Gilbert Hyatt v. Omb ( 2021 )


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  •                 FOR PUBLICATION
    UNITED STATES COURT OF APPEALS
    FOR THE NINTH CIRCUIT
    GILBERT P. HYATT; AMERICAN                No. 20-15590
    ASSOCIATION FOR EQUITABLE
    TREATMENT, INC.,                            D.C. No.
    Plaintiffs-Appellants,     2:16-cv-01944-
    JAD-EJY
    v.
    OFFICE OF MANAGEMENT AND                    OPINION
    BUDGET; MICK MULVANEY, in his
    official capacity as Director of the
    Office of Management and Budget,
    Defendants-Appellees.
    Appeal from the United States District Court
    for the District of Nevada
    Jennifer A. Dorsey, District Judge, Presiding
    Argued and Submitted March 11, 2021
    Las Vegas, Nevada
    Filed May 20, 2021
    2                         HYATT V. OMB
    Before: Jacqueline H. Nguyen, Mark J. Bennett, and
    M. Douglas Harpool, * Circuit Judges.
    Opinion by Judge Nguyen
    SUMMARY **
    Paperwork Reduction Act
    The panel affirmed the district court’s summary
    judgment in favor of the Office of Management and Budget
    (“OMB”) in an action challenging the OMB’s determination
    that certain rules and regulations were not subject to the
    Paperwork Reduction Act (“PRA”).
    Plaintiffs contended that patent applicants should not
    have to comply with certain U.S. Patent & Trademark Office
    rules because they violated the PRA. The PRA requires
    federal agencies engaged in “collection of information” to
    first submit them to the OMB for approval and assignment
    of a control number. Patent applicants and patent examiners
    are guided by Patent Office regulations and the Manual of
    Patent Examining Procedure, which impose formatting,
    timing, and other procedural guidelines (the “Rules”).
    Plaintiffs argued that the Rules imposed “collections of
    information” within the meaning of PRA. Plaintiffs
    requested that the OMB review certain Patent Office rules
    *
    The Honorable M. Douglas Harpool, United States District Judge
    for the Western District of Missouri, sitting by designation.
    **
    This summary constitutes no part of the opinion of the court. It
    has been prepared by court staff for the convenience of the reader.
    HYATT V. OMB                        3
    because they required OMB approval and control numbers,
    and OMB denied their applications.
    The panel held that the challenged Rules did not impose
    “collections of information” subject to the PRA’s procedural
    requirements. The panel agreed with the government that the
    Rules did not impose the kinds of generalized solicitations
    of information that the PRA and its regulations were
    intended to cover, and they were not subject to PRA’s
    approval and control number requirements.
    The panel held that even if some of the Rules imposed
    “collections,” the PRA’s procedural requirements would still
    not apply to virtually any of the Rules because, under
    Exemption 6, the definition of “information” generally
    excluded “[a] request for facts of opinions addressed to a
    single person.” 
    5 C.F.R. § 13203
    (h)(6).
    COUNSEL
    Andrew M. Grossman (argued) and Mark W. DeLaquil,
    Baker Hostetler LLP, Washington, D.C., for Plaintiffs-
    Appellants.
    Jennifer L. Utrecht (argued) and Daniel Tenny, Appellate
    Staff; Nicholas A. Trutanich, United States Attorney; Civil
    Division, United States Department of Justice, Washington,
    D.C.; for Defendants-Appellees.
    4                     HYATT V. OMB
    OPINION
    NGUYEN, Circuit Judge:
    Gilbert P. Hyatt is the named inventor on hundreds of
    inter-related patent applications containing, at one point,
    over 100,000 claims. See generally Hyatt v. U.S. Pat. &
    Trademark Off., 
    797 F.3d 1374
    , 1377 (Fed. Cir. 2015).
    Hyatt and the American Association for Equitable Treatment
    (“AAET”) contend that patent applicants should not have to
    comply with certain U.S. Patent & Trademark Office
    (“USPTO”) rules because, they allege, the USPTO is
    violating the Paperwork Reduction Act (“PRA”). The
    district court disagreed and found that the challenged rules
    are not subject to the PRA at all. We affirm.
    Congress passed the PRA to reduce the burden imposed
    on the public when federal agencies seek 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. The PRA
    applies only to those “collections” seeking information by
    way of identical questions or requirements imposed on ten
    or more people. And collections of things other than
    “information” also need not receive OMB approval. For
    example, in keeping with the Congress’s focus on
    collections imposed on ten or more people, the PRA and its
    regulations      expressly      exclude       individualized
    communications from the PRA’s requirements.
    Against this backdrop, the USPTO examines thousands
    of patent applications every year. The USPTO’s patent
    applications impose identical questions and disclosure
    requirements on ten or more people and are therefore subject
    to the PRA and bear OMB control numbers. After the initial
    HYATT V. OMB                         5
    submission, though, every patent application takes a unique
    path.       Many require extensive back-and-forth
    communications with USPTO patent examiners. These
    subject-matter experts correspond with each applicant
    concerning a particular patent application, asking for or
    commenting on specific deficiencies in that application.
    Applicants sometimes must respond, and in other instances
    can optionally provide additional information.         This
    dialogue is tailored toward clarifying, amending, or
    correcting the application as it winds toward a final
    determination. Along the way, the applicant and examiner
    are guided by USPTO regulations and the Manual of Patent
    Examining Procedure (“MPEP”), which impose formatting,
    timing, and other procedural guidelines.
    Hyatt and AAET argue that because these regulations
    and rules (the “Rules”) apply to all patent applicants and
    allow for or require the submission of information, the Rules
    impose “collections of information” within the meaning of
    the PRA. According to Hyatt and AAET, patent applicants
    need not follow the Rules because the USPTO is violating
    the PRA by failing to obtain OMB approval and a control
    number each time the USPTO makes a request to an
    applicant during the back-and-forth communications process
    concerning a particular patent. OMB rejected this view and
    determined that the Rules are not subject to the PRA. Hyatt
    and AAET challenge OMB’s determination as arbitrary,
    capricious, an abuse of discretion, or otherwise not in
    accordance with law in violation of the Administrative
    Procedure Act (“APA”). We hold that the challenged Rules
    do not impose “collections of information” subject to the
    PRA’s procedural requirements. Indeed, the PRA and the
    regulations expressly exclude from coverage individualized
    communications just like those between a patent examiner
    6                     HYATT V. OMB
    and a patent applicant. We therefore affirm the district
    court’s grant of summary judgment in favor of OMB.
    I. LEGAL FRAMEWORK
    A. The Paperwork Reduction Act
    The PRA seeks to reduce the burden imposed on the
    public when the federal government engages in certain
    “collections of information.” 
    44 U.S.C. § 3501
    (1). Any
    collection of information that is subject to the PRA must be
    approved by OMB and assigned an OMB control number.
    
