Court Opinion

ID: 4314792
Source: CourtListenerOpinion
Date Created: 2018-09-24 15:00:38.396113+00
Date Added: 2024-06-11T14:17:41.948548
License: Public Domain

United States Court of Appeals
      for the Federal Circuit
                 ______________________

 GILBERT P. HYATT, AMERICAN ASSOCIATION
     FOR EQUITABLE TREATMENT, INC.,
             Plaintiffs-Appellants

                            v.

  UNITED STATES PATENT AND TRADEMARK
   OFFICE, ANDREI IANCU, IN HIS OFFICIAL
    CAPACITY AS UNDER SECRETARY OF
  COMMERCE FOR INTELLECTUAL PROPERTY
   AND DIRECTOR OF THE UNITED STATES
     PATENT AND TRADEMARK OFFICE,
              Defendants-Appellees
             ______________________

                       2017-1722
                 ______________________

    Appeal from the United States District Court for the
District of Nevada in No. 2:16-cv-01490-RCJ-PAL, Judge
Robert Clive Jones.
                 ______________________

              Decided: September 24, 2018
                ______________________

    ANDREW M. GROSSMAN, Baker & Hostetler LLP,
Washington, DC, argued for plaintiffs-appellants. Also
represented by MARK W. DELAQUIL.

   MOLLY R. SILFEN, Office of the Solicitor, United States
Patent and Trademark Office, Alexandria, VA, argued for
2                                             HYATT   v. PATO

defendants-appellees. Also represented by THOMAS W.
KRAUSE, ROBERT J. MCMANUS.
                ______________________

    Before REYNA, WALLACH, and HUGHES, Circuit Judges.
HUGHES, Circuit Judge.
     Gilbert Hyatt sued the United States Patent and
Trademark Office alleging that the PTO acted unlawfully
in denying his petition for rulemaking. Mr. Hyatt now
appeals from the district court’s grant of the PTO’s motion
for summary judgment and dismissal of his claims for
lack of subject matter jurisdiction. We reverse the district
court’s dismissal for lack of subject matter jurisdiction.
Because Mr. Hyatt’s claims are either time-barred or
reliant on mistaken statutory interpretation, however, we
affirm on alternate grounds the district court’s grant of
summary judgment.
                             I
     Mr. Hyatt is the named inventor on more than 70 is-
sued patents and approximately 400 pending patent
applications, all of which were filed before June 8, 1995.
Due to Mr. Hyatt’s numerous amendments, those pending
applications contained approximately 115,000 total claims
as of August 2015. Each of these applications incorpo-
rates by reference, and claims priority from, numerous
previously-filed applications dating back to the early
1970s. In October 2012, the PTO dedicated twelve full-
time patent examiners to the sole task of examining Mr.
Hyatt’s applications. By 2015, that number had increased
to fourteen.
    The PTO’s examination of these patents has proven
slow going. Beginning in the mid-2000s, the PTO started
issuing final rejections for some applications, prompting
Mr. Hyatt to appeal the rejections to the Patent Trial and
Appeal Board (PTAB). Upon an applicant’s filing of an
HYATT   v. PATO                                          3

appeal brief before the Board, the patent examiner may
file an examiner’s answer setting forth the grounds on
which the patent was rejected or adding a new ground of
rejection. 37 C.F.R. § 41.39(a). But there is no statutory
or regulatory deadline for filing an answer.            In
Mr. Hyatt’s case, the examiners never filed answers to his
briefs, which prevented the PTAB from acquiring jurisdic-
tion over his appeals. See 37 C.F.R. § 41.35(a).
    In 2013, the PTO issued a series of formal office ac-
tions, called “Requirements,” intended to accelerate
examination of Mr. Hyatt’s claims. These Requirements
instructed Mr. Hyatt to limit the number of claims from
each patent family to 600 absent a showing that more
claims were necessary, identify the earliest possible
priority date and supporting disclosure for each selected
claim, and present a copy of the selected claims to the
PTO. Although Mr. Hyatt challenged the PTO’s authority
to issue these Requirements, we held that the special
circumstances of Mr. Hyatt’s applications justified the
unique disclosure requirements. Hyatt v. U.S. Patent &
Trademark Office, 797 F.3d 1374, 1385 (Fed. Cir. 2015).
Following issuance of the Requirements, the PTO reo-
pened prosecution of 80 applications that its examiners
had previously rejected.
    In February 2014, Mr. Hyatt responded to the reopen-
ing of his 80 applications with a suit in the U.S. District
Court for the District of Nevada alleging the PTO unrea-
sonably delayed examination of his applications by reo-
pening prosecution rather than letting the PTAB hear his
appeals. See Hyatt v. U.S. Patent & Trademark Office,
No. 2:14-CV-00311-LDG, 2014 WL 4829538, at *1 (D.
Nev. Sept. 30, 2014). The Nevada district court deter-
mined that it lacked jurisdiction over Mr. Hyatt’s claims
and transferred his case to the U.S. District Court for the
Eastern District of Virginia. Id. In November 2015, the
Eastern Virginia district court granted summary judg-
ment for the PTO. Hyatt v. U.S. Patent & Trademark
4                                               HYATT   v. PATO

