Amicus Curiae Brief — Chestek PLLC, Petitioner v. Kathi Vidal, Under Secretary of Commerce for Intellectual Property and Director, United States Patent and Trademark Office

No. 23-1217

IN THE

Supreme Court of the United States

_________

CHESTEK PLLC,

Petitioner,

V.

KATHI VIDAL, UNDER SECRETARY OF COMMERCE FOR

INTELLECTUAL PROPERTY AND DIRECTOR, UNITED

STATES PATENT AND TRADEMARK OFFICE,

_________

Respondent.

On Petition for a Writ of Certiorari to

the United States Court of Appeals

for the Federal Circuit

_________

BRIEF AMICUS CURIAE FOR THE

BAR ASSOCIATION FOR THE

DISTRICT OF COLUMBIA

_________

WILLIAM P. ATKINS

Counsel of Record

MATTHEW GRILLO

PILLSBURY WINTHROP

SHAW PITTMAN LLP

1650 Tysons Boulevard,

14th Floor

McLean, VA 22102

(703) 770-7900

william.atkins@

pillsburylaw.com

Counsel for Amicus Curiae

TABLE OF CONTENTS

Page

STATEMENT OF INTEREST OF AMICUS

CURIAE.................................................................. 1

SUMMARY OF ARGUMENT ..................................... 1

ARGUMENT ............................................................... 3

I. Legislative Intent: The APA and AIPA’s

Mandate for Notice-and-Comment

Rulemaking ....................................................... 3

A. Congressional Intent of the APA ................ 4

B. Congressional Intent of the AIPA .............. 5

C. Avoidance of an “Absurd” Result ................ 5

II. Mandatory Notice-and-Comment is

Needed .............................................................. 6

A. The Case at Issue Here ............................... 7

B. Reactionary Rulemaking with Retroactive

Notice-and-Comment .................................. 8

C. USPTO’s Improper Rulemaking Procedure

………………………………………………..10

CONCLUSION .......................................................... 12

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TABLE OF AUTHORITIES

Page(s)

Cases

Adidas AG v. Nike, Inc.,

No. IPR2013-00067 (PTAB Mar. 1, 2021) ............. 8

In re Chestek,

No. 2022-1843 .................................................... 1, 7

Cooper Techs. Co. v. Dudas,

536 F.3d 1330 (Fed. Cir. 2008) .............................. 6

Merck & Co., Inc. v. Kessler,

80 F.3d 1543 (Fed. Cir. 1996) ................................ 2

Michael Fitzpatrick v. Department of Commerce,

DC-1221-21-0423-W-2 (M.S.P.B May 5, 2023) ..... 8

Statutes and Codes

United States Code,

Title 5, Section 553 .................................... 2, 3, 4, 5

Title 5, Section 553(b)(A) ....................................... 6

Title 35, Section 2(b)(2)(B) ................................. 2, 5

Rules and Regulations

Code of Federal Regulations,

Title 37, pt. 2 .......................................................... 7

Federal Register,

Volume 84, Issue 127, page 31498 (Jul. 2, 2019) .. 7

ii

Federal Rules of Civil Procedure,

Rule 37.2 ................................................................. 1

Rule 37.6 ................................................................. 1

Other Authorities

63 A.B.A. Rep. 331, 339-40 (1938) .............................. 4

Andrew Dietrick & Jonathan Stroud, Rules to Bind

You: Problems with the USPTO's PTAB

Rulemaking Procedures, 51 N.M. L. Rev. 430

(2021) ...................................................................... 5

Antonin Scalia, Judicial Deference to Administrative

Interpretations of Law, 1989 Duke L.J. 511, 514

(1989) .................................................................. 3, 4

Clarisa Long, PTO and the Market for Influence in

Patent Law, 157 U. Pa. L. Rev. 1965, 1973–74

(2009) ...................................................................... 5

Eileen McDermott, MSPB Grants ‘Corrective Action’

to APJ for USPTO Retaliation Following

Whistleblower Activity ....................................... 8, 9

Interest Groups in American Public Law, 38 Stan. L.

