Daiichi Sankyo Company, Limited v. Kappos ( 2013 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
______________________________
)
DAIICHI SANKYO COMPANY, )
LIMITED, )
)
Plaintiff, )
)
v. ) Civil Action No. 10-215 (RWR)
)
TERESA STANEK REA, )
)
Defendant. )
______________________________)
MEMORANDUM OPINION
Plaintiff Daiichi Sankyo Company, Limited (“Daiichi”) brings
suit under 35 U.S.C. § 154(b)(4)(A) and the Administrative
Procedure Act, 5 U.S.C. § 501 et seq., against the Under
Secretary of Commerce for Intellectual Property and Director of
the United States Patent and Trademark Office (“USPTO”)1 alleging
that the USPTO improperly calculated the patent term adjustments
(“PTA”) for Daiichi’s United States Patent Nos. 7,365,205 (“‘205
patent”), 7,342,014 (“‘014 patent”), and 7,576,135 (“‘135
patent”). Daiichi and the USPTO cross-move for summary judgment.
Because Daiichi did not timely file its challenge to the USPTO’s
PTA determinations, the USPTO’s cross-motion for summary judgment
will be granted and Daiichi’s cross-motion for summary judgment
will be denied.
1
Teresa Stanek Rea is substituted as the defendant under
Federal Rule of Civil Procedure 25(d).
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BACKGROUND
I. LEGAL BACKGROUND
In the United States, patents are granted “for a term
beginning on the date on which the patent issues and ending 20
years from the date on which the application for the patent was
filed in the United States.” 35 U.S.C. § 154(a)(2). “However,
the prosecution of a patent application may take more than three
years. In order to ensure that all patents have terms of at
least seventeen years,” the Patent Act allows the Director of the
USPTO to adjust the term of a patent to account for certain
delays that may occur during patent prosecution (i.e., to make a
PTA determination). Janssen Pharmaceutica, N.V. v. Rea, 928 F.
Supp. 2d 102, 103 (D.D.C. 2013); see also 35 U.S.C. § 154(b).
One category of delay that is excluded from the calculation
of the patent term, known as “A delay,” “extend[s] the term of
the patent one day for each day the PTO does not meet certain
examination deadlines[.]” Wyeth v. Kappos (Wyeth II), 591 F.3d
1364, 1367 (Fed. Cir. 2010) (citing 35 U.S.C. § 154(b)(1)(A)).
This delay is excluded because the Patent Act guarantees “prompt
Patent and Trademark Office responses.” 35 U.S.C.
§ 154(b)(1)(A). “The PTO notifies the patentee of the amount of
A Delay that has been awarded when it issues the Notice of
Allowance. Because the Notice of Allowance is sent well before a
patent is actually granted, the determination of A Delay is known
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as a Pre–Issuance Determination.” Novartis AG v. Kappos, 904 F.
Supp. 2d 58, 61 (D.D.C. 2012).
A second category of excludable delay, known as “B delay,”
“extends the term of the patent one day for each day issuance is
delayed due to the PTO’s failure ‘to issue a patent within 3
years after the actual filing date of the application in the
United States.’” Wyeth II, 591 F.3d at 1367 (quoting 35 U.S.C.
§ 154(b)(1)(B)). This delay is excluded because the Patent Act
guarantees “no more than [a] 3-year application pendency.” 35
U.S.C. § 154(b)(1)(B). “Because B Delay accrues until the actual
date of issuance, the PTO does not determine the proper amount of
B Delay until the patent is granted.” Novartis, 904 F. Supp. 2d
at 61.
“After determining the proper amount of A and B Delay, the
PTO must determine the extent of any overlap between the two
types of delay.” Id. at 62. “To the extent that periods of [A
delay and B delay] overlap, any [PTA] shall not exceed the actual
number of days the issuance of the patent was delayed.” 35
U.S.C. § 154(b)(2)(A). “Because the overlap determination
depends on the amount of B Delay, it is also done at the time the
patent is granted.” Novartis, 904 F. Supp. 2d at 62.
In 2004, the USPTO issued a regulation explaining its
methodology to calculate A/B Overlap. See Revision of Patent
Term Extension and Patent Term Adjustment Provisions, 69 Fed.
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Reg. 21706-01 (Apr. 22, 2004) (“2004 Notice”). On September 30,
2008, in Wyeth v. Dudas (Wyeth I), 580 F. Supp. 2d 138, 141-42
(D.D.C. 2008), the district court found that the USPTO’s A/B
Overlap methodology, as described in the 2004 Notice, was
contrary to the plain language of § 154(b). The USPTO appealed
the decision, and the Federal Circuit affirmed the district
court’s decision in Wyeth II. Wyeth II, 591 F.3d at 1369-70.
