved by OMB. Id. § 111; see
62 Fed. Reg. 53,132, 53,178 (Oct. 10, 1997) (noting OMB
approval of initial patent applications); 85 Fed. Reg. 60,967,
60,968 (Sept. 29, 2020) (soliciting public comment on
extending OMB-approved initial patent applications). 1 The
parties agree that the initial application is subject to the
requirements of the PRA.

    After the application is submitted, the applicant’s
journey through the examination system may take several

    1
      USPTO also sought and received OMB control numbers for other
collections related to the patent examination process, including for
applications for international patents, see 62 Fed. Reg. at 53,178, and
covering a variety of standardized forms issued by the USPTO, 85 Fed.
Reg. 60,975 (Sept. 29, 2020) (listing the forms covered by the
collection).
8                      HYATT V. OMB

paths, as determined by the USPTO’s patent examiners.
Once past the initial application stage, certain rules kick in,
including the Rules at issue in this appeal: Rules 105, 111,
115, 116, 130, 131, and 132, and MPEP § 2173.05(n).
Applicants first hear back from USPTO when a patent
examiner sends correspondence, called an “office action,”
communicating a decision or asking for additional
information. 37 C.F.R. § 1.104(a)(2). However, if an
applicant wants to include additional information before
receiving any office action, USPTO Rule 115 allows the
applicant to submit a preliminary amendment to their
application. Id. § 1.115(a).

    A patent application may proceed through examination
quickly, but the process sometimes involves significant
back-and-forth between the examiner and the applicant.
Throughout the examination process, USPTO Rule 105
authorizes the examiner to require the applicant to submit
“such information” as the examiner determines “may be
reasonably necessary to properly examine or treat” the
application. Id. § 1.105(a).

    The applicant has multiple opportunities to fix any
shortcomings in their application. If the initial office action
is adverse, USPTO Rule 111 requires the applicant to
respond to the office action or be deemed to have abandoned
the application. Id. § 1.111. The response must directly
address the reasons for the adverse decision, including by
describing the alleged errors in the examiner’s decision. Id.
The applicant may also amend their application to address
the examiner’s specific concerns. Id. And once a final
decision has been made, but before any appeal of such
decision, USPTO Rule 116 allows the applicant to again
amend their application to address any shortcomings. Id.
§ 1.116. MPEP § 2173.05(n) further explains that if an
                         HYATT V. OMB                              9

application is rejected for “multiplicity”—that is, because
there are “an unreasonable number of claims [in the
application] which are repetitious and multiplied, the net
result of which is to confuse rather than to clarify”—the
examiner must request that the applicant “select a specified
[smaller] number of claims for purpose of examination.” If
the applicant does so, the examiner will re-examine the
selected claims. Id. Finally, USPTO Rules 130, 131, and
132 allow an applicant to submit additional evidence through
affidavits or declarations to overcome certain bases for an
examiner’s rejection. 37 C.F.R. §§ 1.130, 1.131, 1.132.

  II. FACTUAL & PROCEDURAL BACKGROUND

    In August 2013, Hyatt requested that OMB review
USPTO Rules 111, 115, and 116, arguing that those Rules
imposed “collections of information” under the PRA and
thus required OMB approval and control numbers. Because
the Rules had not received OMB approval, Hyatt suggested
that he was not required to maintain, provide, or disclose the
information referenced by the Rules. In September 2013,
OMB responded that it had already determined that “these
collections are not subject to the PRA because what is
collected is not considered ‘information,’ pursuant to [three]
exemptions in OMB’s PRA implementing regulation:”
Exemptions 1, 2 6, and 9. 3

    2
      OMB no longer relies on Exemption 1, 5 C.F.R. § 1320.3(h)(1),
and the parties have not briefed this Exemption.
    3
      Exemption 9 excludes “[f]acts or opinions obtained or solicited
through nonstandardized follow-up questions designed to clarify
responses to approved collections of information.”        5 C.F.R.
§ 1320.3(h)(9).
10                    HYATT V. OMB

    In 2016, AAET submitted three requests to OMB,
making similar arguments as to USPTO Rules 105, 130, 131,
and 132, and MPEP § 2173.05(n). OMB responded only
that “the requests under Rule 1.105 are not subject to the
PRA because the responses to questions submitted under
Rule 1.105 are not ‘information,’ but instead are exempt
under” Exemption 9. In 2017, AAET again submitted three
requests to OMB, making similar arguments as to the same
Rules. OMB responded that Rules 105, 130, 131, and 132,
and MPEP § 2173.05(n) were all exempt under Exemptions
6 and 9, and Rules 130, 131, and 132 were additionally
exempt under Exemption 1.

