[00:00:18] Speaker 05:
Next case is Airbus SAS versus Firepass Corporation, 2014, 1808.

[00:00:28] Speaker 05:
Hear from Mr. Zuckowitz when he's ready.

[00:00:42] Speaker 03:
May it please the court?

[00:00:44] Speaker 03:
The board's dismissal of Airbus's cross-appeal

[00:00:47] Speaker 03:
was error because it was in clear conflict with 35 USC section 315.

[00:00:51] Speaker 03:
That statute gives Airbus the right to appeal from any decision favorable to fattenability.

[00:00:57] Speaker 03:
This is a case where inter-party re-examination had been ordered.

[00:01:00] Speaker 03:
The examiner had issued an office action rejecting all the original claims.

[00:01:06] Speaker 03:
Fire pass came back after the office action, proposing dozens of new claims.

[00:01:11] Speaker 01:
I just want to make sure I understand your argument.

[00:01:14] Speaker 01:
Your argument isn't, I don't think,

[00:01:17] Speaker 01:
tell me if I'm wrong, that any time re-exam is instituted, it's then a free for all.

[00:01:24] Speaker 01:
Right?

[00:01:24] Speaker 01:
That's not your argument.

[00:01:25] Speaker 01:
Your argument isn't just because re-exam, just because the examiner finds one substantial new question of patentability, now he or she is forced to adjudicate every proposed rejection that you think he should.

[00:01:37] Speaker 03:
Your Honor, I think Belkin decided that issue, that the mere institution of a re-examination does not open the floodgate to any and all priority.

[00:01:46] Speaker 03:
Our position is that that is limited by the regulation, 37 CFR 1.948.

[00:01:52] Speaker 03:
Interparty re-examination is an adversarial process.

[00:01:56] Speaker 03:
And Congress didn't speak to the particular issue of what happens when the scope of a re-examination is expanded in some way, whether it's because of a patent owner argument or an amended claim or a new claim.

[00:02:11] Speaker 03:
The regulation is set up.

[00:02:12] Speaker 04:
Is it contention that with respect to the new claim limitations that

[00:02:16] Speaker 04:
additional art can be brought in and that, you know, have to find a substantial new question of patentability?

[00:02:24] Speaker 03:
I don't think the substantial new question of patentability test applies post re-examination.

[00:02:29] Speaker 04:
Right, but what you're contending is that where somebody brings in an amendment with a new claim limitation, that additional art can be brought in to show that that is obvious, right?

[00:02:43] Speaker 03:
Subject to the limitations of 1.948.

[00:02:46] Speaker 03:
It's a responsive provision.

[00:02:47] Speaker 03:
So we are, you know, at Airbus as the third party requester brought in new prior arc, I should say additional prior arc that was not subject to the original re-examination order specifically to address the new limitations of claim 91 through 94.

[00:03:02] Speaker 01:
Here's the only thing I don't understand.

[00:03:05] Speaker 01:
In a re-exam, you can only narrow claims.

[00:03:08] Speaker 01:
You can't broaden them, right?

[00:03:11] Speaker 01:
That's true.

[00:03:12] Speaker 01:
So if the examiner said,

[00:03:14] Speaker 01:
your two pieces of new prior art didn't raise a substantially new question of patentability to the original claim.

[00:03:23] Speaker 01:
And if the new claims are only narrower, how do you get to a substantial new question of patentability just because your prior art, which didn't raise a substantial question of patentability on the broader claim, now goes to some of the narrower limitation?

[00:03:42] Speaker 03:
It's an obviousness rejection.

[00:03:44] Speaker 01:
So if you compare, for example... Yes, but if the broad claim isn't rendered obvious by your two references, a narrower claim can't possibly be rendered obvious by your two references.

[00:03:56] Speaker 03:
Maybe I can explain using the example, actually, that happened in this case, which is claim one is anticipated by the 652 patent, prior reference.

[00:04:06] Speaker 03:
It's been held that way by the board.

[00:04:08] Speaker 03:
It's not been appealed.

[00:04:10] Speaker 03:
Claim 91, which is the independent claim that's at issue here on this cross-appeal,

[00:04:14] Speaker 03:
is effectively the same as claim one with some additional, I'll say, trivial hardware limitations that have been added, things such as a filter.

[00:04:22] Speaker 01:
So... Well, no, but it also added a computer, a control means or something, right?

[00:04:27] Speaker 03:
A routine general computer means.

[00:04:29] Speaker 03:
So, trivial or not, the point being that Airbus for claim 91 relied on the 652 patent, which meets for all the limitations of claim 91 that are the same as original claim one.

[00:04:43] Speaker 03:
And then brought in

[00:04:44] Speaker 03:
additional prior art to address the new limitations, most of which were not the subject of any... It's the same prior art, isn't it?

[00:04:51] Speaker 05:
AFWAL and NITE?

[00:04:53] Speaker 03:
That prior art was cited in the original re-examination request for an entirely different purpose.

[00:04:59] Speaker 05:
Well, it was cited against a broader claim, right?

[00:05:02] Speaker 05:
It didn't raise an SNQ?

[00:05:04] Speaker 03:
That was true.

[00:05:06] Speaker 03:
It was cited against claim one with respect to... So why isn't Judge Moore correct?

[00:05:13] Speaker 05:
claims 91 to 94 are narrower.

[00:05:17] Speaker 05:
And so how could it raise an SNQ with respect to a narrower claim if it didn't with respect to a broader claim?

[00:05:23] Speaker 03:
Because we're only relying on that for particular limitations.

[00:05:26] Speaker 04:
It's a new claim, which is they're narrowing it and saying we're avoiding the anticipation by narrowing it.

[00:05:32] Speaker 04:
And now all of a sudden the question of whether the narrower claim is obvious is raised for the first time.