On February 1, 2010, the USPTO issued an Interim Procedure
setting forth its procedure for recalculating PTAs using the
correct A/B Overlap methodology. See Interim Procedure for
Patentees to Request a Recalculation of the Patent Term
Adjustment, 75 Fed. Reg. 5043-01 (Feb. 1, 2010). The Interim
Procedure established that the USPTO would recalculate the PTA
for any patent that had been issued in the 180 days before the
announcement of the Interim Procedure -- that is, any patent
issued on or after August 5, 2009. Id. at 5044.
The final determination of PTA -- which factors in A Delay,
B Delay, and A/B Overlap -- is done at the time the patent is
granted. Novartis, 904 F. Supp. 2d at 62. If the patent
applicant disagrees with the PTA determination, the applicant may
“request reconsideration of any patent term adjustment
determination made by the Director,” id. § 154(b)(3)(B)(ii),
“within two months of the date the patent issued,” 37 C.F.R.
§ 1.705(d) (2012). “[O]n petition of the interested party,”
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(“Rule 183 petition”) the two-month limitation “may be suspended
or waived by the Director or the Director’s designee” “[i]n an
extraordinary situation, when justice requires.” 37 C.F.R.
§ 1.183 (2013).
II. FACTUAL BACKGROUND
Daiichi is the assignee of the ‘205, ‘014, and ‘135 patents.
2d Am. Compl. ¶ 8. Patent Application Serial No. 10/481,262
issued as the ‘205 patent on April 29, 2008. Id. ¶ 9. The
patent issued with a notice that its term would be extended by
504 days under 35 U.S.C. § 154(b) (i.e., the final PTA
determination is 504 days) subject to the patentee’s terminal
disclaimer over the ‘014 patent.2 Id. ¶¶ 9, 31.
Patent Application Serial No. 10/773,344 issued as the ‘014
patent on March 11, 2008. Id. ¶ 10. The patent issued with a
notice that its term would be extended by 357 days under 35
U.S.C. § 154(b) subject to the patentee’s terminal disclaimer
over the ‘205 patent. Id. ¶¶ 10, 33.
2
A “terminal disclaimer” is a statement in which an
applicant or patent owner “disclaims or dedicates to the public
the entire term or any terminal part of the term of a patent or
patent to be granted.” See Manual of Patent Examining Procedures
§ 1490(II) (citing 37 C.F.R. § 1.321(b)); see also 35 U.S.C.
§ 253(b) (providing that “any patentee or applicant may disclaim
or dedicate to the public the entire term, or any terminal part
of the term, of the patent granted or to be granted”). In other
words, the patent applicant or owner gives up the term of a
granted patent which would extend beyond the expiration date of a
prior patent. As such, the term of the granted patent expires on
the same date that the prior patent expires.
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Patent Application Serial No. 10/540,259 issued as the ‘135
patent on August 18, 2009. Id. ¶ 11. The patent issued with a
notice that its term would be extended by 86 days under 35 U.S.C.
§ 154(b) subject to the patentee’s terminal disclaimer over the
‘014 and ‘205 patents. Id. ¶¶ 11, 35. In other words, Daiichi
disclaimed the part of the ‘135 patent term that extended beyond
the expiration date of the ‘014 and ‘205 patents. Thus, in
effect, the ‘135 patent expires on the same day as the ‘014 and
‘205 patents expire.
On February 2, 2009, Daiichi requested that the Director
reconsider her March 11, 2008 and April 28, 2008 PTA
determinations for the ‘014 and ‘205 patents respectively and
filed Rule 183 petitions seeking a waiver of the two-month limit
for filing a request for reconsideration. Id. ¶ 43. The USPTO
denied Daiichi’s Rule 183 petitions and denied its requests for
reconsideration as untimely. Def.’s Cross-Mot. & Opp’n, Exs. 3-
4.
On February 12, 2010, Daiichi filed suit against the USPTO
alleging that the USPTO improperly calculated the PTA for the
‘135 patent. Daiichi asserted that the correct PTA for the ‘135
patent is 504 days. Compl. ¶ 1. In April 2010, the matter was
“remanded to the USPTO for recalculation and adjustment of
plaintiff’s patent term [for the ‘135 patent] in accordance with
[Wyeth II].” Order, entered 4/20/10. On remand, the USPTO
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recalculated the PTA for the ‘135 patent and issued a Certificate
of Correction stating that “[s]ubject to any disclaimer, the term
of the [‘135] patent is extended or adjusted under 35 U.S.C.
§ 154(b) by 503 days.” Def.’s Cross-Mot. & Opp’n, Ex. 1.
