Patent And Trademark Jurisdiction Of The Court Of Customs And Patent Appeals — Part II (Conclusion)

PATENT AND TRADEMARK JURISDICTION OF THE COURT OF CUSTOMS AND PATENT APPEALS ^* --
Part II (Conclusion)

by Charles L. Gholz ^**

Table of Contents

When Is The Board Actually The Commissioner?
Delegation to One of the Boards of the Commissioner's Authority to Decide Petitionable Matters

When Is One Board Actually Another Board?
Transfer of Jurisdiction from Board to Board

When Is The Board Not A Board At All?
Decision by an Illegally Constituted Panel

When Is The Commissioner Not The Commissioner?
Delegation Within the Patent Office and Exercise by the Commissioner of the Jurisdiction of One of the Board

Conclusion

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When Is The Board Actually The Commissioner?
Delegation to One of the Boards of the Commissioner's
Authority to Decide Petitionable Matters

Decisions of the Commissioner on petitionable matters are not appealable, as such, to the CCPA.⁶¹ However, when the commissioner delegates some of his authority to make decisions on petitionable matters to one of the boards, it may be asked whether the CCPA has jurisdiction over appeals from such decisions. The question was first presented to the court in Sunback v. Blair,⁶² where the court held that the Board of Appeals was the Commissioner in disguise. To arrive at this conclusion, the court first determined that the statute⁶³ reposed authority to dissolve interferences solely in the Commissioner. Next, the court read the Patent Office rules which provided that motions to dissolve an interference should be decided by a Law Examiner, with appeal to the Board of Appeals, as delegations of the Commissioners authority. Thus, the court held the board's decision to have been, in legal contemplation, that of the Commissioner and not appealable to the CCPA because "[t]he statutes do not provide for any appeal to this court from any decision of the Commissioner in proceedings relating to patents."⁶⁴ Later that term, Sundback was strongly reaffirmed and defended against various new attacks in Headley v. Bridges.⁶⁵

A case presenting the issue did not come up again, so far as this writer has found, for thirty-nine years. When it did, in In re James,⁶⁶ the court, speaking through Judge Baldwin, greatly extended the rule of Sundback. In James, the Board of Appeals had dismissed an appeal to it on the ground that appellant's failure to file a reply brief in response to newly cited references in the examiner's answer was a "failure to file the brief" within the meaning of Rule 192(b).⁶⁷ On appeal to the CCPA, the majority held that "the board was acting only under authority of the rules -- as an agent of the Commissioner -- and not in any statutory capacity, reviewing, on its merits, an adverse decision of the examiner."⁶⁸ In dissent, Judge Rich first pointed out that the rules of the Patent Office, "if approved by the Secretary of Commerce and not inconsistent with statutory, constitutional, or treaty law, have the force and effect of law."⁶⁹ He then argued that:

a decision of the board interpreting such a regulation is no less a decision of the board subject to our review than a decision of the board interpreting a statute, the Constitution, or a treaty. A decision of the board on a statutory appeal interpreting a regulation established by the Commissioner stands on a very different footing from a decision (whether interpreting a statute, a rule, or opinions of this or any other court) in a proceeding in which the entire proceeding consists, as it did in the Sundback case, only of the exercise of delegated authority.⁷⁰

He further indicated, citing In re Searles,⁷¹ that the court was accustomed to deciding cases involving the interpretation of Patent Office Rules. In Searles the court had found an examiner's decision refusing entry of an amendment to be appealable, in part because the examiner' action "required the exercise of technical skill and legal judgment in order to evaluate the facts presented, interpret the requirements of 35 U.S.C. 116 and Rule 45 and weigh the facts against the requirements."⁷²

It may be hoped that the result in James will prove an isolated aberration, despite the approval which it received from respected commentators.⁷³ Apparently, the rule of Sundback has been seldom applied, presumably because the Commissioner has rarely delegated to the board portions of his statutory, quasi-judicial powers on petitionable matters. However, the boards (and the CCPA, as exemplified by the Searles case) are continually applying the rules of the Patent Office, promulgated under the authority of the Commissioner. To deprive the CCPA of its jurisdiction to review their applications of these rules --even when their actions are taken "only under authority of the rules" and are not, strictly speaking, a part of their review of what the examiner has done⁷⁴ -- would diminish seriously the scope of its jurisdiction.

