Tafas v. Dudas et al

Filing 247

Memorandum in Opposition re 135 MOTION for Summary Judgment of Triantafyllos Tafas filed by Jon Dudas, The United States Patent and Trademark Office. (Attachments: # 1 Exhibit 1 (part 1 of 3)# 2 Exhibit 1 (part 2 of 3)# 3 Exhibit 1 (part 3 of 3))(Wetzler, Lauren)

Tafas v. Dudas et al

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UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA Alexandria Division TRIANTAFYLLOS TAFAS, Plaintiff, v. JON W. DUDAS, et al., Defendants. ) ) ) ) ) ) ) ) ) )

Civil Action No. 1:07cv846(L) (JCC/TRJ)

CONSOLIDATED WITH SMITHKLINE BEECHAM CORPORATION, et al., Plaintiffs, v. JON W. DUDAS, et al., Defendants. ) ) ) ) ) ) ) ) ) ) )

Civil Action No. 1:07cv1008 (JCC/TRJ)

DEFENDANTS' MEMORANDUM IN OPPOSITION TO PLAINTIFF TRIANTAFYLLOS TAFAS'S MOTION FOR SUMMARY JUDGMENT Of Counsel: JAMES A. TOUPIN General Counsel STEPHEN WALSH Acting Deputy General Counsel and Solicitor WILLIAM COVEY Deputy General Counsel WILLIAM G. JENKS JANET A. GONGOLA NATHAN KELLEY WILLIAM LAMARCA Associate Solicitors JENNIFER M. MCDOWELL Associate Counsel United States Patent and Trademark Office CHUCK ROSENBERG UNITED STATES ATTORNEY LAUREN A. WETZLER RALPH ANDREW PRICE JR. R. JOSEPH SHER Assistant United States Attorneys Attorneys for All Defendants Justin W. Williams U.S. Attorney's Building 2100 Jamieson Avenue Alexandria, Virginia 22314 Tel: [phone] Fax: [phone] [e-mail]

Dockets.Justia.com

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TABLE OF CONTENTS Page TABLE OF AUTHORITIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii ARGUMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 I. TA FA S'S ANCILLARY ARGUMENTS FAIL TO ESTABLISH THAT THE FINAL RULES CONFLICT WITH THE PATENT ACT. . . . . . . . . . . . . . . . . . . . . . . 1 A. Final Rules 75 and 265 Do Not Impermissibly Alter Burdens of Proof. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Final Rule 78(f)(2) Does Not Alter Burdens of Proof. . . . . . . . . . . . . . . . . 4 Final Rule 78(f) Comports with Section 122.. . . . . . . . . . . . . . . . . . . . . . . 5 Final Rule 78(d) Is Consistent with Section 121, Which Permits a "Divisional Application" in Response to a Restriction Requirement. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Final Rule 78(d)(ii)(B) Does Not Implicate, Let Alone Conflict with, the "Objectives" of the Bayh-Dole Act (35 U.S.C. § 200). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Final Rule 75 Tracks Statutory Definitions Set Forth in Sections 41 and 112. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Tafas May Not Challenge the Final Rules's Retention of First Action Final Rejection Practice.. . . . . . . . . . . . . . . . . . . . . . . . . . 12

B. C. D.

E.

F.

G.

II. III.

TH E FINAL RULES ARE NOT ARBITRARY OR CAPRICIOUS. . . . . . . . . . . . . . . . . . . 14 TH E FINAL RULES DO NOT IMPLICATE "SECONDARY RETROACTIVITY" CONCERNS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 TA FA S'S PATENT CLAUSE CLAIMS FAIL.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 ALTHOUGH THEY ARE PROCEDURAL, THE FINAL RULES COMPLY WITH THE APA'S NOTICE ANDCOMMENT PROVISIONS. . . . . . . . . . . . . 23 A. The Proposed Rules Provided Sufficient Notice of the Additional Final Rules Identified by Tafas. . . . . . . . . . . . . . . . . . . . . . . . 23

IV. V.

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B.

The Information Provided by the USPTO Was Sufficiently Complete. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

VI.

TH E FINAL RULES COMPLY WITH THE REGULATORY FLEXIBILITY ACT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 A. The USPTO Considered Significant Alternatives and Took Efforts to Minimize Cost Impacts on Small Entities.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 The Assumptions Underlying the USPTO's RFA Certification are Reasonable and Supported by the Administrative Record. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 The USPTO's RFA Certification Properly Accounted for all Costs of Filing an ESD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 The Agency Properly Certified that the Rules Do Not Impose a Significant Economic Impact on a Substantial Number of Small Entities.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

B.

C.

D.

VII.

TH E FINAL RULES COMPORT WITH INTERNATIONAL TREATIES, BUT THE ISSUE IS NOT PROPERLY BEFORE THIS COURT.. . . . . . . . . . . . . . . . . . . . 38

CONCLUSION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 CERTIFICATE OF SERVICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

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TABLE OF AUTHORITIES Page CASES A.F. Stoddard & Co. v. Dann, 564 F.2d 556 (D.C. Cir. 1977). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21, 22 Abbott Labs. v. Gardner, 387 U.S. 136 (1967).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Air Transport Ass'n of Am. v. Civil Aeronautics Bd., 732 F.2d 219 (D.C. Cir. 1984). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25, 26, 27 Anderson v. Aset Corp., 329 F. Supp. 2d. 380 (W.D.N.Y. 2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Alenco Comm'n Inc. v. FCC, 201 F.3d 608 (5th Cir. 2000). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29, 30 Animal Legal Def. Fund v. Quigg, 932 F.2d 920 (Fed. Cir. 1991) ("ALDF"). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Ass'n of Am. Physicians & Surgeons, Inc. v. U.S. Dept. of Health & Human Servs., 224 F. Supp.2d 1115 (S.D. Tex. 2002) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16, 29 Ass'n of Data Processing Serv. Org., Inc. v. Bd. of Governors of the Fed. Reserve Sys., 745 F.2d 677 (D.C. Cir. 1984). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Assoc. Fisheries, Inc. v. Daley, 127 F.3d 104 (1st Cir. 1997). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 30 Bowen v. Georgetown University Hospital, 488 U.S. 204 (1988).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Bristol-Myers Squibb Co. v. Pharmachemie B.V., 361 F.3d 1343 (Fed. Cir. 2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Bruno Indep. Living Aids, Inc. v. Acorn Mobility Servs. Ltd., 394 F.3d 1348 (Fed. Cir. 2005). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 5 Cactus Corner v. USDA, 346 F. Supp. 2d 1075 (E.D. Cal. 2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Califano v. Sanders, 430 U.S. 99 (1977).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 iii