However, because the ‘135 patent is terminally disclaimed by the
‘014 and ‘205 patents, any part of the term of the ‘135 patent
that extends beyond the terms of the earlier ‘014 and ‘205
patents is disclaimed. “Accordingly, although the USPTO has
reinstated the term it denied the ‘135 patent at issuance, the
reinstatement has no practical effect” because the terms of the
‘014 and ‘205 patents expire before the amended term of the ‘135
patent expires. See Pl.’s Mot. for Summ. J., Mem. of P. & A. in
Supp. of Pl.’s Mot. for Summ. J. (“Pl.’s Mem.”) at 4.
On November 9, 2010, Daiichi filed an amended complaint
alleging that the USPTO also incorrectly calculated the PTA for
the ‘014 and ‘205 patents.
The parties now cross-move for summary judgment.
DISCUSSION
“The court shall grant summary judgment if the movant shows
that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” Fed. R. Civ.
P. 56(a).
In a case involving review of a final agency action under
the APA, . . . [the court has a] limited role of . . .
reviewing the administrative record. The function of the
district court is to determine whether or not as a matter
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of law the evidence in the administrative record
permitted the agency to make the decision it did.
Summary judgment thus serves as the mechanism for
deciding, as a matter of law, whether the agency action
is supported by the administrative record and otherwise
consistent with the APA standard of review.
Nat’l Parks Conservation Ass’n v. Jewell, Civil Action No.
12-1690 (RWR), 2013 WL 4616972, at *2 (D.D.C. Aug. 30, 2013)
(alterations, internal quotation marks, and citations omitted)
(quoting Ctr. for Food Safety v. Salazar, 898 F. Supp. 2d 130,
138 (D.D.C. 2012)).
A patent applicant can challenge the USPTO’s PTA
determination under 35 U.S.C. § 154(b)(4)(A). The Act provided
at the time3 that
[a]n applicant dissatisfied with a determination made by
the Director under paragraph (3) shall have remedy by a
civil action against the Director filed in the United
States District Court for the District of Columbia within
180 days after the grant of the patent. [The APA] shall
apply to such action. Any final judgment resulting in a
change to the period of adjustment of the patent term
shall be served on the Director, and the Director shall
thereafter alter the term of the patent to reflect such
change.
35 U.S.C. § 154(b)(4)(A) (2006). The ‘014 patent issued on
March 11, 2008, and the ‘205 patent issued on April 28, 2008.4
3
As the parties note, see Joint Submission Regarding
Amendments to 35 U.S.C. § 154(b), the relevant statutory language
has been amended. However, the parties agree that the original
version of § 154(b) applies here. Id. at 2.
4
Under § 154(b)(4)(A), the 180-day limitations period for
the ‘014 patent ended on September 7, 2008 and the 180-day
limitations period for the ‘205 patent ended on October 25, 2008.
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However, Daiichi did not bring this suit until February 10,
2010.5 Accordingly, the USPTO argues that because Daiichi did
not file its complaint within 180 days of issuance of the ‘014 or
‘205 patents, Daiichi’s suit is untimely. Daiichi argues that
the 180-day limitations period does not apply to this case but
that, even if it does, the limitations period should be equitably
tolled. The USPTO counters that the statute of limitations is
jurisdictional and not subject to equitable tolling.6
I. WHETHER 35 U.S.C. § 154(b)(4)(A) APPLIES TO FINAL PTA
DETERMINATIONS
Daiichi contends that § 154(b)(4)(A) does not apply to the
final PTA determinations at issue in this case. Instead, Daiichi
asserts that, under the plain language of the statute, the 180-
day limitations period applies only to the USPTO’s determination
of A Delay. Section 154(b)(4)(A) applies to an applicant’s
challenge of a determination made “under paragraph (3).” Section
154(b)(3) provides:
5
Moreover, Daiichi did not seek review of the USPTO’s PTA
determinations of the ‘014 and ‘205 patents in its original
complaint. Instead, it first challenged the USPTO’s
determinations in its first amended complaint, which was filed on
November 9, 2010.
6
The USPTO does not argue that its interpretation of
§ 154(b) is entitled to deference under Chevron, U.S.A., Inc. v.
Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), and
courts to have considered this issue have found that the USPTO’s
determination is not entitled to such deference because the USPTO
does not have authority to issue substantiative rules, see
Novartis, 904 F. Supp. 2d at 64; Wyeth I, 580 F. Supp. 2d at 141.
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(A) The Director shall prescribe regulations establishing
procedures for the application for and determination of
patent term adjustments under this subsection.
(B) Under the procedures established under subparagraph
(A), the Director shall –
(i) make a determination of the period of any patent
term adjustment under this subsection, and shall transmit
a notice of that determination with the written notice of
allowance of the application under section 151; and
(ii) provide the applicant one opportunity to
request reconsideration of any patent term adjustment
determination made by the Director.