[00:05:40] Speaker 03:
And you're trying to bring in the art to show that.

[00:05:42] Speaker 03:
These are, these are limitations that were not, that were not, most of which were not in any original claim.

[00:05:47] Speaker 03:
They were never subject to it, to an original examination.

[00:05:50] Speaker 03:
So you have, you have, yes, you have a narrower claim, but for showing that those additional limitations, the narrower scope.

[00:05:58] Speaker 04:
They're saying it's narrower, so we're avoiding the original patentability problem that we had.

[00:06:04] Speaker 04:
Right?

[00:06:05] Speaker 04:
I mean, they're saying that by narrowing the claim, we've avoided invalidity.

[00:06:09] Speaker 03:
That is certainly what the patent owner has said.

[00:06:13] Speaker 03:
But all of the limitations that are duplicative of claim one are met.

[00:06:20] Speaker 03:
They're met by the Sixth Amendment.

[00:06:21] Speaker 04:
We're talking about the new limitations.

[00:06:23] Speaker 04:
You're bringing in new art to address only the new limitations, which they say have solved the invalidity problem.

[00:06:31] Speaker 03:
That is certainly what they say.

[00:06:34] Speaker 04:
Well, that's what you say, too.

[00:06:36] Speaker 04:
You say they've narrowed the claim to avoid

[00:06:39] Speaker 04:
invalidity.

[00:06:40] Speaker 04:
They've raised a new question by doing that, and we're trying to bring in this art to show that that doesn't solve their obviousness problem.

[00:06:47] Speaker 03:
Yes.

[00:06:51] Speaker 03:
We say that doesn't solve their obviousness problem, not because of the substantial new question fattenability analysis.

[00:06:57] Speaker 03:
It's because it's necessary to rebut that amendment.

[00:07:01] Speaker 03:
It's not because that necessarily raises a substantial new question of fattenability, which

[00:07:05] Speaker 03:
Of course it does.

[00:07:06] Speaker 03:
Of course it does.

[00:07:06] Speaker 03:
These are limitations that were never subject to any original examination.

[00:07:10] Speaker 03:
We don't think that that test survives the re-examination order.

[00:07:13] Speaker 03:
That's not how the statutory scheme is set up.

[00:07:16] Speaker 04:
So if we were to agree with you and say that the examiner and the board applied the wrong test, that it isn't a substantial question of patentability, what should we do?

[00:07:26] Speaker 04:
Send it back to them to redo it?

[00:07:28] Speaker 03:
I think that it should be sent back to the board.

[00:07:32] Speaker 03:
for consideration on the merits.

[00:07:33] Speaker 03:
If the board doesn't think that that was sufficiently considered on the merits because the examiner referenced this SNQ test, then it can deal with it as it sees fit.

[00:07:43] Speaker 01:
I guess one of the questions, how many cases is this going to affect?

[00:07:48] Speaker 01:
I mean, re-exam is dead now, so this is only going to be something that's going to affect older cases still in that inter-party re-exam pipeline.

[00:07:58] Speaker 01:
And are you aware of any other, or do you have any personal knowledge of how often, I mean, you know, to me, I looked at this whole prosecution issue and I'm like, why didn't the stupid examiner just address the rejection?

[00:08:10] Speaker 01:
I mean, you know, would have made everybody's life a lot easier, wouldn't have taken them long, I don't get it.

[00:08:15] Speaker 01:
I mean, granted, one of your documents is like 1,300 pages and I get it, but you point it to specific space.

[00:08:20] Speaker 01:
Anyway, the whole point of it is how many more of these cases is something like this going to ever be an issue in?

[00:08:28] Speaker 01:
given the changes in the law.

[00:08:30] Speaker 03:
I can't tell you how many total, Your Honor, but... The thing doesn't matter for you.

[00:08:34] Speaker 01:
You have another one?

[00:08:35] Speaker 03:
We have another re-examination between the same parties.

[00:08:38] Speaker 03:
That involves, I'll say, a similar issue.

[00:08:40] Speaker 01:
Where the examiner also, after amended claims were introduced, refused to address a rejection.

[00:08:47] Speaker 03:
Correct.

[00:08:47] Speaker 03:
Now, that is still pending on appeal before the board.

[00:08:51] Speaker 01:
I guess I'm just wondering, but apart from the two cases that you have, and I bet it's the same examiner on both of them, isn't it?

[00:08:57] Speaker 00:
Yes, it is.

[00:08:57] Speaker 01:
Yeah, yeah, yeah.

[00:08:59] Speaker 01:
So apart from that one examiner in the two cases you have, I just want to know, is there reason for me to be worried

[00:09:07] Speaker 01:
that this is a big deal, that there are a lot of cases in the pipeline that you're aware of that are going to be impacted.

[00:09:14] Speaker 03:
I'm not aware.

[00:09:15] Speaker 03:
It's a big deal to us.

[00:09:16] Speaker 01:
No, I get that.

[00:09:16] Speaker 01:
And I'm not disputing it.

[00:09:18] Speaker 01:
So now let me, though, push on, because there's a difference between whether you deserve to win, to be clear.

[00:09:25] Speaker 01:
So I don't want you to think all these questions are hostile questions I'm about to ask, because they're not.

[00:09:29] Speaker 01:
And so make sure you listen carefully.

[00:09:31] Speaker 01:
There is a difference between whether you deserve to win on this fact pattern.

[00:09:35] Speaker 01:
and the rule that you seem to be pressing for.

[00:09:38] Speaker 01:
I don't think you need to press for as broad a rule as you're asking for in order for you to prevail.

[00:09:45] Speaker 01:
So let me just throw out an alternative idea to you and see if you're like, yeah, that's something we could probably buy into.

[00:09:54] Speaker 01:
It isn't the fact that an amendment is made that automatically opens the door to all new prior art and every rejection that you make.

