PTO Rules Not Subject to the Paperwork Reduction Act

By on May 27, 2021
Posted In Patents

The US Court of Appeals for the Ninth Circuit concluded that certain challenged rules of the US Patent and Trademark Office (PTO) that relate to the patent application process do not violate the Paperwork Reduction Act (PRA) because each called for a response to an individualized communication; a category which is expressly exempted from the PRA. Hyatt v. Office of Management and Budget, Case No. 20-15590 (9th Cir. May 20, 2021) (Nguyen, J.).

Inventor Gilbert Hyatt and the American Association for Equitable Treatment (AAET) contended that patent applicants should not have to comply with certain PTO rules, alleging that the rules violated the PRA, which Congress passed to reduce the burden imposed on the public when responding to federal agencies’ requests for information from private individuals. The PRA requires federal agencies engaged in “collections of information” to first submit them to the Office of Management and Budget (OMB) for approval and an assignment of a control number. Collections of things other than “information” do not need to receive OMB approval, and the PRA applies only to “collections” seeking information through identical questions or requirements imposed on 10 or more people. Thus, the PRA and its regulations expressly exclude individualized communications from PRA applicability.

Hyatt asked OMB to review PTO rules 111, 115 and 116, arguing that those rules imposed “collections of information” under the PRA. Hyatt suggested that because the rules had not received OMB approval and control numbers, he was not required to maintain, provide or disclose the information these rules referenced. OMB responded that it had already determined that “these collections are not subject to the PRA because what is collected is not considered ‘information,’ pursuant to [three] exemptions in OMB’s PRA implementing regulation”:

  • Exemption 1: “[a]ffidavits, oaths, affirmations, certifications . . . provided that they entail no burden other than that necessary to identify the respondent, the date, the respondent’s address, and the nature of the instrument. . .”
  • Exemption 6: “request[s] for facts or opinions addressed to a single person”
  • Exemption 9: “[f]acts or opinions obtained or solicited through nonstandardized follow-up questions designed to clarify responses to approved collections of information.”

5 C.F.R. §§ 1320.3(h)(1), (6), (9).

AAET made similar arguments in submitting three requests to OMB on PTO rules 105, 130, 131 and 132 and MPEP § 2173.05(n). In its response to AAET, OMB only stated that “the requests under Rule 1.105 are not subject to the PRA because the responses to questions submitted under Rule 1.105 are not ‘information,’ but instead are exempt under” Exemption 9. AAET submitted three more requests to OMB on the same rules with similar arguments. OMB responded that Rules 105, 130, 131 and 132 and MPEP § 2173.05(n) were exempt under Exemptions 6 and 9; and Rules 130, 131 and 132 were additionally exempt under Exemption 1.

Hyatt and AAET sued OMB in district court, alleging that OMB’s denial of their petitions was arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law in violation of the Administrative Procedures Act (APA), because the challenged rules were subject to the PRA but had not been reviewed or assigned a control number. The district court found that the challenged rules “constitute requests for facts or opinions addressed to a single person and are excluded from the scope of the PRA” under Exemption 6, and that OMB’s denial of Hyatt and AAET’s PRA petitions was therefore not arbitrary, capricious or contrary to law. The district court did not address the parties’ arguments regarding Exemption 9 and granted summary judgment in favor of OMB. Hyatt and the AAET appealed.

On appeal, the Ninth Circuit affirmed the district court in finding that the challenged rules are not subject to the PRA and do not authorize “collections” because they do not impose “identical” questions or reporting, recordkeeping or disclosure requirements. (44 U.S.C. § 3502(3); 5 C.F.R. § 1320.3(c).) However, the Court disagreed with OMB’s assertion that only collections that collect information using standardized forms impose “identical” requirements, noting that 5 C.F.R. § 1320.3(c)(1) provides “[a] ‘collection of information’ may be in any form or format, including . . . rules or regulations.”

The Ninth Circuit explained that its conclusion “flows from the statutory and regulatory definition of ‘collection,’ which focuses on the nature of the request.” Here, since the challenged rules either impose formatting or submission guidelines, or require or allow a particular patent applicant to respond to an office action, such that each requirement calls for a response to an individualized communication concerning a specific application, none imposed “identical questions . . . or reporting, recordkeeping, or disclosure requirements.”

As the Ninth Circuit explained, although the rules apply to every applicant, merely imposing formatting requirements or providing for a uniform process is not sufficient to turn procedural rules into “collections” under the PRA or its regulations. Focusing on the disparate nature of the examination process and how PTO requests were largely determined by the specific application under consideration, the Court found “[i]t would be illogical and antithetical to the purposes of the PRA to require [the PTO to] submit every such office action for OMB approval.” The Court also cited to the language of Rules 111 and 130 in finding that the “identical” requirements alleged by Hyatt and AAET “merely require that responses to individualized office actions be highly specific” and found nothing in the PRA or its implementing regulations to support that requiring specificity amounts to identically.

The Ninth Circuit further explained that even if some of the challenged rules impose “collections,” Exemption 6—“request[s] for facts or opinions addressed to a single person”—would apply, since office actions from patent examiners are “quintessentially individualized.”