[00:00:03] Speaker 01: The first argued case this morning is number 181151, Honeywell International, Incorporated against Archimand, Incorporated. [00:00:16] Speaker 01: Mr. O'Quinn. [00:00:22] Speaker 02: Thank you, Judge Newman. [00:00:23] Speaker 02: May it please the Court, John O'Quinn on behalf of Honeywell. [00:00:27] Speaker 02: The Board's decision should be vacated because its refusal to allow Honeywell to even file a motion [00:00:33] Speaker 02: to seek leave to obtain a certificate of correction from the director was both substantively and procedurally flawed. [00:00:40] Speaker 01: Mr. Quinn, what do you think the standard is that we should apply? [00:00:45] Speaker 01: Because it does look, and your opponent will stress undoubtedly, that there was an opportunity, more than one, to make this correction earlier. [00:00:56] Speaker 02: So Judge Newman, I think a couple of things. [00:00:59] Speaker 02: whatever standard this court applies in terms of reviewing the board's decision, there's no question that the board was wrong in its analysis, because the board was on the mistaken impression that you cannot use a certificate of correction to correct a priority chain. [00:01:18] Speaker 02: And that's inconsistent with longstanding patent office practice. [00:01:22] Speaker 02: And that is reason enough to vacate the board's decision, because under the [00:01:27] Speaker 02: principle of PRIL versus an LRB and other cases, if the board's gotten it wrong with respect to one aspect of its decision, then that requires a rebalancing of its decision. [00:01:38] Speaker 02: But I think that to answer the question that you asked, Judge Newman, the inquiry before the board, as we've described in our brief, was whether or not there was a plausible basis for Honeywell to be able to seek a certificate of correction in the first place. [00:01:53] Speaker 02: In an analogous context, the Supreme Court, for example, has said with respect to a certificate of appealability, you don't have to show that you're entitled to prevail on the merits in order to be able to appeal. [00:02:05] Speaker 02: And I think the same principle would apply here. [00:02:08] Speaker 02: Yes, the board has a role to weed out what would be a frivolous request. [00:02:13] Speaker 02: But I don't think that there's any dispute that the request here is certainly not one that is frivolous. [00:02:19] Speaker 02: And so the things that the board could and did consider were, number one, whether or not you can use a certificate of correction to correct a priority change. [00:02:29] Speaker 02: And again, long-standing patent office practice says that you can. [00:02:32] Speaker 02: The board's statement to the contrary on which its decision rests, the Appendix 177, is simply wrong. [00:02:39] Speaker 02: You can't square it with Henry Lambrak or Shores and Van Weemen, which are decisions from the patent office. [00:02:49] Speaker 02: or Pfizer versus Teva, Keratec versus Kobayashi, B. Braun, all of which are district court cases that recognize that there's longstanding patent office practice that you can use a certificate of correction to correct a priority chain. [00:03:04] Speaker 01: So let's assume it was an inadvertent error. [00:03:11] Speaker 01: Is this the assumption you wish us to operate on? [00:03:14] Speaker 02: That's absolutely right. [00:03:15] Speaker 01: So let's assume that. [00:03:18] Speaker 01: Here we have a situation which is now contested. [00:03:21] Speaker 01: I think it's also fair to assume that if the change is made, let's call it the correction, the change, it will affect the result. [00:03:30] Speaker 01: It will affect the validity. [00:03:32] Speaker 02: Well, certainly the whole purpose of seeking the correction to the certificate of correction is to be able to get an earlier priority date than the filing of this particular application. [00:03:45] Speaker 02: And that would affect what would and wouldn't be prior art. [00:03:48] Speaker 02: That's absolutely right, Judge Newman. [00:03:49] Speaker 02: And indeed, it's certainly clear, and courts and the board have recognized in other contexts, that that is perfectly fine. [00:03:57] Speaker 02: In Emerson versus SIPCO, the board said, quote, correcting a priority chain always has the potential to affect the validity of a patent involved in litigation, yet such corrections are not precluded by the pending litigation. [00:04:09] Speaker 02: And there, in that particular case, it authorized pursuit of such a correction. [00:04:14] Speaker 02: in the B Braun case in the district court in Delaware and in the Pfizer versus Teva case both of them recognize that it would of course have the ability to affect. [00:04:23] Speaker 00: Didn't this request for the correction come in pretty late into the proceeding? [00:04:27] Speaker 00: Why should we allow a party to glide through certain phases of the proceeding and then seek a correction like this if they don't like what's going on? [00:04:37] Speaker 02: Sure, Judge Raina I appreciate the question and as [00:04:41] Speaker 02: As the prosecuting attorney explained to the board on the telephone call, this was a mistake that was discovered in the context of preparing the patent owner response. [00:04:52] Speaker 02: This is a patent that is one of a family of 100 plus patents. [00:04:57] Speaker 02: And so in the process of preparing the patent owner response, more than a month before the patent owner response was going to be due, Honeywell recognized that there was a sister chain that could be and should be claimed [00:05:09] Speaker 02: And at that point in time, brought it to the board's attention. [00:05:12] Speaker 00: Now, I think it's important to- Within the response? [00:05:15] Speaker 02: It was before the patent owner response was due. [00:05:18] Speaker 02: A month before the patent owner response was due to be filed. [00:05:21] Speaker 02: Now, that time had been extended, but it was before the patent owner response was to be filed. [00:05:25] Speaker 02: And to be clear, even if you think that the board could have perhaps decided that this was untimely, and there was no evidence that there was intentional delay here, there was suggestion that somehow this was strategic behavior, [00:05:38] Speaker 02: There's nothing about it that would have been strategic. [00:05:39] Speaker 02: There's no reason not to claim both priority chains except inadvertence. [00:05:45] Speaker 02: But even if you thought that the board could perhaps decide that the delay was reason, that's not the basis for the board's decision. [00:05:53] Speaker 02: The board's decision is at appendix 177. [00:05:55] Speaker 02: It's very short. [00:05:57] Speaker 02: And what it relies on is the failure to show that the minor character prong has been met. [00:06:03] Speaker 02: And that's just wrong as a matter of law. [00:06:05] Speaker 02: It is a basic misunderstanding of what it means. [00:06:07] Speaker 00: You say that it's the director that has to resolve that issue. [00:06:10] Speaker 00: Well, it's two issues, Judge Raina. [00:06:12] Speaker 00: Number one, that is- What's left for the board to decide? [00:06:15] Speaker 00: When I read your argument, it seems that you want the director to be the deciding factor on both fronts. [00:06:22] Speaker 00: What does the board do? [00:06:24] Speaker 02: Sure. [00:06:24] Speaker 02: So I do think it is ultimately the director's decision. [00:06:27] Speaker 02: This is not something that the director has delegated to the board, unlike, say, institution decisions [00:06:32] Speaker 02: that the director has delegated to the board. [00:06:34] Speaker 02: So it's ultimately for the director. [00:06:36] Speaker 02: I think that the proper role for the board here is to make a preliminary inquiry to assess whether or not, well, is this something that is this frivolous? [00:06:47] Speaker 02: Or is it plausible? [00:06:48] Speaker 02: And again, the analogy I would draw. [00:06:50] Speaker 00: The statute doesn't use the word frivolous. [00:06:52] Speaker 02: Well, the statute actually doesn't address this at all, Judge Raino. [00:06:55] Speaker 02: The statute doesn't contemplate that the board is going to necessarily be deciding anything with respect to a certificate of correction. [00:07:03] Speaker 02: The statute gives that authority to the director. [00:07:06] Speaker 02: Now, the statute allows the director. [00:07:08] Speaker 00: But frivolous isn't a standard for the director or the board. [00:07:12] Speaker 02: No, I agree. [00:07:13] Speaker 02: The director would ultimately decide this on the merits. [00:07:15] Speaker 02: And the director could theoretically delegate his authority to the board. [00:07:19] Speaker 00: So what's left for the board to decide? [00:07:20] Speaker 02: Yeah, so I think that what the board should have been deciding here is kind of like the panel in plastic development, which is available in the appendix of 15143. [00:07:29] Speaker 02: It's a 2017 PTAB decision. [00:07:32] Speaker 02: And that is whether or not there is a sufficient basis to believe that the mistake may be correctable. [00:07:39] Speaker 04: Isn't it essentially a futility? [00:07:41] Speaker 04: review, the board doesn't have to grant this motion if it would be futile for the patent owner to go to the director to seek this correction. [00:07:50] Speaker 02: I think that's absolutely an appropriate way to think about it, Judge Hughes. [00:07:53] Speaker 02: If the board thinks that it would be futile, then no, the board doesn't have to grant it. [00:07:57] Speaker 02: But otherwise, short of that, I think it is absolutely appropriate for the board to say that... But isn't that kind of what the board did here? [00:08:04] Speaker 04: They determined that even though some [00:08:08] Speaker 04: corrections can be granted under this, including to get the right chain back, that this was not a minor correction because it was going towards an entirely different patent, not just correcting the chain back to the same priority date claimed in the original patent. [00:08:26] Speaker 02: Well, first, Judge Hughes, I don't read the board as deciding that. [00:08:30] Speaker 02: What I read the board as deciding is simply that [00:08:33] Speaker 02: you cannot use a certificate of correction to correct the priority chain if it's going to affect what would be potentially prior art in the proceeding. [00:08:44] Speaker 04: I'm not sure that I necessarily agree with you, but let's stick to the premise, though, that there may be two types of corrections of priority chain. [00:08:53] Speaker 04: One, you've just somehow made a mistake in tracking back to the [00:08:58] Speaker 04: Priority date you claimed in the original patent right and the chain and the chain somehow got broken or something But you can get there other way you're still going back to the same patent. [00:09:07] Speaker 04: That's not what's going on here, right? [00:09:10] Speaker 04: You claim priority back to a certain patent and your new proposed priority chain goes back to an entirely different patent Obviously related but not mentioned at all in the original patent claim I take it and a completely different change [00:09:26] Speaker 02: So Judge Hughes, first, it's not mentioned in the original application. [00:09:30] Speaker 02: I agree with that. [00:09:31] Speaker 02: Second, I wouldn't characterize it as being a completely different chain, because the two of the patents in the chain are themselves continuations and part of patents that were already in the existing chain. [00:09:43] Speaker 02: But I would say that's not inconsistent with what has been authorized in cases like Pfizer versus Teva or like Shores and Van Weemen. [00:09:52] Speaker 04: Are there instances where you can [00:09:54] Speaker 04: cite to us that the director has allowed this type of chain correction to a different priority patent under this minor or inadvertent standard? [00:10:04] Speaker 02: No, I understand the question. [00:10:06] Speaker 02: I guess I'll put it this way. [00:10:07] Speaker 02: I'm not aware of any where the director has disallowed it on those grounds. [00:10:12] Speaker 02: I'm not aware of one specifically that has allowed it, but I'm not aware of one that has disallowed it. [00:10:16] Speaker 02: And if that is really sort of the basis here for saying, [00:10:21] Speaker 02: maybe a certificate of correction would not be appropriate. [00:10:24] Speaker 02: I would submit two things. [00:10:25] Speaker 02: Number one, the board should at least allow us to file a motion so that that issue could have been crystallized. [00:10:30] Speaker 02: And second, I'm not sure the board's in a position to make that decision as opposed to the director and the petitions branch which decides these types of issues. [00:10:39] Speaker 01: So did the board suggest that since they held that you hadn't shown that this was a minor change, that therefore the alternative for [00:10:50] Speaker 01: correcting an error is to put the patent into reissue. [00:10:54] Speaker 01: So is there something that's available at this stage? [00:10:58] Speaker 02: So Judge Newman, the board didn't suggest that at all. [00:11:00] Speaker 01: And again, somewhere, as maybe your opponents suggested. [00:11:03] Speaker 02: I think they may have. [00:11:04] Speaker 02: And they may have said that they think that that is what would be appropriate here. [00:11:08] Speaker 02: And I think that gets back to the board's fundamental error. [00:11:12] Speaker 02: The board's fundamental error is thinking that a certificate of correction could not be used [00:11:17] Speaker 02: to correct the priority chain. [00:11:20] Speaker 02: And if you look at, for example, Appendix 154. [00:11:21] Speaker 01: Well, I don't know if they said that in this case, at least, that based on the explanations which had been offered or not offered, that the standard had not been met of showing that it was a minor or inadvertent error. [00:11:37] Speaker 02: Well, the board didn't go off on the grounds that this was not inadvertent or in the sense of being. [00:11:44] Speaker 01: They cited the statute, the regulations. [00:11:45] Speaker 02: That's right. [00:11:46] Speaker 02: The board went off solely on two grounds. [00:11:49] Speaker 02: One, the failure to show it's a minor prong, which I think turns on the board's misunderstanding. [00:11:53] Speaker 02: The board, if you look at appendix 154 and 156, the board focuses on whether or not this is tantamount to a clerical or typographical error. [00:12:03] Speaker 02: And indeed, Arkema's counsel said the fact that it was not a typo was enough to quote in the discussion. [00:12:08] Speaker 02: That's at appendix 162 to 164, where that discussion is taking place. [00:12:13] Speaker 02: And that's not the right standard. [00:12:15] Speaker 02: Again, when you look at Henry Lambreck, you look at Shores and Van Wemen, you look at Pfizer v. Teva and these other cases, word to info versus Google, there's no question that a certificate of correction can be used to correct a priority chain. [00:12:30] Speaker 02: And the board's just simply