[00:10:02] Speaker 01:
Because, wait, listen, hear me out.

[00:10:04] Speaker 01:
Will you give me an example?

[00:10:06] Speaker 01:
For example, suppose your initial SNQ question to the examiner was, this claim, these two references, and he says no SNQ.

[00:10:17] Speaker 01:
Suppose all they did was add another new limitation to the claim, and you now want the examiner to consider those same two references, so all you have is a slightly narrower claim, no additional references.

[00:10:30] Speaker 01:
That is not your fact pattern.

[00:10:31] Speaker 01:
I know that.

[00:10:32] Speaker 01:
That's why I said, keep in mind, it's not a hostile question to you winning or losing.

[00:10:36] Speaker 01:
It's more trying to go to the heart of when does the examiner have a right to refuse to consider a rejection?

[00:10:43] Speaker 01:
You seem to have proposed a rule that is, I wasn't sure if it was any time re-exam is initiated or any time there's any amendment.

[00:10:52] Speaker 01:
Neither of them are really palatable for me because I can envision circumstances that aren't your case where I feel like the examiner ought to have a right

[00:11:01] Speaker 01:
to still say no SNQ here.

[00:11:02] Speaker 01:
I said no SNQ the first time, the fact that they added a limitation and you're raising only the same two references, still no SNQ.

[00:11:09] Speaker 01:
I know that's not your fact pattern.

[00:11:11] Speaker 01:
What do you think about that role?

[00:11:12] Speaker 03:
Understand the instinct that there is some unfairness to that.

[00:11:16] Speaker 03:
The idea that a requester could bring back in the same exact references for a narrower claim.

[00:11:22] Speaker 03:
It doesn't make sense in that sense.

[00:11:25] Speaker 03:
The test is 1.948.

[00:11:26] Speaker 03:
And under the scenario that you gave, Your Honor, the examiner could say, no, you didn't meet the standards of 1.948.

[00:11:34] Speaker 04:
You're only using the new art to address the new claim limitations.

[00:11:41] Speaker 04:
You're not contending that you could use new art to show obviousness with respect to the claim limitations that were in the original claims, correct?

[00:11:51] Speaker 03:
That is correct, Your Honor.

[00:11:55] Speaker 03:
There is a, maybe I don't want to call it an exception, but there are times when a patent owner could open the door to that through an argument.

[00:12:01] Speaker 03:
It happened actually in our case, it's not on appeal, but where the patent owner came back subsequent to the re-examination order in response to the first office action and gratuitously said, by the way, all the reasons for denying the SNQ with respect to these APWAL 2060 aircraft, they were all wrong.

[00:12:20] Speaker 03:
That's what happened in our case.

[00:12:21] Speaker 03:
And so there might be a situation like that that could arise where there might be a reason to bring back in the prior art.

[00:12:29] Speaker 03:
And that's why in an adversarial system, 1.948 makes perfect sense, where it has to be responsive in order to bring back that prior art.

[00:12:37] Speaker 01:
It has to be responsive, but it kind of goes back.

[00:12:39] Speaker 01:
And maybe your view is the examiner has to, he can reject the rejection.

[00:12:44] Speaker 01:
He can refuse sensitive rejection.

[00:12:45] Speaker 01:
Maybe that is your view, but I guess what I was thinking was,

[00:12:48] Speaker 01:
Kind of goes back to that very first question I asked.

[00:12:50] Speaker 01:
Again, I know not your fact matter, but if you have a broader claim and you've argued two new references, an examiner says no SNQ, and then the patentee adds a limitation for whatever reason to that claim and you only argue those same two references, I mean, it feels like he should be able to, the examiner should be able to say, look, no SNQ, you can't force me

[00:13:15] Speaker 01:
into considering all of the ones I said there's no SNQ for simply by virtue of the patentee introducing, because even though they added a limitation, it wouldn't necessarily, the same two references, if they didn't help you with the whole thing, wouldn't necessarily help you with the whole thing plus a new limitation.

[00:13:33] Speaker 03:
I agree, Your Honor, I agree with the outcome of what you're saying, just for a different reason, that's all, just that the SNQ test

[00:13:40] Speaker 03:
is entirely a bar to unjustified challenges to issue patents.

[00:13:44] Speaker 03:
That's how the statute set up after the legislative history sets.

[00:13:47] Speaker 03:
So the office has created a regulation to deal exactly with the problem that your honor stated.

[00:13:53] Speaker 03:
And in this case, they didn't follow it.

[00:13:55] Speaker 01:
So the examiner could have said, I don't think these new references that you're introducing are really relevant to the amendment or argument.

[00:14:03] Speaker 01:
I mean, I don't think I see how he could in this case, given that you are citing

[00:14:07] Speaker 01:
the filter and the computer or whatever in the references.

[00:14:10] Speaker 01:
But you're saying there would, in a different case where it really seems like a frivolous attempt to just redo what you lost on already, he could use that mechanism to avoid doing it.

[00:14:23] Speaker 01:
But it wouldn't be, he wouldn't be able to say no SNQ go away.

[00:14:27] Speaker 01:
He'd have to say your art is not responsive to.

[00:14:31] Speaker 03:
That's exactly right, Your Honor.

[00:14:33] Speaker 03:
And in our case, there was no objection under 1.948 that it was responsive.

[00:14:37] Speaker 05:
But this is a question of appealability, right?

[00:14:41] Speaker 05:
Whether the decision below was one favorable to patentability.

[00:14:47] Speaker 05:
So this is an issue of appealability.

[00:14:50] Speaker 03:
I agree, Your Honor.

[00:14:52] Speaker 03:
So there are kind of two ways to look at this.

[00:14:54] Speaker 03:
I mean, the error of the board stems from what we believe is a misreading of the Belkin decision, if you know, Your Honor.

