Swearing Behind Reference Still Requires Proof of (Timely Filed) Evidence
By Joseph Herndon --
Thomas Steed, Sourav Bhattacharya, and Sandeep Seshadrijois (collectively "Steed") filed a patent application entitled "Web-Integrated On-Line Financial Database System and Method for Debt Recovery," on April 6, 2004, with priority claimed to a provisional application filed on November 13, 2003. The inventors prosecuted their application pro se.
During prosecution, all claims were rejected as obvious in view of U.S. Publication No. 2004/0019560 ("Evans"), alone or in combination with other references. After unsuccessfully attempting to distinguish the Evans Rejections on the merits, Steed undertook to remove Evans as a reference in accordance with 37 C.F.R. § 1.131, by "swearing behind" the reference whereby the Applicant establishes that it was in possession of the claimed subject matter before the effective date of the reference. (Swearing behind no longer applies to newly filed patent applications which are examined under the first-to-file regime).
The Evans effective date is December 23, 2002. Steed's priority date is November 13, 2003, and thus to successfully swear behind Evans (and remove Evans as applicable prior art), Steed would need to show a reduction to practice of his invention prior to December 23, 2002, or conception of his invention prior to December 23, 2002 coupled with due diligence from prior to December 23, 2002 to a subsequent reduction to practice or filing of his application. To this end, during prosecution, Steed submitted a Rule 131 Declaration that included four exhibits, as well as statements from Steed that Exhibit A showed "conception of the invention prior to the date of the Evans et al. reference," and that Exhibits B, C, and D showed "diligence continuing to the constructive reduction to practice."
The Examiner found the Declaration and the exhibits insufficient, stating that the evidence relied on to show conception was "a high level presentation that does not include any specifics of the actual invention, only a broad overview of the idea" and that it "fail[ed] to disclose any of the key elements of independent claim 37." The Examiner found Exhibits B, C, and D to be insufficient for demonstrating diligence, for "there are significant gaps of time between each of the appendices A–D that amount to entire years of diligence being omitted" with "a total of about 63 months' worth of time unaccounted for to show due diligence with respect to the invention."
Steed then filed more exhibits and again stated that they established "both the inventive act and reduction to practice prior to the publication date of Evans et al." and "due diligence of nearly 63 months." The Examiner again found these exhibits to be insufficient to show conception or reduction to practice. Steed appealed to the Board, and submitted still further new evidence including entries in "Inventor Activity Logs" and "Inventor Intranet Site Activity Logs" to show diligence. During the Board hearing, the Board stated that it could not consider any new evidence not already of record before the Examiner.
Following the hearing but before the Board's decision, Steed filed several motions attempting to allege deficiencies in the Appeal process. None of these motions were ruled on. In its decision, the Board stated that it could not consider any new argument or new evidence without a showing of good cause why the argument or evidence was not previously presented to the Examiner, citing 37 C.F.R. § 41.37(c)(1)(vii) (2011). The Board then ruled that Steed had not set forth specific facts to establish dates and acts of either conception or reduction to practice, and that the assertions at oral argument "are not set forth in the Appeal Brief or the Reply Brief, and are thus considered waived." The Board then reviewed and affirmed the Examiner's rejection on the ground of obviousness based on the Evans reference.
The Ruling of Waiver
The Federal Circuit first addressed the issue of whether Steed "waived" the issue of establishing a reduction to practice by failing to set forth in the Appeals Briefing sufficient evidence. The Federal Circuit noted that the finding of a waiver by the Board was in error, and it was clear that Steed's briefs before the Board attempted to establish conception, diligence, and actual reduction to practice. The flaw in Steed's proofs was in the content of the documentary evidence, not in any purported waiver. In any event, despite its charge of waiver, the Board ultimately considered the relevant information.
Actual Reduction to Practice
Steed did not provide, with the Rule 131 Declaration submitted during prosecution, evidence adequate to demonstrate an actual reduction to practice before the Evans effective date. Steed made many "statements" that there was a working prototype much before December 2002, but these statements of generalized activity with no factual evidence of proof are insufficient. Steed ultimately did provide supporting affidavits by two independent third-party witnesses, but this evidence was offered for the first time during the Board hearing, and thus, the Board declined to rely on this evidence.
The Federal Circuit found that the Board cannot be faulted for not reviewing evidence that was not presented to the Examiner, and thus, not of record. Any evidence not already in record will not be considered by the Board.
Looking at the evidence of record, the Federal Circuit found that no specific dates or acts are tied to the several elements of the claims, and bald assertions that the invention was "reduced to practice before December 23, 2002" and that "from about November 26, 1997 through April 6, 2004 (the filing date of the . . . application) . . . we engaged in a diligent and reasonably continuous effort . . . to develop, market, manufacture, and seek patent protection for the invention," without supporting proof are insufficient.
Steed exhaustively tried to argue that the new evidence was properly before the Board, stating that 37 C.F.R. § 41.47(e)(2) permits new evidence for good cause. The Federal Circuit, though, noted that this regulation does not so provide, and the exception stated in § 41.47(e)(2) only allows appellants to rely on a new argument when it is based upon a recent decision of either the Board or a court.
Conception and Diligence
Again, the Federal Circuit agreed with the Board in that the evidence of record submitted by Steed did not establish conception before the Evans effective date because Steed did not adequately explain the exhibits and how they showed conception of the claimed subject matter.
Thus, the Evans publication remains as a reference, and the Examiner's rejection of obviousness was sustained.
Steed lastly argued that the Examiner and the Board violated due process by not contacting the Applicant as requested in a footnote to a Table of an Appeal Brief, by not considering the third-party affidavits, and by failing to respond, in the Examiner's Answer, to all of the arguments presented by Steed.
The Federal Circuit found no failure of due process, or unfairness, on the record of the PTO proceedings. The Board correctly applied the law in ruling that Steed did not establish possession of the invention described and claimed before the effective date of the Evans reference. Thus the claims were properly rejected on the ground of obviousness in view of the Evans Rejections.
The Federal Circuit informed Steed, that to the extent they have better proof of an earlier actual reduction to practice or conception date, the proper remedy is to file a continuation application and present the evidence to the Examiner in the first instance.
It seems that most of the problems during prosecution and during Appeal by Steed were self-imposed due to lack of patent law knowledge. Prosecuting an application pro se can be risky for these reasons. Although the USPTO will give liberal interpretation to documents filed pro se, legal requirements for establishing conception and due diligence will not be relaxed. The Federal Circuit still requires evidence to be timely submitted, and evidence to be sufficient to prove facts of conception and due diligence.
In re Steed (Fed. Cir. 2015)
Panel: Circuit Judges Newman, Clevenger, and Dyk
Opinion by Circuit Judge Newman