When Is One Board Actually Another Board?
Transfer of Jurisdiction from Board to Board

Theoretically, the division of functions between the Board of Patent Interferences and the Board of Appeals is sharp -- the former is to decide questions of priority and questions ancillary thereto,⁷⁵ and the latter is to decide questions of patentability and, at the least, questions "logically related" thereto.⁷⁶ Notwithstanding this theoretical division of authority, the possibility exists that one board might decide an issue which the CCPA would later determine to have been within the exclusive jurisdiction of the other board. Should this happen, the CCPA will be faced with the difficult question of whether to review the matter. There are two ways in which the court might resolve the issue. First, it could find that the particular board decision was ultra vires for that board and therefore declare the whole proceeding void. The CCPA would thus lack jurisdiction to review whatever decision the board made. Alternatively, the court could rule prospectively that decisions on that particular issue should be made by the other board, but nevertheless assume jurisdiction to review the decision on the theory that the error did not affect substantial rights, particularly since the erring board's decision was still reviewable by the CCPA. The latter alternative, however, would seem to ignore the parties' right to have the issue decided in the first instance by the board having specialized expertise over the issues involved. Although the CCPA has not yet been faced with this problem, it may soon be. In Moore v. McGrew⁷⁷ the Board of Patent Interferences stated that the determination of whether or not two applications or an application and a patent interfere in fact "involves . . . a question of patentability, which, while not ancillary to priority, is property treated by the Board of Patent Interferences."⁷⁸ The board thereafter decided that an "interference in fact" did exist between McGrew's patent and Moore's application and awarded priority to McGrew.

It may be debated whether, in general, the question of the existence of an interference in fact between the claims of two applications, or between the claims of an application and the claims of a patent, is solely one of patentability or is one ancillary to priority. This is, after all, an issue fundamental to all interference proceedings in which the count differs from one or more of the corresponding claims.⁷⁹ Brailsford v. Lavet,⁸⁰ the leading modern case on the subject, appears to assume that the CCPA has jurisdiction over appeals on the issue of the existence of an interference in fact, although the court does not seem to have specifically considered this issue.⁸¹ The only consideration militating against deciding the issue in the context of an interference is the fact that such determinations are much closer conceptually to the usual work of the Board of Appeals (determining anticipation and obviousness) than it is to the usual work of the Board of Patent Interferences (determining priority and the existence of support for the counts in the parties' disclosure).

Moore was not, however, the ordinary interference-in-fact case. Moore's application and McGrew's patent were both assigned to the same firm, and the interference was declared in compliance with a Commissioner's Notice⁸² which directed that an interference should be declared between an application and a commonly owned patent if the two were "directed to identical inventive concepts or . . . [if] one of the concepts would be obvious in view of the other" unless the common assignee made a determination of priority. In effect, this was a device to compel the common assignee to determine the validity of the claims in his two cases under 35 U.S.C. §§ 102(g) and 103, the sanction for noncooperation being the declaration of an interference. Thus, (1) it was a special proceeding, to which only commonly assigned cases were subject, and (2) the scope of inquiry was much broader than it is in the usual interference. In Brailsford the CCPA had said that

[i]n considering the existence or nonexistence of an interference in fact between the instant parties, the first consideration is whether the omission of the recited "core portion" from the claim of the Brailsford patent results in a different invention being claimed.⁸³

In Moore, on the other hand, the Board of Patent Interferences determined that there was an interference in fact by determining that the parties' inventions, though concededly different, were obvious in view of each other.⁸⁴

On these facts, it would indeed seem that the Board of Patent Interferences decided a question of straight patentability -- namely, the patentability of Moore's claims under 35 U.S.C. §103 over McGrew's invention, which the board assumed to be available against Moore under 35 U.S.C. § 102(g).⁸⁵ Of course, the question was clearly assigned to the board by the above-mentioned Commissioner's Notice, and the assignment was, arguably, only a logical extension of the firmly established phantom-count practices,⁸⁶ which permits the declaration of an interference on a count which neither party can make. On the other hand, as the Board of Interferences itself seemed to admit, the determination of patentability is a long way from its usual jurisdiction.⁸⁷

The question of interference law raised by Moore is far beyond the scope of this article.⁸⁸ For present purposes, it is sufficient to ask whether, if such a case is appealed and if the court does determine that the Board of Patent Interferences decided a question of patentability not ancillary to priority, the court will then review the board's decision. The CCPA has countenanced the Commissioner's delegation of some of his quasi-judicial authority to one of the boards,⁸⁹ but is should not approve transfer by the Commissioner of a portion of one board's statutory authority to another.⁹⁰ To do so would defeat the whole purpose of having boards with different, specialized expertise, a consideration which is not present when the Commissioner delegates some of his authority to a board which he has, presumably, concluded has specialized expertise particularly suiting it to decide the matters delegated.