[00:15:00] Speaker 03:
Using the wrong test.

[00:15:03] Speaker 03:
Using the wrong test.

[00:15:05] Speaker 03:
The Belkin decision talks about... They shouldn't be using the SNQ test with respect to the amendment.

[00:15:11] Speaker 03:
That's correct.

[00:15:12] Speaker 03:
That's correct, Your Honor.

[00:15:13] Speaker 03:
But what happens, I mean, in our case with respect to appealability, when a requester legitimately proposes a rejection, meets all the requirements of 1.948, and it's during the course of a reexamination, and the examiner doesn't accept it, that's a decision favorable to patentability under any interpretation of that phrase.

[00:15:32] Speaker 01:
See, that doesn't...

[00:15:34] Speaker 01:
That doesn't make sense, because then it would morph every determination by the examiner that there is no SNQ for a given rejection into a question of patentability.

[00:15:45] Speaker 03:
Well, Your Honor, I mean, under our view of it, it would be an examiner's determination that that proposed rejection was not responsive under 1.948.

[00:15:53] Speaker 01:
But that's not the determination he made here, right?

[00:15:56] Speaker 01:
The determination he made was no SNQ.

[00:16:00] Speaker 03:
Right.

[00:16:00] Speaker 03:
So we think that was an improper test.

[00:16:02] Speaker 04:
Well, isn't that the simpler way of doing it rather than to say we should treat the SNQ determination as a determination as to patentability?

[00:16:10] Speaker 03:
That allows the examiner, that gives the examiner the statutory authority to take our appeal right away, which he doesn't have.

[00:16:17] Speaker 04:
I don't understand what you're saying.

[00:16:18] Speaker 04:
I don't think you're listening to my question.

[00:16:20] Speaker 04:
Isn't the simplest thing to say here that he applied the wrong standard, that SNQ isn't the test with respect to the amendment, whatever limitations there are on his considering

[00:16:31] Speaker 04:
prior art, and we could just send it back and say you applied the wrong test, apply the correct test.

[00:16:37] Speaker 04:
Yes, that is correct, Your Honor.

[00:16:40] Speaker 05:
We've consumed your rebuttal time, but we'll give it back to you.

[00:16:44] Speaker 05:
Thank you.

[00:16:44] Speaker 05:
Three minutes.

[00:16:45] Speaker 05:
Mr. Shumsky.

[00:16:52] Speaker 02:
Thank you, Your Honor.

[00:16:52] Speaker 02:
Good morning.

[00:16:53] Speaker 02:
May it please the court, Eric Shumsky.

[00:16:56] Speaker 02:
Excuse me, with a frog in my throat, representing fire paths

[00:17:00] Speaker 02:
Judge Moore, I'd like to begin with the very first question that you asked, because I think it really goes to the heart of the question, and particularly my friend on the other side's answer, which I actually think makes the resolution of the core legal question here easier.

[00:17:15] Speaker 02:
You asked whether reexamination, whether it's a free for all once you get into reexamination.

[00:17:22] Speaker 02:
And the answer is absolutely not.

[00:17:25] Speaker 02:
And not just because of Belkin, it's that every single bit of authority out there tells us that the SNQ standards, the first step of the two-step process, applies even after re-examination has been started.

[00:17:39] Speaker 02:
So Belkin tells us that.

[00:17:41] Speaker 02:
Portola also tells us that.

[00:17:44] Speaker 02:
And this is where I want to get to the answer that... Well, Portola's dealing with an entirely different question, right?

[00:17:50] Speaker 02:
I'm not sure if it is in the following sense, Portola was dealing with amended claims in a re-examination and it applied the SNQ standard and considered whether there was in fact an SNQ there.

[00:18:05] Speaker 04:
I don't think it applied the SNQ standard.

[00:18:07] Speaker 04:
I think that the PTO's argument was that the amendments solved the problem of jurisdiction because the amendments raised a substantial new question.

[00:18:21] Speaker 02:
I don't want to fight too hard on this point because we don't rely that heavily on Portola, but I'm not sure that's quite right.

[00:18:27] Speaker 05:
Wasn't Portola overruled by Congress?

[00:18:30] Speaker 02:
Not this aspect of it.

[00:18:31] Speaker 02:
One very limited aspect of Portola was overruled by Congress.

[00:18:35] Speaker 02:
But all I mean to say, Judge Dyke, is that Portola was applying the SNQ standard.

[00:18:41] Speaker 02:
And even if that was merely just the common understanding of both parties, including the PTO and this court,

[00:18:48] Speaker 02:
If SNQ were not the appropriate standard for those claims and reexamination, the entire body of the opinion would have been unnecessary.

[00:18:57] Speaker 02:
The whole fight there was whether there was a new question.

[00:19:00] Speaker 02:
If SNQ isn't the standard, you don't even have to talk about it.

[00:19:03] Speaker 04:
The opinion was directed to the SNQ standard in terms of whether you were limited to relying on new art or whether you could also say that old art raised a substantial new question.

[00:19:16] Speaker 04:
And that aspect is of the case, as Judge McCrory pointed out, was overruled by Congress.

[00:19:22] Speaker 04:
But in terms of the amendment language, which you're relying on, the court said we reject the commissioner's argument.

[00:19:29] Speaker 04:
The amendments create a substantial new question.

[00:19:32] Speaker 04:
That's a different question here.

[00:19:35] Speaker 04:
There, the PTO was arguing that somehow the jurisdiction over the re-exam could be saved by

[00:19:42] Speaker 04:
looking at the amendments and said that they raised a substantial question.

[00:19:46] Speaker 04:
That's not what's involved.

[00:19:47] Speaker 02:
I do not disagree with you, Your Honor.

[00:19:48] Speaker 02:
We're on the same page.

