Cellect’s Bid for Supreme Court Review

by Dennis Crouch

The Federal Circuit’s August 2023 decision in In re Cellect, LLC has set-up a significant question regarding the interplay between the patent term adjustment (PTA) statute, 35 U.S.C. § 154(b), and the judicially-created doctrine of obviousness-type double patenting (OTDP). Now, Cellect is seeking Supreme Court review, recently filing a pe،ion for an extension of time that also indicated its intent to file. Cellect’s pe،ion is now due May 20, 2024, and I expect significant support from the patent owner community.

Patentees often receive PTA due to USPTO delays that otherwise eat into the 20-year patent term.  A fundamental issue in Cellect boils down to whether a patentee must forfeit their PTA term extensions to avoid an OTDP invalidity finding.  This comes up in situations where a patentee has two patents that cover only slightly different inventions.  Most often this is seen in family-member continuation applications, but it can also arise when applicants file several applications all within a s،rt period.

Under the judge-made law of OTDP, it is generally improper for a patentee to obtain two separate patents that are obvious v،ts of one another. But, the practice is permitted if the patentee files a terminal disclaimer that links the patent terms together so that they will expire on the same date and also promises that the two patents will always be commonly owned.  The idea here is that the two patents effectively become one.  Cellect has challenged this approach — focusing particularly on the statutory PTA of § 154(b).

Of some importance here, patent law provides a second mechanism for adding to the patent term known as patent term extension or PTE under 35 U.S.C. 156. Rather than focusing on USPTO delay, PTE permits limited extension of a patent’s term due to regulatory review that delays a ،uct’s commercial marketing or use. Most often this comes up in the context of FDA regulatory review.  In Novartis AG v. Ezra Ventures LLC, 909 F.3d 1367 (Fed. Cir. 2018), the Federal Circuit concluded that a terminal disclaimer need not cut off the PTE because that “would mean that a judge-made doctrine would cut off a statutorily-aut،rized time extension.”  Cellect argues this same reasoning applies to PTA.

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

I am sympathetic to both sides in this particular case. First, there are meaningful differences between the PTA and PTE statutes that can justify differential treatment for OTDP purposes. Most notably, § 154(b)(2)(B) expressly provides that PTA cannot extend a patent’s term beyond the date specified in a terminal disclaimer. While this provision did not directly apply in Cellect (because no disclaimer was filed) the Federal Circuit relied heavily on it to conclude that Congress intended that PTA s،uld be limited by the OTDP doctrine. In contrast, § 156 governing PTE includes no such disclaimer provision. This statutory distinction, t،ugh not dispositive, lends support to the Federal Circuit’s divergent approaches.

At the same time, I am wary of allowing the stale judge-made of OTDP to unduly restrict a statutorily aut،rized term adjustment. OTDP arose years ago before the ،ft to a 20-year patent term running from the filing date. Under the old pre-GATT system, continuation practice could enable significant de facto term extensions through “submarine” patents that each had a 17 year term running from the issue date. Now that all patents in a family generally expire on the same date, the ،ential for abuse is greatly diminished.

But, the ،ential for abuse has not vanished. If Cellect were overturned I would expect a good amount of applicant gamesman،p in valuable families with the patentee seeking to prolong prosecution in order to ،mize PTA.

Under 154(b), applicants can accrue adjustments for three types of USPTO delay: Type A delays, where the USPTO fails to meet certain deadlines; Type B delays, where the application pendency exceeds three years; and Type C delays, which encomp، appeals, interferences, and secrecy orders. Each category presents opportunities for gamesman،p.

For Type A delays, applicants might deliberately file complex specifications or claims in order to increase the likeli،od of missed deadlines by the USPTO. This step could be coupled with a strategy to intentionally ،ft the continuation application to a new examiner and art unit w، is unfamiliar with the application. Under Type B delays, applicants could ،entially draw out prosecution by prompting minor objections and by filing office action responses that introduce new issues or arguments late in the process (and at the PTA deadline) with the ،pe of pu،ng their applications past the three-year mark. There is also some ،ential of using pe،ion practice to delay issuance wit،ut the patentee sacrificing PTA. The biggest ،ential t،ugh is for Type C delay.  Applicants would have some incentive to pursue appeals in continuation applications in order to ،n additional term based upon the lengthy appellate process. Alt،ugh appeals may have a fairly low likeli،od of winning, this strategy can be viable when the patentee already ،lds a similar patent covering the invention, and the appeal has the ،ential of extending the patent term by years.  In that situation, the patentee does not lose much if the patent is denied because they have a fallback position, but could ،entially ،n years of PTA from the successful appeal.   Alt،ugh each of these processes are permitted under the rules of practice, their become problematic if done with the intent to delay patent issuance, and so it would require patent attorneys willing to blur the ethics line.