    Id.
     § 3512(a).
    As relevant here, a federal agency conducts a “collection
    of information” when it
    obtain[s], caus[es] to be obtained, solicit[s],
    or require[es] the disclosure to third parties or
    the public, of facts or opinions . . . regardless
    of form or format, calling for . . . answers to
    identical questions posed to, or identical
    reporting or recordkeeping requirements
    imposed on, ten or more persons . . . .
    Id. § 3502(3). This includes collections that are “mandatory,
    voluntary, or required to obtain or retain a benefit” and “any
    requirement or request for persons to obtain, maintain,
    retain, report, or publicly disclose information.” 
    5 C.F.R. § 1320.3
    (c).
    “Information” is “any statement or estimate of fact or
    opinion.” 
    5 C.F.R. § 1320.3
    (h). There are ten enumerated
    categories “generally” exempt from being defined as
    “information,” except that “OMB may determine that any
    specific item constitutes ‘information.’” 
    Id.
     Most relevant
    HYATT V. OMB                               7
    here, Exemption 6 excludes from the definition of
    “information” “[a] request for facts or opinions addressed to
    a single person.” 
    Id.
     § 1320.3(h)(6).
    Under the PRA, any person may ask OMB “to review
    any collection of information conducted by or for an agency”
    to determine if the collection is covered by the PRA and
    requires a control number. 
    44 U.S.C. § 3517
    (b). OMB must
    respond to any non-frivolous request, 
    id.
     § 3517(b)(1), and
    if it determines that the agency has been conducting an
    unapproved collection of information, it may take
    “appropriate remedial action, if necessary,” id. § 3517(b)(2).
    B. The Patent Application Process
    The USPTO is authorized to promulgate regulations
    governing the granting and issuing of patents. 
    35 U.S.C. §§ 2
    (a)(1), (b)(2)(A). The patent application process begins
    when a patent application is submitted using one of several
    uniform applications approved by OMB. 
    Id.
     § 111; see
    