[00:19:49] Speaker 02:
My point is only that it's at least indicative of and supportive of the broader proposition we're making.

[00:19:54] Speaker 02:
And I do want to finish going back to the question that you asked Judge Moore.

[00:20:01] Speaker 02:
The answer that Airbus gave is that Congress didn't speak to the particular issue.

[00:20:07] Speaker 02:
and that what we are talking about here is what you do with 37 CFR Section 1.948.

[00:20:13] Speaker 02:
We are in agreement that 1.948 is the provision that tells you what the requester is allowed to do and say once you're in the world of amended claims.

[00:20:25] Speaker 02:
But the critical fact here, and this is where I think that this case starts to look pretty easy, is that the MPEP, Section 2666.05 in particular,

[00:20:37] Speaker 02:
interprets 37 CFR 1.948.

[00:20:42] Speaker 02:
And so this is a classic case for at a minimum hour deference where we're talking about an agency's interpretation of its own regulation and what 2666.05 says is... I don't know if I can see the MPEP being that clear.

[00:20:59] Speaker 01:
You tell me precisely what it says that makes it clear.

[00:21:02] Speaker 02:
So section 2666.05 deals with amended claims and it interprets section 1.948 and it says, any such new proposed rejection stands on the same footing as a proposed rejection presented with the request for re-examination

[00:21:23] Speaker 02:
And it applies the underlying re-examination standard 2617.

[00:21:28] Speaker 04:
Where are you reading from?

[00:21:29] Speaker 02:
Is this in your brief?

[00:21:32] Speaker 02:
I don't know if this precise quotation is in the brief.

[00:21:34] Speaker 02:
I know that we cite and rely on 2666.05.

[00:21:39] Speaker 02:
So what I'm looking at is the 2008 revision to the MPEP, which is the one that would have been in place at the time.

[00:21:45] Speaker 02:
And the page number I have here is 2600-93.

[00:21:47] Speaker 02:
And the substance of it is that this provision of the MPEP

[00:21:53] Speaker 02:
applies the same MPEP provision 2617 that requires the showing of a substantial new question of patentability.

[00:22:02] Speaker 04:
But even if you were correct, and I don't know whether you are, what are you saying, that there's Chevron deference applicable to this provision, or just our deference?

[00:22:11] Speaker 02:
I think it would be our deference, technically, because it's the agency interpreting its own regulation.

[00:22:17] Speaker 02:
But again, this is just to take the other side's argument off.

[00:22:20] Speaker 04:
But the question is,

[00:22:22] Speaker 04:
Does the statute allow the PTO to use substantial new question of patentability with respect to new claim limitations ahead and by amendments, or whether that's just the wrong standard under the statute?

[00:22:36] Speaker 04:
Could you address that question?

[00:22:39] Speaker 02:
Sure, Your Honor.

[00:22:39] Speaker 02:
Just to be clear, I was addressing the argument as it was made, which is that the statute doesn't say one way or another.

[00:22:47] Speaker 02:
And if that is true, if

[00:22:50] Speaker 02:
If there is a gap in the statute that nearly needs to be filled, some interpretation that needs to be added, then we really are in the world of our deference, and it's a pretty easy case.

[00:23:01] Speaker 04:
But to answer your question... Well, I'm not sure that they're saying the statute is ambiguous, but go ahead.

[00:23:06] Speaker 02:
I think what he said was Congress didn't speak to the particular issue.

[00:23:10] Speaker 02:
I mean, I'll let him speak for himself.

[00:23:13] Speaker 02:
I do think that this remains a powerful argument, whatever.

[00:23:17] Speaker 02:
whatever the other side says on that question.

[00:23:21] Speaker 02:
But the bottom line is we think that the statute itself at a minimum authorizes, if not says that the better answer is, that you apply the SNQ standard.

[00:23:30] Speaker 02:
We know that SNQ is the standard that applies.

[00:23:33] Speaker 04:
But the statute tells you when to use SNQ, and it doesn't say anything about using SNQ to amendments, right?

[00:23:41] Speaker 04:
Well, it also doesn't say... It doesn't say that as to amendments that are to be considered under the

[00:23:47] Speaker 04:
initial examination standards.

[00:23:50] Speaker 02:
Right.

[00:23:50] Speaker 02:
And if that were all, then that leaves the gap in the statute.

[00:23:53] Speaker 02:
And the question is just which is the best.

[00:23:55] Speaker 02:
Where's the gap?

[00:23:56] Speaker 04:
I mean, it sounds as though they said use SNQ with respect to the initial commencement of the re-exam.

[00:24:03] Speaker 04:
And if somebody makes an amendment, you treat it like an initial examination.

[00:24:07] Speaker 04:
What is clear about that?

[00:24:10] Speaker 02:
If that were right, if that were the rule, it would prove way too much because it would make Belkin wrong.

[00:24:16] Speaker 02:
Belkin has already told us you don't draw a line between everything up to the moment of re-examination and everything that comes after.

[00:24:24] Speaker 02:
What we know from not just Belkin, but Section 2658 of the MPEP, and to the extent you think it at least indicative, Portola, and also 2666.05, and every other authority in every other circumstance we've been able to identify

[00:24:42] Speaker 02:
is that even after re-examination has started, you still use SNQ.

[00:24:47] Speaker 02:
You still use the same two-step process.

[00:24:49] Speaker 04:
Well, we're talking about applying SNQ to limitations added by amendments.

[00:24:55] Speaker 04:
Belkin doesn't have anything to do with that, right?

[00:24:58] Speaker 04:
Well, it doesn't squarely address the question of amendments, to be sure, but Belkin does.

[00:25:03] Speaker 04:
It says do the amendments under the initial examination standards, right?

[00:25:07] Speaker 04:
Correct.

[00:25:09] Speaker 04:
So that sounds as though that's what you're supposed to do to apply the initial examination standards to the amendments.

