671 F. 2d 533 - Smith v. J Mossinghoff

This appeal is from the order and judgment of the district court granting motion of defendant-government ("Commissioner") to dismiss a mandamus action of plaintiffs-appellants ("Smith") to require the United States Patent and Trademark Office ("PTO") to revive an abandoned application for a patent and to issue a patent thereon.1 Abandonment was finally determined by a decision of the Deputy Assistant Commissioner of the PTO dated September 17, 1979, responding to a renewed petition under 37 CFR 1.1372 to revive the application. We affirm.

The basis of the PTO's determination was that Smith had not provided "sufficient grounds for establishing unavoidable delay in prosecuting (his) application within the meaning of 35 U.S.C. § 133 and 37 CFR 1.137." 35 U.S.C. § 133 provides:

Upon failure of the applicant to prosecute the application within six months after any action therein, of which notice has been given or mailed to the applicant, or within such shorter time, not less than thirty days, as fixed by the Commissioner in such action, the application shall be regarded as abandoned by the parties thereto, unless it be shown to the satisfaction of the Commissioner that such delay was unavoidable.

It is uncontested that Smith failed to take action until twenty-two days after the time had expired.

In its opinion, the district court set forth the following summary from the administrative file of Smith's patent application:

     Dates                          Events
Dec. 6, 1976     Plaintiff filed patent application serial
                 #748,001 entitled SOLVENT
                 RECOVERY SYSTEMS.
Nov. 1, 1977     Patent Office advised plaintiff that
                 all claims pending in application had
                 been examined and rejected.
Feb. 3, 1978     Plaintiff filed an amendment to the
                 application.
Mar. 16, 1978    Patent Office advised plaintiff that
                 all claims were still rejected.  The
                 rejection was made FINAL and
                 plaintiff was given a period of three
                 months in which to respond or the
                 application would become abandoned.
June 7, 1978     Plaintiff requested an extension of
                 one month in response time giving
                 as a justification "inability to
                 respond...due to extensive out-of-
                 state travel."
June 12, 1978    Request for extension approved.
June 13, 1978    Plaintiff and his attorney met with
                 the patent examiner.  Agreement
                 with respect to the claims was not
                 reached.
July 14, 1978    Plaintiff amended application again.
Aug. 31, 1978    Patent Office advised plaintiff's
                 attorney that he had six months
                 "FROM THE DATE OF THE
                 FINAL REJECTION" to respond.
Sept. 19, 1978   Application became abandoned due to
                 plaintiff's failure to respond within
                 the six months period.
Oct. 10, 1978    Plaintiff filed PETITION TO
(22 days late)   REVIVE claiming failure to observe
                 time limit was "due to excusable
                 confusion over the time to file a
                 response."
Dec. 20, 1978    Patent Office denied petition to
                 revive noting that the "record is
                 inadequate to establish unavoidable
                 delay within the meaning of 35 U.S.C.
                 133."
Jan. 9, 1979     Plaintiff's attorney wrote
                 Commissioner of Patents describing errors in
                 filing made by his office and urged
                 again the revival of the application.
                 Plaintiff's attorney argued that the
                 delay was unavoidable due primarily
                 to confusion among his staff
                 regarding the significance of the notice and
                 secondarily to the inability of counsel
                 to review it himself due to a
                 deposition and trial in another matter.
Feb. 20, 1979    Patent Office dismissed petition
                 pointing out that the record still did not
                 support a finding that the delay was
                 unavoidable.
May 3, 1979      Plaintiff's attorney submitted further
                 material to the Patent Office.
May 30, 1979     Patent Office considered latest
                 material submitted and concluded that
                 there was no adequate verified
                 showing of a cause for unavoidable delay.
                 The petition was dismissed.
July 5, 1979     Plaintiff requested reconsideration of
                 dismissal of his petition.
Sept. 17, 1979   Patent Office reconsidered and
                 reaffirmed its denial of the petition.
August 15, 1979  Plaintiff filed this civil action #80-
                 2071.

Smith has not offered objection to this summary or to the district court's further findings that the six months' statutory period (measured from the date of the final rejection) for prosecuting the application did not run until midnight September 18, 1978, since September 16, 1978, fell on Saturday; that it was admitted by Smith's attorney that he personally knew of the notice (that the period for response was six months from the date of final rejection) on or before September 18 and still took no action; and that "final rejection" is a term of art well known and understood by competent practitioners before the PTO. The district court also found that since Smith's attorney had until midnight of September 18, 1978, to act (37 CFR 1.7), he had sufficient time to take appropriate action.

The district court set forth the following summary of Smith's submissions in support of his position that failure to prosecute the application until twenty-two days after the time had expired was unavoidable for purposes of 35 U.S.C. § 133 and 37 CFR 1.137:

The district court concluded that unavoidable delay under 35 U.S.C. § 133 was not established by internal filing errors of Smith's attorney, or by the attorney's preoccupation with other legal matters or with moving his residence, or by the attorney's inadvertence or mistake, citing Potter v. Dann, 201 USPQ 574, 575 (D.D.C.1978); further, that Smith was bound by the acts of his attorney since he chose him as his representative and could not avoid the consequences of the attorney's acts or omissions, citing Link v. Wabash Railroad Co., 370 U.S. 626, 633-34, 82 S.Ct. 1386, 1390, 8 L.Ed.2d 734 (1962). Noting that the PTO's advisory action was "both clear and explicit" in stating that the period of response was extended to run 6 months "FROM THE DATE OF THE FINAL REJECTION," the district court observed that "(i)t is hard to see how one could comprehend the first part of the quoted sentence and ignore the underlined portion." Finally, the court concluded that the excuses offered by Smith were "insufficient to justify overturning the Patent Office's decision."

