Court Opinion

ID: 9496839
Source: CourtListenerOpinion
Date Created: 2023-08-05 16:36:39.958962+00
Date Added: 2024-06-11T17:57:50.072415
License: Public Domain

PAULINE NEWMAN, Circuit Judge,
dissenting.
My colleagues have peered deep into the recesses of patent examination, plucked out a routine and unreviewable administrative procedure — the “restriction requirement” for facilitating examination of complex cases — -and created a new standard of administrative review and a new ground of patent invalidity. I must, respectfully, dissent.
Whether or not the patent applicant here in suit was given proper or consistent restriction requirements by the various examiners, the issuance of these actions was entirely discretionary with the Commissioner. When the examiners accepted the applicant’s elections and the divisional applications filed in compliance therewith, these actions are not rulings of law; they are discretionary actions renewable, if at all, under the strictures of the Administrative Procedure Act. It is not disputed that the applicant made the required election for each restriction requirement, and that the divisional and continuing applications at issue were accepted by the examiner as properly filed. The district court reviewed these procedures and found that 35 U.S.C. § 121 protected the patentee from citation of the earlier patent against the later one:
35 U.S.C. § 121.... A patent issuing on an application with respect to which a requirement for restriction under this section has been made, or on an application filed as a result of such a requirement, shall not be used as a reference either in the Patent and Trademark Office or in the courts against a divisional application or against the original application or any patent issued on either of them....
Thus the district court held that under 35 U.S.C. § 121 the patent at issue was not an available reference.
If my colleagues on this panel now intend to require that the minutiae of the various discretionary restriction requirements and the acceptance by the examiners of the applicant’s compliances with those requirements are subject to appellate review, the standard of review is that of the Administrative Procedure Act, not *1351the de novo untangling of internal procedures for which my colleagues remand to the district court. See Dickinson v. Zurko, 527 U.S. 150, 119 S.Ct. 1816, 144 L.Ed.2d 143 (1999).1
Restriction Requirements are not Appeal-able within the PTO
The PTO has myriad procedures to guide and facilitate the conduct of patent examination. Rules of operation are essential to the effective performance of a complex agency with many employees and an enormous volume of work.2 The PTO’s patent examination procedures fill a three-inch thick Manual of fine print. In addition, PTO regulations fill Volume 37 of the Code of Federal Regulations. Over 3500 scientists and engineers apply these procedures to the most advanced science and technology of the age.
Early in the evolution of patent examination the Patent Office adopted the discretionary “restriction” practice, to simplify the search and examination of complex inventions. In electing to require “restriction” the patent examiner requires the applicant to select a specified aspect of the claimed subject matter, the examiner having first divided the subject matter into groups of claims based on classification for search purposes. The applicant then selects the aspect to be examined, and usually also “traverses” the requirement, a formality grounded in administrative protocols. Examination then proceeds as to the selected subject matter. The non-selected aspects are then removed from consideration in that case; they may be rejoined or they may be moved into one or more divisional applications for examination. Lest the first patent be citable as prior art against a1 divisional application — -an illogical event that apparently had occurred — the 1952 Patent Act precluded this event by enacting § 121. Thus the patentee was shielded from this unintended substantive consequence of an examination procedural convenience. In Applied Materials, Inc. v. Advanced Semiconductor Materials America, Inc., 98 F.3d 1563 (Fed.Cir.1996) this court explained:
The purpose of § 121 is to accommodate administrative convenience and to ■ protect the patentee from technical flaws based on this unappealable examination practice.... Section 121, viewed overall, assures that the technicalities of restriction practice are not elevated from their purpose of examination convenience to a potential taint on the validity of the ensuing patents.
Id. at 1568.
.In the present case, four different examiners imposed somewhat variant restriction requirements, reflecting their divergent *1352views of how the subject matter should be divided for search and examination. Some examiners grouped all of the platinum compounds together and all of the cancer-treatment uses together; another put the compositions with the compounds, another with the uses; another separated the different kinds of platinum compounds; another included the corresponding composition and use claims with each type of platinum compound. Some required an election of species; some did not.
To each examiner’s restriction requirement, the applicant made the requisite election from among the examiner’s categories, while duly “traversing” the requirement. None of the examiners objected to the applicant’s compliance with any of the restriction requirements. None rejected a later filed application on an earlier one. None of these actions is appealable to the Board of Appeals or the courts. The Court of Customs and Patent Appeals explained that a restriction decision is not an actual rejection on grounds of patentability, but simply a procedural requirement. The court explained in In re Hengehold, 58 C.C.P.A. 1099, 440 F.2d 1395, 1399 (1971):
On considering §§ 121, 132 and 134 and the intent unmistakably evinced by the clear language therein, it is evident to us that Congress ... decided not to regard the procedure involved in matters of “division” or “restriction” as a “rejection.” Instead, section 121 denominates restriction procedure as a “requirement.” ... It is apparent, then, that Congress intended to differentiate between whatever requirements and objections an examiner might make on the one hand, and matters involving actual rejections of claims on the other, at least insofar as its provision of statutory rights of appeal to the board accruing from such actions in and of themselves.
440 F.2d at 1402-03 (citations omitted). Restriction requirements are like other PTO “requirements” that are “matters of a discretionary, procedural or nonsubstan-tive nature.” Id. at 1403. See also In re Harnisch, 631 F.2d 716 (CCPA 1980):
In the PTO, patent applications are examined for compliance with the statutory provisions of Title 35, United States Code, as set forth in sections 100, 101, 102, 103, and 112. These are considered to be examinations “on the merits.” There are also procedural questions arising under section 121 and related PTO rules concerned with “restriction practice.”
Id. at 721.
The only remedy available to an applicant who is dissatisfied with the restriction requirement is a petition to the Director for review:
37 C.F.R. § 1.144. After a final requirement for restriction, the applicant, in addition to making any reply due on the remainder of the action, may petition the Director to review the requirement. Petition may be deferred until after final action on or allowance of claims to the invention elected, but must be filed not later than appeal. A petition will not be considered if reconsideration of the requirement was not requested (see § 1.181).
Such a procedure implements standard administrative practice relative to agency actions. See generally Martin v. Occupational Safety & Health Review Comm’n, 499 U.S. 144, 151, 111 S.Ct. 1171, 113 L.Ed.2d 117 (1991) (“Because applying an agency’s regulation to complex or changing circumstances, calls upon the agency’s unique expertise and policymaking prerogatives, we presume that the power authori*1353tatively to interpret its own regulations is a component of the agency’s delegated lawmaking powers.”).
Indeed, should there be any imperfections in the agency’s interpretations or applications of the regulations with respect to the examiner’s theory of restriction or compliance by the applicant, they are not grounds of invalidity. See Magnivision, Inc. v. Bonneau Co., 115 F.3d 956 (Fed.Cir.1997):
Procedural lapses during examination, should they occur, do not provide grounds of invalidity. Absent proof of inequitable conduct, the examiner’s or the applicant’s absolute compliance with the internal rules of patent examination becomes irrelevant after the patent has issued.
Id. at 960. Such internal agency procedures are not judicially reviewable. See Hyatt v. Boone, 146 F.3d 1348 (Fed.Cir.1998):
Regularity of routine administrative procedures is presumed, and departure therefrom, should such have occurred, is not grounds of collateral attack. Courts should not readily intervene in the day-to-day operations of an administrative agency, especially when the agency practice is in straightforward implementation of the statute.
Id. at 1355-56.
The presumption of validity would collapse if the PTO’s administration of the restriction protocols could be turned into satellite litigation of patent-destroying consequence. In American Hoist & Derrick Co. v. Soioa & Sons, Inc., 725 F.2d 1350 (Fed.Cir.1984) the court referred to
the deference that is due to a qualified government agency presumed to have properly done its job, which includes one or more [patent] examiners who are assumed to have some expertise in interpreting the references and to be familiar from their work with the level of skill in the art and whose duty it is to issue only valid patents.
Id. at 1359. .
Restriction is a Discretionary Requirement
No statute defines the parameters of the examiner’s discretion beyond the authorization of 35 U.S.C. § 121, for the subject and scope of this discretion is unrelated to patentability. In In re Hengehold the court explained:
There are a host of various kinds of decisions an examiner makes in the examination proceeding — mostly matters of a discretionary, procedural or nonsub-stantive nature — which' have not been and are not now appealable to the board or to this court.... [A] requirement for restriction under § 121 is now one of those discretionary matters no longer tantamount to a rejection of the claims,
440 F.2d at 1399.
The entrusting of discretionary agency procedures to agency management is a classical administrative practice, requiring judicial restraint. See Vermont Yankee Nuclear Power Corp. v. Natural Res. Def. Council, Inc., 435 U.S. 519, 98 S.Ct. 1197, 55 L.Ed.2d 460 (1978):
[T]his Court has for more than four decades emphasized that the formulation of procedures was basically to be left within the discretion of the agencies to which Congress had confided the responsibility for substantive judgments.
Id. at 524, 98 S.Ct. 1197. In Citizens to Preserve Overton Park, Inc. v. Volpe, 401 *1354U.S. 402, 410, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971) the Court, interpreting the Administrative Procedure Act, stated that internal agency actions are not reviewable if either (1) Congress expressed an intent to prohibit judicial review, or (2) the decision is “committed to agency discretion.”
Undoubtedly the procedures surrounding restriction requirements can be complex. An entire Chapter of the Manual of Patenting Examining Procedure is devoted to it.3 By statute it is discretionary, for its purpose is administrative convenience, not pitfalls in substantive validity. The fact that four examiners made somewhat inconsistent requirements for restriction does not change the controlling weight of the examiners’ steady determination of the applicant’s compliance with their requirements. A discretionary action having no substantive consequence and that is unre-viewable is not a ground of patent invalidity, and is not subject to collateral attack.4
Remand is Inappropriate
The panel majority orders the district court to repeat its review of the restriction process, to search for flaws in the procedure, for my colleagues find it too complex for them appellate decipherment. A complex agency record is not sound reason to discard the required agency deference, or to ask the district court to repeat what the court has already done and ruled upon. Whatever the continuing force of the pre-Zurko “consonance” cases, on which the majority relies, in this case the patents at issue were the product of restriction requirements in which the examiners accepted the applicant’s elections and the ensuing divisional applications. The courts lack authority to invalidate the patent on the basis of an asserted flaw in a discretionary procedure, here proposed after sixteen years. That these restriction requirements were varied and somewhat inconsistent cannot now penalize the paten-tee, who complied with them and whose compliance was accepted by all of the examiners involved in the examination. See Northern Telecom, Inc. v. Datapoint Corp., 908 F.2d 931, 938 (Fed.Cir.1990) (“[A]ny doubt as to whether the examiner lapsed in his duty [under § 121] does not increase the burden on the applicant.”)
The sequence of restriction requirements was presented to the district court, who decided the question. It cannot be correct that when the examiner found no flaw in this non-substantive non-appealable *1355procedure, the courts can later conduct a de novo search for some tenuous lapse, and invalidate any patent for which we disagree with the agency’s discretionary decision. In Securities & Exchange Commission v. Chenery Corp., 318 U.S. 80, 63 S.Ct. 454, 87 L.Ed. 626 (1943), the Court discussed such discretionary administrative authority:
If the action rests upon an administrative determination — an exercise of judgment in an area which Congress has entrusted to the agency — of course it must not be set aside because the reviewing court might have made a different determination were it empowered to do so. But if the action is based upon a determination of law as to which the reviewing authority of the courts does come into play, an order may not stand if the agency has misconceived the law.
Id. at 94, 63 S.Ct. 454.
Compliance with a restriction requirement is an “exercise of judgment,” id., and is entrusted to the Director. Each examiner in the case before us determined that the applicant had complied with the requirement that was imposed. The question of restriction, its correctness and its compliance, cannot now be collaterally attacked as grounds of patent invalidity. The district court’s decision should be affirmed.