[00:25:17] Speaker 02:
I apologize, Your Honor.

[00:25:18] Speaker 02:
I think I understand the question now and perhaps I didn't before.

[00:25:21] Speaker 02:
I don't know that applying the initial examination standards means that S&Q is off the table.

[00:25:28] Speaker 02:
If that were true, then when an examiner, Sue Espante, identifies a potential new basis for rejection, you also wouldn't apply S&Q.

[00:25:38] Speaker 02:
And we know that you do.

[00:25:39] Speaker 02:
We know it from the MPEG and from Belkin and from various other sources.

[00:25:45] Speaker 02:
So again, we're in this situation where you would have to conclude that in just this one situation, proposed amended claims, you don't apply SNQ.

[00:25:58] Speaker 02:
You don't apply the so-called two-step process that we know applies in every single other circumstance.

[00:26:06] Speaker 04:
And it seems to me that... But the amendments are different because you're adding claim limitations that weren't part of the original proceeding.

[00:26:13] Speaker 04:
You're trying to avoid an invalidity determination.

[00:26:16] Speaker 04:
And why isn't that a rather different situation than the initial institution and the treatment of prior art with respect to the original clients?

[00:26:26] Speaker 02:
So let me try answering it this way.

[00:26:27] Speaker 02:
So imagine that the claims here are issued.

[00:26:30] Speaker 02:
So they issue as part of a new patent.

[00:26:32] Speaker 02:
And at that point, Airbus

[00:26:34] Speaker 02:
seeks to have the claims re-examined.

[00:26:37] Speaker 02:
At that point, it seems absolutely incontestable that you would apply the SNQ standard.

[00:26:43] Speaker 02:
You would have issued claims, you would be seeking re-examination, and you would apply the two-step process.

[00:26:50] Speaker 02:
So again, the baseline is that you always apply SNQ.

[00:26:55] Speaker 02:
You would have to think there would be- I don't know what the statute says.

[00:26:59] Speaker 02:
Well, it is when you put them together, it's what Belkin says, it's what 2666.05 says, it's what 2658 says.

[00:27:09] Speaker 02:
Again, one can discuss how much weight it's worth, but it's what Portola says.

[00:27:16] Speaker 02:
We know that you apply the SNQ standard for ex parte re-examination.

[00:27:22] Speaker 02:
for claims or rejections identified sous-spontae by the examiner even after ex parte re-examination has begun.

[00:27:29] Speaker 02:
We know you apply it for inter-partis re-examination.

[00:27:32] Speaker 02:
We know you apply it for rejections identified sous-spontae by the examiner after inter-partis re-examination has begun.

[00:27:40] Speaker 02:
This truly would be the only situation in which you don't apply the two-step process.

[00:27:47] Speaker 02:
And there is nothing about the statutory structure

[00:27:50] Speaker 02:
leave aside this court's precedent in Belkin and each of these other scenarios to suggest that this situation merits different treatment.

[00:28:02] Speaker 02:
Perhaps another way of getting at this question is to go to a later question that you also asked Judge Moore, and that was, what do you do when you are getting these claims amended?

[00:28:15] Speaker 02:
What happens when you have potentially new claims?

[00:28:18] Speaker 02:
And that is to say new elements on the claims.

[00:28:21] Speaker 02:
And the answer is exactly the same here, at least with regard to the reasons for applying SNQ, as it is in every single other one of these scenarios.

[00:28:31] Speaker 02:
This is a process by which, as the court recognized in Belkin and has in subsequent authorities reaffirmed, you have the two-step process for a reason.

[00:28:42] Speaker 02:
You have it because this was meant to be.

[00:28:44] Speaker 04:
I must say it.

[00:28:47] Speaker 04:
find this very confusing.

[00:28:48] Speaker 04:
The whole concept of SNQ is directed to a substantial new question of passability with respect to claims that have already been examined in the initial examination and whether that should be revisited in the re-exam.

[00:29:03] Speaker 04:
When you have new claims with new limitations that haven't been examined, why is it make any sense to apply the substantial new question?

[00:29:15] Speaker 04:
to new limitations, new claims that have never previously been examined.

[00:29:20] Speaker 02:
Judge Dyke, I think the answer to that, and just to situate this in the discussion, the question here is whether the standard makes sense.

[00:29:27] Speaker 02:
And the argument the other side we need to be making is it doesn't make sense.

[00:29:30] Speaker 02:
And indeed, the argument they've made in their papers is it could never make sense.

[00:29:35] Speaker 02:
And that's not right for the following reason.

[00:29:37] Speaker 02:
And it's the reason that Judge Moore suggested that with one of her earlier questions.

[00:29:43] Speaker 02:
It is entirely possible.

[00:29:45] Speaker 02:
that you would have no substantial new question.

[00:29:48] Speaker 02:
And again, a case like this illustrates why.

[00:29:51] Speaker 02:
To the extent the elements are elements that have previously been examined, and to the extent those elements have been examined in the course of the proceedings or the antecedent proceedings, in light of the same art, there's nothing new.

[00:30:07] Speaker 02:
And so while it is true.

[00:30:09] Speaker 04:
Are you arguing that you can bring up new art with respect to the old flame limitations?

[00:30:14] Speaker 04:
It's only the new claim limitations that were never part of the initial examination.

[00:30:20] Speaker 02:
But again, all I'm trying to show is that SNQ can make sense here.

[00:30:26] Speaker 01:
And the reason it can... I don't understand how it can make sense in this fact pattern.

[00:30:31] Speaker 01:
And here is your problem.

[00:30:34] Speaker 01:
Correct me if I have any of these facts wrong.

[00:30:36] Speaker 01:
Original independent claim one, the examiner decided there was an SNQ

[00:30:42] Speaker 01:
based on the 652 prior art, but there wasn't based on those other two?