Rev. 29, 60 (1985) ................................................... 4

Morris D. Forkosch, Treatise on Administrative Law

70 (1956) ................................................................. 4

Reginald Parker, Administrative Law, A Text 61-62

(1952) ...................................................................... 4

Sen. Doc. No. 248 (1946) ............................................. 4

iii

Walter Gellhorn, The Administrative Procedure Act:

The Beginnings, 72 Va. L. Rev. 219, 221-22, fn. 11

(1986) ...................................................................... 4

iv

STATEMENT OF INTEREST OF AMICUS

CURIAE1

The Bar Association of the District of

Columbia is a non-profit organization that has an IP

Section (“BADC”) which monitors developments in

intellectual property law and practice. This section

includes members who specialize in various aspects

of intellectual property law. Members frequently

represent clients involved in intellectual property

matters and are concerned with the USPTO’s

administrative practices including its rulemaking

authority and internal decision-making.

In support of its interest in ensuring that the

USPTO conducts its affairs equitably, fairly, and

without arbitrariness or capriciousness, the BADC

supports the Petitioner. The BADC respectfully

requests that this Court consider the arguments

contained herein and grant Petitioner’s writ of

certiorari.

SUMMARY OF ARGUMENT

With In re Chestek, the Federal Circuit

reinforces the unfortunate precedent that the

USPTO remains exempt from notice-and-comment

rulemaking. No. 2022-1843 (Fed. Cir. Feb. 13, 2024).

1 Pursuant to Rule 37.2, amicus notified counsel of record for all

parties of their intent to file an amicus brief at least ten days

prior to the due date for the brief. Pursuant to Rule 37.6,

amicus affirms that no counsel for a party authored this brief

in whole or in part, and no person other than amicus and

their counsel made a monetary contribution to its

preparation or submission.

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Longstanding Federal Circuit precedent

established that the USPTO has the authority to

issue only procedural rules. See, e.g., Merck & Co.,

Inc. v. Kessler, 80 F.3d 1543, 1550 (Fed. Cir. 1996);

see also Cooper Techs. Co. v. Dudas, 536 F.3d 1330,

1335 (Fed. Cir. 2008). Procedural rules are exempt

from notice-and-comment rulemaking under §

533(b)(A) of the Administrative Procedure Act

(“APA”).). With the USPTO able to only issue

procedural rules, the USPTO’s decision to engage in

notice-and-comment is currently a discretionary act

for the Director, not mandatory.

And yet, Congress explicitly stated in the

American Inventors Protection Act of 1999 (“AIPA”)

that the USPTO is subject to the APA and its

comment procedures. See 35 U.S.C. § 2(b)(2)(B)

(referencing 5 U.S.C. § 553, the APA rule making

statute). Current precedential caselaw renders 35

U.S.C. § 2(b)(2)(B) meaningless, however. Only this

Court can correct the distinction between procedural

and substantive rules within the context of the

USPTO.

The following explains why this Court should

grant certiorari: to correct the precedence which has

afforded the USPTO such latitude and to provide

necessary guidance to the USPTO on providing

notice-and-comment.

2

ARGUMENT

I.

Legislative Intent: The APA and AIPA’s

Mandate for Notice-and-Comment

Rulemaking

Since it can only promulgate procedural rules,

the USPTO can change its rules without notice-andcomment rulemaking due to the APA’s procedural

exception, regardless of the impact on the public,

practitioners, and stakeholders the agency relies on

for funding. 35 U.S.C. § 553(b)(A).

This is contrary to the purpose of the APA and

the AIPA, which state that an agency, such as the

USPTO, is subject to notice-and-comment

rulemaking procedure. The current precedential

caselaw results in a practical result that is “absurd,”

being “[incompatible] with the reason [and] purpose

of the statute.” Antonin Scalia, Judicial Deference to

Administrative Interpretations of Law, 1989 DUKE

L.J. 511, 514 (1989) (discussing the application of the

“traditional tools of statutory construction” to the

APA, specifically noting the importance of

“consideration of policy consequences” and avoidance

of “absurd” results when analyzing the Act).