. The majority opinion, in its footnote. 1, mis-perceives my concern. The issue is not the standard of review of the agency’s findings of substantive fact in determining patentability. In holding that "the PTO is an ‘agency’ subject to the APA's constraints,” Zurko, 119 S.Ct. at 1819, the Court required that matters of agency procedure (such as whether a restriction requirement must be repeated) are delegated to the agency. The APA assigns such procedures, which have no substantive impact, to internal agency management; the panel majority distorts the administrative process in holding that the agency’s examining practices in complex cases receive plenary judicial review and management.

. In 2002 the PTO received 333,68.8 new patent applications and granted 162,221 patents. See 20Ó2 United States Patent & Trademark Office Performance & Accountability Rep. at 15. The average pendency was twenty-four months, id., and hundreds of thousands of applications are under examination at any given time.

. A commentator experienced in the field states: “Many patent examiners and patent practitioners are confused by restriction practice and unity of invention practice in the [USPTO].” Jon W. Henry, Some Comments on "Independent and Distinct” Inventions of 35 U.S.C. '121 and Unity of Invention (pt. 1), 84 J. Pat. & Trademark Off. Soc'y 745, 748 (2002).

. The majority states by footnote that precedent requires de novo review of not only the lineage of continuating and divisional applications, but also of the correctness of the examiner’s issuance of restriction requirements and the examiner’s acceptance of the applicant’s response to restriction requirements. That is an inapt enlargement of precedent, indeed the case on which the majority relies, Geneva Pharmaceuticals, Inc. v. Glaxosmithkline, PLC, 349 F.3d 1373 (Fed.Cir.2003), states that “requirements for restriction under 35 U.S.C. 121 are discretionary with the Commissioner." Id. at 1378 quoting MPEP '803.01. The Manual of Patent Examining Procedure abjures the examiners to exercise care in making restriction requirements, id., but neither the MPEP nor any judicial decision removes the discretion of the Director, formerly termed the Commissioner, nor carves out an exception for restriction requirements into APA review of discretionary actions.