Background
In 2007, the USPTO under Director Jon Dudas promulgated a package of new rules — known as the “continuation and claims” rules — designed to address the agency’s growing backlog of pending patent applications. The rules imposed significant new limits on patent prosecution: applicants would be permitted only a limited number of continuation applications and requests for continued examination (RCEs) before facing heightened burdens to justify further prosecution. The rules also capped the number of claims per application and required applicants to provide examiner support documents (ESDs) with applications containing more than 5 independent claims or 25 total claims.
Dr. Triantafyllos Tafas, a patent applicant, challenged the rules in the Eastern District of Virginia, along with GlaxoSmithKline. The district court enjoined implementation of all the new rules, finding they were substantive rulemaking beyond the USPTO’s authority. The USPTO appealed.
The Court’s Holding
The Federal Circuit issued a nuanced ruling. The court held that the USPTO does have authority to promulgate procedural rules regulating how applicants prosecute patents — the agency’s rulemaking power under 35 U.S.C. § 2(b)(2) extends to regulations governing the conduct of proceedings before the Office. Most of the contested rules — including the claims-counting rules and the ESD requirement — were upheld as procedural regulations within the USPTO’s authority, even though they imposed significant burdens on applicants.
However, the court invalidated Rule 78, which would have limited applicants to two continuation applications per parent with a heavy burden to obtain a third. The court held that Rule 78 was inconsistent with 35 U.S.C. § 120, which explicitly grants applicants the right to file continuation applications and claim their benefit — a statutory right the USPTO cannot extinguish through regulation. Judge Rader’s partial dissent argued the court should have invalidated more of the rules as substantive rather than procedural.
Key Takeaways
- The USPTO has authority to promulgate procedural rules regulating the conduct of patent prosecution, including rules about claim numbers, examination support documents, and claims formatting.
- The USPTO cannot through rulemaking override statutory rights granted directly by Congress, including applicants’ statutory right to file continuation applications under 35 U.S.C. § 120.
- The distinction between “procedural” rules (within USPTO authority) and “substantive” rules (requiring Congressional authorization) is critical in evaluating the validity of USPTO regulations.
- Although the most controversial rule (limiting continuations) was struck down, the case confirmed that the USPTO has broad authority to regulate the manner in which applicants present their inventions for examination.
Why It Matters
Tafas v. Doll addressed one of the most significant proposed changes to U.S. patent prosecution practice in decades. The continuation application is a fundamental tool of the U.S. patent system — it allows applicants to pursue additional claims on their inventions in subsequent applications while maintaining priority to the original filing date, enabling applicants to tailor their patent portfolios as products develop and markets clarify.
The pharmaceutical and biotechnology industries, which routinely file multiple continuation applications covering different aspects of drug compounds and methods, were particularly concerned about the proposed rules. The decision’s partial invalidation of Rule 78 preserved the continuation practice that many patent-intensive industries depend on. At the same time, the ruling’s confirmation of broad USPTO procedural rulemaking authority presaged later debates about the agency’s regulatory power, relevant to issues like inter partes review procedure and fee-setting authority that arose after the America Invents Act of 2011.