A threshold issue raised by Smith is whether this case should be remanded for an evidentiary hearing because, he argues, "the trial judge granted summary judgment to the Commissioner of Patents on the bare record and without holding an evidentiary hearing and absent a motion by either party."

Although the Commissioner's motion of October 20, 1980, was labeled a "MOTION TO DISMISS" pursuant to Rule 12(b)(6), Fed.R.Civ.P., it was, in effect, a motion for summary judgment under Rule 56, Fed.R.Civ.P., since it was accompanied by, inter alia, a "statement of material facts" comprising five pages of the record, along with the file history of the involved patent application which includes the matters summarized earlier in this opinion. The motion was also accompanied by six pages of "POINTS AND AUTHORITIES" clearly directed to the merits-whether Smith's delay in prosecuting his application was unavoidable. The sufficiency of the petition for writ of mandamus in stating a cause of action appears to have been assumed.

On November 6, 1980, Smith filed an opposition to the "motion to dismiss" and requested leave of one month to file a memorandum of points and authorities. Leave to December 6, 1980, was granted. His memorandum clearly recognizes that the Commissioner's motion was directed to the merits and states:

In the present case, the Commissioner of Patents is not supporting his motion of insufficiency of the complaint (sic, petition) but instead ... his ruling that the delay in this case was not unavoidable.

Indeed, Smith's memorandum declares that the "ISSUE" is-

Whether the delay in responding to the final rejection ... was unavoidable due to an error in computation of time for response.

Although the memorandum addresses the standards for granting a motion to dismiss, it also is directed to the issue of unavoidability of delay, citing, inter alia, Commissariat A L'Energie Atomique v. Watson, 274 F.2d 594, 124 USPQ 126 (D.C.Cir.1960); Potter v. Dann, 201 USPQ 574 (D.D.C.1978); and In re Decision Dated February 18, 1969, 162 USPQ 383 (Comm'r Pats. 1969). Nowhere does Smith's memorandum dispute the Commissioner's statement of material facts or the file history of the involved patent application.

Accordingly, we conclude that Smith had notice and a reasonable opportunity to respond to what was, in effect, a motion for summary judgment; further, that there were no issues of material fact before the district court.3 Although the district court mislabeled the motion a "motion to dismiss," it granted what was, in effect, a motion for summary judgment, as related earlier in this opinion. Under the circumstances, we hold that the mislabeling was harmless error.42. Dispositive Issue

The dispositive issue is whether the district court erred in failing to hold that the Commissioner's determination (that Smith's failure to prosecute his patent application within six months from the date of final rejection was not unavoidable under 35 U.S.C. § 133) was arbitrary, capricious, or an abuse of discretion under 5 U.S.C. § 706(2)(A).

The critical phrase "unless it be shown to the satisfaction of the Commissioner that such delay was unavoidable"5 has remained unchanged since first enacted in 1861 (section 12 of "An Act in Addition to 'An Act to promote the Progress of the useful Arts'," 12 Stat. 248, Ch. 88, 2 Mar. 1861). There is a dearth of legislative history that might provide some clue to the meaning intended by Congress for the critical phrase and, particularly, for the word "unavoidable." Cases in point are few. This court in Commissariat A L'Energie Atomique, 274 F.2d at 596-97, 124 USPQ at 128, said (in holding that the district court should have exercised jurisdiction over a petition for mandamus) that-

in cases like the present, where valuable rights are at stake, the Commissioner's discretion cannot remain wholly uncontrolled, if the facts clearly demonstrate that the applicant's delay in prosecuting the application was unavoidable, and that the Commissioner's adverse determination lacked any basis in reason or common sense (citing United States v. Laughlin, 249 U.S. 440, 39 S.Ct. 340, 63 L.Ed. 696 (1919)).

In Potter v. Dann, supra, our district court held that counsel's admitted nonawareness of PTO rules did not constitute "unavoidable" delay. In In re Decision Dated February 18, 1969, supra, the Commissioner held that an attorney's interpretation of a rule was not unreasonable and that delay was unavoidable. Clearly the question of whether an applicant's delay in prosecuting an application was unavoidable must be decided on a case-by-case basis, taking all of the facts and circumstances into account.

Here, the district court emphasized three points in concluding that the excuses offered by Smith were insufficient to justify overturning the PTO's denial of relief: (1) the excuses contained conflicting statements; (2) the preoccupation of Smith's attorney with other legal matters or moving his residence did not relieve Smith of compliance with PTO regulations; and (3) Smith's attorney, admittedly aware on September 18, 1978, of the notice of August 31, 1978, had sufficient time to take appropriate action to avoid abandonment.6 Taking all of the facts and circumstances into account, and, particularly, those emphasized by the district court, we hold that the Commissioner's refusal to revive Smith's abandoned patent application, because the delay in prosecution was not unavoidable, did not lack any basis in reason or common sense and was, therefore, not arbitrary, capricious, or an abuse of discretion.

It follows that the district court did not err in failing to hold to the contrary.

The judgment of the district court is affirmed.7