Office, 146 F. Supp. 3d 771, 787 (E.D. Va. 2015).
Mr. Hyatt did not appeal the court’s decision.
     While his unreasonable delay case was pending before
the Nevada district court, Mr. Hyatt filed a petition for
rulemaking with the PTO pursuant to 5 U.S.C. § 553(e).
His petition requested that the PTO either promulgate a
rule repealing Manual of Patent Examining Procedure
(MPEP) § 1207.04 or declare that MPEP provision unen-
forceable. Section 1207.04 describes an examiner’s ability
to, “with approval from the supervisory patent examiner,
reopen prosecution to enter a new ground of rejection in
response to appellant’s brief.” This section provides an
alternative to MPEP § 1207.03, which allows examiners
to include new grounds of rejection in their answers to an
applicant’s appeal brief. To avoid abandonment of an
application following a reopening of prosecution, the
applicant must file a reply to the office action reopening
prosecution or initiate a new appeal to the PTAB by filing
a new notice of appeal. MPEP § 1207.04.
    Mr. Hyatt’s petition raised three arguments in sup-
port of repealing MPEP § 1207.04. He argued that MPEP
§ 1207.04 (1) conflicts with 35 U.S.C. § 6(b)(1)’s creation of
a right for applicants to appeal rejections; (2) conflicts
with 37 C.F.R. § 41.39’s implicit disallowance of prosecu-
tion reopening after an applicant’s filing of an appeal
brief; and (3) was improperly adopted without notice-and-
comment rulemaking. In September 2014, the PTO
denied Mr. Hyatt’s petition. He subsequently requested
reconsideration of that denial, which the PTO denied in
December 2015.
    In June 2016, Mr. Hyatt filed this suit challenging the
denial of his petition for rulemaking in Nevada district
court under the Administrative Procedure Act. See 5
U.S.C. §§ 701–706.     Mr. Hyatt’s complaint primarily
alleges, for the same reasons raised in his petition for
rulemaking, that the PTO’s adoption of MPEP § 1207.04
HYATT   v. PATO                                         5

was arbitrary and capricious, in excess of statutory au-
thority, and without observance of procedure required by
law. Accordingly, he alleges that the PTO’s denial of his
request to rescind MPEP § 1207.04 was similarly arbi-
trary and capricious, an abuse of discretion, or otherwise
not in accordance with law.
    The district court granted summary judgment to the
PTO and dismissed all of Mr. Hyatt’s claims, determining
that it lacked subject matter jurisdiction over them. In
choosing to dismiss the case rather than transfer it to a
court with the requisite jurisdiction, the district court
reasoned that Mr. Hyatt’s challenges to MPEP § 1207.04
were “likely precluded” because he could have raised the
same arguments in his prior unreasonable delay suit.
J.A. 4. Mr. Hyatt now appeals. We have jurisdiction
under 28 U.S.C. § 1295(a)(1).
                            II
    We review a district court’s grant of summary judg-
ment according to the law of the regional circuit. Teva
Pharm. Indus. Ltd. v. AstraZeneca Pharm. LP, 661 F.3d
1378, 1381 (Fed. Cir. 2011) (quoting Lexion Med., LLC v.
Northgate Techs., Inc., 641 F.3d 1352, 1358 (Fed. Cir.
2011)). The Ninth Circuit reviews such grants de novo.
Universal Health Servs., Inc. v. Thompson, 363 F.3d 1013,
1019 (9th Cir. 2004). Following the Ninth Circuit, “[w]e
must determine, viewing the evidence in the light most
favorable to the nonmoving party, whether there are any
genuine issues of material fact and whether the district
court correctly applied the relevant substantive law.” Id.
(quoting EEOC v. Luce, Forward, Hamilton & Scripps,
345 F.3d 742, 746 (9th Cir. 2003)).
    “The district court’s conclusion that it lacks subject
matter jurisdiction is subject to de novo review.” Ip v.
United States, 205 F.3d 1168, 1170 (9th Cir. 2000) (quot-
ing Central Green Co. v. United States, 177 F.3d 834, 835
(9th Cir. 1999)). When an issue of claim preclusion is
6                                              HYATT   v. PATO