If the USPTO issues only procedural rules,

then 35 U.S.C. § 2(b)(2)(B) is meaningless. The

history of the APA and the AIPA speaks to the

necessity for administrative agencies to adhere, at

least to some degree, to public engagement in

rulemaking through notice-and-comment procedure.

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A.

Congressional Intent of the APA

The Congressional intent underlying the APA

is “undoubtedly to bring about … a curb of the

administrative branch” such “that the governors

shall be governed, and the regulators shall be

regulated.” REGINALD PARKER, ADMINISTRATIVE LAW,

A TEXT 61–62 (1952) (quoting Sen. Doc. No. 248, at

244 (1946)). The drafters of the APA remarked on the

dangers and controversy surrounding

“administrative absolutism,” the idea that “the law is

whatever is done officially” and “there should be no

[or minimal] judicial review … of administrative

action.” Walter Gellhorn, The Administrative

Procedure Act: The Beginnings, 72 VA. L. REV. 219,

221–22, fn. 11 (1986) (quoting 63 A.B.A. Rep. 331,

339–40 (1938) and quoting O.R. McGuire, chairman

of the American Bar Association Special Committee

on Administrative Law respectively). It was

necessary to find a way to require administrative

officials to “base decisions not on conventional

processes of reasoning, but on responses to

constituent desires and on informally obtained

information about issues of fact and policy.” Cass R.

Sunstein, Interest Groups in American Public Law,

38 STAN. L. REV. 29, 60 (1985) (emphasis added).

These concerns were addressed by the introduction of

notice-and-comment procedure, characterized by the

late Justice Antonin Scalia as “probably the most

significant innovation of the [APA].” Scalia, Judicial

Deference to Administrative Interpretations of Law at

514. “The constitutional notice and hearing

requirements … are generally present where life,

liberty, or property is being injured, or one’s rights

4

are being impaired.” MORRIS D. FORKOSCH, TREATISE

ON ADMINISTRATIVE LAW 70 (1956) (emphasis added).

B.

Congressional Intent of the AIPA

In 1999, Congress passed the AIPA “which

reorganized the [USPTO] and established it” as an

independent executive agency, expanding its

influence and ability to control its own operations.

Clarisa Long, PTO and the Market for Influence in

Patent Law, 157 U. PA. L. REV. 1965, 1973–74 (2009).

The AIPA explicitly connected the USPTO to the

APA, by adding the requirement that the USPTO

“may establish regulations … which … shall be made

in accordance with [APA notice-and-comment

procedure].” 35 U.S.C. § 2(b)(2)(B) (referencing 5

U.S.C. § 553, the APA rule making statute)

(emphasis added). As an administrative agency, the

USPTO is subject to all the regulations of the APA.

Congress chose to make this explicit by including

direct reference to the APA’s rulemaking statute in

the AIPA. Despite such inclusion, the USPTO has

repeatedly acted unilaterally in changing its rules,

often contrary to the interests of practitioners and

stakeholders. See generally Andrew Dietrick &

Jonathan Stroud, Rules to Bind You: Problems with

the USPTO’s PTAB Rulemaking Procedures, 51 N.M.

L. REV. 430 (2021).

C.

Avoidance of an “Absurd” Result

The inclusion of notice-and-comment

procedure in the APA was intended to give citizens a

proverbial “seat at the table” in agency rulemaking,

especially one where their personal or property

rights were likely to be impacted. The USPTO grants

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and denies tangible patent and trademark rights in

the United States. The AIPA acknowledged this and

explicitly stated that the USPTO must adhere to

notice-and-comment procedure.

The status quo, affirmed again by the Federal

Circuit in the case now before this Court, is that all

rules promulgated by the USPTO are procedural and

therefore exempt from notice-and-comment

rulemaking per 5 U.S.C. § 553 (b)(A). See In re

Chestek, No. 2022-1843; see also Cooper Techs., 536

F.3d at 1335. This is an absurd result because it

renders 35 U.S.C. § 2(b)(2)(B) meaningless.