[00:30:48] Speaker 02:
Correct.

[00:30:49] Speaker 01:
Okay.

[00:30:50] Speaker 01:
So then, so we're in reading them because there is a substantially new question based on a new piece of prior art, the 652 patent that wasn't previously before the office.

[00:31:00] Speaker 01:
In response to the 652 patent, the applicant then amends the claims to add new structural limitations, a filter,

[00:31:11] Speaker 01:
reduce humidity and computer control.

[00:31:14] Speaker 01:
So we have the 652 patent, new patent has rendered a substantial new question on independent claim one.

[00:31:24] Speaker 01:
Now we're looking at an amended version of claim one.

[00:31:27] Speaker 01:
And the question is, does the requester have a right to say these amendments don't get you out of the problem

[00:31:39] Speaker 01:
that we proved existed with the old claim because these new amendments are present in this additional prior art.

[00:31:48] Speaker 01:
This case ain't a do-over of the SQN that the examiner rejected.

[00:31:54] Speaker 01:
This case is a true example of them presenting art that goes directly to the heart of amendments after they've already established that the original claim is not entitled to patentability.

[00:32:07] Speaker 02:
Not surprisingly, I disagree, but let me resist the premise of the question before.

[00:32:12] Speaker 01:
On what fact do you disagree?

[00:32:14] Speaker 02:
I disagree in the following sense.

[00:32:19] Speaker 01:
Did I misstate any fact?

[00:32:23] Speaker 02:
Did you misstate any fact?

[00:32:29] Speaker 01:
I don't think I did, so I want to make sure that I'm not misunderstanding which art was applied to which claim, for example, or something like that.

[00:32:36] Speaker 02:
You did not misstate any fact, but it is legally irrelevant for the following reasons.

[00:32:44] Speaker 02:
First of all, of course, just as a threshold matter, if we are right that the SNQ standard applies, that would only be a question about the merits.

[00:32:52] Speaker 02:
And that then would be.

[00:32:54] Speaker 01:
I know, we don't have appeal rights.

[00:32:55] Speaker 02:
Understood.

[00:32:56] Speaker 02:
So that's as a threshold matter.

[00:32:59] Speaker 02:
This goes to the question I was inartfully the answer.

[00:33:02] Speaker 02:
I was inartfully giving Judge Dyke about why the SNQ standard can make sense, why 2666.05 of the MPEP does make sense in applying the SNQ standard here.

[00:33:16] Speaker 02:
If the elements that are added are new to claim 91 here,

[00:33:23] Speaker 02:
but they are claim elements that were previously examined, then they are old in the sense of the SNQ standard.

[00:33:33] Speaker 01:
So while you are correct in stating those facts and stating that- Are you saying this new art is not allowed to be argued by them in pursuance to 1-948?

[00:33:46] Speaker 02:
Yes, precisely because our view on the underlying merits is that these are arguments that have been made in the course of the prosecution and the prior examinations, but more to the point.

[00:34:01] Speaker 02:
So long as that is a possibility, so long as it makes sense to continue having the filter of the SNQ standard to weed out that possibility and to ensure that there are not duplicative proceedings

[00:34:16] Speaker 02:
And I think one would have to concede that it is at least a possibility.

[00:34:20] Speaker 04:
Are you suggesting that in the initial examination here that this art was considered in relation to filter and computer limitations?

[00:34:30] Speaker 02:
There are a number of different limitations here and claims 91 through 94.

[00:34:35] Speaker 02:
No, no.

[00:34:35] Speaker 02:
I'm asking you, in the initial examination here,

[00:34:38] Speaker 04:
Are you suggesting that this prior art was used to address filter and computer limitations similar to those that have been added now?

[00:34:47] Speaker 02:
My understanding, Your Honor, is that these elements are all over the prior examination of- I don't think you're answering my question.

[00:34:55] Speaker 04:
Are you suggesting that this art, this new art, was considered during the initial examination with respect to these claim limitations, which now appear for the first time,

[00:35:08] Speaker 04:
in the amended claims?

[00:35:12] Speaker 02:
Yes, Your Honor, that much of this, and to be clear though, this is an argument that is for the examiner and then ultimately... No, but where in this record does this show that the initial examination considered this or

[00:35:25] Speaker 04:
with respect to these new claim limitations.

[00:35:27] Speaker 02:
Well, that's the simplest answer, Your Honor, is that it's not on this record because it's not before this court because it wasn't argued to this court.

[00:35:36] Speaker 04:
But the only thing I am- But you're making representations about what happened in the initial examination that you can't support.

[00:35:45] Speaker 02:
So let me take a step back from the record and answer the question in the following way.

[00:35:50] Speaker 02:
The question was posed in terms of the record of this case.

[00:35:55] Speaker 02:
Isn't this a case in which you have exactly the problem we should be worried about?

[00:36:00] Speaker 02:
And my answer to that question is no, you are absolutely right, Judge Dyke, that I say that as a representation and it's not on the face of this record.

[00:36:09] Speaker 02:
But my only point and the only thing that I think has been argued and that we need to establish is, does the SNQ standard apply?

[00:36:20] Speaker 02:
And my point is it makes perfect sense for the SNQ standard to apply.

[00:36:25] Speaker 02:
I would prefer, frankly, to abstract it from the facts of this case because I think it's simpler and more straightforward for the reason I was suggesting to judge more.

[00:36:34] Speaker 02:
You can have a situation in which you are talking about old elements and old art.

[00:36:40] Speaker 02:
And if that is so, if that is a possibility, then it makes sense to use the SNQ filter for the same reason that Belkin

[00:36:49] Speaker 02:
And the board itself and Avery Dennison and every other bit of relevant authority we've been able to identify suggest that it makes sense to apply that same filter.