“particular to patent law,” we analyze it under our own
law. Acumed LLC v. Stryker Corp., 525 F.3d 1319, 1323
(Fed. Cir. 2008) (quoting Hallco Mfg. Co. v. Foster, 256
F.3d 1290, 1294 (Fed. Cir. 2001)). We review de novo
whether claim preclusion bars a plaintiff’s claim. Faust v.
United States, 101 F.3d 675, 677 (Fed. Cir. 1996). Wheth-
er a claim is barred by a statute of limitations is also a
legal question subject to de novo review. Newby v. Enron
Corp., 542 F.3d 463, 468 (Fed. Cir. 2008). An agency’s
denial of a petition for rulemaking is reviewed for wheth-
er it is arbitrary and capricious. Preminger v. Sec’y of
Veterans Affairs, 632 F.3d 1345, 1353 (Fed. Cir. 2011).
                             A
    As an initial matter, the district court had subject
matter jurisdiction over Mr. Hyatt’s challenge to the
PTO’s denial of his petition for rulemaking. Under 28
U.S.C. § 1331, district courts have “original jurisdiction of
all civil actions arising under the Constitution, laws, or
treaties of the United States.” The APA is a federal
statute that provides a cause of action for persons “suffer-
ing legal wrong because of agency action.” 5 U.S.C. § 702.
Subject to some exceptions inapplicable in this case, APA
challenges to federal agency actions usually fall within
the district courts’ § 1331 jurisdiction. See Califano v.
Sanders, 430 U.S. 99, 105–07 (1977). In addition, if a
plaintiff’s APA challenge raises a substantial question of
patent law, district courts have jurisdiction under 28
U.S.C. § 1338(a). Helfgott & Karas, P.C. v. Dickinson, 209
F.3d 1328, 1334 (Fed. Cir. 2000). Here, Mr. Hyatt chal-
lenges the validity of a PTO rule, in part on the basis that
it conflicts with statutes and regulations governing the
patent application process. We have held that “the ques-
tion of whether the [PTO] has violated the APA in apply-
ing . . . its own regulations . . . raises a substantial
question under the patent laws sufficient to vest jurisdic-
tion with the district court based in part upon 28 U.S.C.
HYATT   v. PATO                                           7

§ 1338(a).” Id. Thus, the district court had original
jurisdiction over Mr. Hyatt’s case.
     Although Congress has granted this court and the
Eastern Virginia district court exclusive jurisdiction to
review final PTAB application decisions, this grant does
not displace the district court’s jurisdiction in this case.
Under 35 U.S.C. § 141(a), if the PTAB affirms an examin-
er’s final rejection, the applicant may appeal the PTAB’s
final decision to this court. Under 35 U.S.C. § 145, an
applicant may alternatively challenge the PTAB’s deci-
sion by instituting a civil action against the PTO Director
in the Eastern Virginia district court.          But here,
Mr. Hyatt’s petition for rulemaking was not an appeal
from an examiner’s rejection of his applications. Related-
ly, the PTO Director’s denial of Mr. Hyatt’s petition is not
a PTAB decision. Thus, Mr. Hyatt’s challenge to the
denial of his petition falls outside the exclusive zone of
jurisdiction created by § 141 and § 145.
     The district court reasoned that, even though the de-
nial of Mr. Hyatt’s petition for rulemaking was not itself a
final PTAB decision within the scope of § 141 and § 145, it
lacked jurisdiction because an order invalidating MPEP
§ 1207.04 would indirectly affect our jurisdiction over
appeals from final PTAB decisions. This reasoning re-
flected the district court’s interpretation of Telecommuni-
cations Research & Action Center v. FCC, 750 F.2d 70
(D.C. Cir. 1984) (“TRAC”), a case in which the D.C. Cir-
cuit noted a “well settled” rule that “where a statute
commits review of agency action to the Court of Appeals,
any suit seeking relief that might affect the Circuit
Court’s future jurisdiction is subject to the exclusive
review of the Court of Appeals.” Id. at 76, 78–79.
    The district court, however, read the TRAC rule too
broadly. The rule applies to cases concerning interlocuto-
ry challenges to agency proceedings that will culminate in
final agency actions exclusively reviewable by certain
8                                             HYATT   v. PATO