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Camp v. Pitts, 411 U.S. 138 (1973).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Carpenter v. Sec'y of Veterans Affairs, 343 F.3d 1347 (Fed. Cir. 2003). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 32 Chamber of Commerce of U.S. v. SEC, 443 F.3d 890 (D.C. Cir. 2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Chevron USA, Inc. v. NRDC, Inc., 467 U.S. 837 (1984).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1, 3 Cmty. Nutrition Inst. v. Block, 749 F.2d 50 (D.C. Cir. 1984). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25, 27 Conference of State Bank Supervisors v. Office of Thrift Supervision, 792 F. Supp. 837 (D.D.C. 1992). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Conn. Light & Power Co. v. NRC, 673 F.2d 525 (D.C. Cir. 1982). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Eldred v. Ashcroft, 537 U.S. 186 (2002).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21, 22 Envtl. Def. Ctr., Inc. v. EPA, 344 F.3d 832 (9th Cir. 2003). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 34 Figueroa v. United States, 57 Fed. Cl. 488 (2003). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Figueroa v. United States, 466 F.3d 1023 (Fed. Cir. 2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21, 22 Fressola v. Manbeck, 1995 WL 656874, at *1 (D.D.C. 1995). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Graham v. John Deere Co. of Kansas City, 383 U.S. 1 (1966).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20, 21 Grand Canyon Air Tour Coal. v. FAA, 154 F.3d 455 (D.C. Cir. 1998). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Grocery Serv., Inc. v. USDA Food & Nutrition Serv., 2007 WL 2872876 (S.D. Tex. Sept. 27, 2007). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

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Hanover Potato Prods., Inc. v. Shalala, 989 F.2d 123 (3d Cir. 1992).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 In re Bogese, 22 U.S.P.Q. 2d 1821 (Comm'r Pat. 1991). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13, 14 In re Epstein, 32 F.3d 1559 (Fed. Cir. 1994) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 In re Oetiker, 977 F.2d 1443 (Fed. Cir. 1992). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3, 5 In re Piasecki, 745 F.2d 1468 (Fed. Cir. 1984). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 In re Rath, 402 F.3d 1207 (Fed. Cir. 2005). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 In re Schneller, 397 F.2d 350 (C.C.P.A. 1968). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 In re Thorpe, 777 F.2d 695 (Fed. Cir. 1985). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 In re Van Ornum, 686 F.2d 937 (Fed. Cir. 1982). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Landgraf v. USI Film Products, 511 U.S. 244 (1994).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Little Bay Lobster Co., Inc. v. Evans, 352 F.3d 462 (1st Cir. 2003). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Long Island Care at Home, Ltd. v. Coke, 127 S. Ct. 2339 (2007).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Merck & Co., Inc. v. Kessler, 80 F.3d 1543 (Fed. Cir. 1996). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 21 Molins PLC v. Quigg, 837 F.2d 1064 ( Fed. Cir. 1988).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Motor Vehicle Mfrs. Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29 (1983).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

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N.C. Fisheries Ass'n, Inc. v. Gutierrez, 2007 WL 2331048, *24 (D.D.C. Aug. 17, 2007). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Nat'l Ass'n of State Utility Consumer Advocates v. FCC, 372 F.3d 454 (D.C. Cir. 2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Nat'l Coal. for Marine Conserv. v. Evans, 231 F. Supp.2d 119 (D.D.C. 2002). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 New Motor Vehicle Bd. of Cal. v. Orrin W. Fox Co., 439 U.S. 96 (1978).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim North Carolina Fisheries Ass'n v. Daley, 27 F. Supp. 2d 650 (E.D. Va. 1998). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Novo Hydro Can, Inc. v. United States, 472 F.3d 1347 (Fed. Cir. 2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Ribis v. Mike Barnard Chevrolet-Cadillac, Inc., 468 F. Supp. 2d 489 W.D.N.Y. 2007). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13, 20, 24, 39 Salt Inst. v. Leavitt, 440 F.3d 156 (4th Cir. 2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Small Refiner Lead Phase-Down Task Force v. EPA, 705 F.2d 506 (D.C. Cir. 1983). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 South Offshore Fishing Association v. Daley, 995 F. Supp. 1411 (M.D. Fla. 1998). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32, 34, 35 Star Fruits S.N.C. v. United States, 393 F.3d 1277 (Fed. Cir. 2005). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3, 5 Stevens v. Tamai, 366 F.3d 1325 (Fed. Cir. 2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 4, 5 Studiengesellschaft Kohl mbh v. N. Petrochemical Co., 784 F.2d 351 (Fed. Cir. 1986). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Suramerica de Aleaciones Laminadas, C.A. v. United States, 966 F.2d 660 (Fed. Cir. 1992). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Tafas v. Dudas, -- F. Supp. 2d --, 2008 WL 112043 (E.D. Va. Jan. 9, 2008) ("Tafas II"). . . . . . . . passim

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Tozzi v. EPA, 148 F. Supp. 2d 35 (D.D.C. 2001). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 U.S. Cellular Corp. v. FCC, 254 F.3d 78 (D.C. Cir. 2001). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 30, 38 United States v. Mead Corp., 533 U.S. 218 (2001).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Washington v. Daley, 173 F.3d 1158 (9th Cir. 1999). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 CONSTITUTION U.S. Const. art. I, § 8, cl. 8.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20, 22 STATUTES 5 U.S.C. § 553. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 5 U.S.C. §§ 601-612. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19, 27 5 U.S.C. § 704. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 5 U.S.C. § 706. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 5 U.S.C. § 706(2)(A). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8, 14, 39 35 U.S.C. § 2(b)(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 5 35 U.S.C. § 2(b)(2)(B). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 35 U.S.C. § 41. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10, 11, 12 35 U.S.C. § 41(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 35 U.S.C. § 101. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 4, 11 35 U.S.C. § 102. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 35 U.S.C. § 103. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 35 U.S.C. § 111. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 35 U.S.C. § 112. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim

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35 U.S.C. § 120. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8, 13 35 U.S.C. § 121. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim 35 U.S.C. § 122. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 35 U.S.C. § 131. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3 35 U.S.C. § 132. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 35 U.S.C. § 132(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12, 13, 14 35 U.S.C. § 151. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3 35 U.S.C. § 156(b)(2)(B). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 35 U.S.C. § 200. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 35 U.S.C. §§ 202-10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 44 U.S.C. § 3501. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 44 U.S.C. § 3516. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 LEGISLATIVE MATERIALS H.R. Rep. 94-592 (1975), reprinted at 1975 U.S.C.C.A.N. 1220. . . . . . . . . . . . . . . . . . . . . . . . . 39 EXECUTIVE ORDERS Exec. Order No. 12,866, 58 Fed. Reg. 51735 (Sept. 30, 1993). . . . . . . . . . . . . . . . . . . . . . . . . . . 16 REGULATIONS 37 C.F.R. § 1.56 (2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3 37 C.F.R. § 1.62 (1996) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 37 C.F.R. § 1.75(c) (2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11, 12 37 C.F.R. § 1.78(b) (2006).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 37 C.F.R. § 1.105 (2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3 37 C.F.R. § 1.183 (2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 6

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37 C.F.R. § 1.321 (2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 FEDERAL REGISTER Changes To Practice for Continued Examination Filings, Patent Applications Containing Patentably Indistinct Claims, and Examination of Claims in Patent Applications; Final Rule, 72 Fed. Reg. 46716 (Aug. 21, 2007) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim Changes to Practice for Continuing Applications, Requests for Continuing Examination Practice, and Applications Containing Patentably Indistinct Claims, 71 Fed. Reg. 48 (Jan. 3, 2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Changes to Practice for the Examination of Claims in Patent Applications, 71 Fed. Reg. 61 (Jan. 3, 2006). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Notice, 71 Fed. Reg. 30,662 (May 30, 2006).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 TREATIES Paris Convention for the Protection of Industrial Property, July 14, 1967, 21 U.S.T. 1583. . . 8, 39 Patent Cooperation Treaty ("PCT"), Jan. 24, 1978, 28 U.S.T. 7645. . . . . . . . . . . . . . . . . . . . 39, 40 MANUAL OF PATENT EXAMINATION PROCEDURE MPEP § 608.01(n). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 MPEP § 702. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 MPEP § 706.07(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12, 13 MPEP § 724. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 MPEP § 724.04(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 MPEP § 806.04 (d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 MPEP § 809.02. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 MPEP § 809.02(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 MPEP § 1302.04. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 MPEP § 1490. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 MPEP § 2113. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 ix

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MISCELLANEOUS 4A Chisum on Patents § 14.02[4] (2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 GO O D WILL AND OTHER INTANGIBLE ASSETS, Statement of Fin. Accounting Standards No. 142 (Fin. Accounting Standards Bd. 2001).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34, 37

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Defendants Jon W. Dudas and the United States Patent and Trademark Office (collectively "USPTO" or "Office") respectfully oppose Plaintiff Triantafyllos Tafas's ("Tafas") cross-motion for summary judgment. This memorandum addresses only those claims that Tafas raises but that the GlaxoSmithKline Plaintiffs ("GSK") do not. To the extent that Tafas's arguments overlap with those of GSK, the USPTO addresses those arguments in its memorandum opposing GSK's cross-motion for summary judgment. The USPTO respectfully recommends that the Court first read the memorandum that responds to GSK's cross-motion for summary judgment before turning to this brief. ARGUMENT I. TA FA S'S ANCILLARY ARGUMENTS FAIL TO ESTABLISH THAT THE FINAL RULES CON F LIC T WITH THE PATENT ACT Tafas challenges the Final Rules on a variety of grounds beyond those already addressed in the USPTO's opposition to GSK's summary judgment motion.1 These arguments are largely distractions from the core issues in this case and are uniformly without merit. They must, of course, be considered within the framework of Chevron deference elaborated in the USPTO's opening brief and in its opposition to GSK's summary judgment motion. Chevron USA, Inc. v. NRDC, Inc., 467 U.S. 837 (1984); Mem. in Supp. of Defs. Mots. for Summ. J. ("USPTO Mem."), Dkt. No. 127, at 13-17; Defs. Mem. in Opp. to the GlaxoSmithKline Pls. Mot. for Summ. J. ("USPTO GSK Opp."), at Part I.A. A. Final Rules 75 and 265 Do Not Impermissibly Alter Burdens of Proof

Tafas's approach to attacking Final Rules 75 and 265, is different, but no more persuasive

Changes To Practice for Continued Examination Filings, Patent Applications Containing Patentably Indistinct Claims, and Examination of Claims in Patent Applications; Final Rule, 72 Fed. Reg. 46716 (Aug. 21, 2007) ("Final Rules") (Ex. 1 to Mem. in Supp. of Defs. Mots. for Summ. J. ("USPTO Mem."), Dkt. No. 127). 1

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than GSK's approach. Tafas argues that Final Rules 75 and 265 ("the 5/25 Rule") violate the Patent Act by "impermissibly shift[ing] the burden of proving when an application should issue to the applicant." Pl. Triantafyllos Tafas' Mem. of Law in Supp. of Summ. J. Mot. ("Tafas Mem."), Dkt. No. 141, at 13. This is incorrect both as a matter of fact and law. As a factual matter, by requiring an examination support document ("ESD") when applicants present more than 5/25 claims for examination, the Office is not transferring to applicants its own duty under 35 U.S.C. §§ 131 and 151 to examine an application and determine whether the claimed invention is patentable. Nor is the Office asking applicants to come forward with a prima facie case of patentability, diverging from current practice where the examiner makes a prima facie case of unpatentability. See In re Oetiker, 977 F.2d 1443, 1445 (Fed. Cir. 1992). Instead, Final Rules 75 and 265 merely require an applicant who files a large number of claims to assist the examiner by providing additional information about the claims, which the examiner will use in examining the application. The applicant is not required to prove that any material is patentable or conduct the examination for the examiner. See 72 Fed. Reg. at 46805. Furthermore, notwithstanding the USPTO's adoption of the prima facie case mechanism, it is well-established that the USPTO may promulgate rules that place on the applicant the burden of coming forward with information to assist in examination. It is well-settled, for example, that the USPTO has authority under 37 C.F.R. § 1.56 (2006) to require applicants to present information known to them that is material to examination. See, e.g., Bruno Indep. Living Aids, Inc. v. Acorn Mobility Servs., Ltd., 394 F.3d 1348, 1352 (Fed. Cir. 2005). Likewise, under 37 C.F.R. § 1.105 (2006), an examiner may require an applicant to produce "such information as may be reasonably necessary to properly examine or treat the matter." As the Federal Circuit held in Star Fruits S.N.C. v. United States, 393 F.3d 1277 (Fed. Cir. 2005), an examiner may properly