35 U.S.C. § 154(b)(3). Daiichi admits that § 154(b)(3)(A)
“provides the authority for and requires the Director of the
USPTO to establish general procedures for determining PTA.”
Pl.’s Mem. at 13. However, § 154(b)(3)(B) refers to the PTA
determination sent with the notice of allowance. Because only
the A Delay determination is sent at that time, Daiichi argues
that “the unambiguous interpretation of Section 154(b)(3) is that
it relates solely to [A Delay].” Pl.’s Mem. at 12. Thus,
Daiichi argues that the “paragraph (3)” determination referred to
in § 154(b)(4)(A) includes only the Director’s determination of A
Delay, and the general APA statute of limitations applies to an
applicant’s challenge of a final PTA determination.
When interpreting a statute, courts begin by looking at the
statutory text. Caminetti v. United States, 242 U.S. 470, 485
(1917). “[I]f a statute is ‘plain and unambiguous,’ . . . ‘[the
court’s] analysis ends with the text.’” Cook v. Food & Drug
Admin., 733 F.3d 1, 9 (D.C. Cir. 2013) (quoting Chao v. Day, 436
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F.3d 234, 235 (D.C. Cir. 2006)). The plain meaning of a
“paragraph (3)” determination is any determination that could be
made under § 154(b)(3). This includes any PTA determination made
under the regulations the Director promulgated under
§ 154(b)(3)(A), which includes A Delay, B Delay, and A/B Overlap,
as well as the Director’s A Delay determination referred to in
§ 154(b)(3)(B). This interpretation of “paragraph 3” includes
the entirety of the determinations that could be made under
§ 154(b)(3) and does not construe “paragraph (3)” to mean only
“paragraph (3)(B).” Congress knows how to limit a provision to a
certain subparagraph. See Cent. Bank of Denver, N.A. v. First
Interstate Bank of Denver, N.A., 511 U.S. 164, 176-77 (1994)
(comparing statutory provisions and finding that “Congress knew
how to impose aiding and abetting liability when it chose to do
so”). For example, earlier in § 154, Congress referred
specifically to “an adjustment under paragraph (2)(c)” rather
than referring generally to “paragraph (2).” See 35 U.S.C.
§ 154(b)(3)(C) (stating that “[t]he Director shall reinstate all
or part of the cumulative period of time of an adjustment under
paragraph (2)(C)” in certain circumstances). Because in
§ 154(b)(4)(A) Congress used the broader phrase, “paragraph (3),”
the plain meaning of the statute is that the 180-day limitations
period applies to any determination made under § 154(b)(3) --
including the final PTA determination.
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Furthermore, Daiichi’s argument was squarely rejected in
Novartis, 904 F. Supp. 2d 58, and Janssen Pharmaceutica, N.V. v.
Kappos, 844 F. Supp. 2d 707 (E.D. Va. 2012). In Novartis, Judge
Huvelle considered that the title of the subsection -- Procedures
for patent term adjustment determination -- is generic and does
not suggest that the section is limited only to A Delay, and the
fact that it “is the only section of the statute to address the
PTO’s procedures for determining PTA,” and found that the section
“is clearly intended to relate to all PTA determinations,
regardless of when they occur.” Novartis, 904 F. Supp. 2d at 65.
She further reasoned that her interpretation of the statute is
not only “consistent with the plain meaning of the statute,” but
also it “avoids absurd results.” Id. Specifically, she sought
to avoid an interpretation of the statute where “a patentee would
have 180 days in which to challenge the calculation of A Delay
but six years [under the APA, 28 U.S.C. § 2401(a),] in which to
challenge B Delay and A/B Delay Overlap.” Id.In Janssen, Judge Brinkema found that “[o]n its face,
§ 154(b)(4)(A) applies to all PTA decisions made by the Director
applying the USPTO’s own regulations before issuance of a
patent.” Janssen, 844 F. Supp. 2d at 712. She stated that the
plain intent of the statute is “to strictly limit the forum and
timing for seeking judicial review of these very specific USPTO
decisions.” Id. at 713. Thus, she reasoned that if applicants
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could seek post-issuance review of the USPTO’s PTA determinations
under the APA, “the very limitations on judicial review Congress
included in the patent statute” “would [be] eviscerate[d].” Id.
She further explained that “it would be absurd for Congress to
impose limitations on the specific statutory judicial review
mechanisms (i.e., § 154(b)(4)(A)) when it simultaneously intended
to allow a patentee to seek generic APA review of the very same
question, (i.e., the number of days of PTA to which the . . .
patent is entitled) without any of those same restrictions.” Id.
(emphasis and internal quotation marks omitted). Accordingly,
she held that
in a case in which a patentee is challenging the number
of days of PTA calculated by the USPTO, whether that
calculation occurred before the patent was issued or
afterwards, such a decision is governed by §§ 154(b)(3)
and (b)(4)(A). In other words, any challenge to a PTA
determination is governed by § 154(b)(4)(A).
