Appeal of Patent Claim Rejections
Robert J. Yarbrough
If a patent applicant’s claims are twice rejected by a patent examiner, the applicant can appeal that rejection to the Patent Trial and Appeal Board (“PTAB” or “Board”). Appeals from patent claim rejections are specifically authorized by 35 U.S.C. §134 and are the subject of this article. This article discusses PTAB rules applying to appeals filed on or after January 23, 2012. The prior rules apply to appeals filed prior to that date. A patent applicant dissatisfied with a Board decision can further appeal to the Court of Appeals for the Federal Circuit (“CAFC”) under 35 U.S.C. § 141. Appeals to the CAFC are beyond the scope of this article.
Any patent practitioner contemplating an ex parte patent appeal should review 37 CFR Part 41, MPEP §1200 and PTAB website. The MPEP provides pre-approved language for many of the required steps of the appeals process. Decisions of the Board also are available on the website.
Examples of two successful appeals appear at the end of this article, including the notices of appeal, appeal briefs and a request for pre-appeal brief review.
B. Effect of fee increases
PTO fee increases go into effect on March 19, 2013. The PTO will more than double the notice of appeal filing fee to $750.00 for a small entity. A new 'filing an appeal' fee of $1,250.00 for a small entity is due when briefing is complete and the matter is ready for review by the PTAB. If the matter is resolved with the examiner by reopening prosecution after the applicant submits the brief, then the 'filing an appeal' fee is not due.
The fee increases will price appeals out of the reach of many independent inventors and other small entity applicants. The fee increases will serve to insulate examiners from oversight and effectively will transfer power to the patent examiners.
C. Regulations controlling appeals
1. The rules of the Board control appeals and are found at 35 CFR Part 41.
The most recent rule set for the Board was promulgated on November 22, 2011 at 76 Fed. Reg. 72270 and applies to all appeals filed after January 22, 2012. The previous rules continue to apply to appeals filed prior to that date.
2. Changes in the November 22, 2011 rulemaking.
The 2011 rulemaking made several changes to speed the appeals process and to remove some of its legalistic impediments. Those changes include that all rejected claims are part of the appeal unless cancelled by the applicant. Previously, an applicant's mistake in omitting a claim from the listing of claims under appeal or in failure to address the claim specifically in the brief resulted in cancellation of the claim. The regulations include default assumptions if some of the parts of the brief are missing or incomplete, rather than rejecting the brief outright. Also, if the examiner's answer relies upon any evidence not relied upon in the office action under appeal, then the answer raises a new ground of rejection, which allows the applicant to elect to either proceed with the appeal or to reopen prosecution. The 2011 rulemaking makes other changes as well.
D. Appeal Procedure
1. Notice of Appeal
Rule 41.31(a) provides that the first step in appealing a second rejection by the examiner is to file a notice of appeal. The notice of appeal is not complicated, but must specify the action appealed from, must be signed, must include the necessary fee, and must be timely. The time for filing the notice of appeal is the same as for filing a response to an office action under Rule 1.134; namely, three months from the date of mailing of the office action. The period can be extended under rule 1.136 to a total of six months upon filing a petition and fee. The PTO recommends a separate letter for the notice of appeal and has published PTO/SB/31 as a notice of appeal form.
The notice of appeal fees are good until the Board issues a final decision; therefore, if prosecution is reopened for any reason after the fee is paid, the fee can be applied to any subsequent appeal prior to the final decision of the Board. From MPEP §1205.01, the PTO contemplates that an appeal can be used in conjunction with a revival of an application, as where the applicant inadvertently does not appeal within six months of the date of the office action.
2. Pre-Appeal Brief Conference
In the OG Notice of 12 July 2005, the PTO allowed an applicant to
request a "pre-appeal brief conference" as a pilot program beginning
in 2006. The pilot program was extended indefinitely by the OG
Notice of 07 February 2006 and is still in effect as of this writing
Procedure: At the time of filing a notice of appeal, the applicant may request that the rejection be reviewed by a panel of examiners and must submit a written argument of not more than five pages in length. The panel generally will consist of the examiner who made the rejection under appeal, the examiner's SPE and a third examiner. After review, the panel can elect to reopen prosecution, to allow the pending claims while leaving prosecution closed, to allow the application to remain on appeal, or to reject the request on procedural grounds.