    62 Fed. Reg. 53,132
    , 53,178 (Oct. 10, 1997) (noting OMB
    approval of initial patent applications); 
    85 Fed. Reg. 60,967
    ,
    60,968 (Sept. 29, 2020) (soliciting public comment on
    extending OMB-approved initial patent applications). 1 The
    parties agree that the initial application is subject to the
    requirements of the PRA.
    After the application is submitted, the applicant’s
    journey through the examination system may take several
    1
    USPTO also sought and received OMB control numbers for other
    collections related to the patent examination process, including for
    applications for international patents, see 62 Fed. Reg. at 53,178, and
    covering a variety of standardized forms issued by the USPTO, 
    85 Fed. Reg. 60,975
     (Sept. 29, 2020) (listing the forms covered by the
    collection).
    8                      HYATT V. OMB
    paths, as determined by the USPTO’s patent examiners.
    Once past the initial application stage, certain rules kick in,
    including the Rules at issue in this appeal: Rules 105, 111,
    115, 116, 130, 131, and 132, and MPEP § 2173.05(n).
    Applicants first hear back from USPTO when a patent
    examiner sends correspondence, called an “office action,”
    communicating a decision or asking for additional
    information. 
    37 C.F.R. § 1.104
    (a)(2). However, if an
    applicant wants to include additional information before
    receiving any office action, USPTO Rule 115 allows the
    applicant to submit a preliminary amendment to their
    application. 
    Id.
     § 1.115(a).
    A patent application may proceed through examination
    quickly, but the process sometimes involves significant
    back-and-forth between the examiner and the applicant.
    Throughout the examination process, USPTO Rule 105
    authorizes the examiner to require the applicant to submit
    “such information” as the examiner determines “may be
    reasonably necessary to properly examine or treat” the
    application. Id. § 1.105(a).
    The applicant has multiple opportunities to fix any
    shortcomings in their application. If the initial office action
    is adverse, USPTO Rule 111 requires the applicant to
    respond to the office action or be deemed to have abandoned
    the application. Id. § 1.111. The response must directly
    address the reasons for the adverse decision, including by
    describing the alleged errors in the examiner’s decision. Id.
    The applicant may also amend their application to address
    the examiner’s specific concerns. Id. And once a final
    decision has been made, but before any appeal of such
    decision, USPTO Rule 116 allows the applicant to again
    amend their application to address any shortcomings. Id.
    § 1.116. MPEP § 2173.05(n) further explains that if an
    HYATT V. OMB                              9
    application is rejected for “multiplicity”—that is, because
    there are “an unreasonable number of claims [in the
    application] which are repetitious and multiplied, the net
    result of which is to confuse rather than to clarify”—the
    examiner must request that the applicant “select a specified
    [smaller] number of claims for purpose of examination.” If
    the applicant does so, the examiner will re-examine the
    selected claims. Id. Finally, USPTO Rules 130, 131, and
    132 allow an applicant to submit additional evidence through
    affidavits or declarations to overcome certain bases for an
    examiner’s rejection. 
    37 C.F.R. §§ 1.130
    , 1.131, 1.132.
    II. FACTUAL & PROCEDURAL BACKGROUND
    In August 2013, Hyatt requested that OMB review
    USPTO Rules 111, 115, and 116, arguing that those Rules
    imposed “collections of information” under the PRA and
    thus required OMB approval and control numbers. Because
    the Rules had not received OMB approval, Hyatt suggested
    that he was not required to maintain, provide, or disclose the
    information referenced by the Rules. In September 2013,
    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:”
    Exemptions 1, 2 6, and 9. 3
    2
    OMB no longer relies on Exemption 1, 
    5 C.F.R. § 1320.3
    (h)(1),
    and the parties have not briefed this Exemption.
    3
    Exemption 9 excludes “[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)(9).
    10                    HYATT V. OMB
    In 2016, AAET submitted three requests to OMB,
    making similar arguments as to USPTO Rules 105, 130, 131,
    and 132, and MPEP § 2173.05(n). OMB responded only
    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. In 2017, AAET again submitted three
    requests to OMB, making similar arguments as to the same
    Rules. OMB responded that Rules 105, 130, 131, and 132,
    and MPEP § 2173.05(n) were all exempt under Exemptions
    6 and 9, and Rules 130, 131, and 132 were additionally
    exempt under Exemption 1.
    Hyatt and AAET sued, alleging that OMB’s denial of
    their petitions were arbitrary, capricious, an abuse of
    discretion, or otherwise not in accordance with law in
    violation of the APA, because the challenged Rules were
    subject to the PRA and yet had not been reviewed or
    assigned a control number.
    The parties filed cross motions for summary judgment.
    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 appeals.
    III. STANDARD OF REVIEW
    We have jurisdiction under 
    29 U.S.C. § 1291
    , and we
    “review de novo a challenge to a final agency action decided
    on summary judgment and pursuant to Section 706 of the
    APA.” Ctr. for Biological Diversity v. Esper, 
    958 F.3d 895
    ,
    HYATT V. OMB                               11
    903 (9th Cir. 2020) (citing Turtle Island Restoration
    Network v. U.S. Dep’t of Com., 
    878 F.3d 725
    , 732 (9th Cir.
    2017)).
    IV. DISCUSSION
    A. The Rules Do Not Impose “Collections                               of
    Information” and Are Not Subject to the PRA.
    The district court correctly held that OMB’s denial of
    Hyatt and AAET’s PRA petitions was not arbitrary,
    capricious, or contrary to law. The challenged Rules are not
    subject to the PRA; they 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). 4
    This conclusion flows from the statutory and regulatory
    definition of “collection,” which focuses on the nature of the
    request—that is, the inquiry or prompt to which a member
    of the public is being asked to respond. Here, the Rules
    either impose formatting or submission guidelines or require
    or allow a particular patent applicant to respond to an office
    action. For example, Rule 105 requires a response to an
    examiner’s individualized request for “such information as
    may be reasonably necessary to properly examine or treat” a
    particular application. 
    37 C.F.R. § 1.105
    (a). Rule 111
    requires an applicant to reply to an adverse decision by
    “specifically point[ing] out the supposed errors in the
    examiner’s action,” “reply[ing] to every ground of objection
    4
    Although we agree with OMB on this ultimate conclusion, we note
    that OMB’s assertion that only collections that collect information using
    standardized forms impose “identical” requirements is incorrect. See
    