Id.
II. EQUITABLE TOLLING
Daiichi argues that the 180-day limitations period is not
jurisdictional and should be equitably tolled in this case. The
USPTO opposes.
A. Whether § 154(b)(4)(A) is jurisdictional
“The Supreme Court has distinguished between prescriptions
that may be ‘properly typed jurisdictional,’ and those better
classified as ‘claim-processing rules[.]’” Menominee Indian
Tribe of Wis. v. United States, 614 F.3d 519, 523 (D.C. Cir.
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2010) (quoting Scarborough v. Principi, 541 U.S. 401, 413-14
(2004)). A jurisdictional rule “governs a court’s adjudicatory
capacity, that is, its subject-matter or personal jurisdiction.”
Henderson ex rel. Henderson v. Shinseki, 131 S. Ct. 1197, 1202
(2011). Claim-processing rules are those “that seek to promote
the orderly progress of litigation by requiring that the parties
take certain procedural steps at certain specified times.” Id.
at 1203. Unlike a jurisdictional rule, “a nonjurisdictional
federal statute of limitations is normally subject to a
‘rebuttable presumption’ in favor ‘of equitable tolling.’”
Holland v. Florida, 130 S. Ct. 2549, 2560 (2010) (quoting Irwin
v. Dep’t of Veterans Affairs, 498 U.S. 89, 95-96 (1990)).
Under the “‘readily administrable bright line’” rule the
Supreme Court established in Arbaugh v. Y&H Corp., 546 U.S. 500(2006), to decide whether a rule is jurisdictional, courts “look
to see if there is any ‘clear’ indication that Congress wanted
the rule to be ‘jurisdictional.’” Henderson, 131 S. Ct. at 1203(quoting Arbaugh, 546 U.S. at 515-16). “Congress, of course,
need not use magic words in order to speak clearly on this point.
‘[C]ontext, including [the Supreme] Court’s interpretation of
similar provisions in many years past, is relevant.’” Id.(quoting Reed Elsevier, Inc. v. Muchnick, 559 U.S. 154, 168
(2010)).
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For example, courts have found that 28 U.S.C. § 2253(a),
(b), and (c)(1), 28 U.S.C. § 2501(a), and 28 U.S.C. § 2401(a)
contain unambiguous jurisdictional language. See Gonzalez v.
Thaler, 132 S. Ct. 641, 649 (2012) (28 U.S.C. § 2253(a), (b), and
(c)(1)); John R. Sand & Gravel Co. v. United States, 552 U.S.
130, 132-34 (2008) (28 U.S.C. § 2501(a)); Spannaus v. U.S. Dep’t
of Justice, 824 F.2d 52, 55 (D.C. Cir. 1987) (28 U.S.C.
§ 2401(a)). Section 2501(a) states: “Every claim of which the
United States Court of Federal Claims has jurisdiction shall be
barred unless the petition thereon is filed within six years
after such claim first accrues.” 28 U.S.C. § 2501(a) (emphasis
added). Section 2401(a) provides that “every civil action
commenced against the United States shall be barred unless the
complaint is filed within six years after the right of action
first accrues.” 28 U.S.C. § 2401(a) (emphasis added).
Section 2253(a) states: “In a habeas corpus proceeding or a
proceeding under section 2255 before a district judge, the final
order shall be subject to review, on appeal, by the court of
appeals for the circuit in which the proceeding is held.” 28
U.S.C. § 2253(a) (emphasis added). Section 2253(b) limits that
grant to the appeals court, stating that
[t]here shall be no right of appeal from a final order in
a proceeding to test the validity of a warrant to remove
to another district or place for commitment or trial a
person charged with a criminal offense against the United
States, or to test the validity of such person’s
detention pending removal proceedings.
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28 U.S.C. § 2253(b) (emphasis added). Section 2253(c)(1)
provides that “[u]nless a circuit justice or judge issues a
certificate of appealability, an appeal may not be taken to the
court of appeals from” a final order in habeas corpus proceeding
or proceeding under 28 U.S.C. § 2255. 28 U.S.C. § 2253(c)(1)
(emphasis added).
Although “[f]iling deadlines . . . are quintessential
claim-processing rules,” Henderson, 131 S. Ct. at 1203, the USPTO
argues that, like the jurisdictional statutes listed above,
§ 154(b)(4)(A) bars any suit that is filed after a certain
limitations periods and thus, should be considered
jurisdictional. See 35 U.S.C. § 154(b)(4)(A) (2006) (stating
that a patent applicant has a “remedy by a civil action” that is
filed “within 180 days after the grant of the patent”). However,
the USPTO has not demonstrated that § 154(b)(4)(A) includes
unambiguous jurisdictional terms such as “jurisdiction,” that it
states that suits not filed timely are “barred,” or that it
explicitly establishes procedures that must be met before the
applicant can file suit. Compare 28 U.S.C. § 2501(a), 28 U.S.C.