When Is The Board Not a Board at All?
Decision by an Illegally Constituted Panel

This question was raised in the famous case of In re Wiechert⁹¹ but not reached by a majority of the court.

On general principles, one would have thought that a decision by an illegally constituted panel of one of the boards was void and that the CCPA therefore had no jurisdiction to review whatever decision the "board" had made. The court has managed to avoid this result, however, by adopting the peculiar doctrine⁹² of refusing to consider the legality of a board's constitution unless the point is "properly raised," and, so far, the court has been able to find that the point was not "properly raised."^92a

In Wiechert, the decision appealed from had been rendered by a "Board of Appeals" consisting of an Examiner-in-Chief and two acting Examiners-in-Chief, one of whom was a Supervisory Examiner and one of whom was a Primary Examiner.⁹³ During the proceedings in the Patent Office, Wiechert had challenged the constitution of this board on the ground that, under 35 U.S.C. § 7, not more than one acting Examiner-in-Chief could be a member of a three-man board hearing an appeal.⁹⁴ The appellant did not press the point on appeal to the CCPA, but the court, after hearing arguments on the merits, sua sponte set the case down for reargument on two questions relating to the composition of the board and a third concerning the authority of the court to consider the first two on its own motion. The third question proved to be dispositive, for a majority of the judges⁹⁵ participating held that the court lacked such authority because (1) appellant had not challenged the composition of the board in his reasons of appeal,⁹⁶ (2) appellant had abandoned the question by not arguing it before the CCPA, except as compelled to do on reargument, and (3) the panel which had decided the merits of the case below had not expressly decided that it was legally constituted.⁹⁷ In response to the arguments of the two judges who did not concur with the majority's reasoning, the majority cited United States v. L.A. Tucker Truck Lines, Inc.,⁹⁸ for the proposition that "an invalid appointment would not so vitiate a board's decision that neither waiver nor abandonment of the defect would be possible."⁹⁹ In L.A. Tucker Truck Lines, the Supreme Court upheld the Interstate Commerce Commission's jurisdiction over a case heard by an invalidly appointed examiner. The Wiechert majority stated its belief that "the present case is governed by analogous considerations."¹⁰⁰
Judges Almond and Smith in separate opinions agreed that:

[i]f the "board" panel could not . . . [render a valid decision on behalf of the "Board of Appeals"] because of its illegal composition, this court would lack jurisdiction of the subject matter under the statute.¹⁰¹

They disagreed, however, on the legality of the composition of the board, Judge Almond finding it to have been legal and therefore concurring with the majority and Judge Smith finding it to have been illegal and therefore voting to dismiss the appeal.

The dissenting judges would seem to be on firm ground in arguing that no acts of the parties, including their express agreement that the court did have jurisdiction over the appeal, can confer jurisdiction on the court and that the court should always be ready to dismiss an appeal for want of jurisdiction, notwithstanding the parties' failure to raise the question either below or on appeal.¹⁰² It should not be forgotten, however, that the majority did intimate a view on the validity of the board's decision despite its contention that the matter was not properly before it. The majority indicated that an invalid appointment would not render the board's decision nugatory. Thus, even the majority probably would not have been prepared to render an opinion in an appeal to it from, say, the decision of a board of arbitrators, chosen by the parties to arbitrate an expected interference before either one had filed his application, whether or not either party challenged the court's jurisdiction.

The above example, while absurd, even outrageous, is given to emphasize that the case before the CCPA in Wiechert was neither absurd nor outrageous. In fact, the two CCPA judges who reached the issue split as to the board's legality, and the Court of Appeals for the District of Columbia Circuit, when later presented with the same issue in an action brought under the Administrative Procedure Act, held the board to have been legally constituted.¹⁰³ Thus, Weichert might not be followed in a more egregious case. For example, an attempt by the Commissioner to appoint a panel consisting of three acting Examiners-in-Chief, all three of the grade of Primary Examiner, would be so clearly contrary to any conceivably tenable interpretation of 35 U.S.C. § 7¹⁰⁴ that the court might well ignore the Wiechert doctrine.