wrong about that. [00:12:32] Speaker 02: The board also addressed the issue of prejudice, but it did not provide any reasoning for that. [00:12:37] Speaker 02: And it didn't identify anything that would, in fact, have been prejudicial in this case. [00:12:41] Speaker 02: And it didn't consider the prejudice to us, namely, [00:12:43] Speaker 02: that there's no other remedy available if we were not able to pursue a certificate of correction in this context. [00:12:50] Speaker 02: I see them into my rebuttal, but I'm happy to answer further questions. [00:12:52] Speaker 01: Let's hear from the other side, and we'll save you rebuttal time. [00:12:55] Speaker 02: Thank you, Judge Mayne. [00:13:00] Speaker 03: Your Honor, it's Mark Feldstein for ARCMA. [00:13:03] Speaker 04: Why isn't your friend's argument that the board [00:13:06] Speaker 04: should just make an initial kind of plausibility determination about whether a correction can be, certificate of correction can be sought the right way to do this, rather than the board kind of supplanting the director in this case. [00:13:19] Speaker 03: So I don't think the board supplanted the director. [00:13:21] Speaker 03: The board asked literally for a showing of whether Honeywell would be entitled to it. [00:13:26] Speaker 03: They didn't ask Honeywell to prove it. [00:13:27] Speaker 03: They asked for a showing. [00:13:29] Speaker 03: And if you limit it merely to the plausibility, as Honeywell was arguing, [00:13:33] Speaker 03: you leave out prejudice, which counsel didn't reference once. [00:13:36] Speaker 03: Prejudice is clearly a factor. [00:13:38] Speaker 03: Their lead case, at least in their opening brief, USAA, considers, among other things, prejudice. [00:13:45] Speaker 03: And it's an appropriate factor for the court. [00:13:47] Speaker 00: If the correction is allowed, does that drive the result in the case? [00:13:50] Speaker 00: I'm sorry, Your Honor? [00:13:50] Speaker 00: If the correction is permitted, does that drive the result in the case? [00:13:55] Speaker 03: Well, counsel said, you know, they say now that it was case dispositive and therefore a basis for appeal. [00:14:02] Speaker 03: What they said during the hearing, in fact, was that it's a placeholder, and that they would have to then prove up entitlement to the priority. [00:14:10] Speaker 03: So the certificate of correction by itself actually isn't enough, and this is part of what we addressed in the harmless error. [00:14:17] Speaker 03: Even if they had gotten the motion, even if they had gotten the certificate of correction, [00:14:21] Speaker 03: That doesn't make it case dispositive. [00:14:23] Speaker 03: It makes which questions why we're here at all on a pure procedural issue. [00:14:28] Speaker 03: They would have had to show that they were entitled to priority. [00:14:30] Speaker 03: They didn't show that there was prejudicial error in their opening brief. [00:14:35] Speaker 03: In fact, there's not prejudicial error because they wouldn't have been entitled to priority. [00:14:40] Speaker 03: As your honors had asked, there's no reference to the prior applications, the ones they want to incorporate, [00:14:45] Speaker 03: in the chain of patents, which is a requirement in the MPEP 1481.03 that has to be, quote, clear from the record if you're going to insert a late claim to priority. [00:14:57] Speaker 01: That's why they're here. [00:14:59] Speaker 03: Sorry, Your Honor? [00:14:59] Speaker 01: That's why they're here. [00:15:00] Speaker 01: There's no reference, and they want to insert it. [00:15:04] Speaker 03: Correct, Your Honor. [00:15:04] Speaker 03: But the MPEP requires 1481.03, which they cite in their opening brief, requires that for a late claim for priority, this is 35 USC 120, a late claim for priority [00:15:16] Speaker 03: The change in priority has to be, quote, clear from the record of the patent and the parent applications. [00:15:22] Speaker 03: Here, there's no reference in the patent or the parent applications to the sister chain that they're trying to incorporate. [00:15:30] Speaker 03: Is that because they were not allowed to make their argument? [00:15:33] Speaker 03: No, because the record of the patent itself, looking at the file history of the patent, looking at the record, looking at the inventors, both in declaration, that's usually where you find support to say, [00:15:46] Speaker 03: It was in the record all along, and we're going to add a late claim of priority, but we can point to where you can backtrack it. [00:15:52] Speaker 03: Here it's obviously not clear from the record. [00:15:55] Speaker 03: It took Honeywell eight and a half months after we filed our petition noting that they don't have a priority going all the way back, a written description support going all the way back. [00:16:06] Speaker 03: And it took them eight and a half months to say, hey, this could help us to add it in. [00:16:10] Speaker 03: It's obviously not clear from the record in that context. [00:16:14] Speaker 01: So here we have [00:16:15] Speaker 