    5 C.F.R. § 1320.3
    (c)(1) (“A ‘collection of information’ may be in any
    form or format, including . . . rules or regulations.”).
    12                     HYATT V. OMB
    and rejection in the prior Office action,” and “present[ing]
    arguments pointing out the specific distinctions believed to
    render the claims . . . patentable.” 
    Id.
     § 1.111(b). Each of
    these requirements calls for a response to an individualized
    communication concerning a specific application. Rule 115
    allows an applicant to make an optional preliminary
    amendment to an application in a specific format; no
    information is requested or required. Id. § 1.115(a).
    Similarly, Rules 130, 131, and 132 generally authorize
    submission of additional information—specifically,
    evidence regarding prior art. Id. §§ 1.130, 1.131, 1.132.
    Rules 130 and 131 impose some content and format
    requirements on any submission, while Rule 132 merely
    allows for the submission of “an oath or declaration” with no
    parameters. Rule 116 allows for amendment before appeal
    of a final action and allows three types of amendment:
    (1) “canceling claims or complying with any requirement of
    form expressly set forth in a previous Office action;”
    (2) “presenting rejected claims in better form;” or (3) if good
    cause is shown, “touching the merits of the application or
    patent under reexamination.” Id. § 1.116(b). None of these
    options impose “identical questions . . . or reporting,
    recordkeeping, or disclosure requirements.” 
    5 C.F.R. § 1320.3
    (c).     Finally, under MPEP § 2173.05(n), the
    examiner decides the number of claims to which the
    applicant is limited, making the request individualized and
    not identical.
    This conclusion also follows from a practical
    understanding of the patent application process. Patent
    examiners engage in thousands of conversations with patent
    applicants each year, subject to the Rules. This dialogue is
    tailored toward clarifying, amending, or correcting a single
    application as it travels toward a final determination. But
    while the Rules apply to every applicant, merely imposing
    HYATT V. OMB                         13
    formatting requirements or providing for a uniform process
    is not sufficient to turn procedural rules into “collections”
    under the PRA or its regulations. An exemplar office action
    filed in the record demonstrates the point. There, the
    examiner of an initial application for a patent of a seed of
    soybean plant cultivar asks the applicant to submit
    information “reasonably necessary to the examination of
    [the] application” under Rule 105, including the “breeding
    methodology,” “[t]he filial generation in which the instant
    plant was chosen,” and “homozygosity or heterozygosity of
    the parents.” These questions simply would not be asked of
    the inventor of, say, computer components, or of a soybean
    cultivator who submitted a more detailed application. It
    would be illogical and antithetical to the purposes of the
    PRA to require USPTO submit every such office action for
    OMB approval.
    Moreover, many of the “identical” requirements that
    Hyatt and AAET point to merely require that responses to
    individualized office actions be highly specific. See, e.g.,
    