[00:37:00] Speaker 01:
Can I just ask you a final question here, which is, are you aware of any number of other cases in which this matters?

[00:37:07] Speaker 01:
I mean, this seems to be a backward looking only scenario given that

[00:37:12] Speaker 01:
these statutes don't exist in this form.

[00:37:14] Speaker 02:
My understanding is the same as yours, Your Honor.

[00:37:16] Speaker 02:
Frankly, in all candor, one of my first questions I'm looking at this case is why doesn't this come up more?

[00:37:21] Speaker 02:
And we just haven't been able to find many examples.

[00:37:24] Speaker 02:
The ones that I'm aware of are Avery Dennison, where, of course, the board addressed exactly the question presented here and decided it in our favor.

[00:37:34] Speaker 02:
And as my friend on the other side says, there are a couple of other pending matters involving the same parties.

[00:37:39] Speaker 02:
and where there was a similar threshold determination of no SNQ.

[00:37:44] Speaker 04:
So under the AIA, reexaminations continue that were instituted before the effective date of the act, but that no new ones can be initiated.

[00:37:55] Speaker 04:
Is that the cutoff date?

[00:37:57] Speaker 02:
That's my understanding, Your Honor.

[00:37:59] Speaker 02:
Right, so that this is truly backward-looking in that regard.

[00:38:03] Speaker 05:
Thank you, Mr. Shumstein.

[00:38:04] Speaker 05:
Thank you very much.

[00:38:05] Speaker 05:
Mr. Berkowitz, we'll give you five minutes.

[00:38:07] Speaker 05:
We'll bottle if we need it.

[00:38:12] Speaker 03:
Let me first address your question, Judge Dyke, about whether any of these claim limitations were previously examined.

[00:38:21] Speaker 03:
The answer is no.

[00:38:23] Speaker 03:
And we did point that out in our brief that these limitations were not the subject of any originally challenged claim.

[00:38:30] Speaker 03:
And most of them were not the subject of any original claim.

[00:38:32] Speaker 03:
They were things like a filter.

[00:38:34] Speaker 03:
Were never the subject of any prior examination.

[00:38:38] Speaker 03:
And I think for that reason, it actually

[00:38:41] Speaker 03:
is a perfect example of why it doesn't make sense to apply the SNQ test in these circumstances and certainly not to cut off a requester's appeal right whenever an examiner mentions the word SNQ.

[00:38:58] Speaker 03:
To counsel's point, as far as we know, there is no authority talking about the SNQ test

[00:39:05] Speaker 03:
post-re-examination order.

[00:39:08] Speaker 03:
We disagree that the MPEP 2666.05 talks about that.

[00:39:13] Speaker 03:
That section talks about 37 CFR 1.948, which is the regulation allowing responsive arguments.

[00:39:22] Speaker 01:
The Belkin case, we don't... But then tell me how, because the opposing counsel points out that that MPEP section is talking expressly about 1.948, and it says that any newly proposed rejection has to

[00:39:35] Speaker 01:
comply with the guidelines of 2617, which are about SNQ.

[00:39:40] Speaker 01:
2617.

[00:39:42] Speaker 03:
It's a passing reference to 2617 or 16, which also talks about particularly pointing out the way in which the prior art renders the claims unpatentable.

[00:39:59] Speaker 03:
I think it's a big leap to say that this is something that

[00:40:05] Speaker 03:
the agency has done through the MPEP, when it's otherwise clear in the regulation, the SNQ test isn't there, it's just not mentioned.

[00:40:18] Speaker 03:
So there really, we don't think there is any authority that talks about, and I guess one other point I should make is that's not really what's at issue here because this was not a matter of interpreting 1.948.

[00:40:29] Speaker 03:
There was no reference by the examiner to, you know, you failed to meet the standards of 1.948.

[00:40:36] Speaker 03:
because of this implicit SNQ test.

[00:40:41] Speaker 03:
The examiner just never talked about 1.948.

[00:40:43] Speaker 03:
He applied the wrong standard.

[00:40:48] Speaker 03:
Your Honor, I guess what I want to say at the end is that your question from earlier, Judge Laurie, is about appealability.

[00:40:55] Speaker 03:
And this is an issue of appealability.

[00:40:57] Speaker 03:
And the facts of this case demonstrate exactly why a third party requester has to have the right to appeal.

[00:41:04] Speaker 03:
You have a fact pattern here where these were entirely new limitations.

[00:41:09] Speaker 03:
And we put in prior art to address these limitations never before examined.

[00:41:14] Speaker 03:
And the examiner, for whatever reason, presumably because we had cited this art in the original request, just reflexively said no SNQ.

[00:41:22] Speaker 03:
And under the board's reasoning, that could cut off our right to appeal.

[00:41:27] Speaker 03:
And that's not what Section 315 is about.

[00:41:30] Speaker 03:
In fact, Section 315 was amended by Congress.

[00:41:34] Speaker 03:
to create symmetry between the right to appeal of a requester and a patent owner.

[00:41:39] Speaker 03:
What the board's rule does is effectively create a situation where there isn't symmetry anymore.

[00:41:45] Speaker 03:
If our proposed rejection had been adopted, of course the fire pass and patent owner could have appealed.

[00:41:50] Speaker 03:
But under the board's reasoning, if it's not adopted for this particular reason, we can appeal.

[00:41:57] Speaker 03:
So the board's rule effectively takes the statute back to its pre-amendment days, where there's an asymmetry between

[00:42:04] Speaker 03:
what the requester can appeal and what the patent owner can appeal.

[00:42:06] Speaker 05:
Thank you.

[00:42:07] Speaker 05:
Mr. Berkowitz will take the case under review.

[00:42:13] Speaker 05:
All rise.

[00:42:16] Speaker 05:
The honorable court is adjourned from day to day.