courts. In those cases, the court with jurisdiction over the
final agency action also has exclusive jurisdiction over the
interlocutory challenges in order to “protect its future
jurisdiction.” In re Nat. Res. Def. Council, 645 F.3d 400,
405 (D.C. Cir. 2011). For example, in TRAC, public
interest groups petitioned the D.C. Circuit for a writ of
mandamus to compel the Federal Communications Com-
mission to resolve several matters pending before the
agency. 750 F.2d at 72. The court determined that
district courts would lack jurisdiction over this type of
unreasonable delay challenge because the final agency
action that the petitioners sought to compel would be
exclusively reviewable in the courts of appeals. Id. at 75,
77. Similarly, in Public Utility Commissioner of Oregon v.
Bonneville Power Administrator, 767 F.2d 622 (9th Cir.
1985), utility companies sued the Bonneville Power Ad-
ministration in district court to challenge the constitu-
tionality of the agency’s process for adjusting the way in
which it calculated certain electricity prices. Id. at 624–
25. The court determined that, because the agency’s final
decision on rate calculations would be exclusively review-
able in the court of appeals, an interlocutory challenge to
the process of making that decision could not be brought
in the district courts. Id. at 625–26.
     In contrast to the agency actions challenged in those
cases, the PTO’s denial of Mr. Hyatt’s petition was not an
intermediate action taken in the course of proceedings
that would culminate in a final agency action exclusively
reviewable by this court and the Eastern Virginia district
court. The process for petitioning the PTO for rulemaking
is completely separate from the patent application exami-
nation process that culminates in final PTAB decisions.
Thus, we do not need to exercise exclusive jurisdiction
over denials of petitions for rulemaking in order to protect
our future jurisdiction. If another court granted Mr.
Hyatt’s requested relief and prohibited PTO examiners
from reopening prosecution of applications after an appeal
HYATT   v. PATO                                            9

brief has been filed, the prosecution process would
change, but our ability to review final PTAB decisions
would remain unaffected.
    Accordingly, the exclusive jurisdiction of this court
and the Eastern Virginia district court to review final
PTAB decisions under § 141 and § 145 does not displace
the district court’s jurisdiction over APA challenges to the
PTO’s denial of a petition for rulemaking.
                             B
    The PTO argues that the judgment in Mr. Hyatt’s pri-
or unreasonable delay case bars his present claims under
the doctrine of claim preclusion. In his prior suit,
Mr. Hyatt challenged the PTO’s reopening of prosecution
for 80 of his pending applications. Hyatt, 146 F. Supp. 3d
at 773. He alleged that the prosecution reopenings
formed part of a pattern of unreasonable delay by the
PTO that included issuing repeated examination suspen-
sions and raising new grounds of rejection. Id. at 773,
780. He sought a declaration that the PTO had “unrea-
sonably delayed final agency action on the 80 patent
applications in issue” and injunctive relief “barring the
PTO from reopening prosecution on the PTO’s own initia-
tive once plaintiff files . . . an appeal brief.” Id. at 780.
The Eastern Virginia district court granted summary
judgment for the PTO on the grounds that Mr. Hyatt
lacked a remedy because the PTO had recommenced
examination of his applications. Id. at 787. Mr. Hyatt
does not dispute that he could have argued in his prior
suit that MPEP § 1207.04 is invalid.
    For general principles of claim preclusion, we apply
the law of the regional circuit. But, for claim preclusion
issues “particular to patent law,” as is the case here which
requires an analysis of issues related to the prosecution
and examination of patents, we apply our own law.
Acumed LLC, 525 F.3d at 1323.          Claim preclusion ap-
plies when “(1) there is identity of parties (or their priv-
10                                            HYATT   v. PATO

