« Zen Valor | Main | Carnac The Magnificent »

February 7, 2008


The organized crime syndicate known as the USPTO tried to thwart input in its fight to implement its illegal rule changes to examination practice. The attack is answered.

Despite representing to this Court several times that the administrative record was complete, the PTO itself demonstrated otherwise when it recently and belatedly supplemented the administrative record, not once but twice. These submissions establish a pattern of "deliberately or negligently" omitting adverse documents from the record.

Polestar Capital and Norseman Group filed an opposition to the PTO's motion to strike amici curiae briefs.

The Plaintiffs challenged the PTO's Final Rules on multiple grounds, including that the PTO's rulemaking was arbitrary and capricious and unsupported by the agency's record. This Court invited participation by amici curiae on the important issues raised by the parties. In that regard, Polestar submitted an amicus brief seeking to explain in detail why the PTO's Final Rules are, among other grounds, arbitrary and capricious. In doing so, Polestar referred to exhibits that were not included in the PTO's designated administrative record, even though the PTO should have, and to all indications did, consider several of those exhibits in its rulemaking.

In an attempt to divert the Court's attention from the true import of these exhibits, the PTO has filed a motion to strike. But that motion to strike is unfounded. Each of the exhibits that the PTO seeks to strike fits one or more well-established categories of extra-record evidence that the Court may either admit to supplement the administrative record, or consider even though it may be said to be outside the record.

In an effort to prevent the Court from considering these exhibits, the PTO's motion incorrectly invokes the "law of the case." That doctrine is inapplicable because the Court has not held that the record is complete and that no party or amicus may expand upon the record. Indeed, since the Court denied Tafas' motion for reconsideration, Tafas v. Dudas, __ F. Supp. 2d __, 2008 WL 112043 (E.D. Va. Jan. 9, 2008) ("Tafas II"), the PTO has three times supplemented the administrative record, twice expressly conceding that it had not produced a complete record, and once to introduce an entirely extraneous exhibit. The PTO's recent efforts to cure the defects in the administrative record amplify the need for the Court to consider Polestar's amicus brief and supporting exhibits. Thus, the PTO's motion to strike Polestar's exhibits should be denied in its entirety.

Then Polestar Capital and Norseman Group raised the curtain on patent agency cover-up of undisclosed documents during the rule-making process.

On January 18, 2008, the PTO admitted that it had, at best, "negligently" omitted documents from the record through "oversight," because they had been "in a different physical location" than the rest of the "administrative record" (PTO's Amended Certification, docket no. 240-2). Several of these late-produced documents are adverse to the PTO's positions. For example, one of the newly-produced notice and comment letters estimates the costs of the rules, including paperwork and destruction of patent asset value, at billions of dollars (docket No. 240- 4, SA004-35).

On January 22, 2008, the very day on which parties were to file their last briefs that could raise new issues, the PTO again updated the record, this time with the long-sought November 2005 Initial Regulatory Flexibility Act Certification of No Substantial Impact ("Initial RegFlex Certification"). In this document, the PTO exempted itself from doing a Regulatory Flexibility analysis.

To ensure public accountability, Executive Order 12,8662 ยง 6(a)(4)(E)(ii) requires the PTO to document and disclose to the public the changes it makes as a result of OMB review. Public disclosure is essential to ensure that the rulemaking process remains fair, and that the final text of a rule is not the result of secret deals with interested parties. [T]here were such changes, but the PTO has never identified them, let alone produced the part of the record reflecting that change. The PTO has withheld from the administrative record the version that it submitted to OMB, and perhaps other versions as well. Therefore, it is reasonable to infer that the final rule is the product of a secret deal that the PTO is hiding from the Court.

The PTO has never contested that it had a great deal of material information available during notice and comment, and withheld from the public everything of any analytical utility. The PTO has never contested that the non-transparent summary information that it disclosed... was insufficient to meet its obligations under the Administrative Procedure Act. The PTO has never contested that it breached its own information quality regulations for its own conduct by disseminating information to the public that lacked "objectivity," "utility," and "transparency," while withholding information that it possessed that would have met these criteria.