In determining whether the USPTO is subject

to notice-and-comment procedure, it is necessary to

delineate substantive from procedural rules and

inquire as to whether this line is drawn the same

way for all administrative agencies. The powers

wielded, and subject matter governed by the USPTO

are unique among the executive agencies, requiring

an analysis of rulemaking that acknowledges the

specialized context in which intellectual property

rights are granted by the USPTO.

II.

Mandatory Notice-and-Comment is

Needed

The USPTO is the cornerstone of patent and

trademark rights in the United States and essential

for protecting inventor and brand rights as well as

fostering innovation.

This case and a recent situation underscore

the urgent need for this Court’s intervention, one

which will ensure that the USPTO adheres to the

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principles of public accountability and transparency

as mandated by the APA and as recognized by the

AIPA.

A.

The Case at Issue Here

The current petition is the result of a new

USPTO rule which impacts rights by overreaching

into personal information of applicants. See In re

Chestek, No. 2022-1843 at 2 (Petitioner “fail[ed] to

comply with the domicile address requirement of 37

C.F.R. §§ 2.32(a)(2) and 2.189”).

The rule in question stems from a 2019

amendment to trademark regulations, requiring

applicants to provide their domicile address—defined

as their permanent legal residence or principal place

of business—excluding previously accepted mere

mailing addresses. See generally Requirement of U.S.

Licensed Attorney for Foreign Trademark Applicants

and Registrants, 84 Fed. Reg. 31498 (Jul. 2, 2019)

(codified at 37 C.F.R. pt. 2) [hereinafter “Foreign

Attorney Requirement”]. The original rule was

subject to notice-and-comment; however, the

finalized amended version, which altered the rule

requiring foreign applicants to retain U.S. licensed

counsel, was promulgated by the USPTO without

adhering to the notice-and-comment procedure. Id. at

31507 (stating the amended rule “does not require

notice-and-comment rulemaking” because it is

procedural in nature). Petitioner Chestek challenged

both the domicile address rule and the USPTO’s

failure to follow the notice-and-comment procedure.

See generally In re Chestek, No. 2022-1843. The

USPTO maintains that the “proposed changes were

[procedural and therefore] exempt from the

7

requirements of notice-and-comment rulemaking but

that it had nevertheless ‘chosen to seek public

comment.’” Id. at 2.

B.

Reactionary Rulemaking with

Retroactive Notice-and-Comment

Another development stems from a case

involving retaliation by the USPTO against an

Administrative Patent Judge (“APJ”) named Michael

Fitzpatrick. See generally Michael Fitzpatrick v.

Dep’t of Commerce, DC-1221-21-0423-W-2 (M.S.P.B

May 5, 2023) (Initial Decision). APJ Fitzpatrick is an

administrative patent judge in the Patent Trial and

Appeal Board (“PTAB”) at the USPTO. This case

resulted in a new USPTO rule without notice-andcomment.

On July 19, 2018, APJ Fitzpatrick’s

whistleblower complaint quietly called into question

the practice of “panel stacking” at the PTAB. Id.

Judicial panels at the PTAB usually consist of three

APJs. APJ Fitzpatrick accused USPTO leadership of

manipulating panel compositions to sway the

patentability decisions in PTAB cases, particularly in

the Adidas AG v. Nike, Inc., No. IPR2013-00067

(PTAB Mar. 1, 2021), inter partes review (“Adidas

IPR”). Eileen McDermott, MSPB Grants ‘Corrective

Action’ to APJ for USPTO Retaliation Following

Whistleblower Activity, IP WATCHDOG (May 11, 2023,

12:15 PM) (summarizing the APJ Fitzpatrick MSPB

initial decision) (citations omitted).2 According to his

2 Available at https://ipwatchdog.com/2023/05/11/mspb-grants-

corrective-action-apj-uspto-retaliation-following-

8

complaint, the USPTO covertly and illegally

expanded the review panel from three to five judges

after the decision had already been made, changed

the outcome, and then reduced the panel back to

three, all without notifying the involved parties. Id.