01: the complexities of patent prosecution, which are getting, I say, worse and worse or better and better, more and more unmanageable. [00:16:25] Speaker 01: Let's assume for the sake of this question that it was an inadvertent mistake. [00:16:32] Speaker 01: At what point do the courts, certainly it's not the role of the MPEP to throw the book at someone who might have missed something as [00:16:44] Speaker 01: Significant, it turns out, as another group of patents, same owner. [00:16:51] Speaker 01: There was no issue of conflict internally. [00:16:57] Speaker 01: A long chain in all of the patents that were cited and unsighted. [00:17:02] Speaker 01: And it didn't happen to have been put together. [00:17:06] Speaker 01: And let's just assume that there is a meritorious entitlement here. [00:17:12] Speaker 01: Nonetheless, at what stage [00:17:15] Speaker 01: Do the courts step in and try and achieve the right result if we can figure out what the right result is? [00:17:23] Speaker 03: I think that the board had it correct. [00:17:26] Speaker 03: They looked at this. [00:17:27] Speaker 03: They looked at it. [00:17:27] Speaker 03: It was already post-institution. [00:17:29] Speaker 03: It was two and a half months after institution. [00:17:31] Speaker 03: The post-grant review decision had been instituted [00:17:35] Speaker 03: on the grounds that we find you're not entitled to written description support back to 2004. [00:17:41] Speaker 03: Mid-litigation, a litigant shouldn't be free if it's prejudicial to the other side, which it was prejudicial to Arkema, to go change the entire grounds of the proceeding. [00:17:51] Speaker 03: And so it's not appropriate to make a change at that point. [00:17:54] Speaker 03: And that's what the prejudice issue was and is and remains and was part of the basis for the board denying [00:18:03] Speaker 03: Honeywell authorization. [00:18:05] Speaker 00: Who makes that determination, the prejudice determination? [00:18:08] Speaker 00: Isn't that part of whether this is a minor change or not? [00:18:11] Speaker 03: No, prejudice is entirely separate. [00:18:13] Speaker 00: Does that go to the merits of minor change and doesn't that belong to the director? [00:18:19] Speaker 03: No, I don't believe so, Your Honor. [00:18:20] Speaker 03: I think minor is a question of is it a minor change to the patent itself. [00:18:24] Speaker 03: Prejudice was in the context of the PGR itself and the board in its decision [00:18:30] Speaker 03: references back to the showing of prejudice that had been made during the hearing. [00:18:34] Speaker 03: What's left for the director to decide then? [00:18:37] Speaker 00: If the board's deciding minor change and whether there's prejudice or not, delay, all these other things you're talking about, whether a certificate will even, the correction will even affect any type of a change, what's left for the director? [00:18:52] Speaker 03: The director had they done it in, for example, early enough in the case, pre-institution, [00:18:58] Speaker 03: as in the USAA case they rely on. [00:19:01] Speaker 03: It was a pre-institution intent to file certificate correction. [00:19:05] Speaker 03: Had they done it at a different time, or if there hadn't been prejudice, then it would have gone to the director for the director to decide, is it minor? [00:19:12] Speaker 03: And then there's the separate question later, does it change provider and description support they would need? [00:19:22] Speaker 04: Are you saying that the minor change is connected to the prejudice inquiry? [00:19:26] Speaker 03: No, I'm saying it's not. [00:19:28] Speaker 04: I'm saying that the minor is 255. [00:19:30] Speaker 04: If this was a minor change, then it doesn't really matter at what stage this was filed, because there might be prejudice. [00:19:37] Speaker 04: But it's still, if it's a minor change, they're probably entitled to a certificate of correction. [00:19:42] Speaker 03: Not if it's prejudicial. [00:19:44] Speaker 03: Not if it interferes with the proceeding. [00:19:45] Speaker 03: The post-grant review, the time we've been proceeding, the board has... I don't understand how that can be right. [00:19:52] Speaker 04: That's going to mean that if a patentee made an inadvertent [00:19:56] Speaker 04: mistake and are entitled to a certificate of correction under the statute and the regulations, they're going to get that right taken away from them because you filed an IPR? [00:20:07] Speaker 03: They don't have a right to get a certificate of correction. [00:20:10] Speaker 03: The director has a right to grant a certificate of correction. [00:20:12] Speaker 03: That's not the way 255 is written. [00:20:14] Speaker 04: Sure, but if it's minor and inadvertent, the statutes and regulations [00:20:19] Speaker 04: basically give them a right to seek it and how it should be granted. [00:20:22] Speaker 03: It's potentially available for typographical, clerical, or minor. [00:20:25] Speaker 04: It just seems to me that you're arguing for more than you need to