[T]he PTO either had no software model, or chose to withhold it, either had no "methodology or analysis" underlying any software used to generate the slide or chose to withhold it, either had no articulation of its assumptions or chose to withhold it, and either had no underlying data, or chose to withhold them. The PTO can choose which rope it wishes to hang by - either failure to produce a complete record, Hanover Potato, 989 F.2d at 130-31, or arbitrary and capricious absence of substantial evidence, Data Processing, 745 F.2d at 684, and failure to support its computer model. Appalachian Power, 251 F.3d at 1035. The result is the same.

The PTO does not contest that [it] failed to provide anything more than undocumented output of its computer models, and has failed to disclose the underlying "assumptions and methodology"..., the data that was input to the model, or any other "complete analytic defense" of the model. The PTO also does not contest the consequence of that non-disclosure, that all rules based on those inscrutable models are "arbitrary and capricious." Appalachian Power, 251 F.3d at 1035. For all the record reveals or the PTO argues, the Continuations, RCE, 5/25/ESD, and Rule 78(f) "patentably distinct" rules are the product of "garbage in, garbage out" computation.

On USPTO core incompetency -

[T]he PTO has no identifiable standards for examiner conduct, supporting the observation in many of the notice and comment letters that the PTO's backlog problem is caused primarily by unfocused examination under unsupervised procedure.

[In concocting the new rules,] the PTO did not consider the effect on total backlog or Office efficiency end-to-end, or view efficiency of the Office as a whole; instead, the PTO pretended that a valid analysis could be performed on one piece in isolation. The PTO will not dispute that appeals and petitions must be considered by more highly-trained, and therefore harder-to-come-by people. By forcing more applications through this narrow bottleneck, the rules could well cause backlog to increase - a proposition the PTO cannot now rebut, because it failed to address this issue on the record.

Posted by Patent Hawk at February 7, 2008 2:02 AM | The Patent Office


Polestar Amicus Brief and Reply in Opposition has pointed out (and rightly so) this very "Dark Side" of the PTO hierarchy's effort to manipulate the administrative rule-making process, hide the relevant (and damaging) information on these Rules, and generally flout the APA, RFA and OMB procedures. This hearing on Friday in GSK/Tafas suit is very important, not only for our patent system, but also for whether we remain a country of laws where the government is our servant (not the other way around some think it is), or whether the APA, RFA and any other law in this country is meaningless drivel. Sorry to put it this was, but as a second generation patent attorney who was taught and raised to respect the law and the important values of this country (including our Constitution), that's how important this hearing Friday could be.

Posted by: EG at February 7, 2008 5:32 AM

The writing is quite good. Who represents these amici?

Posted by: Steve Sereboff at February 7, 2008 8:08 AM

You are so right, and the brief discussed here is not the main PoleStar brief. That one is document #173 in the electronic docket.

The main brief is a thing of beauty, too. It reads like a criminal indictment against the PTO for obstruction of justice written by Gore Vidal. I suggested to Dennis that he have every one of his students download the PoleStar brief and study it as the way to write a brief. It was done by Craig J. Franco at Odin Fledman. Great job.

One point that Franco makes, however briefly, that just about everybody else is missing in this mess is the attempt by the PTO to turn revisions of the MPEP into federal statute by amending Rule 104 so that examiners can apply the MPEP as though it has full force of federal law. See 72 Fed Reg 46737 col 1. Just think of the sort of fascism that would lead to. That one change in the rules would allow the PTO to write any new rule they want to and circumvent all the hassles they are now going through.

Posted by: Sofa King Appalled at February 7, 2008 10:19 AM

Sofa King,

You're right about the original Polestar Brief being a thing of beauty. At times, it reads just like a Robert Ludlum thriller, which is scary as we're talking about "reality" here with these awful PTO Rules.

Posted by: EG at February 7, 2008 11:50 AM