The Pre-Appeal Brief Conference offers a relatively low cost mechanism to obtain review of an examiner’s decision by someone other than the examiner. The Pre-Appeal Brief Conference would appear to be most useful where the applicant does not believe that the examiner is competent or willing to evaluate fairly the applicant’s arguments.
3. Appeal Brief
The applicant must file an appeal brief within two months of receipt of the notice of appeal by the PTO and must include the brief filing fee. If the applicant requested a pre-appeal brief conference, the time for filing the appeal brief is extended to thirty days after the conference panel renders its decision. The extension of time provisions of §1.136(a) apply to appeal briefs, so the applicant can purchase more time to file. The time will be extended by up to five months upon payment of the specified fee. The time can be extended beyond five months in extraordinary circumstances and upon filing a petition. Failure to file the appeal brief in the allowed time results in abandonment of the application if there are no allowed claims. The application can be revived upon payment of the revival fees, provided the abandonment was inadvertent.
The MPEP states that the brief must contain the following, in the following order:
a. a statement of the real party in interest. The purpose of this section is to allow the Board to avoid conflicts of interest. The real party in interest will be the inventor, an assignee, a parent corporation or the participants in a joint venture.
b. a statement of related appeals, interferences and judicial proceedings relating to the application. If there are any, copies of decisions in those appeals or proceedings must accompany the brief as an appendix. The 'related proceedings' include proceedings in which the applicant's legal representative is involved. 'Related proceedings' is interpreted broadly by the PTO, and includes co-pending applications having common subject matter.
c. a statement of the status of pending claims (rejected, allowed, withdrawn, objected to, cancelled) and an identification of the claims that are appealed.
d. a statement of the status of amendments filed after final rejection. Some claim amendments are allowed after final rejection; for example, to place claims in better form for appeal or to meet form objections. This statement advises the Board as to whether the examiner entered those amendments.
e. a summary of the subject matter of the independent claims, supported by references to the specification and the drawings by page and line number and by element number. All 'means' claims must include reference to the specification and drawing references corresponding to the claimed means.
f. a statement of the grounds for rejection to be reviewed. For example: "whether claims 1 and 2 are unpatentable under 35 USC 103 over Smith in view of Jones."
g. the argument, which presents the applicant reasons why the decision of the examiner should be reversed. The argument is supported by authority and by citation to the record. The record consists of everything that was before the examiner when the examiner made his or her decision, including the application and any affidavits or other evidence submitted to the examiner by the applicant.
The applicant cannot attach new evidence to the brief that was not in the record and cannot rely upon any evidence that was not in the record. If the applicant needs affidavits or other evidence to support an appeal, the applicant should file an RCE or continuation application and present the evidence to the examiner. If the examiner again rejects the claim in light of the new evidence, then the applicant can appeal that rejection to the Board and cite the evidence to the Board.
One important aspect of an appeal brief relates to arguments that apply to more than one claim. The applicant can present the argument separately for each claim. Alternatively, the applicant can lump the claims together and apply the argument to the group of claims. If the applicant lumps the claims together, the Board will pick one claim as representative and consider the argument in light of that claim. All claims will rise or fall based on the Board's review of the representative claim.
The applicant can file a supplemental paper if an authority becomes available after filing the brief, such as a new published court decision.
h. a 'claims appendix' will reproduce all of the claims under consideration in the appeal. The claims are clean and are not marked.
i. an 'evidence appendix' will include all of the evidence to be considered by the Board.
j. a 'prior actions' appendix to provide prior decisions of the Board or of a court.
The MPEP indicates that the above list is the minimum for the appeal brief and the brief may include other information such as a table of cases, list of references or table of contents. The PTO suggests adding a title page and a table of contents to the minimum list described above.
4. MPEP brief requirements inconsistent with the regulations
One point of interest is that the most recent rules and the MPEP are inconsistent in the requirements of what must go into the appeal brief of the applicant. The rule preamble states as follows, at 73 FR 72271column 1:
...the goal of this final rule to effect an overall lessening of the burden on appellants and examiners to present an appeal to the Board. ...[S]tatements of the status of claims, the status of amendments and the grounds of rejections to be reviewed on appeal are no longer required in the appeal brief... or in the examiner's answer.
