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Supernus Pharmaceuticals, Inc. v. Iancu

Reduction in Patent Term Adjustment May Not Exceed Applicant’s Failure to Reasonably Prosecute

Supernus Pharmaceuticals, Inc. v. Iancu, __ F.3d __, 2019 WL 286925 (Fed. Cir. Jan. 23, 2019) (Dyk, Schall, REYNA) (E.D. Va.: Lee) (3 of 5 stars)

Fed Cir reverses summary judgment for the PTO. The appeal relates to the PTO’s calculation of patent term adjustment under §§ 154(b)(1)(A)–(C); Supernus argued that 37 C.F.R. § 1.704(c)(8) (under which the PTO reduced the term adjustment due to Supernus’s purported delay) is unlawful. Supernus argues that its conduct should have invoked a different regulation (§ 1.704(c)(6)), and that most of the disputed period was being improperly charged to applicant delay. “Supernus contends, and the USPTO does not dispute, that Supernus could not have taken any efforts to conclude prosecution of [its] application during [the relevant period].” Op. at 12.

The district court erred in reasoning that Supernus’s argument was foreclosed by Gilead v. Lee, 778 F.3d 1341 (Fed. Cir. 2015). Gilead is not on point because it did not address whether §1.704(c)(8) was reasonable (per Chevron) in reducing PTA for periods during which there was no failure to engage in reasonable prosecution efforts. And Gilead was not targeted at the “precise question” at issue here for a Chevron analysis, which is “whether the PTO may reduce PTA by a period that exceeds the time during which the applicant failed to engage in reasonable efforts to conclude prosecution.” Op. at 12–13.

On this question, § 1.704(c)(8) contravenes the plain terms of § 154(b)(2)(C)(i) and thus fails step one of Chevron. That subsection expressly requires that PTA be reduced by an amount “equal to” the period of time during which the applicant failed to engage in reasonable efforts to conclude prosecution. The opinion concludes that the PTO’s assessment of applicant delay in this case is incompatible with that requirement.

KEYWORDS: CHEVRON; PATENT TERM ADJUSTMENT; PROSECUTION