Adding to the controversy, APJ Fitzpatrick

asserted that the then-USPTO Director expressed

his intentions to terminate Fitzpatrick’s

employment. Id. Fitzpatrick was also (1) pressured to

omit remarks about the panel’s expansion in his

concurring opinion, (2) subsequently removed from

the panel, (3) reassigned and relegated to ex parte

appeals at the PTAB, and (4) negatively appraised in

performance reviews. Id. The Merit Systems

Protection Board (“MSPB”) determined APJ

Fitzpatrick’s claims to be credible and ordered

corrective actions that reinstated him to his original

duties. Id.

PTAB officials later testified about this

unfortunate activity between May 11 and 24, 2022.

See Fitzpatrick, DC-1221-21-0423-W-2 (Hearing

Transcripts, recording testimony of currently active

USPTO APJs Philli Kauffman, Susan Mitchell,

Michael Tierney, and current Chief APJ Scott R.

Boalick). On May 26, 2022, a mere two days after the

hearings, the USPTO reacted by issuing an “Interim

Process for PTAB Decision Circulation and Internal

PTAB Review,” (“Interim Process”) without any

notice or comment. Interim process for PTAB decision

circulation and internal PTAB review, USPTO

(published May 26, 2022, 4:12 PM, updated July 20,

whistleblower-activity/id=160782/ (last visited June 12,

2024).

9

2022, 9:08 AM).3 This Interim Process altered the

previous procedure that was recently testified about

at the MSPB, now making it “clear that the Director

is not involved, pre-issuance, in directing or

otherwise influencing panel decisions, and [that] the

PTAB panel has final authority and responsibility for

the content of a decision.” On July 20, 2022, the

USPTO retroactively provided a notice-and-comment

for this rule. The following day, the U.S. Government

Accountability Office would publish a highly critical

report on USPTO decision-making. U.S. GOV’T

ACCOUNTABILITY OFF., GAO-22-106121, PATENT

TRIAL AND APPEAL BOARD: PRELIMINARY

OBSERVATIONS ON OVERSIGHT OF JUDICIAL DECISIONMAKING (2022).

While there are others, this is another

incident where the USPTO issued an initial rule

without notice or comment. While it was a welcome

development after the fact, prior public

accountability within the USPTO could have

prevented this and other similar unfortunate

situations.

C.

USPTO’s Improper Rulemaking

Procedure

Lastly, even when the USPTO implements

notice-and-comment rulemaking, it is not always

implemented properly. In 2023, the USPTO

published changes to the MPEP but chose not to

follow the proper notice-and-comment procedure. See

3 Available at https://www.uspto.gov/interim-process-ptabdecision-circulation-and-internal-ptab-review (last accessed

Jun 13, 2024).

10

Julie Burke, Ph.D, USPTO Flexes Its AIA Powers To

Make Retroactive Substantive MPEP Policy Changes,

IP WATCHDOG (Mar. 23, 2023, 12:15p PM).4 The

established process requires specific proposed

changes, public comments, review and analysis of

those comments, and final publication based on the

feedback. Id. However, the USPTO implemented

policy changes before the comment period ended,

provided vague questions regarding its request for

comment, and published retroactive changes shortly

after the comment period closed. Id. This deviation

caused confusion and reduced transparency for

stakeholders.

This Court’s intervention is needed in order to

overrule the timeworn precedent, precedent which is

contrary to the AIPA.

4 Available at https://ipwatchdog.com/2023/03/23/uspto-flexes-

aia-powers-make-retroactive-substantive-mpep-policychanges/id=158222/ (last visited June 13, 2024).

11

CONCLUSION

The BADC respectfully requests that this

Court consider the arguments contained herein and

grant Petitioner’s writ of certiorari.

Respectfully submitted,

WILLIAM P. ATKINS

Counsel of Record

MATTHEW GRILLO

PILLSBURY WINTHROP

SHAW PITTMAN LLP

1650 Tysons Boulevard,

14th Floor

McLean, VA 22102

(703) 770-7900

william.atkins@

pillsburylaw.com

Counsel for Amicus Curiae

JUNE 2024

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