here, because the board determined that this wasn't minor. [00:20:31] Speaker 04: So whether there was prejudice or not, the fact that there's prejudice helps. [00:20:35] Speaker 04: But if this isn't minor, it's not something the director would have granted. [00:20:39] Speaker 03: Absolutely. [00:20:39] Speaker 03: And what Honeywell, I think, overstates what the board said about minor, that Honeywell articulates that there was sort of a per se decision by the board [00:20:49] Speaker 03: that a change in priority can never be minor. [00:20:52] Speaker 03: That's not what the board said. [00:20:53] Speaker 03: And neither does the precedent they rely on say that a change in priority is always minor. [00:20:58] Speaker 04: Are you aware of any decisions or director from the board or the director that have allowed certificates of corrections of this character where what they're trying to get the change is to a unmentioned patent or an unmentioned earlier patent or parent rather than correcting [00:21:19] Speaker 04: somehow something that is something that was already in the patented issue. [00:21:24] Speaker 03: All the cases that that have come up in the briefing that Honeywell cites in support of their side as I read them are going back to the original parent application and fixing your priority. [00:21:34] Speaker 04: But you're not aware of any cases that say this situation is not permissible. [00:21:39] Speaker 03: Correct your honor. [00:21:40] Speaker 04: So if that's the case then why shouldn't it particularly if it's a kind of you [00:21:45] Speaker 04: issue a first impression on this statute of regulation, why shouldn't the director make it in the first instance, not the PTAB? [00:21:53] Speaker 03: The PTAB wasn't usurping the authority of the PTAB or the director to make this. [00:21:57] Speaker 03: The PTAB had a duty to conduct a post-claim review. [00:21:59] Speaker 04: Well, I mean, I get what you're saying, but they kind of are if it's a live question of whether this is possible or not. [00:22:06] Speaker 04: I mean, if there was a long line of precedence from the director saying, this isn't a minor change, this is [00:22:13] Speaker 04: something that doesn't entitle you to a certificate of correction, then I think it would be very easy for the board to say, look, the director's not going to grant this, it's futile, we're not going to give it. [00:22:24] Speaker 04: But this seems to me, unless you all have come up with something that you haven't cited in the briefs or [00:22:30] Speaker 04: today, an open question of whether the director would have granted that. [00:22:34] Speaker 03: Yeah, there are other cases that are in the record. [00:22:36] Speaker 03: Prime Focus is a PTAB case where it was a certificate of correction was denied at the, the motion for authorization of a certificate of correction was denied because changing, the change there wasn't a priority change, I believe it was a change to the claims, but it would have made the case of moving target [00:22:54] Speaker 03: And it was too late to have done that. [00:22:56] Speaker 04: Sure, but that's different again. [00:22:57] Speaker 04: I mean, this is a change to a priority date. [00:22:59] Speaker 04: It's of a different character than kind of an inverting, you know, mistaking of the chain and the actual documents underlying the patented issue. [00:23:10] Speaker 04: It has to add, at least I think in your view, it has to add new material, as in adding a different patent and adding more evidence about the chain. [00:23:20] Speaker 04: But I'm not convinced that the director would disallow [00:23:24] Speaker 03: And that's why the board can be affirmed, even if there was a mistake on minor, because of the prejudice issue. [00:23:32] Speaker 03: It was a two-pronged decision. [00:23:34] Speaker 03: We're not convinced that Honeywell made a showing. [00:23:37] Speaker 03: They don't make a judgment that it's impossible. [00:23:40] Speaker 03: They say that Honeywell, who had two hearings over one and a quarter hours to make a showing, that Honeywell failed to make a showing that it was minor character. [00:23:50] Speaker 03: given that the prejudice that had been articulated and further that it would be prejudicial at this stage. [00:23:56] Speaker 03: So the board's decision rests on two pearls. [00:23:57] Speaker 04: So if we don't have any precedent from the director or the board on this issue about whether this is minor or not, what kind of showing would they make other than saying, here are the facts, here's the patent we want to get priority back to, we think the board would let us? [00:24:13] Speaker 03: What they admitted, in fact, rather than making a showing, is that the board's decision was [00:24:18] Speaker 03: The institution decision was premised on finding that the patent was only entitled to a 2014 priority date for its claims, and they admitted that they were trying to change that, and they admitted that would change the basis of institution. [00:24:33] Speaker 03: And so it was pretty clearly not minor