Furthermore, Judge Smith's dissent contrasts the majority's reliance on a case involving the invalid appointment of a hearing examiner with his own reliance on cases involving the invalid appointment of judges, particularly panels of judges, arguing that the court should have "look[ed] for guidance" to cases involving the latter rather than the former because the members of the Board of Appeals, like federal judges, are appointed by the President, with the advice and consent of the Senate.¹⁰⁵ However, flattering as the analogy must have been to the career staff at the Patent Office, it seems unlikely to convince most judges. There is a mystique surrounding the appointment of judges (apparent, at least, to other judges) which is simply not present with respect to the appointment of quasi-judicial, administrative officers, no matter how August their position or carefully considered their appointment. Thus, it may be predicted that courts (including the CCPA) will be more willing to overlook minor irregularities in the appointment of the latter than in the appointment of the former and that they may even be willing to stretch a point to avoid calling them irregularities at all.¹⁰⁶

When Is The Commission Not the Commissioner?
Delegation Within the Patent Office and Exercise by the Commissioner of the Jurisdiction of One of the Board

As previously indicated,¹⁰⁷ the Commissioner can delegate some of his authority to decide either petitionable or appealable matters to the three quasi-judicial boards in the Patent Office.¹⁰⁸ Similarly, the Commissioner's power to delegate to others in the executive branch of the Patent Office his quasi-judicial authority to decide either petitionable or appealable matters seem so firmly established--and so necessary for the proper management of an enterprise as large as the Patent Office--as to have become indisputable.¹⁰⁹ Thus, in one sense it would seem that the "Commissioner" is whoever the Commissioner (or his delegate) says he is, providing that the individual or all the members or the tribunal to whom the authority is delegated are at all relevant times employed by the Patent Office.¹¹⁰

Two cases involving Patent Office Rule 56,¹¹¹ however, present an interesting variant of this problem. In Vandenberg v. Reynolds,¹¹²the CCPA held that the question of whether an application should have been stricken from the files for having been altered after being executed was a question ancillary to priority. But, faced with a series of cases in which the Commissioner had decided whether or not to strike applications on this ground, the CCPA held that "[t]he decision of that question [i.e., whether or not to strike the application] must be made in the first instance by the Commissioner."¹¹³ Similarly, in Norton v. Curtiss¹¹⁴the court held that the question of whether an application should have been stricken from the files as tainted with fraud was a question ancillary to priority which should be decided "in the first instance" by the Commissioner.¹¹⁵ Nevertheless, the court in both instances reviewed the Commissioner's decision.¹¹⁶

Where did the court get this authority to review decisions of the Commissioner in patent cases, authority which it had specifically disavowed in Sundback?¹¹⁷ In James,¹¹⁸Judge Rich, author of the court's opinion in both Vandenberg v. Reynolds cases, explained that the court had "reviewed the Commissioner's decision [in Vandenberg] because we regarded it as ancillary to priority."¹¹⁹ While that explains why Patent Office decisions whether to strike an application under Rule 56 are reviewable in the CCPA, it does not explain why, in the Patent Office, they should be made "in the first instance" by the Commissioner rather than by the Board of Patent Interferences.¹²⁰ Certainly 28 U.S.C. § 1542¹²¹ does not hint at any such power. A better solution, in this writer's opinion, would have been to have held that questions of whether or not to strike applications under Rule 56 should be decided "in the first instance" by the Board of Patent Interferences, because ancillary to priority.¹²² The CCPA's jurisdiction over appeals from that decision would then follow in the normal course, whereas at present it constitutes an anomaly inexplicable in terms of the court's statutory jurisdiction.

Conclusions

The traditional separation of Patent Office decisions into "petitionable" decisions, reviewable only in the federal district courts, and "appealable" decisions, reviewable in either the CCPA or the courts of the District of Columbia, leads to some unique and highly perplexing problems of jurisdiction. The CCPA has certainly not solved all the problems inherent in the divided review structure, nor are even its recent pronouncements on the subject easily reconcilable. However, the cases discussed in the body of this article do offer the basis for making a few predictions.

First, tradition is of enormous importance in this field, and the CCPA is likely to tolerate a few intellectual anomalies rather than depart from established practices concerning routine and recurring problems of jurisdiction. Second, if the problem is one of novel impression, the CCPA is likely to find jurisdiction if the challenged Patent Office decision required expertise in statutory patent or trademark law, was made by an entity from which appeals may be taken in that kind of case, and was made in the course of a clearly appealable decision. Third, the more "procedural" the decision and the more connected with the legitimate interest of the Patent Office in self regulation, free of outside interference, the less likely the CCPA is to review the Patent Office decision or to give the appellant relief if it does. Fourth, if the issue is "properly presented," the court will probably hold that an otherwise appealable Patent Office decision made by the wrong board or by the Commissioner, although within the statutory jurisdiction of one of the boards, was therefore void and unreviewable by the CCPA. Similarly, the court will probably hold that an otherwise appealable decision made by an illegally constituted board or panel of a board, or by a purported delegate of the Commissioner who is for some reason not a proper repository for a delegation of the Commissioner's authority, was therefore void and unreviewable by the CCPA. However, the court will probably continue to display great reluctance to find these issues to have been properly presented. Beyond these, we must simply wait for developments.