    Hyatt and AAET sued, alleging that OMB’s denial of
their petitions were arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law in
violation of the APA, because the challenged Rules were
subject to the PRA and yet had not been reviewed or
assigned a control number.

    The parties filed cross motions for summary judgment.
The district court found that the challenged Rules “constitute
requests for facts or opinions addressed to a single person
and are excluded from the scope of the PRA” under
Exemption 6, and that OMB’s denial of Hyatt and AAET’s
PRA petitions was therefore not arbitrary, capricious, or
contrary to law. The district court did not address the
parties’ arguments regarding Exemption 9, and granted
summary judgment in favor of OMB. Hyatt appeals.

             III. STANDARD OF REVIEW

    We have jurisdiction under 29 U.S.C. § 1291, and we
“review de novo a challenge to a final agency action decided
on summary judgment and pursuant to Section 706 of the
APA.” Ctr. for Biological Diversity v. Esper, 958 F.3d 895,
                          HYATT V. OMB                               11

903 (9th Cir. 2020) (citing Turtle Island Restoration
Network v. U.S. Dep’t of Com., 878 F.3d 725, 732 (9th Cir.
2017)).

                        IV. DISCUSSION

A. The Rules Do Not Impose “Collections                               of
   Information” and Are Not Subject to the PRA.

   The district court correctly held that OMB’s denial of
Hyatt and AAET’s PRA petitions was not arbitrary,
capricious, or contrary to law. The challenged Rules are not
subject to the PRA; they do not authorize “collections”
because they do not impose “identical” questions or
reporting, recordkeeping, or disclosure requirements.
44 U.S.C. § 3502(3); 5 C.F.R. § 1320.3(c). 4

    This conclusion flows from the statutory and regulatory
definition of “collection,” which focuses on the nature of the
request—that is, the inquiry or prompt to which a member
of the public is being asked to respond. Here, the Rules
either impose formatting or submission guidelines or require
or allow a particular patent applicant to respond to an office
action. For example, Rule 105 requires a response to an
examiner’s individualized request for “such information as
may be reasonably necessary to properly examine or treat” a
particular application. 37 C.F.R. § 1.105(a). Rule 111
requires an applicant to reply to an adverse decision by
“specifically point[ing] out the supposed errors in the
examiner’s action,” “reply[ing] to every ground of objection

    4
      Although we agree with OMB on this ultimate conclusion, we note
that OMB’s assertion that only collections that collect information using
standardized forms impose “identical” requirements is incorrect. See
5 C.F.R. § 1320.3(c)(1) (“A ‘collection of information’ may be in any
form or format, including . . . rules or regulations.”).
12                     HYATT V. OMB

and rejection in the prior Office action,” and “present[ing]
arguments pointing out the specific distinctions believed to
render the claims . . . patentable.” Id. § 1.111(b). Each of
these requirements calls for a response to an individualized
communication concerning a specific application. Rule 115
allows an applicant to make an optional preliminary
amendment to an application in a specific format; no
information is requested or required. Id. § 1.115(a).
Similarly, Rules 130, 131, and 132 generally authorize
submission of additional information—specifically,
evidence regarding prior art. Id. §§ 1.130, 1.131, 1.132.
Rules 130 and 131 impose some content and format
requirements on any submission, while Rule 132 merely
allows for the submission of “an oath or declaration” with no
parameters. Rule 116 allows for amendment before appeal
of a final action and allows three types of amendment:
(1) “canceling claims or complying with any requirement of
form expressly set forth in a previous Office action;”
(2) “presenting rejected claims in better form;” or (3) if good
cause is shown, “touching the merits of the application or
patent under reexamination.” Id. § 1.116(b). None of these
options impose “identical questions . . . or reporting,
recordkeeping, or disclosure requirements.” 5 C.F.R.
§ 1320.3(c).     Finally, under MPEP § 2173.05(n), the
examiner decides the number of claims to which the
applicant is limited, making the request individualized and
not identical.