ies); (2) there has been an earlier final judgment on the
merits of a claim; and (3) the second claim is based on the
same set of transactional facts as the first.” Jet, Inc. v.
Sewage Aeration Sys., 223 F.3d 1360, 1362 (Fed. Cir.
2000). Both parties agree that the prior unreasonable
delay case involved identical parties and reached a final
judgment on the merits. They only dispute whether the
prior case involved the same set of transactional facts.
    To determine whether there is an identity of claims,
this court is guided by the Restatement (Second) of Judg-
ments. Foster v. Hallco Mfg. Co., 947 F.2d 469, 478 (Fed.
Cir. 1991). Under the Restatement approach, what
constitutes the same transaction of facts is “to be deter-
mined pragmatically,” considering “whether the facts are
related in time, space, origin, or motivation, whether they
form a convenient trial unit, and whether their treatment
as a unit conforms to the parties’ expectations or business
understanding or usage.” Restatement (Second) of Judg-
ments, § 24 (Am. Law Inst. 1982).
    Consideration of these factors makes clear that
Mr. Hyatt’s claims in this case do not share an identity
with his unreasonable delay claims. First, the two sets of
claims relate to different sets of facts. Mr. Hyatt’s unrea-
sonable delay claims arose from the PTO’s reopening of
prosecution for 80 of his applications in 2013. In contrast,
his present claims arose from the PTO’s denial of his
petition for rulemaking in December 2015. This petition-
ing process is completely independent of the PTO’s appli-
cation examination process. In addition, the two sets of
claims could not have been conveniently tried together.
Mr. Hyatt’s petition for rulemaking was not denied until
December 2015, more than two years after the reopenings
of his applications and a month after the final decision in
his unreasonable delay case.           Thus, even though
Mr. Hyatt could have raised the same arguments concern-
ing MPEP § 1207.04’s validity in his prior suit, his pre-
sent claims arise from a different set of facts unrelated in
HYATT   v. PATO                                          11

time, origin, or motivation to his prior unreasonable delay
claims.    Accordingly, claim preclusion does not bar his
present claims.
    The PTO’s argument that the two sets of claims arise
from the same set of transactional facts relies on a mis-
understanding of Mr. Hyatt’s claims. The PTO frames
Mr. Hyatt’s suit as a collateral attack on the agency’s
reopening prosecution for the 80 applications at issue in
his unreasonable delay case. But Mr. Hyatt’s present suit
does not seek any relief related to those 80 applications.
His claims challenge the PTO’s denial of his petition for
rulemaking and his complaint only seeks forward-looking
relief such as “[a] declaration that MPEP § 1207.04 is
unlawful,” “[a] declaration that the PTO . . . unlawfully
denied the Director Petition,” and “[a]n order enjoining
the PTO . . . from enforcing MPEP § 1207.04.” J.A. 23–24.
The requested relief makes clear that Mr. Hyatt is not
collaterally attacking the PTO’s prior prosecution reopen-
ings. 1
                             C
    The PTO next argues that Mr. Hyatt’s claims are
time-barred. In the absence of a specific statutory limita-
tions period, actions for judicial review against the United
States under the APA are subject to the statute of limita-

   1    Although claim preclusion does not bar Mr. Hy-
att’s challenge to MPEP § 1207.04 in this challenge to the
PTO’s denial of his petition for rulemaking, he does not
have free reign to raise similar challenges in any future
proceeding. Because Mr. Hyatt undoubtedly could have
challenged the validity of MPEP § 1207.04 in his unrea-
sonable delay suit, claim preclusion would bar him from
doing so in any future case arising from the PTO’s reopen-
ing of prosecution for the 80 applications at issue in his
prior case.
12                                            HYATT   v. PATO