based on Honeywell's own admissions. [00:24:39] Speaker 04: But if they had found a chain back to the other patent that they claimed priority to, [00:24:44] Speaker 04: that was in the record, I think that would clearly be a minor change. [00:24:48] Speaker 04: We still may have to do the prejudice analysis, but that would have been sufficient showing for a minor change because the director does grant certificate of corrections in those circumstances. [00:24:59] Speaker 04: So again, the question is, if we agree that the director can grant a certificate of correction in those circumstances and has never addressed this circumstance, why isn't it [00:25:11] Speaker 04: an abuse of discretion for the board to make that first decision rather than the director? [00:25:16] Speaker 03: The board has rule 42.3. [00:25:20] Speaker 03: It's required to cede its exclusive jurisdiction. [00:25:25] Speaker 03: There's no challenge that has exclusive jurisdiction. [00:25:27] Speaker 03: And the board must be able to manage its own docket. [00:25:30] Speaker 03: And if any time someone comes in and says, we believe that it was inadvertent, we'll have a declaration to say that the error was inadvertent, it's going to force the PTAB to give up its docket. [00:25:41] Speaker 03: and give up the management of his own docket, which is not a proper requirement. [00:25:46] Speaker 04: That argument proves too much, because that argument would prove the same thing for minor corrections, and I think it would be fair to say that if the board disallowed [00:25:58] Speaker 04: a motion to file certificate of correction on something that's minor and then it's almost certain that the director would grant, we would find that an abuse of discretion. [00:26:07] Speaker 04: So the management of the DACA to me doesn't answer the question of whether this is still something that is a relatively open question that should have been sent back to the director to decide rather than the board making it in the first instance as a futility determination. [00:26:23] Speaker 03: Sending it back to the director two and a half months in [00:26:26] Speaker 03: would have interfered with proceeding as it was going on. [00:26:29] Speaker 03: And that's what the board should probably be able to do to manage its socket. [00:26:33] Speaker 04: Would you agree that would be the same argument even if it was a minor correction, right, if it was filed at the same time? [00:26:40] Speaker 04: Would you be up here arguing? [00:26:42] Speaker 04: I suppose you would be if the board had ruled in your favor on a minor correction. [00:26:45] Speaker 04: But I think you would have a hard time prevailing that it was OK for the board not to send something back that looked like it was a minor. [00:26:53] Speaker 04: mistake that could be corrected. [00:26:54] Speaker 03: If it's prejudicial, that's a separate reason for the board to deny, and a proper reason. [00:27:00] Speaker 03: And Honeywell, in the argument before the board, they, sui sponte, recognized that prejudice was an issue. [00:27:07] Speaker 03: They recognized it in the opening brief. [00:27:08] Speaker 03: Prejudice is an issue, and it's an independent reason why, and a clear reason here where the board can be affirmed on the finding of prejudice alone. [00:27:17] Speaker 04: I know you're just about out of your time, but do you have any view, because I'm going to ask your friend about this, [00:27:20] Speaker 04: What our standard of review on this question is, whether it's an abuse of discretion or do we have full de novo review of the board's denial of the motion? [00:27:29] Speaker 03: I don't think it's more than abuse of discretion. [00:27:31] Speaker 03: I don't think it's higher than that. [00:27:32] Speaker 03: I mean, we do argue, Your Honor, that the board's management of its own docket under Rule 42.3 is an exception under 701A2, that it's left to the board's discretion on when it may or may not cede its jurisdiction. [00:27:48] Speaker 03: our lead argument, Your Honor, is that it's actually not reviewable. [00:27:51] Speaker 00: Did the Board make some factual findings here? [00:27:53] Speaker 03: The Board absolutely did make factual findings. [00:27:55] Speaker 00: So wouldn't that be a substantial evidence standard? [00:27:58] Speaker 03: If it's an APA review, I think that 706 is the arbitrary and capricious standard. [00:28:05] Speaker 01: Okay, any more questions for Mr. Faust? [00:28:09] Speaker 01: Thank you. [00:28:14] Speaker 02: Thank you, Judge Newman. [00:28:14] Speaker 02: Let me start with the standard review question, Judge Hughes, that you were asking my colleague. [00:28:19] Speaker 02: I mean, we are here under 706. [00:28:21] Speaker 02: 706 means that if the agency has acted in a manner that's arbitrary and capricious, abused its discretion, or otherwise not in accordance with law, you've got to send it back. [00:28:31] Speaker 02: I would submit that the agency here failed each one of those prongs. [00:28:34] Speaker 02: It acted contrary to law because it