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Federal Circuit decision affirms USPTO statutory interpretation, saves up to tens of thousands of patents from invalidity

Posted on June 22, 2016

A Federal Circuit decision this week affirmed the USPTO’s interpretation of the statute controlling filing of continuation applications, affirming that filing the continuation on the same day as issuance of the parent application falls within the meaning of “before.”  As a result of this ruling on technical requirements for patent priority claims, thousands or even tens of thousands of issued patents were likely saved from invalidity.

Since at least 1961, the USPTO has advised patent applicants that filing a continuation application on the same day as a parent application issues is sufficient to meet the statutory timing requirement for claiming “priority,” or the benefit of the earlier filing date for the parent application.  The statute governing priority of continuation, divisional, and continuation-in-part patent applications, 35 U.S.C. § 120, reads in relevant part (emphasis added):

An application for patent for an invention disclosed . . . in an application previously filed in the United States . . . shall have the same effect, as to such invention, as though filed on the date of the prior application, if filed before the patenting or abandonment of or termination of proceedings on the first application or on an application similarly entitled to the benefit of the filing date of the first application and if it contains or is amended to contain a specific reference to the earlier filed application.

That is, a continuation (or divisional) application must be filed “before” the issuance of the parent application in order to have “co-pendency” with that parent application, and therefore be entitled to the same priority as the parent application.  Any break in co-pendency within the priority chain for a continuation application can potentially invalidate the patent issuing on that application, and any patents issuing on subsequent continuation or divisional applications within the priority chain. 

In the USPTO’s Manual of Patent Examining Procedure (3rd ed., Nov. 1961), the term “before” was explicitly interpreted as encompassing the filing of the continuation on the same day as issuance of the parent application:

If the first application issues as a patent, it is sufficient for the second application to be co-pending with it if the second application is filed on the same day or before the patenting of the first application.

Since at least that time, patent applicants have filed continuations as late as the same day as issuance of the parent.  The USPTO’s statutory interpretation and the practice of same-day continuations were approved by at least one district court, in MOAEC, Inc. v. MusicIP Corp., 568 F. Supp. 2d 978, 982 (W.D. Wis. 2008).   

Last year, however, a Delaware district court took the opposite view, holding that “before” could not be effectively change to “on or before” in order to permit same-day continuations.  Moreover, the Delaware Court held, the Patent Office’s long-standing interpretation of the statute as permitting same-day continuations was not entitled to any weight (citations omitted):

The Court does not agree with Plaintiff that the PTO is entitled to Chevron deference on this issue. A court only defers to an administrative agency's construction of a statute where "the statute is silent or ambiguous with respect to the specific issue." 35 U.S.C. § 120 is not silent on when a continuation must be filed in order to get the parent's priority date. Nor is it ambiguous. It expressly states that the application must be filed "before" the parent application issues.

Because it determined that the co-pendency requirement for priority was not met, the Court ruled on summary judgment that four asserted patents were invalid as anticipated by the publications of foreign counterparts to earlier U.S. applications within the priority chain.

On appeal, the Federal Circuit looked to an 1864 Supreme Court decision approving same-day continuations as meeting co-pendency requirements.  The legislative history of the 1952 Patent Act, which first codified the current continuation application requirements, meant to preserve existing patent law where not expressly altered. Finally, the Court held, the longstanding administrative interpretation was not meaningfully at odds with the statutory language.  Absent an important policy reason – which had not been articulated by the accused infringer – established practice and expectations should not be disrupted.

Like the four patents at issue in the Delaware district court proceeding, thousands of patents previously maintained and enforced and thousands currently in force resulted from same-day continuations.  Most if not all of these patents were saved from invalidity by the Federal Circuit’s reversal of the lower court decision.