The U.S. Court of Appeals for the Federal Circuit has held that the U.S. Patent and Trademark Office (USPTO) Board of Appeals has the authority to terminate an interference without resolving issues of patentability or priority. Berman v. Housey, Case No. 01-1311 (Fed. Cir. May 29, 2002).

Berman filed an amendment in a pending application, requesting that an interference be declared with a pending patent application of Housey (later issued as a patent, Housey III). The examiner determined that a claim of the Berman application interfered with claims of Housey III and with claims of Housey I and II (two earlier issued patents). Soon after the interference was declared, Housey filed a preliminary motion to terminate the interference under 35 U.S.C. §135(b), asserting that Berman did not file an interfering claim within one year of the issuance of Housey I or II. Berman opposed the motion, claiming that one of his originally filed claims was directed to substantially the same subject matter as the count. Berman also filed a motion for judgment that all claims of Housey I-III were invalid based on prior art.

The Board held that the originally filed claim of Berman was not directed to the same or substantially the subject matter as claimed in Housey I and II, that Berman did not present an interfering claim within one year of the issuance of Housey I or II and that under §135(b), Berman was now barred from doing so. The Board terminated the interference, entered judgment for Housey and dismissed Berman’s patentability motion as moot.

On appeal, Berman argued that the Board erred in failing to consider Berman’s patentability motion, urging that the Board was required to resolve all issues of patentability and priority. Berman relied on a line of prior Federal Circuit decisions, including Perkins v. Kwon, and on 35 U.S.C. §6 that states that the Board "shall determine priority and patentability of invention in interferences declared under §135(a)."

The Federal Circuit observed that a §135(b) determination is a threshold issue that should be addressed by the Board before proceeding on the merits of an interference, and held that once the Board determines that there is a §135(b) bar, the Board may refuse to address other issues that have been raised (e.g., priority or patentability). Observing the tension between the plain language of §6 and §135(a), the Federal Circuit further noted that §6 is an enabling statute that empowers the Board but does not require it to do any affirmative act. The Federal Circuit also looked to the legislative history of §6 and found that the only congressional intent was to permit the Board to hear both patentability and priority issues.

The Federal Circuit, in distinguishing Perkins v. Kwon, noted that Perkins only holds that the Board has the authority to consider patentability and priority when both issues are raised in an interference, even after the Board determines that one party is not entitled to the claims.

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