Similarly, the final rule no longer requires appellants to file an evidence appendix or a related proceedings appendix.
The importance of the listed omissions from the rules is that the brief will no longer be rejected as non-compliant if it does not contain the statement of status, status of amendments or the grounds for rejection.
5. Amendments to support the appeal
37 CFR §1.116, 37 CFR 41.33 and MPEP 1206 relate to amendments and affidavits after final rejection.
Amendments after final rejection in conjunction with an appeal are divided into two groups: amendments made prior to filing the appeal brief and amendments made after filing the brief. The only claim amendments allowed after filing the notice of appeal and prior to filing the appeal brief are: to (a) cancel claims, (b) comply with requirements as to form required by the examiner, (c) to present a rejected claim in 'better form' for appeal, and (d) other amendments if the applicant can present a good reason why the amendment was not presented earlier. I suspect that a new grounds for rejection in a final rejection would be a sufficient reason for a claim amendment after final to overcome the new grounds for rejection.
After the brief is filed, the amendments may only (a) cancel claims, and (b) place dependent claims in independent form. Claims can be placed in dependent form either by making the dependent claim independent or by amending the independent claim to include the limitations of the dependent claim.
6. Filing Affidavits or Exhibits to support the Appeal
According to MPEP 1206(II), An affidavit or other evidence can be submitted after final rejection before or on the same date as filing the notice of appeal, but only if (a) the affidavit or exhibit overcomes all rejections and (b) the applicant provides a good reason for not submitting the affidavit earlier. As before, I suspect that a new citation or argument from the examiner in the final office action would be adequate justification for an after-final affidavit or exhibit to overcome the new citation or argument.
Otherwise, no new affidavits or exhibits are allowed. If the examiner's answer includes a new ground for rejection, the applicant can ask to reopen prosecution and submit affidavits or exhibits to counter the new ground. Otherwise, no new evidence or affidavits is allowed absent filing a continuation application or RCE and terminating the appeal.
7. Review of the Appeal Brief for compliance with form requirements.
Since March, 2010, the Board reviews appeals briefs for compliance with filing requirements, not the examiner. The examiner does not see the brief before it is accepted by the Board. The prior procedure, where the examiner determined whether a brief met form requirements, was an endless source of frustration for practitioners and subject to abuse by examiners.
For briefs filed prior to January, 2012, paralegals employed by the Board review the appeals brief to determine whether the brief meets all of the requirements above. For briefs filed after January 2012, the Board's paralegals now look only for a summary of the claims under appeal and the claims appendix.
8. Examiner's Answer
Once the appeal brief is forwarded to the examiner by the Board, the
examiner considers the brief. The examiner can elect to reopen
prosecution to enter a new ground for rejection (or just enter a new
ground - see below). The examiner can elect to withdraw the final
rejection and allow the patent to issue, or the examiner can
maintain the appeal by filing an answer to the appeal.
As a matter of internal PTO procedure, the examiner, a SPE and another examiner will conduct a 'conference' to consider the issues raised by the appeal brief. If the Board determines that the examiner's answer does not include notations by the conferees indicating the conference was held, the Board is supposed to send the matter back to the technology center to hold a conference.
The examiner can raise a new ground for rejection in the answer (with the approval of the TC Director), in which case the applicant can elect either to proceed with the appeal or to reopen prosecution. The new grounds will be identified in examiner's 'grounds for rejection' section. When the applicant receives the examiner's answer, the applicant MUST review this section and identify any new grounds or risk loss of the appeal by failure to file the required reply brief within two months. This is a trap for the unwary. If the applicant needs evidence to counter the new ground of rejection, then the applicant must request to reopen prosecution and submit the evidence.
Of interest, MPEP 1207.02 invites the examiner to copy and paste language from the office action into the appeals brief.
The examiner is not allowed to raise a new ground to reject a previously allowed or objected-to claim, but can reopen prosecution to reject the previously allowed claim.