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declare an application abandoned for failure to comply with a request under § 1.105, even though the applicant contended the requested information could not provide the basis for an unpatentability rejection on the merits. This is because the USPTO has "inherent authority . . . to require information from an applicant," which extends beyond what would be material under § 1.56. Id. at 1282. Even if the Court were to find that Final Rules 75 and 265 shift the burden of proof to the applicant, however, Tafas fails to cite any section of the Patent Act unambiguously establishing that the USPTO must bear the burden of coming forward with prima facie evidence of unpatentability. The sections he cites ­ 35 U.S.C. §§ 101, 111, 112, 131, and 151 ­ say nothing of the sort, and as the Federal Circuit has acknowledged, the origin of the current burden-shifting practice is "uncertain." In re Piasecki, 745 F.2d 1468, 1472 (Fed. Cir. 1984). Moreover, the only case Tafas cites, Oetiker, does not purport to interpret the Patent Act, but simply describes the USPTO's current practice of having the examiner come forward with a prima facie case of unpatentability. In the absence of unambiguous language requiring the USPTO to bear the burden to come forward with a prima facie case, the USPTO may enact reasonable regulations altering this practice, provided it has the power to do so under 35 U.S.C. § 2(b)(2).2 See United States v. Mead Corp., 533 U.S. 218, 229 (2001); Chevron, 467 U.S. at 842-431. Oetiker establishes that the USPTO has such authority, for it makes clear that "the prima facie case is a procedural tool," id. ­ precisely the type of tool that even Tafas would admit the USPTO has authority to alter. See also Piasecki, 745 F.2d at 1472. Thus, in Stevens v. Tamai, 366 F.3d 1325 (Fed. Cir. 2004), the Federal Circuit affirmed the USPTO's authority to set burdens of At least two judges of the Federal Circuit have noted the anomaly of a regime that does not place the burden of proof on the party seeking a government grant of exclusive rights and implied that the statute may not require that outcome. See In re Epstein, 32 F.3d 1559, 1570 (Fed. Cir. 1994) (Plager, Cowen, J.J. concurring). 3
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proof in interference proceedings. See id. at 1333 ("[T]he Office can allocate the burdens associated with this goal in a reasonable manner not inconsistent with the existing statutory scheme.") (citing Merck & Co, Inc. v. Kessler, 80 F.3d 1543, 1549 (Fed. Cir. 1996)). Finally, contrary to Tafas's suggestion, there is no loss of substantive rights because the Final Rules do not alter the substantive criteria for allowing and rejecting applications. See 35 U.S.C. § 101, 102, 103 & 112. The USPTO will still only reject applications on the merits if the evidence of record establishes a prima facie case of unpatentability.3 B. Final Rule 78(f)(2) Does Not Alter Burdens of Proof

Tafas also challenges the legality of Rule 78(f)(2), which sets forth a rebuttable presumption that applications that meet certain narrow conditions contain patentably indistinct claims. 72 Fed. Reg. at 46840; 37 C.F.R. § 1.78(f)(2). Final Rule 78(f)(2) helps ensure that applicants will not evade the 2 + 1 and 5/25 Rules by seeking to patent the same invention using multiple initial applications. Final Rule 78(f)(2), like the 5/25 Rule, is fundamentally an information-producing regulation, for in order to rebut the presumption, an applicant must "explain[] how the application contains only claims that are patentably distinct from the claims in each of such other pending nonprovisional applications or patents." 72 Fed. Reg. at 46840; 37

Tafas concocts a rather far-fetched example wherein the agency would instruct an applicant that certain claims were allowable if rewritten and then prevent the applicant, by operation of rule, from receiving a patent with the rewritten claims. Tafas Mem. at 14. The USPTO suggests that such esoteric examples are not appropriately considered on this facial challenge and are best handled if and when they arise in the real world. Cf. Abbott Labs. v. Gardner, 387 U.S. 136, 148-49 (1967), overruled on other grounds, Califano v. Sanders, 430 U.S. 99 (1977). Certainly Tafas has not alleged that he is currently facing anything like the hypothetical problem he posits. Of course, even if he were, there are avenues of relief available for applicants unjustly caught by USPTO rules, including an examiner's amendment, wherein the examiner and not the applicant amends the claims, see U.S. Pat. & Trademark Off., Manual of Patent Examining Procedure ("MPEP") § 1302.04 (8th ed. 2001, rev. Aug. 2006), or a petition by the applicant under 37 C.F.R. § 1.183 (2006) to waive a particular rule. 4

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C.F.R. § 1.78(f)(2). This information, like the ESD, helps an examiner determine whether the application meets the conditions of patentability and ensures against double-patenting. The arguments that refute Tafas's ESD-related burden-shifting claim thus apply with equal force to Final Rule 78(f)(2). See supra Part I.A. First, Final Rule 78(f)(2) does not, as a factual matter, shift burdens of proof, but merely is an information-producing regulation that aids the USPTO in examining an application. Furthermore, the Federal Circuit has made clear that the USPTO can require the submission of information in aid of its meeting its burden under current practice to come forward with a prima facie case of patentability. See Bruno Indep. Living Aids, 394 F.3d at 1352; Star Fruits S.N.C., 393 F.3d at 1282. Regardless, even if Final Rule 78(f) shifts any burden of proof, Tafas can point to no statutory language prohibiting the USPTO from doing so. Burdens of proof are "procedural" tools lying within the agency's authority under § 2(b)(2). Stevens, 366 F.3d at 1333; Oetiker, 977 F.2d at 1445. Accordingly, Final Rule 78(f)(2) does not run afoul of the Patent Act.4 C. Final Rule 78(f) Comports with Section 122

Tafas also argues that the requirement to identify patentably indistinct claims and the requirement to rebut a presumption of patentably indistinct claims in related applications in Final Rule 78(f) will force applicants to disclose subject matter that they want to maintain in confidence. Tafas Mem. at 16-18; see also Tafas Am. Compl. at ¶ 56(h). Such forced disclosure, Tafas complains, contravenes 35 U.S.C. § 122. Id.