    This conclusion also follows from a practical
understanding of the patent application process. Patent
examiners engage in thousands of conversations with patent
applicants each year, subject to the Rules. This dialogue is
tailored toward clarifying, amending, or correcting a single
application as it travels toward a final determination. But
while the Rules apply to every applicant, merely imposing
                      HYATT V. OMB                         13

formatting requirements or providing for a uniform process
is not sufficient to turn procedural rules into “collections”
under the PRA or its regulations. An exemplar office action
filed in the record demonstrates the point. There, the
examiner of an initial application for a patent of a seed of
soybean plant cultivar asks the applicant to submit
information “reasonably necessary to the examination of
[the] application” under Rule 105, including the “breeding
methodology,” “[t]he filial generation in which the instant
plant was chosen,” and “homozygosity or heterozygosity of
the parents.” These questions simply would not be asked of
the inventor of, say, computer components, or of a soybean
cultivator who submitted a more detailed application. It
would be illogical and antithetical to the purposes of the
PRA to require USPTO submit every such office action for
OMB approval.

    Moreover, many of the “identical” requirements that
Hyatt and AAET point to merely require that responses to
individualized office actions be highly specific. See, e.g.,
37 C.F.R. § 1.111(b) (Applicant must “specifically point[]
out the supposed errors in the examiner’s action” and “reply
to every ground of objection and rejection in the prior Office
action.”); id. § 1.130(b) (Applicant “must identify the
subject matter publicly disclosed and provide the date such
subject matter was publicly disclosed.”). There is nothing in
the PRA or its implementing regulations that suggests that
requiring specificity amounts to identicality.

    For these reasons, we agree with the government that the
Rules simply do not impose the kinds of generalized
solicitations of information that the PRA and its regulations
are intended to cover. Because the Rules do not impose
“collections,” they are not subject to the PRA’s approval and
control number requirements.
14                        HYATT V. OMB

B. Even If They Impose “Collections,” Most of The
   Rules Are Exempted from the PRA Under
   Exemption 6.

    Even if some of the Rules impose “collections,” the
PRA’s procedural requirements would still not apply to
virtually any of the Rules because, under Exemption 6, the
definition of “information” generally excludes “[a] request
for facts or opinions addressed to a single person.” 5 C.F.R.
§ 1320.3(h)(6). Exemption 6’s preclusion of individualized
communications from the PRA accords with the statute’s
emphasis on identical requests sent to many people.

    As a general matter, office actions—letters and calls
from a patent examiner sent to an individual applicant—are
quintessentially individualized. Requiring or allowing
applicants to respond to such an individualized
communication is not a collection of “information.” For
example, Rule 105 authorizes the examiner to require the
applicant to submit whatever information the examiner
thinks “necessary to properly examine or treat the matter.”
37 C.F.R. § 1.105(a). Rule 111 requires the applicant to
respond to an adverse office action by pointing out the
alleged errors in the examiner’s decision, making
amendments to address the examiner’s specific concerns,
and more. Id. § 1.111. The other Rules generally also
concern individualized communications to single
applicants. 5

     5
       To be sure, Rule 115, which allows applicants to amend their
application before receiving any office action at all, cannot be said to
impose any “request.” 37 C.F.R. § 1.115. Rule 115, therefore, does not
fall under Exemption 6—but that is of no consequence, since as
discussed above Rule 115, and all the challenged Rules, do not impose
collections at all.
                     HYATT V. OMB                      15

                        *   *   *

    Because the Rules do not impose collections subject to
the PRA, the decision of the district court is

   AFFIRMED.