SUPERNUS PHARMACEUTICALS, INC., UNITED THERAPEUTICS CORPORATION, Plaintiffs-Appellants
ANDREI IANCU, UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL PROPERTY AND DIRECTOR OF THE UNITED STATES PATENT AND TRADEMARK OFFICE, Defendant-Appellee
from the United States District Court for the Eastern
District of Virginia in No. 1:16-cv-00342-GBL-IDD, Judge
Gerald Bruce Lee.
Douglas H. Carsten, Wilson, Sonsini, Goodrich & Rosati,
PC, San Diego, CA, argued for plaintiffs-appellants. Also
represented by Veronica Susana Ascarrunz, Adam William
Burrowbridge, Washington, DC.
R. Snader, United Therapeutics Corporation, Washington, DC,
for plaintiff-appellant United Therapeutics Corporation.
Trent McCotter, Office of the United States Attorney for the
Eastern District of Virginia, Alexandria, VA, argued for
defendant-appellee Andrei Iancu. Also represented by Kakoli
Caprihan, Brian Racilla, Office of the Solicitor, United
States Patent and Trademark Office, Alexandria, VA.
Dyk, Schall, and Reyna, Circuit Judges.
Pharmaceuticals, Inc. and United Therapeutics Corp.
appeal the entry of summary judgment by the U.S. District
Court for the Eastern District of Virginia. The district
court determined that, based on this court's decision in
Gilead Sciences, Inc. v. Lee, the U.S. Patent and
Trademark Office's calculation of the patent term
adjustment for the patent at issue was correct, and that
summary judgment was warranted as a matter of law. We reverse
the district court's grant of summary judgment because
the patent term adjustment in this case went beyond the
period during which the applicant failed to undertake
reasonable efforts and thereby exceeded the limitations set
by the patent term adjustment statute.
life of a patent, the period of time during which the
exclusive nature of a patent is in effect, is measured in
years and days and is referred to as the "term" of
the patent or "patent term." Prior to June 8, 1995,
the term of a patent was seventeen years, measured from the
date that the patent issued to its expiration date seventeen
years later. See Merck & Co. v. Kessler, 80 F.3d
1543, 1547 (Fed. Cir. 1996).
the United States entered the World Trade Organization,
it assumed certain obligations and commitments under the
terms of the World Trade Organization Agreement on Trade
Related Aspects of Intellectual Property Rights. See
Agreement on Trade-Related Aspects of Intellectual
Property Rights, 33 I.L.M. 1197 (1994). As a result, Congress
changed the patent term from seventeen years to twenty years,
measured from the filing date of the earliest United States
non-provisional application for the patent. See Pub.
L. No. 103-465, § 532, 108 Stat. 4809, 4984 (1994)
(codified at 35 U.S.C. § 154(a)(2)).
addition to extending the patent term from seventeen
years to twenty years, Congress passed the patent term
adjustment ("PTA") statute in 1999 in an effort to
discourage delay in the patent application process.
See Pub. L. No. 106-113, § 1000(a)(9), 113
Stat. 1501, 1536 (1999) (codified at 35 U.S.C. §
154(b)). Specifically, § 154(b) grants the U.S. Patent
and Trademark Office ("USPTO") authority to adjust
the patent term by adding days to account for delays caused
by the USPTO. See id. §§
154(b)(1)(A)–(C). Such adjustments are favorable to an
applicant because they extend the life of the patent. But the
USPTO may also reduce the PTA in order to account for delays
caused by the applicant. Id. § 154(b)(2);
see, e.g., Gilead Scis., Inc. v.
Lee, 778 F.3d 1341, 1343–45 (Fed. Cir. 2015).
154(b)(1) outlines three types of delays caused by the USPTO,
known as Types A, B, and C, that can result in a PTA.