Because Final Rule 78(f)(1) and (2), like the ESD requirement, are both fundamentally information-producing measures, Amicus Cantor Fitzgerald Property Holdings, LLC ("CFPH") errs in suggesting that this rule is substantive rather than procedural in nature. Br. of Amicus Curiae CFPH, LLC in Supp. of Pls. Summ. J. Mots., Dkt. No. 119. Final Rule 78(f) is procedural, and within the USPTO's rulemaking authority under 35 U.S.C. § 2(b)(2), for many of the same reasons as Final Rules 75 and 265. See USPTO GSK Opp. at Part I.A. 5

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The USPTO addressed this claim in its opening brief, including explaining that the issue has been waived. USPTO Mem. at 33. The USPTO responds further only to address an unlikely hypothetical Tafas poses. Tafas speculates that the situation could arise in which an applicant files one application on track for publication and later files a second, related application with a non-publication request. While the Office is unaware of any such situation, such an applicant could use existing Office procedure to keep certain information about the second application out of the publicly-available file by filing a "petition to expunge." See MPEP § 724 (addressing submission of trade secret, proprietary, and protective order materials and expungement procedures for information not material to patentability). Under those procedures, the Office would maintain such information under seal and expunge the information if it was found not to be important to a reasonable examiner in deciding whether to allow the application to issue as a patent. MPEP § 724.04(a). Thus, the process would lead only to the disclosure of information that an applicant would otherwise be required to disclose to obtain a patent. Alternatively, such a hypothetical applicant could petition for a waiver of Final Rule 78(f) under 37 C.F.R. § 1.183 (2006) if he believes compliance with Final Rule 78(f) will cause a disclosure of information that he thinks should be protected under § 122. Thus, Final Rule 78(f) would not automatically require the disclosure of unpublished information in Tafas's unique hypothetical. D. Final Rule 78(d) Is Consistent with Section 121, Which Permits a "Divisional Application" in Response to a Restriction Requirement

Tafas appears to assert that Final Rule 78(d) prohibits the filing of so-called "voluntary divisional" applications. Tafas Mem. at 15-16. Tafas's argument proceeds from the flawed premise that 35 U.S.C. § 121 permits an applicant to file a divisional application drawn to subject matter that was described, but not claimed, in a parent application where no restriction ever issued. Id. As the USPTO's opening brief explains, the Final Rules simply follow the Patent 6

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Act's requirement that a "divisional" application may be drawn to subject matter that was: (i) disclosed; (ii) claimed; and (iii) subject to a restriction requirement in an earlier application. USPTO Mem. at 31-32. Section 121 states: If two or more independent and distinct inventions are claimed in one application, the Director may require the application to be restricted to one of the inventions. If the other invention is made the subject of a divisional application which complies with the requirements of section 120 of this title it shall be entitled to the benefit of the filing date of the original application. 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, if the divisional application is filed before the issuance of the patent on the other application . . . . 35 U.S.C. § 121 (emphases added). Section 121 thus explains that only "claimed" subject matter may be restricted. In addition, § 121 explains that the estoppel effect against double patenting will not arise unless the Office issues a restriction requirement. See Bristol-Myers Squibb Co. v. Pharmachemie B.V., 361 F.3d 1343, 1347-48 (Fed. Cir. 2004) ("As section 121 has been interpreted by this court, Bristol-Myers is entitled to invoke the statutory prohibition against the use of the '707 patent `as a reference' against the divisional application that resulted in the '927 patent only if the divisional application was filed as a result of restriction requirement.") (emphasis added); Studiengesellschaft Kohl mbh v. N. Petrochemical Co., 784 F.2d 351, 360 (Fed. Cir. 1986) (Newman, J., concurring) ("[T]he safeguard of §121[3] does not apply if the divisional application was voluntarily filed by the applicant and not in response to a PTO restriction requirement . . . [n]or does it apply if the restriction requirement was withdrawn by the examiner."). A so-called "voluntary divisional" lacks the necessary restriction requirement and therefore cannot qualify as a true "divisional" application under § 121. While Tafas or any

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applicant may voluntarily file a child application drawn to subject matter disclosed (but unclaimed) in a parent application, that filing is simply a continuation application under 35 U.S.C. § 120.5 The cases Tafas cites are not to the contrary. Tafas Mem. at 16. Tafas selectively quotes from In re Schneller, 397 F.2d 350 (C.C.P.A. 1968), but there, the C.C.P.A. merely expressed bafflement over why the applicant did not wait for a restriction requirement. Id. at 353 ("There is, therefore, no direct indication before us of why appellant chose this voluntary division method . . . except for his present contention that under the rules he thinks he should not have done so. He certainly could have tried it. At worst he would have had a requirement for restriction."). Moreover, In re Van Ornum, 686 F.2d 937 (Fed. Cir. 1982), simply clarifies that the so-called "voluntary divisional application" in Schneller was actually nothing more than a "continuation" application. Id. at 943. Tafas also asserts ­ with no explanation ­ that Final Rule 78(d)(1)(iii) improperly prohibits filing continuation-in-part applications off of divisional applications. Tafas Mem. at 16. As the USPTO explained in its opening brief, the law has never permitted such a practice. USPTO Mem. at 31.

The allegation by Amicus "FICPI" that the definition of a "divisional application" in the Final Rules violates the Paris Convention for the Protection of Industrial Property ("Paris Convention"), July 14, 1967, 21 U.S.T. 1583, is flawed. See Br. of Amicus Curiae Federation Internationale des Conseils en Propriete Industrielle ("FICPI") in Supp. of the Pls. Anticipated Mots. for Summ. J., Dkt. No. 140, at 3-4. In fact, to the extent that the Paris Convention permits an applicant to divide a patent application "on his own initiative," Article 4G (2) expressly provides that "each country of the Union shall have the right to determine the conditions under which such division shall be authorized." Paris Convention, Article 4G (2), 21 U.S.T. 1583. Here, the United States has exercised such right by enacting 35 U.S.C. § 121, which conditions the filing of divisional applications upon issuance of a restriction by the Director. See also infra Part VIII (explaining why no cause of action for violation of the Paris Convention may be pursued under the Administrative Procedure Act ("APA"), 5 U.S.C. § 706(2)(A)). 8

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E.