misunderstood what it means to be of minor character. [00:28:39] Speaker 02: The board doesn't do the- Well, let's set that aside. [00:28:42] Speaker 04: I know that you're arguing. [00:28:44] Speaker 04: the better reading of the opinion. [00:28:45] Speaker 04: But I'm not convinced that that's what the board was doing. [00:28:49] Speaker 04: I think it seemed to me that they were distinguishing between minor and non-minor errors. [00:28:53] Speaker 04: And if that's the case, then they're doing the law correct. [00:28:56] Speaker 04: But tell me why it's arbitrary. [00:28:58] Speaker 02: The only other point I'd make on that, Judge Hughes, is just, again, if you look back at the record and look at appendix 154, you'll see there's no suggestion by the board, not in its questions and not in its decision, that this is about the specifics of the priority chain. [00:29:11] Speaker 02: This is all about the fact that it's going to change prior art. [00:29:13] Speaker 02: And that's going to happen. [00:29:14] Speaker 02: every time that you have a correction to a priority chain. [00:29:17] Speaker 02: And that also gets to why it's arbitrary and capricious. [00:29:20] Speaker 02: In every other analogous circumstance where the board has, where the Patent Office has been faced with the certificate of correction, the use of a certificate of correction for correcting a priority chain, it is said that that is something that is potentially available and that that is something you can use a certificate of correction for. [00:29:39] Speaker 04: Sure, I get all that, but my problem is it's [00:29:43] Speaker 04: very unclear to me whether this is the type of correction of a chain that the director would allow. [00:29:51] Speaker 04: This is not the type of kind of generally the ones where we see which are pretty minor where it's in the specification or in the prosecution history and you just didn't know the chain properly and you can go back and point to the underlying documents. [00:30:05] Speaker 04: I take it, I may be wrong, but I think you have to add additional documents here. [00:30:10] Speaker 04: You have to add stuff that wasn't in [00:30:12] Speaker 04: the prosecution of this patent. [00:30:14] Speaker 02: Well, we point to what would be now the parent application. [00:30:17] Speaker 02: So this can all be discerned from this application and from what we're asserting would be the proper parent application. [00:30:23] Speaker 02: But I agree you have to point. [00:30:24] Speaker 04: That parent application was not mentioned anywhere in the current patent. [00:30:29] Speaker 02: I'm not aware of it having been mentioned in the current patent. [00:30:31] Speaker 04: And so nobody has cited to me any case where the director has allowed a correction on that basis. [00:30:37] Speaker 02: And I'll say this, Judge Hughes, that gets back to, again, what is the posture we're in? [00:30:41] Speaker 02: The board denied us permission to even seek permission to file a certificate of correction. [00:30:47] Speaker 02: They cut us off at the first step. [00:30:49] Speaker 02: And at a minimum, the board, precisely for the reasons that you've identified, the board should have at least allowed briefing on this. [00:30:56] Speaker 02: And then these issues could have been sussed out. [00:30:58] Speaker 02: If I may, Judge Newman, I'd like to respond. [00:30:59] Speaker 02: I know I'm past my rebuttal time. [00:31:01] Speaker 02: But if I could, I'd just like to respond on the prejudice point, because we've heard a lot about it. [00:31:06] Speaker 02: And I think it's important to recognize [00:31:09] Speaker 02: that for all of the statement of saying there's prejudice, there's not actually any evidence of prejudice. [00:31:15] Speaker 02: Again, because the board didn't brief this, they didn't put on any evidence in response to say, oh, well, there actually is prior art that we would have put in. [00:31:23] Speaker 02: That was one of the arguments they make is there's other prior art that we could have asserted. [00:31:28] Speaker 02: There's no record of that. [00:31:29] Speaker 02: That's pure speculation. [00:31:31] Speaker 02: And their main argument about prejudice is just to say, well, it's prejudicial because now things [00:31:36] Speaker 02: that would have been prior art will not be prior art because you've changed the priorities. [00:31:42] Speaker 02: That can't be the prejudice here because that's going to be true every time a certificate of correction. [00:31:45] Speaker 04: That would be automatic prejudice. [00:31:46] Speaker 02: That's absolutely right, Judge Hughes. [00:31:48] Speaker 04: Even for the minor issues. [00:31:49] Speaker 02: Even for the minor issues, even for a typographical correction. [00:31:52] Speaker 02: That's absolutely right. [00:31:54] Speaker 01: Anything else you want to ask? [00:31:57] Speaker 01: No. [00:31:57] Speaker 01: Thank you. [00:31:58] Speaker 01: Thank you both. [00:31:59] Speaker 02: Thank you, Judge Negard. [00:32:00] Speaker 02: The case is under submission.