tions in 28 U.S.C. § 2401(a). See Schwalier v. Hagel, 776
F.3d 832, 835 (Fed. Cir. 2015); Preminger v. Sec’y of
Veterans Affairs, 517 F.3d 1299, 1307 (Fed. Cir. 2008).
Section 2401(a) provides that “every civil action com-
menced against the United States shall be barred unless
the complaint is filed within six years after the right of
action first accrues.”
     A procedural challenge to an agency rulemaking un-
der the APA accrues at the time of final agency action.
Preminger, 517 F.3d at 1307. The promulgation of a
regulation is a final agency action. Id. Although the
issue has not been directly addressed by this court, other
circuits apply a separate standard to accrual for substan-
tive challenges to agency rulemaking. See Wind River
Min. Corp. v. United States, 946 F.2d 710, 714–15 (9th
Cir. 2001); see also Pub. Citizen v. Nuclear Regulatory
Comm'n, 901 F.2d 147, 152 (D.C. Cir. 1990). A substan-
tive challenge alleges that the agency acted in excess of
its constitutional or statutory authority. Wind River Min.
Corp., 946 F.2d at 715. For substantive challenges, the
right of action accrues either when the agency makes its
initial decision or at the time of an adverse application of
the decision against the plaintiff, whichever comes later.
Id. An agency’s denial of a plaintiff’s petition for rule-
making qualifies as an adverse application of the existing
rule against the plaintiff. Nw. Envtl. Advocates v. EPA,
537 F.3d 1006, 1019 (9th Cir. 2008). We see no reason to
depart from this precedent regarding the accrual date for
a substantive challenge.
    Here, Mr. Hyatt’s challenge to the PTO’s denial of his
petition for rulemaking is based on three challenges to
MPEP § 1207.04, two of which are time-barred. First,
Mr. Hyatt argues that the PTO promulgated MPEP
§ 1207.04 without providing public notice and an oppor-
tunity to comment. Because this challenge alleges a
procedural irregularity in the PTO’s adoption of the rule,
this right of action accrued at the time the agency made
HYATT   v. PATO                                          13

its initial decision to adopt MPEP § 1207.04. The PTO
added MPEP § 1207.04 to the MPEP in 2005. See MPEP
§ 1207.04 (8th ed. , rev. 3, Aug. 2005). Mr. Hyatt filed his
complaint in 2016. Thus, his notice-and-comment claim
was filed outside of the six-year statute of limitations
period and is time-barred.
    Mr. Hyatt argues that, although the PTO added
MPEP § 1207.04 to the MPEP in 2005, the PTO’s subse-
quent amendments to MPEP § 1207.04 in 2014 restarted
the statute of limitations. This court has not addressed
the impact of rule amendments on the statute of limita-
tions for procedural challenges to a rule. Mr. Hyatt urges
the adoption of the D.C. Circuit’s rule that treats an
amendment that “substantively alter[s]” the rule in a way
that “alter[s] the rights and obligations” of regulated
persons as restarting the statute of limitations. Mendoza
v. Perez, 754 F.3d 1002, 1019–20 (D.C. Cir. 2014).
    Even under the D.C. Circuit’s rule, however, the stat-
ute of limitations would not be reset by the PTO’s 2014
amendment to § 1207.04 because the amendment did not
substantively alter the rule. In Mendoza, the D.C. Circuit
determined that the Department of Labor substantively
altered the foreign worker visa process by altering sub-
stantive rights (e.g., minimum wage rates for sheep
herders) as well as procedural rules governing the visa
application process. Id. at 1019–20. Here, the PTO added
language to MPEP § 1207.04 providing that a new ground
of rejection raised by the examiner to reopen prosecution
could “include[] both a new ground that would not be
proper in the examiner’s answer as described in MPEP
§ 1207.03, subsection II and a new ground that would be
proper.” Compare MPEP § 1207.04 (8th ed., rev. 9, Aug.
2012), with MPEP § 1207.04 (9th ed., rev. 1, Mar. 2014).
These changes clarified the meaning of a term that al-
ready appeared in the original rule. They did not alter
the procedures by which an examiner reopened prosecu-
tion or alter the substantive rights of the applicant. Thus,
14                                             HYATT   v. PATO