§ 2401(a), 28 U.S.C. § 2253(a), 28 U.S.C. § 2253(b), and 28
U.S.C. § 2253(c)(1), with 35 U.S.C. § 154(b)(4)(A) (“An applicant
dissatisfied with a determination made by the Director under
paragraph (3) shall have remedy by a civil action against the
Director filed in the United States District Court for the
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District of Columbia within 180 days after the grant of the
patent.”). Thus, the USPTO has not shown that § 154(b)(4)(A)
“speak[s] in jurisdictional terms or refer[s] in any way to the
jurisdiction of the district courts.” Zipes v. Trans World
Airlines, Inc., 455 U.S. 385, 394 (1982). Because courts should
be hesitant to find that a rule is jurisdictional, see Gonzalez,
132 S. Ct. at 648, and the USPTO has not shown that
§ 154(b)(4)(A) contains jurisdictional language, the court holds
that the provision is not jurisdictional. Cf. Novartis, 904 F.
Supp. 2d at 67 (finding that “it is perhaps more prudent to
conclude that § 154(b)(4)(A) should be viewed as a
‘claim-processing rule’” “[i]n light of . . . recent
admonishments to construe the meaning of ‘jurisdictional’
narrowly”). Because § 154(b)(4)(A) is not jurisdictional, there
is a rebuttable presumption that it is subject to equitable
tolling.7
B. Whether § 154(b)(4)(A) should be equitably tolled
“[E]quitable tolling -- as a method for adjusting the rights
of two ‘innocent parties’ -- merely ensures that the plaintiff is
not, by dint of circumstances beyond his control, deprived of a
‘reasonable time’ in which to file suit.” Chung v. U.S. Dep’t of
Justice, 333 F.3d 273, 279 (D.C. Cir. 2003) (quoting Cada v.
Baxter Healthcare Corp., 920 F.2d 446, 452 (7th Cir. 1990)).
7
The USPTO does not attempt to rebut this presumption.
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“Generally, a litigant seeking equitable tolling bears the burden
of establishing two elements: (1) that he has been pursuing his
rights diligently, and (2) that some extraordinary circumstance
stood in his way.” Pace v. DiGuglielmo, 544 U.S. 408, 418
(2005). Courts must decide whether to equitably toll a statute
of limitations period on a “‘case-by-case basis.’” Holland, 130
S. Ct. at 2563 (quoting Baggett v. Bullitt, 377 U.S. 360, 375
(1964)). However, courts “extend[] equitable relief only
sparingly.” Irwin, 498 U.S. at 96.
Daiichi argues that the statute of limitations should be
equitably tolled because extraordinary circumstances prevented it
from timely pursuing its rights. Specifically, Daiichi asserts
that it reasonably relied on the correctness of the USPTO’s
methodology for calculating A/B Overlap described in the 2004
Notice, and thus, did not challenge the USPTO’s PTA determination
for the ‘014 and ‘205 patents. Pl.’s Mem. at 28-29.
Accordingly, Daiichi contends that the 180-day limitations period
should be equitably tolled until the district court decided Wyeth
I in September 2008.8
8
Daiichi’s argument assumes that, under general tolling
principles, the 180-day limit would have been tolled while its
petitions for reconsideration and Rule 183 petitions were pending
before the Director. Because Daiichi has not shown that the
limitations period should be equitably tolled in this case,
whether the limitations period was tolled by Daiichi filing
petitions for reconsideration and Rule 183 petitions is not
addressed.
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To toll a statute of limitations, a
[p]laintiff must either show that defendant has concealed
its acts with the result that plaintiff was unaware of
their existence or it must show that its injury was
“inherently unknowable” at the accrual date. . . . In
[the second] situation the statute will not begin to run
until plaintiff learns or reasonably should have learned
of his cause of action.
Japanese War Notes Claimants Ass’n of Phil., Inc. v. United
States, 373 F.2d 356, 359 (Ct. Cl. 1967) (footnote omitted)
(quoting Urie v. Thompson, 337 U.S. 163, 169 (1949)). In
particular, equitable tolling may be appropriate where failure to
meet a statute of limitations “is the result of justifiable
reliance on the advice of [a] government officer.” See Jarrell
v. U.S. Postal Serv., 753 F.2d 1088, 1092 (D.C. Cir. 1985); see
also Bull S.A. v. Comer, 55 F.3d 678, 681 (D.C. Cir. 1995). In
determining whether equitable tolling is justified in such a
case, courts distinguish between a government officer’s or
agency’s advice on the limitations period and the officer’s or
agency’s understanding of the party’s substantive legal rights.
