En Banc Denied in In re Cellect: Double Patenting and Patent Term Adjustment

by Dennis Crouch
The Federal Circuit has denied Cellect’s en banc petition on the interplay between obviousness-type-double-patenting and patent-term-adjustment.  The situation here is creating some strategic challenges for patentees with large patent families. 
The vast majority of obviousness-type double-patenting rejections arise in family-member cases — continuation applications where the USPTO examiner identifies the claims in one application as obvious variants from a sister application.  The easiest way to overcome an OTDP rejection is via terminal disclaimer that links the two patents together so that they maintain the same owner and expire on the same day.  The terminal disclaimer filing often has no negative consequences because the patents are already set to expire on the same day and would likely already be maintained together as assets.  But, one area of concern has to do with Patent-Term-Adjustment (PTA).
Although the 20-year patent term begins running as of filing, a patent is only enforceable once issued.  This gap creates a potential that unduly delayed patent prosecution will eat into the effective patent term.  An example of this situation might involve a successful PTAB appeal of an erroneous examiner rejection.  That appeal process will typically take years to complete.  Congress stepped in years ago to a “patent term guarantee” that establishes three bases for adjusting patent term due to various delays in prosecution.

Type 1: if the USPTO fails to take certain actions within specified time frames;
Type 2: if the USPTO fails to issue a patent within three years of the actual filing date of the application; and
Type 3: for delays due to interference, secrecy order, or successful appellate review.

The basic setup here is that applicants receive a day-for-day addition to the patent term for each delay that fits into one of the statutory categories. 35 U.S.C. 154(b).
Back to terminal disclaimers : The statute appears relatively clear that patent-term-adjustment does not extend a patent term beyond that disclaimed in a terminal disclaimer. Section 154(b)(2)(B) states plainly that “[n]o patent the term of which has been disclaimed beyond a specified date may be adjusted under this section beyond the expiration date specified in the disclaimer.”  There are quibbles about what this actually, means, but the USPTO and Federal Circuit have agreed that a terminal disclaimer cuts off additional term that may be granted via PTA (note opposite ruling with respect to PTE based upon FDA delays).
In Cellect , the patentee obtained two similar patents but was not asked to file a terminal disclaimer – perhaps because of failures at the USPTO.  Because the two patents had the same priority filing date, they were also set to expire on the same date — except that one of the patents was delayed during prosecution and so had an extended patent term.  During reexamination, the USPTO found the second patent invalid as an obvious variant of the already expired patent — holding that the patentee was improperly attempting to extend the patent term. On appeal, the Federal Circuit affirmed — holding that it is improper to extend the term of an expired patent via a separate patent with additional PTA.  This is generally an issue that can be cured if both patents are still in-force.  However, if there is seemingly no way to cure a new OTDP finding if one of the patents has already expired.
The en banc petition was well drafted and supported by strong amicus briefing. However, the Federal Circuit has denied the petition.
I believe that there is some chance for Supreme Court review. I would focus the petition on the equitable nature of the judge-made remedy in this situation and explain how this case does not include any showing of either wrongdoing by the patentee or unreasonable harm to the public. 
The Fate of Patent Term Adjustment: In re Cellect Seeks Rehearing on Double Patenting

Parties

Cellect, LLC: Paul J. Andre – Kramer Levin Naftalis & Frankel LLP
Samsung Electronics Co., Ltd. (Amicus Curiae): Douglas Hallward-Driemeier – Ropes & Gray LLP

Amici:

USPTO: Kakoli Caprihan (Solicitors Office)
Pharmaceutical Research and Manufacturers of America (Amicus Curiae): Jeffrey Kushan – Sidley Austin LLP
Intellectual Property Owners Association (Amicus Curiae):Paul Berghoff – McDonnell Boehnen Hulbert & Berghoff LLP
Biotechnology Innovation Organization (Amicus Curiae): Kevin Edward Noonan – McDonnell Boehnen Hulbert & Berghoff LLP
ALVOGEN PB Research & Development LLC (Amicus Curiae): Jeremy Lowe – Leydig, Voit & Mayer, Ltd.
Association for Accessible Medicines (Amicus Curiae): Kurt A. Mathas – Winston & Strawn LLP
Bob Armitage (Amicus Curiae Pro Se)
American Intellectual Property Law Association (Amicus Curiae): Sophie F. Wang – Choate, Hall & Stewart LLP
New York Intellectual Property Law Association (Amicus Curiae): Jeffrey I.D. Lewis – Foley Hoag LLP
Inari Agriculture, Inc. (Amicus Curiae): Scott Anthony McKeown – Wolf, Greenfield & Sacks, P.C.
Novartis Pharmaceuticals Corporation (Amicus Curiae): Jane M. Love – Gibson, Dunn & Crutcher LLP
Language Technologies, Inc. (Amicus Curiae): Steven J. Rizzi – McKool Smith, P.C.