the PTO’s amendments to MPEP § 1207.04 did not restart
the statute of limitations for Mr. Hyatt’s procedural
challenges.
     Mr. Hyatt also argues that the PTO’s reconsideration
of the issue of reopening prosecution in 2011 and 2013
restarted the statute of limitations. When “an agency’s
actions show that it has not merely republished an exist-
ing rule . . . , but has reconsidered the rule and decided to
keep it in effect,” the agency’s “renewed adherence” to the
rule is “substantively reviewable” even if a challenge to
the agency’s original adoption of the rule would be time-
barred. See Pub. Citizen, 901 F.2d at 150 (quoting Ass’n
of Am. R.Rs. v. ICC, 846 F.2d 1465, 1473 (D.C. Cir. 1988)).
Here, the PTO’s actions do not show any reconsideration
of the practices codified in MPEP § 1207.04. In 2011, the
PTO declined to alter the level of supervisory approval
necessary for an examiner to reopen prosecution. Rules of
Practice Before the Board of Patent Appeals and Interfer-
ences in Ex Parte Appeals, 76 Fed. Reg. 72,287 (Nov. 22,
2011). In 2013, the PTO adjusted its appeal fee struc-
tures to limit fees when an examiner reopens prosecution
after an appeal brief has been filed. Setting and Adjust-
ing Patent Fees, 78 Fed. Reg. 4,230–31 (Jan. 18, 2013).
While these issues tangentially relate to prosecution
reopening, the PTO’s discussion of them does not suggest
that it reconsidered whether examiners should be able to
reopen prosecution of an application after an applicant
files an appeal brief before the PTAB. Accordingly, the
PTO’s 2011 and 2013 discussions of related issues did not
restart the statute of limitations for Mr. Hyatt’s challeng-
es to MPEP § 1207.04.
    Mr. Hyatt’s argument that MPEP § 1207.04 conflicts
with 37 C.F.R. § 41.39 is also time-barred. This challenge
is not “substantive” because an agency can violate its own
regulations while remaining within its statutory and
constitutional authority. Nor is the challenge “procedur-
al” because an argument that two rules substantively
HYATT   v. PATO                                          15

conflict does not challenge how the agency adopted the
rules. Thus, for the purpose of determining when a right
of action accrues under § 2401(a), we view a claim that an
agency’s action conflicts with a preexisting regulation as a
policy-based challenge. Because the right of action for a
policy-based challenge to an agency action accrues at the
same time as the right of action for a procedural chal-
lenge, see Wind River Min. Corp., 946 F.2d at 715, the
latest that this right of action could have accrued was also
2005, outside the six-year statute of limitations period.
Thus, Mr. Hyatt’s claim that MPEP § 1207.04 conflicts
with 37 C.F.R. § 41.39 is also time-barred.
    Mr. Hyatt’s argument that MPEP § 1207.04 violates
35 U.S.C. § 6(b)(1), however, is timely. This claim con-
cerns the statutory authority of the PTO to adopt MPEP
§ 1207.04, which makes it a substantive challenge. The
PTO denied Mr. Hyatt’s petition for rulemaking in 2015,
which qualifies as an adverse application of MPEP
§ 1207.04 against him. See Nw. Envtl. Advocates, 537
F.3d at 1019. As a result, his right of action accrued in
2015, well within the limitations period.
                             D
    Because his other claims are time-barred, we only
consider the merits of Mr. Hyatt’s claim that the PTO
unlawfully denied his petition for rulemaking because
MPEP § 1207.04 violates 35 U.S.C. § 6(b)(1). Section
6(b)(1) requires that the PTAB “shall — (1) on written
appeal of an applicant, review adverse decisions of exam-
iners upon applications for patents pursuant to section
134(a).” Under 35 U.S.C. § 134(a), “[a]n applicant for a
patent, any of whose claims has been twice rejected, may
appeal from the decision of the primary examiner to the
Patent Trial and Appeal Board, having once paid the fee
for such appeal.” Mr. Hyatt argues that an examiner’s
ability to reopen prosecution after an appeal brief has
been filed deprives applicants of their right to maintain
16                                             HYATT   v. PATO