On the one hand, a statute of limitations may be equitably
tolled where a party reasonably relies on a government officer’s
incorrect advice regarding the limitations period. For example,
in Bull, the Commissioner of Patents and Trademarks gave Bull
S.A. an incorrect renewal deadline for Bull’s trademark in a
signed and sealed Certificate of Renewal. Bull, 55 F.3d at 679.
Bull applied to renew its trademark on the incorrect deadline in
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the Certificate of Renewal, but was informed that it had missed
the correct, statutory renewal deadline, and that it was unable
to renew its trademark. Id. The D.C. Circuit found that the
statutory renewal deadline should be equitably tolled because
Bull justifiably relied on the Commissioner’s incorrect renewal
deadline. Id. at 682 (“The facts of this case support Bull’s
claim of justifiable reliance: Bull received an official
government document, published under the signature and Seal of
the Commissioner, that certified a renewal lasting until May 15,
1992. Once in receipt of this document, and, as detailed below,
absent any circumstances that would alert Bull to the error, Bull
was entitled to rely on its validity.” (emphasis omitted)).
On the other hand, a statute of limitations may not be
equitably tolled where a party relies on the government officer’s
or agency’s interpretation of the party’s legal rights. See,
e.g., Venture Coal Sales Co. v. United States, 370 F.3d 1102(Fed. Cir. 2004); Catawba Indian Tribe of S.C. v. United States,
982 F.2d 1564 (Fed. Cir. 1993).9 In Venture Coal Sales, the
9
In Catawba Indian Tribe, the Federal Circuit considered
whether the Catawba Indian Tribe’s claims were barred by a six-
year statute of limitations. Catawba Indian Tribe, 982 F.2d at
1569. In that case, the Tribe argued that a representative of
the Bureau of Indian Affairs had assured the Tribe that the
Catawba Indian Tribe Division of Assets Act, 25 U.S.C. §§ 931-938(1988), would not affect the Tribe’s rights to its ancestral
lands. Catawba Indian Tribe, 982 F.2d at 1567. Later, the
Supreme Court construed the Act in such a way as to cause the
Tribe to lose a portion of its land. See id. at 1571-72. The
Tribe argued that the statute of limitations for claims regarding
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plaintiffs paid a Coal Sales Tax on all of the coal they
produced. Id. at 1103. In 1997, the district court in the
Eastern District of Virginia held the Coal Sales Tax
unconstitutional because it violated the Export Clause of the
United States Constitution, U.S. Const. art. I, § 9, cl. 5. Id.
(citing Ranger Fuel Corp. v. United States, 33 F. Supp. 2d 466(E.D. Va. 1998)). The plaintiffs argued that “the statute of
limitations should be tolled because it did not know nor could it
have known in the exercise of reasonable diligence that its
claims [for a refund] had accrued.” Id. at 1107. The plaintiffs
asserted that their claims were “inherently unknowable” until the
tax was held unconstitutional in 1997. Id. The Federal Circuit
found that the plaintiffs knew that they had paid the Coal Sales
Tax and knew of the Export Clause, and concluded that the
plaintiffs “had all the facts necessary to initiate a claim
against the United States.” Id. The Federal Circuit rejected
the plaintiffs’ argument that equitable tolling was justified
because the plaintiffs “did not know the legal theory on which
the Tribe’s lands did not begin to run until the Supreme Court’s
decision. Id. The Federal Circuit recognized that equitable
tolling may be justified in “the case when the facts necessary to
know of the harm were intentionally withheld from the plaintiff
by the defendant.” Id. at 1572. However, it inferred that
equitable tolling is not permissible where “all the relevant
facts were known” but the plaintiff, such as the Tribe,
misunderstood “the meaning of the law.” See id. Thus, the court
concluded that the statute of limitations should not be equitably
tolled. See id.
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[their] refund claim might succeed.” Id. The court explained
that “‘ignorance of rights which should be known is not enough’”
to toll a statute of limitations. Id. (alteration omitted)
(quoting Japanese War Notes Claimants Ass’n, 373 F.2d at 359).
Daiichi insists that Bull should be applied in this case.
However, unlike Bull, Daiichi does not argue that the USPTO
misled it about the § 154(b)(4)(A) 180-day deadline or that
Daiichi was otherwise unaware of the statute of limitations.
Daiichi asserts that this is a “distinction without a
difference,” Reply Mem. of P. & A. in Supp. of Pl.’s Mot. for
Summ. J. & Mem. of P. & A. in Opp’n to Def.’s Cross-Mot. for
Summ. J. (“Pl.’s Reply & Opp’n”) at 18, but provides no support
for its assertion that Bull applies to this case despite this
distinguishing factor.