Final Rule 78(d)(ii)(B) Does Not Implicate, Let Alone Conflict with, the "Objectives" of the Bayh-Dole Act (35 U.S.C. § 200)

Tafas argues that Final Rule 78(d)(ii)(B) frustrates the objectives of the Bayh-Dole Act as set out in 35 U.S.C. § 200 (titled "Policy and objective"). Tafas Mem. at 19-20. Focusing on a prefatory statement of policy, Tafas does not allege that the Final Rules violate any actual rights, requirements, or obligations of the Bayh-Dole Act. Indeed, they do not. The Bayh-Dole Act simply creates funding agreements between the Government and small businesses or non-profit organizations and, under certain circumstances, confers on the Government rights to license inventions whose research and development it has funded. See 35 U.S.C. §§ 202-10. None of the Final Rules remotely relate to ­ much less conflict with ­ these substantive provisions, which is enough to dispose of Tafas's claim. To the extent the Court goes further, Tafas's specific argument is that requiring applicants to prosecute generic claims6 to exhaustion before filing a divisional application to any nonelected species7 "significantly delays the commercial utilization of non-elected species later found by contractors under the Bayh-Dole Act to be valuable." Tafas Mem. at 20; Tafas Am. Compl. at ¶ 56 (l) & (m). In fact, the Final Rules treat generic claims exactly like the preexisting rules, and Tafas fails to show otherwise.8 The Final Rules thus have no bearing on the

A generic claim is a claim that covers multiple species that may also be separately claimed in the same application. See MPEP § 806.04(d). When the Office examines a generic claim, it may ask the applicant to choose (i.e., "elect") one of the species covered by the generic claim for initial examination. The species not chosen for initial examination are referred to as "non-elected species." See MPEP § 809.02(a). For example, if an application contains a generic claim covering multiple species as well as separate species claims, the only action the USPTO can take is to issue a "provisional" restriction. See MPEP § 809.02. That is, if the generic claim is ultimately found allowable, then the Office cannot issue a restriction requirement under 35 U.S.C. § 121, dividing the species claims, because the allowable generic claim covers all the species. If, however, the generic claim 9
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objectives of the Bayh-Dole Act. F. Final Rule 75 Tracks Statutory Definitions Set Forth in Sections 41 and 112

Tafas incorrectly argues that Final Rules 75(b)(2) and 75(c) impermissibly alter the definition of "dependent" and "multiple dependent" claims in violation of 35 U.S.C. § 112 and allegedly reset fees in violation of 35 U.S.C. § 41.9 Tafas Mem. at 12-13; Tafas Am. Compl. at ¶ 56(a). He is incorrect on both counts. See USPTO Mem. at 30-31. Final Rule 75(b)(2) states that: (i) a "claim that refers to another claim but does not incorporate by reference all the limitations of the claim to which it refers will be treated as an independent claim for fee calculation purposes" and (ii) "a claim that refers to a claim of a different statutory class of invention will also be treated as an independent claim for fee calculation purposes." 72 Fed. Reg. at 46836. By treating such claims as independent, Final Rule 75(b)(2) tracks the statutory definitions of "dependent" and "multiple dependent" claims set forth in the Patent Act. A dependent claim refers to an earlier claim and further limits the subject matter of that claim. See 35 U.S.C. § 112, ¶ 4. A multiple dependent claims refers to more than one earlier claim and also further limits the subject matter of those claims. See id., ¶ 5. A claim that refers to another claim but does not incorporate the limitations of that claim, as set forth in 75(b)(2), is in no way dependent on the referenced claim. Similarly, a claim that references another claim of

is ultimately not found allowable and the applicant chooses to cancel the rejected generic claim, then the Office would be free to issue a restriction requirement dividing the independent and distinct species claims. Once the restriction requirement issues, the applicant could file claims to the non-elected species claims in divisional applications under § 121. Tafas incorrectly cites Final Rule 75(b)(4) rather than Final Rule 75(c) regarding the definition of multiple dependent claims. Tafas Mem. at 30. In the USPTO's opening memorandum, the Office incorrectly identified Final Rule 75(c) as Final Rule 75(b)(5)(C). USPTO Mem. at 30. The USPTO apologizes for any confusion this error may have caused. 10
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a different statutory class of invention,10 as set forth in 75(b)(2), cannot be a dependent claim either because it does not further limit the referenced claim in any way; it merely refers to it. See USPTO Mem. at 30 (citing IPXL Holdings, 430 F.3d at 1384 (single claim directed to multiple statutory classes of invention is improper under 35 U.S.C. § 112)).11 Thus, both kinds of claims set forth in Final Rule 75(b)(2) stand alone and are properly treated as independent claims. Further, as is evident from the quoted text of Final Rule 75(b)(2), the rule says nothing about changing the fees an applicant must pay for independent claims. A claim classified as "independent" costs the same under the Final Rules as it does under pre-existing rules. Although such claims have been treated as dependent in the past for fee purposes, substantively such claims have always been treated as independent for patentability purposes. Hence, contrary to Tafas's argument, Final Rule 75(b)(2) comports with both 35 U.S.C. § 112 and 35 U.S.C. § 41. The same is true of Final Rule 75(c). This rule states: "For fee calculation purposes . . . a multiple dependent claim will be considered to be that number of claims to which direct reference is made therein." 72 Fed. Reg. at 46837. Notably, this is the same definition for "multiple dependent" claim found in pre-existing Rule 75(c). See USPTO Mem. at 30 (citing 37

Under 35 U.S.C. § 101, there are four types of inventions: (i) process; (ii) machine; (iii) manufacture; and (iv) composition of matter. A claim must be directed to one of these statutory kinds of invention to be eligible for patenting. If a claim is directed to more than one kind, it is said to be a "claim of different statutory classes." Tafas specifically mentions "product-by-process" claims to argue that Final Rule 75(b)(2) changes the definition of a dependent claim. Tafas Mem. at 12. A "product-byprocess" claim is a specialized type of product claim where the product is defined in terms of process or method of making. See MPEP § 2113. In such a claim, the process steps are not considered to be limitations of the claims for patentability purposes, i.e., the patentability of the product does not depend upon its process of making. Id.; In re Thorpe, 777 F.2d 695 (Fed. Cir. 1985). Where a "product-by-process" claim is written in dependent form ­ incorporating the process steps by reference to a process claim ­ it nevertheless must be substantively treated as an independent claim since incorporated process steps are not given patentable weight. 11
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C.F.R. § 1.75(c) (2006)). Final Rule 75(b)(5)(c) thus does not change the definition of "multiple dependent claim" in any way. Moreover, in treating a multiple dependent claim to be that number of claims to which it refers, Final Rule 75(c) and pre-existing Rule 75(c) adopt the statutory definition for a "multiple dependent" claim set forth in 35 U.S.C. § 112, ¶ 5. As explained above, the Patent Act defines a "multiple dependent" claim as making "reference, in the alternative only, to more than one claim previously set forth." 35 U.S.C. § 112, ¶ 5. Lastly, the text in Final Rule 75(c) regarding the fees to be charged for a multiple dependent claim matches the fee language in 35 U.S.C. § 41. See 35 U.S.C. § 41(a) (providing that a multiple dependent claims "for purposes of computing fees" "shall be considered as separate dependent claims in accordance with the number of claims to which reference is made") (unnumbered ¶). Accordingly, like Final Rule 75(b)(2), Final Rule 75(c) is consistent with the Patent Act. G. Tafas May Not Challenge the Final Rules's Retention of First Action Final Rejection Practice