Reprinted with permission. Previously published in the Journal of Patent Office Society (1973) volume 55, pages 184-202, and the George Washington Law Review (1972), volume 416.

*.This article is a slightly updated version of an article which previously appeared at 40 Geo. Wash. L. Rev. 416 (1972). It is reprinted with permission.

**.The author is a member of the New York and District of Columbia Bars, and is presently associated with the Washington, D.C. law firm of Sughrue, Rothwell, Mion, Zinn and MacPeak. At the time this article was first written the author was Technical Advisor to the Hon. Giles S. Rich, Associate Judge of the Court of Customs and Patent Appeals. However, the views expressed herein are the author's own and are not necessarily shared by any member of the court.

An earlier version of this article was submitted to Professor Donald R. Dunner of the National Law Center, George Washington University, in satisfaction of course requirements. The author is indebtted to Professor Dunner and to Professor Robert E. Park, also of the National Law Center, for their suggestion for improvements in the first draft.

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Endnotes

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[61].In re Marriott-Hot Shoppes, 411 F.2d 1025, 162 U.S.P.Q. 106 (C.C.P.A. 1969). See also Myers v. Feigelman, 455 F.2d 596, 172 USPQ 580 (C.C.P.A. 1972).

[62].47 F.2d 378, 8 U.S.P.Q. 220 (C.C.P.A. 1931).

[63]Section 4904 of the Revised Statutes, the relevant portion of which is substantively identical to the first sentence of the present 35 U.S.C. § 135(a), which states:

Whenever an application is made for a patent which, in the opinion of the Commissioner, would interfere with any pending application, or with any unexpired patent, he shall give notice thereof to the applicants, or applicant and patentee, as the case may be.

[64].47 F.2d at 380, 8 U.S.P.Q. at 222.

[65].48 F.2d 938, 9 U.S.P.Q. 421 (C.C.P.A. 1931). See also Tenney v Nordmeyer, 94 F.2d 396, 36 U.S.P.Q. 346 (C.C.P.A. 1935) and the strange case of Spatafora v. Zaiger, 69 F.2d 118, 20 U.S.P.Q. 316 (C.C.P.A. 1934) (dissolution of three-way interference as to one party on the ground that he "was not the first inventor" held not appealable). Spatafora seems to extend Sunback unreasonably. Even assuming that only the Commissioner and his delegates have authority to dissolve an interference on grounds unrelated to priority (such as unpatentability of the subject matter in view of the prior art, the ground in Sunback), an assumption which now seems questionable as a matter of substantive law, see note 81 infra and accompanying text, the board's action in Spatafora was, in essence, a determination of non-priority and should have been appealable as such.

[66].432 F.2d 473, 167 U.S.P.Q. 403 (C.C.P.A. 1970), discussed in Pat. L. Persp. § A.12-1 (1970 Dev.).

[67].Rule 192 (b) of the Rules of Practice in Patent Cases, 37 C.F.R § 1.192(b) (1971) provides that "[o]n failure to file the brief, accompanied by the requisite fee, within the time allowed, the appeal shall stand dismissed."

[68].432 F.2d at 476, 167 U.S.P.Q. at 405.

[69].Id. at 477, 167 U.S.P.Q. at 406. See 35 U.S.C. § 6 (1970).

[70].432 F.2d at 477, 167 U.S.P.Q. at 406.

[71].422 F.2d 431, 164 U.S.P.Q. 623 (C.C.P.A. 1970), discussed in Pat. L. Persp. § A.12-3 (1970 Dev.).

[72].422 F.2d at 435, 164 U.S.P.Q. at 626.

[73].In Pat. L. Persp. § A.12-1 to -4 (1970 Dev.), Messrs. Dunner, Gambrell, and Kayton approved the result in James but not the rationale by which the majority reached it. It was their view that "the only decisions of the board which the CCPA can review are those the board is capable of making, viz., decisions based on the board's review of 'adverse decisions of examiners upon application for patents'," from which it would seem to follow that the CCPA can review an examiner's adverse decision which is based on a rule and which has bee