Alternatively, Daiichi argues that Wyeth I was a change in
law that justifies equitable tolling. See Pl.’s Reply & Opp’n at
15-17 (arguing that “[t]olling is appropriate here due to . . .
[the] shift in law occasioned by Wyeth”). However, Daiichi has
not shown that it was unable to pursue its rights until “such
time as a federal court . . . ruled on and upheld the very claims
[it] seek[s] to pursue.” Novartis, 904 F. Supp. 2d at 68. As in
Venture Coal, Daiichi possessed all the facts necessary to
challenge the USPTO’s PTA determinations before Wyeth I was
decided. Daiichi does not dispute that it knew of the PTA
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determinations for the ‘014 and ‘205 patents, the USPTO’s
methodology for calculating PTAs described in its 2004 Notice,
and 35 U.S.C. § 154(b). Thus, Daiichi “was free to raise the
issues that Wyeth . . . raised in [its] lawsuit[] within the 180
days after [its] patents were granted.” Novartis, 904 F. Supp.
2d at 68. Accordingly, Daiichi has not shown that extraordinary
circumstances exist that warrant equitable tolling.10
Even if Daiichi could demonstrate that extraordinary
circumstances justify equitable tolling, it has not shown that it
diligently pursued its rights to challenge the USPTO’s PTA
determinations. Daiichi asserts that it would have been futile
to challenge the PTAs for the ‘014 and ‘205 patents before the
district court decided Wyeth I but that it “diligently acted to
preserve its rights” by filing Rule 183 Petitions and motions for
reconsideration of the PTA determinations for the ‘014 and ‘205
patents less than 180 days after the Wyeth I decision and
amending its complaint to challenge the PTA determinations for
the ‘014 and ‘205 patents promptly after the USPTO denied its
Rule 183 Petitions and motions for reconsideration. Pl.’s Mem.
10
Daiichi also argues that equitable tolling of the statute
of limitations for its challenges of the ‘014 and ‘205 PTA
determinations is necessary to correct the patent term for the
‘135 patent. Pl.’s Mem. at 31; Pl.’s Reply & Opp’n at 19-20.
However, Daiichi does not provide any support for its argument
that such a related effect justifies equitably tolling the
statute of limitations. Furthermore, this argument does not
explain why Daiichi did not timely challenge the ‘014 and ‘205
PTA determinations.
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at 29-30. In Communications Vending Corp. of Arizona, Inc. v.
FCC, 365 F.3d 1064, 1075 (D.C. Cir. 2004), the D.C. Circuit
rejected a similar argument. In that case, the court found that
the plaintiff’s argument that it would have been futile to pursue
its claim in light of the agency’s interpretation of the
governing law did not excuse the party from timely filing its
claim. The court explained:
The only sure way to determine whether a suit can be
maintained is to try it. The application of the statute
of limitations cannot be made to depend upon the
constantly shifting state of the law, and a suitor cannot
toll or suspend the running of the statute by relying
upon the uncertainties of controlling law. It is
incumbent upon him to test his right and remedy in the
available forums. These suits were not commenced until
through the labor of others the way was made clear.
Id. (quoting Fiesel v. Bd. of Educ., 675 F.2d 522, 524–25 (2d
Cir. 1982)). Confronted in Novartis with the same argument as
Daiichi raises in this case, Judge Huvelle relied on
Communications Vending to conclude:
It is of no moment that the PTO had consistently applied
its pre-Wyeth interpretation of A/B Delay Overlap; the
question is not what the PTO would have done in response
to a request for reconsideration, but rather what a
federal court would have done in reviewing the PTO’s
interpretation. That was both unasked and unanswered
until Wyeth raised exactly this issue in its lawsuit,
just as [the patent applicant] was free to do at any
point within 180 days of its patents being granted.
Novartis, 904 F. Supp. 2d at 68. Thus, Daiichi has not shown
that it was justified in not pursuing its rights until after
Wyeth I was decided. Instead, Daiichi sat on its rights for
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almost a year after the ‘014 and ‘205 patents issued, and has not
demonstrated that equitable considerations exist for not
diligently pursuing its rights to challenge the PTA
determinations.
CONCLUSION
Section 154(b)(4)(A) applies to final PTA determinations.
Although § 154(b)(4)(A) is subject to equitable tolling, Daiichi
has not shown that extraordinary circumstances prevented it from
timely challenging the PTA determinations for the ‘014 and ‘205
patents or that it has been diligently pursuing its rights.
Therefore, the USPTO’s motion for summary judgment will be
granted and Daiichi’s motion for summary judgment will be denied.
A separate Order accompanies this Memorandum Opinion.
SIGNED this 3rd day of December, 2013.
/s/
RICHARD W. ROBERTS
Chief Judge