Prosecuting Patent Applications in District Court after Kappos v. Hyatt

Prosecuting Patent Applications in District Court after Kappos v. Hyatt

Under the Supreme Court's decision in Kappos v. Hyatt [enhanced version available to subscribers] patent applicants that pursued their claims through a de novo civil action in district court, rather than through review at the Federal Circuit, are free to submit new evidence to support the right to a patent. The district court will then engage in de novo fact finding rather than deferential review of the PTO record with broad discretion to determine how much weight to give the new evidence. In this Analysis, Mary LaFrance discusses prosecuting patent applications in district court after Kappos. She writes:

     In a rehearing en banc, the Federal Circuit ... [held] that, in a civil action under § 145, a patent applicant is free to introduce new evidence, subject only to the Federal Rules of Evidence and the Federal Rules of Civil Procedure. Accordingly, it rejected the PTO Director's argument that an applicant's right to submit new evidence was limited to "new evidence that could not reasonably have been provided to the agency in the first instance." The court noted, however, that the District Court would be free to consider the applicant's failure to provide that evidence to the PTO in determining how much weight to give the new evidence

    The Federal Circuit also considered the degree of deference which the District Court in a § 145 proceeding should apply to the PTO's findings of fact. If no new evidence is submitted to the district court, the court determined, then the Administrative Procedure Act (APA) will apply. Under the APA, a court reviewing the record of an agency proceeding must uphold the agency's findings of fact if they were based on "substantial evidence." When new evidence is introduced, however, the District Court must make de novo fact findings.

    The Federal Circuit agreed with the Commissioner that, as a matter of policy, patent applicants should be encouraged to provide full disclosure to the PTO. While implicitly acknowledging that its interpretation of § 145 would not promote such a policy, the court concluded that this policy choice should be left to Congress.

    In a partial dissent from the en banc opinion, Judges Newman and Dyk argued that, even if no new evidence is submitted in the § 145 proceeding, the District Court owes no deference to PTO fact-findings, because Congress intended a § 145 proceeding to be "a full de novo proceeding," in contrast to a § 141 proceeding before the Federal Circuit, which is limited to the agency record and governed by the "substantial evidence" standard of the APA.

Questions Presented and the Supreme Court's Holdings in Brief

    The Supreme Court granted certiorari to consider the following questions:

1. Whether the plaintiff in a Section 145 action may introduce new evidence that could have been presented to the agency in the first instance.

2. Whether, when new evidence is introduced under Section 145, the district court may decide de novo the factual questions to which the evidence pertains, without giving deference to the prior decision of the PTO.

(citations omitted)

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