Tafas alleges for the first time in his cross-motion for summary judgment that the Final Rules' maintenance of "first action final rejection" ("FAFR") practice violates 35 U.S.C. § 132(a).12 Tafas Mem. at 18-19. Because Tafas failed to present this claim in his complaint, it should not be considered. See New Motor Vehicle Bd. of Ca. v. Orrin W. Fox Co., 439 U.S. 96, 125 n.29 (1978) ("Although the Court has endorsed the modern relaxation of pleading rules, it has never receded from the requirement that civil complaints provide parties defendant with "fair

FAFR allows the USPTO to finally reject on the merits the claims in a continuation application in a first Office action in certain circumstances. See MPEP § 706.07(b) ("The claims of a new application may be finally rejected in the first Office action in those situations where (A) the new application is a continuing application of, or a substitute for, an earlier application, and (B) all claims of the new application (1) are drawn to the same invention claimed in the earlier application, and (2) would have been properly finally rejected on the grounds and art of record in the next Office action if they had been entered in the earlier application."). 12

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notice" of the claims against them."); Ribis v. Mike Barnard Chevrolet-Cadillac, Inc., 468 F. Supp. 2d 489, 495 (W.D.N.Y. 2007) ("[A] plaintiff may not use a memorandum of law or similar paper to assert a claim that is not contained in the complaint."); Anderson v. Aset Corp., 329 F. Supp. 2d. 380, 383 (W.D.N.Y. 2004) ("[A] memorandum of law is not a proper vehicle for rewriting or amending the complaint."). Moreover, the Federal Circuit has already held that a facial challenge to FAFR practice under 35 U.S.C. § 132, like Tafas's, is unripe, as a challenge to such a long-standing policy must first be brought in the context of a specific application. See Molins PLC v. Quigg, 837 F.2d 1064 ( Fed. Cir. 1988) (declining to review USPTO's longstanding "FAFR" policy until it was presented to the court in context of specific application, "concluding that validity of MPEP 706.07(b) in vew of 35 U.S.C. § 132 is not ripe for judicial review"). Accordingly, this claim is not justiciable. Regardless, nothing in § 132(a) prohibits the FAFR practice, which has existed since 1923 and serves the important purpose of preventing delay tactics by applicants. See, e.g., In re Bogese, 22 U.S.P.Q. 2d 1821, 1827 (Comm'r Pat. 1991) (FAFR practice "is in accordance with the statutory objective of reducing delay in prosecution . . . [and] is traceable as far back as 1923 and has existed on a continuous basis until the present date . . . [and] was crystallized in Office practice in MPEP Section 706.07(b) at the time the present 35 U.S.C. Section 120 was enacted in 1952; it must be assumed that legislators were aware of the practice . . ." ). Section 132(a) simply requires the Office to "notify" an applicant of any rejection or objection to a claim and allow the applicant to respond so that the application can be reexamined. 35 U.S.C. § 132(a). Since FAFR practice simply permits the Office to reject a claim in a continuation application in a first Office action ­ where that claim has been previously rejected on the same grounds in the

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prior parent application and the applicant has not amended that claim or presented any new evidence ­ FAFR practice comports with 35 U.S.C. § 132(a). See Bogese, 22 USPQ2d at 1825 (holding that FAFR practice is consistent with 35 U.S.C. § 132(a)). In sum, despite his many attempts, Tafas fails to establish that the Final Rules violate the Patent Act. II. THE FINAL RULES ARE NOT ARBITRARY OR CAPRICIOUS Tafas argues on three erroneous and unsupported grounds that the Final Rules are arbitrary or capricious. See 5 U.S.C. § 706(2)(A). Like GSK, he fails to show that the Court should not defer to the Final Rules under the highly deferential State Farm standard. Motor Vehicle Mfrs. Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 43 (1983); see Tafas v. Dudas, -- F. Supp. 2d --, 2008 WL 112043, at *3 (E.D. Va. Jan. 9, 2008) ("Tafas II"). First, Tafas disagrees with one of the USPTO's stated reason for the Final Rules, calling the "backlog" rationale arbitrary and capricious.13 Tafas Mem. at 33. The USPTO's articulated goal of improving efficiency is neither arbitrary nor capricious. See, e.g., Nat'l Ass'n of State Utility Consumer Advocates v. FCC, 372 F.3d 454, 460 (D.C. Cir. 2004) (finding agency's efficiency rationale for increasing subscriber line charge cap proper and supported by the evidence). As the USPTO explained in its opening brief and its opposition to GSK's summary judgment motion, the administrative record amply establishes that the Final Rules will enable the USPTO to help reduce its backlog of pending applications. See A05641-A05721 (computer modeling of efficiency gains)14; see also USPTO Mem. at 35-36 (articulating a rational
13

By focusing solely on the backlog rationale, Tafas (like GSK) ignores the USPTO's additional purposes for the Final Rules (e.g., to improve patent quality).
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Cited excerpts of the administrative record are attached, in numerical order, at Ex. 1. 14

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connection between each rule and expected efficiency gains); USPTO GSK Opp. at Part II. Rather than pointing to contrary record evidence to support his claim, Tafas resorts to bald assertions and citations to extra-record evidence (without any explanation of what he believes is probative in that evidence). Tafas Mem. at 33-34. Use of such extra-record evidence is improper and must be disregarded.15 As this Court has already observed, "`the focal point for judicial review should be the administrative record already in existence.'" Tafas II, 2008 WL 112043, at *3 (quoting Camp v. Pitts, 411 U.S. 138, 142 (1973)). Despite extraordinary efforts to prove that the USPTO's record is incomplete or inadequate, Tafas failed to make a "sufficiently strong or substantial showing of incompleteness to overcome the presumption that the USPTO properly designated the administrative record." Id. at 18. Accordingly, this Court's review is confined to the administrative record, and Tafas's "same arguments," relying on "most of the same exhibits" as in his discovery-related briefs, must be disregarded.16 Tafas Mem. at 34 n.12. Second, Tafas suggests that there are inconsistencies between materials that the USPTO submitted to the Office of Management Budget (OMB), primarily pursuant to the Paperwork Reduction Act ("PRA"), 44 U.S.C. § 3501 et seq, and other materials that he fails to clearly