    37 C.F.R. § 1.111
    (b) (Applicant must “specifically point[]
    out the supposed errors in the examiner’s action” and “reply
    to every ground of objection and rejection in the prior Office
    action.”); 
    id.
     § 1.130(b) (Applicant “must identify the
    subject matter publicly disclosed and provide the date such
    subject matter was publicly disclosed.”). There is nothing in
    the PRA or its implementing regulations that suggests that
    requiring specificity amounts to identicality.
    For these reasons, we agree with the government that the
    Rules simply do not impose the kinds of generalized
    solicitations of information that the PRA and its regulations
    are intended to cover. Because the Rules do not impose
    “collections,” they are not subject to the PRA’s approval and
    control number requirements.
    14                        HYATT V. OMB
    B. Even If They Impose “Collections,” Most of The
    Rules Are Exempted from the PRA Under
    Exemption 6.
    Even if some of the Rules impose “collections,” the
    PRA’s procedural requirements would still not apply to
    virtually any of the Rules because, under Exemption 6, the
    definition of “information” generally excludes “[a] request
    for facts or opinions addressed to a single person.” 
    5 C.F.R. § 1320.3
    (h)(6). Exemption 6’s preclusion of individualized
    communications from the PRA accords with the statute’s
    emphasis on identical requests sent to many people.
    As a general matter, office actions—letters and calls
    from a patent examiner sent to an individual applicant—are
    quintessentially individualized. Requiring or allowing
    applicants to respond to such an individualized
    communication is not a collection of “information.” For
    example, Rule 105 authorizes the examiner to require the
    applicant to submit whatever information the examiner
    thinks “necessary to properly examine or treat the matter.”
    
    37 C.F.R. § 1.105
    (a). Rule 111 requires the applicant to
    respond to an adverse office action by pointing out the
    alleged errors in the examiner’s decision, making
    amendments to address the examiner’s specific concerns,
    and more. 
    Id.
     § 1.111. The other Rules generally also
    concern individualized communications to single
    applicants. 5
    5
    To be sure, Rule 115, which allows applicants to amend their
    application before receiving any office action at all, cannot be said to
    impose any “request.” 
    37 C.F.R. § 1.115
    . Rule 115, therefore, does not
    fall under Exemption 6—but that is of no consequence, since as
    discussed above Rule 115, and all the challenged Rules, do not impose
    collections at all.
    HYATT V. OMB                      15
    *   *   *
    Because the Rules do not impose collections subject to
    the PRA, the decision of the district court is
    AFFIRMED.
    

Document Info

Docket Number: 20-15590

Filed Date: 5/20/2021

Precedential Status: Precedential

Modified Date: 5/20/2021