9. Time for the Examiner's Answer
The examiner is supposed to provide his or her answer within two months after the applicant's brief is submitted.
10. Applicant's Reply Brief
The applicant can elect to either reopen prosecution or proceed with
the appeal when the examiner cites a new grounds for rejection.
Again, the applicant MUST take action within two months, or the
appeal is dismissed. The time extensions of §1.136 do not apply and
the two-month period cannot be extended. If the new grounds do not
extend to all of the claims on appeal, then the affected claims are
cancelled, but the remaining claims are not affected.
If the applicant elects to proceed with the appeal, the reply brief must include the following:
a. a cover page as used for other PTO documents.
b. status of the claims.
c. grounds for rejection for review.
The reply brief cannot include exhibits or amendments. If it does, it is treated as an election to reopen prosecution.
11. Supplemental Replies by the Examiner
Supplemental replies come up in two situations:
(a) If the reply brief raises a new issue, the examiner may file a supplemental answer. Briefing stops at that point and the matter goes to the Board.
(b) The examiner also may file a supplemental answer if the Board, after considering the briefs, remands the application to the examiner for further consideration of the rejection. The applicant MUST file a response within two months to the examiner's supplemental answer from a remand or lose the appeal. Again, the applicant has the option of either reopening prosecution or proceeding with the appeal.
E. Matters that are Not Appealable
There are matters that are outside of the Boards jurisdiction. Those matters include the examiner’s refusal to enter a response or amendment and refusal to withdraw a restriction requirement. The applicant’s remedy to address a non-appealable decision of the examiner is to file a petition under Rule 1.182 (invoking the general supervisory authority of the Director), to file a petition under Rule 1.144 (relating to restrictions), to file a request for continuing examination (“RCE”) under Rule 1.114 to continue prosecution, or to file a divisional application to address restricted claims. If an issue is not appealable, then the examiner’s decision will not be reviewed by the Board and any objection to the examiner’s decision not raised by petition is waived.
According to the metrics published on the PTAB website, the Board began fiscal year 2013 with 26,670 pending ex parte appeals from claim rejections. During the month of November, 2012, the most recent period as of this writing for which information is available, the Board received 1,969 new appeals and issued 1765 decisions. These numbers make it appear that the Board is losing ground; however, the numbers do not reflect notices of appeal that are filed but never make it to the Board. An appeal may not be decided by the Board for several reasons - the matter is decided on a pre-appeal brief conference, the examiner reopens prosecution after receiving the appeal brief, or the applicant chooses not to file a brief.
The Board reports that as of early 2013, it currently is deciding chemical and biotech appeals filed in 2011, electrical appeals filed in 2009 and mechanical appeals filed in 2010.
G. Appeal Results
According to the Board, for decisions from ex parte appeals decided in fiscal year 2013 through November 2012, the Board affirmed the examiner's rejection in 54% of decisions, reversed the examiner in 28.7 % of decisions and affirmed in part (or reversed in part) in 14.3% of decisions. The Board does not disclose whether 'affirmed in part' means that the applicant actually had claims allowed.
As noted above, the applicant also may find relief in the pre-appeal brief conference stage. As of 2010, a total of 12,019 pre-appeal brief conferences were held, which was 34% of the total appeals filed. Of that number, 56% of the office actions were affirmed (that is, the conferees did not modify the actions of the examiner), prosecution was reopened in 38% of cases and the examiner reversed in 5% of cases. The usual result when prosecution is reopened is that the application is rejected on other grounds.
Appeal to the Patent Trial and Appeal Board is a useful remedy for patent practitioners, inventors and invention owners. The fee increases reduce its usefulness.
The following are examples of two successful appeals from patent claim rejections.
1. In re application of Nancy C. Frye, application no. 10/790,923
2. In re application of Nichols, et. al., application no. 11/465,498
a. Notice of Appeal
b. Appeal Brief
c. Non-final rejection (prosecution reopened by examiner)
d. Applicant's response to the non-final rejection
e. Final rejection
f. Appeal Brief
g. Notice of defective appeal brief (at the time, review of appeals briefs for form was under the control of the examiner).
h. Appeal Brief
i. Examiner's answer
j. Decision by the Board