The USPTO has contemporaneously filed a motion to strike, inter alia, Tafas's extrarecord evidence and the parts of his brief that rely on them. The USPTO also moves to strike the vast majority of the exhibits to and text of the Amici Polestar Capital and Norseman Group's brief, which likewise uses extra-record evidence to argue that the Final Rules are arbitrary or capricious. See Br. of Amici Curiae Polestar Capital & Norseman Group in Supp. of Pls. ("Polestar Br."), Dkt. No. 173. Notably, even if this Court were to consider the extra-record statement of Commissioner John Doll that both Tafas and Amici Polestar Capital and Norseman Group excerpt (without providing a full transcript of the remarks), the administrative record shows that the USPTO did, in fact, consider whether rework applications were caused by examiner error or by applicant error and the impact of that rework upon the backlog. A04705-A04718. 15
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identify. Here again, Tafas relies on extra-record materials, including a document that was submitted to OMB on September 26, 2007, more than a month after the USPTO promulgated the Final Rules. See Tafas Mem. at 35 (citing Ex. 25 to Reuda Declaration). Such materials are not properly before the Court, and his arguments should not be considered. Tafas's OMB-related arguments are improper for another threshold reason. Even assuming (contrary to fact) that the USPTO's submissions to OMB contain information at odds with other USPTO statements, any such difference is irrelevant to the question of whether the Final Rules are arbitrary or capricious. To the extent any discrepancies exist, an assertion the USPTO contests, Tafas's recourse is to inform the Director of OMB. Cf. Ass'n of Am. Physicians & Surgeons, Inc. v. U.S. Dept. of Health & Human Servs., 224 F. Supp.2d 1115, 1129 (S.D. Tex. 2002) ("The PRA does not create a private right of action."); Tozzi v. EPA, 148 F. Supp. 2d 35, 43, 47 (D.D.C. 2001) (same); Exec. Order No. 12,866, 58 Fed. Reg. 51735 (Sept. 30, 1993) (stating that Order "is intended only to improve the internal management of the Federal Government" and "does not create any right or benefit, substantive or procedural, enforceable at law or equity"). This lawsuit is not about whether the USPTO properly complied with the PRA or Executive Order 12,866, which is all that his claims implicate.17 See Tafas Mem. at 35. In any event, Tafas's claims are meritless and do not remotely suggest that the USPTO acted in an arbitrary or capricious manner: (a) Tafas contends that the USPTO made "comments" that the rules would have

Amici Polestar Capital and Norseman Group similarly add a challenge under the Information Quality Act ("IQA"), 44 U.S.C. § 3516 Note, which is not properly considered by the Court because it is not raised by the parties. Polestar Br. at 15-17. In any event, like Executive Order 12,866 and the PRA, the IQA "creates no legal rights in any third parties" and simply "orders the [OMB] to draft guidelines concerning information quality and specifies what those guidelines should contain." Salt Inst. v. Leavitt, 440 F.3d 156, 159 (4th Cir. 2006). 16

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"little impact" on applicants, but "suggested" to OMB that 5,000 applicants would avail themselves of the ESD procedure, while stating in unspecified "other forums" that most applicants would not file an ESD. Tafas Mem. at 35 ¶(a). Tafas fails to specify any such comments or statements in his extra-record exhibits, nor can the USPTO find any. Id. Moreover, while the USPTO has stated that the Final Rules will not have a "significant economic impact on a substantial number of small entities[,]" 72 Fed. Reg. at 46830-31 ­ a term of art under the RFA ­ it has not stated that they would have "little impact." Tafas Mem. at 35 ¶(a). The number of small entity applicants who will file an ESD bears no correlation to whether such filing will have a "significant economic impact" on those applicants. (b) Tafas accuses the USPTO of misstating that it received "no comments" in

response to the Information Collection Review ("ICR") that it submitted to OMB on September 26, 2007. Tafas Mem. at 35 ¶(b) (citing Ex. 25). The USPTO's statement is true. The USPTO published notice of its proposed ICR in the Federal Register on May 30, 2006 and opened a sixty-day comment period. See Notice, 71 Fed. Reg. 30,662 (May 30, 2006). Just as Tafas's exhibit states, "[n]o public comments were received" in response to that notice. The statement does not refer to public comments on the Proposed Rules. (c) Tafas argues that the USPTO asserted to the public that the Final Rules place no

limit on the number of continuing applications, but estimated to OMB that it expected 1,000 petitions for third or subsequent continuation applications to be filed. Tafas Mem. at 35 ¶(c). Here again, Tafas fails to identify any specific statements. Regardless, the USPTO's estimate was just that ­ an estimate ­ based on public comments it received during the rulemaking process concerning applicants' expected behavior. There is no inconsistency. (d) Tafas claims that USPTO told the public the effect of the Final Rules would be

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"offset by a rapidly decreasing inventory in the appeal process" while at the same time promulgating other proposed rules that "would increase workload in appeal by approximately one-third." Tafas Mem. at 35 ¶(d). Tafas again cites nothing for the USPTO's purported "assertions to the public." Id. In any event, the USPTO's analysis of pre-appeal brief conference effects speaks for itself. A05018. (a)18 Tafas asserts that the USPTO told OMB the rules were not economically

significant, while internal data in the administrative record at A04553 indicates a substantial economic effect. Tafas Mem. at 35 second ¶(a). A04553 compares projected costs to applicants of the Proposed Rules, not the Final Rules. See A04553 (showing the cost to applicants of the "10 Representative Claims" to be $158.3 million). A04553 is not inconsistent with any representations the USPTO made to OMB about the cost of the Final Rules actually adopted. (b) Tafas likewise makes much of the USPTO's decreased estimate to OMB of the

paperwork burden imposed by the ESD requirements. Tafas Mem. at 35 second ¶(b). Yet again, the Agency's estimates are simply that ­ estimates ­ which are always subject to change, and which the OMB will have an opportunity to review in conducting its PRA review. (c) Tafas's argument that Under Secretary Dudas failed to cite specific numbers in his

Congressional speech is plainly irrelevant. Moreover, as with the OMB issues, his recourse is to alert his member of Congress, not to have the Final Rules invalidated. Tafas Mem. at 35 second ¶(c). Finally, Tafas disagrees with portions of the USPTO's calculations relating to the ESD requirement, but his objection is irrelevant. Tafas Mem. at 36. As Tafas's own brief makes clear, the numbers he cites relate only to the agency's certification of the Proposed Rules under The USPTO echoes Tafas's paragraph numbering on page 35 of his brief, which restarts (a)-(c). 18
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the Regulatory Flexibility Act ("RFA"), 5 U.S.C. §§ 601-12. Id. (citing 71 Fed. Reg. 61, 66 (Jan. 3, 2006)). These numbers, which were later refined in the Agency's final RFA certification, did not