an appeal under § 6(b)(1). He contends that the statute’s
use of the term “shall” unambiguously requires the Board
to hear an appeal if an applicant files an appeal brief after
his claims have been twice rejected. He also contends
that the term “appeal” precludes PTO examiners from
unilaterally preventing review of their rejections.
     “Statutory interpretation begins with the language of
the statute.” Norfolk Dredging Co. v. United States, 375
F.3d 1106, 1110 (Fed. Cir. 2004). “A court derives the
plain meaning of the statute from its text and structure.”
Id. When the language of the statute is clear and unam-
biguous, the plain meaning of the statute is conclusive
absent special circumstances. Id.
    Here, the plain meaning of § 6(b)(1)’s text refutes
Mr. Hyatt’s arguments. Section 6(b) outlines the PTAB’s
duties. The statute’s mandatory language indicates that
the PTAB does not have discretion over whether to review
an examiner’s rejection of an application. But the text
does not require the PTAB to reach the merits of every
appeal that is filed. Section 134(a) explicitly conditions
an applicant’s ability to appeal on the payment of a fee.
Mr. Hyatt does not question the PTO’s authority to im-
pose procedural conditions that must be satisfied prior to
PTAB review, such as time limits and content restrictions
for the filing of an appeal brief. See 37 C.F.R. § 41.37.
Failure to comply with these procedural requirements can
result in dismissal of an appeal even after the applicant
has filed the written notice of appeal contemplated by
§ 6(b)(1). 37 C.F.R. § 41.37(c). Under current examina-
tion rules, an examiner’s decision not to reopen prosecu-
tion is another condition that must be satisfied before an
appeal reaches the Board. These conditions on the PTAB
reaching the merits of an appeal do not conflict with
§ 6(b)(1)’s requirement that the PTAB review rejections.
    The inclusion of the term “appeal” in § 6(b)(1) does not
alter this analysis. Mr. Hyatt asserts that “appeal” is a
HYATT   v. PATO                                         17

term of art that connotes an adverse party, here the PTO
examiner, cannot unilaterally prevent review. He cites
Black’s Law Dictionary, which defines “appeal” as “[a]
proceeding undertaken to have a decision reconsidered by
a higher authority; esp., the submission of a lower court’s
or agency’s decision to a higher court for review and
possible reversal.” Black’s Law Dictionary (10th ed.
2014). Even assuming Congress intended to adopt this
definition for § 6(b)(1), it does not support Mr. Hyatt’s
inference. The PTO’s rules allow applicants to seek
review of examiners’ final rejections before a higher
authority, the PTAB. Nothing in this definition of appeal
suggests the PTO cannot impose conditions on the PTAB’s
ability to reach the merits of an appeal or delay the ap-
peal. Allowing examiners to reopen prosecution does not
deprive applicants of their right to appeal final examiner
rejections because reopening prosecution cannot circum-
vent PTAB review. Once the examiner adds a new
ground of rejection, the applicant may immediately ap-
peal it along with the old grounds. MPEP § 1207.04.
    Mr. Hyatt expresses concern that examiners could use
repeated prosecution reopenings to prevent the PTAB
from ever reviewing application rejections.        But the
prospect that prosecution reopenings after the filing of an
appeal brief might be used abusively cannot override the
plain meaning of § 6(b)(1). Moreover, as Mr. Hyatt
knows, the APA offers a remedy for such situations by
enabling reviewing courts to compel agency actions un-
lawfully withheld or unreasonably delayed without ade-
quate reason or justification. 5 U.S.C. §§ 702, 706(1). Mr.
Hyatt’s prior petition for a writ of mandamus on the basis
of unreasonable delay failed because the PTO had already
recommenced its examination of his applications by the
time the district court reached the case’s merits. Hyatt,
146 F. Supp. 3d at 785–86. There is no evidence in the
record that, in the wake of that decision, PTO examiners
have repeatedly reopened prosecution of Mr. Hyatt’s
18                                             HYATT   v. PATO

applications for the purpose of further delaying PTAB
review.
                             III
     Mr. Hyatt’s petition for rulemaking relied on two
time-barred challenges to MPEP § 1207.04 and an errone-
ous interpretation of § 6(b)(1). The PTO’s denial of this
petition was not arbitrary and capricious. Therefore, we
affirm the district court’s grant of the PTO’s motion for
summary judgment. Because the district court had
jurisdiction over Mr. Hyatt’s claims, however, we reverse
the district court’s dismissal of Mr. Hyatt’s action for lack
of subject matter jurisdiction and remand for the court to
enter judgment in favor of the PTO consistent with this
opinion.
  AFFIRMED-IN-PART AND REVERSED-IN-PART
                           COSTS
     No costs.