Adjustments for a Type A delay apply when the USPTO fails to
provide a notification under 35 U.S.C. § 132 or a notice
of allowance within fourteen months of an application's
filing. 35 U.S.C. § 154(b)(1)(A)(i). The statute
provides that "the term of the patent shall be extended
1 day for each day" the USPTO does not meet its response
deadlines. Id. § 154(b)(1)(A). Similarly, Type
B adjustments extend the patent term by one day for every day
that the USPTO fails to issue a patent after three years have
passed between the filing date of the application and the
date of allowance. Id. § 154(b)(1)(B). Finally,
Type C adjustments are for delays that are excluded from
the Type B delay due to derivation proceedings, secrecy
orders, or successful appeals. Id. §
noted above, the statute recognizes that conduct by the
applicant may also cause delay in the examination or
prosecution of the application. Section 154(b)(2)(C)
authorizes the USPTO to reduce the total amount of PTA
for Type A, B, and C delays by deducting the number of days
equal to the period of time that "the applicant failed
to engage in reasonable efforts to conclude prosecution of
the application." Id. § 154(b)(2)(C)(i).
An applicant is deemed to have failed to engage in reasonable
efforts for the cumulative time in excess of three months
that the applicant takes to respond to a notice of
rejection, objection, argument, or other request from the
USPTO. Id. § 154(b)(2)(C)(ii). The statute
provides that the Director of the USPTO "shall prescribe
regulations establishing the circumstances that constitute a
failure of an applicant to engage in reasonable efforts to
conclude processing or examination of an application."
Id. § 154(b)(2)(C)(iii).
Director of the USPTO has promulgated such regulations: 37
C.F.R. § 1.704, titled "Reduction of period of
adjustment of patent term." 37 C.F.R. § 1.704
(2015). Relevant here is § 1.704(c)(8), which regulates
the calculation for reduction of PTA in instances where
the applicant submits a supplemental paper to the USPTO.
Section 1.704(c)(8) provides:
Submission of a supplemental reply or other paper, other
than a supplemental reply or other pa- per expressly
requested by the examiner, after a reply has been filed, in
which case the period of adjustment set forth in § 1.703
[that extends the patent's term due to USPTO delay] shall
be reduced by the number of days, if any, beginning on
the day after the date the initial reply was filed and ending
on the date that the supplemental reply or other such
paper was filed . . . .
USPTO has also promulgated regulations that permit an
applicant to file an information disclosure statement
("IDS") up to the end of the patent examination
process, while providing incentives for an applicant to
submit any necessary IDS promptly. Id. §§
1.97(a)–(d). As relevant here, the USPTO will accept
without condition an IDS that is filed before notice of
the first office action after the applicant has filed a
request for continued examination ("RCE").
Id. § 1.97(b)(4). Also relevant here, when an
applicant submits an IDS disclosing a communication from
a foreign patent office, there is a thirty-day safe harbor
that exempts reduction of PTAs under § 1.704(c)(8),
provided that the IDS is submitted within thirty days of the
applicant receiving the information from the foreign patent
office that is eventually contained in the IDS. Id.
relevant facts in this case are not in dispute.
Appellant Supernus Pharmaceuticals, Inc.
("Supernus") is the owner and assignee of the
patent at issue, U.S. Patent No. 8,747,897 ("the
'897 patent"), titled "Osmotic Drug Delivery
System." Co-Appellant United Therapeutics Corp.
("UTC") is the exclusive licensee of the '897
patent. UTC assisted in the prosecution of the patent
application and took action as the applicant in that
capacity. Super-nus and UTC are collectively referred to
herein as "Supernus."
April 27, 2006, Supernus filed U.S. Patent Application
No. 11/412,100 ("the '100 application"). On
August 20, 2010, the USPTO issued a final rejection. On
February 22, 2011, Supernus filed an RCE, which removed
the finality of the rejection and permitted the examiner to
consider additional information submitted by Supernus. 35
U.S.C. § 132(b); 37 C.F.R. § 1.114. The '100
application issued on June 10, 2014, as the '897 patent.
same day it filed the '100 application, Super-nus filed
international application PCT/US2007/009969, claiming
priority from the '100 application. The
international application gave rise to European
Application No. 07755989.6. On October 13, 2011, the European
Patent Office ("EPO") issued the European
application as European Patent EP2010189 ("the EP
patent"). On August 21, 2012, the EPO notified
Supernus's European patent counsel that a Notice ...