SCOTUS Holds That The USPTO Cannot Recover Its Attorney Fees Under 35 U.S.C. § 145

In Peter v. NantKwest, Inc., No. 18-801 (Dec, 11, 2019), the Supreme Court considered whether 35 U.S.C. § 145, which provides that an applicant must pay "[a]ll expenses of the proceedings" when it appeals an adverse USPTO decision in the district court, should include the pro rata salaries of USPTO attorneys and paralegals who worked on the case.

In a unanimous decision, the Court held that § 145 "does not overcome the American Rule's presumption against fee shifting to permit the USPTO to recoup its legal personnel salaries as 'expenses of the proceedings.'" The Court found it instructive that various statutes that allowed for fee shifting used the terms "expenses" and "attorney's fees" in tandem, indicating that "Congress understands the two terms to be distinct and not inclusive of each other." Further, when Congress intended to provide fee shifting, it did so explicitly, such as under 35 U.S.C. § 285 ("The court in exceptional cases may award reasonable attorney's fees to the prevailing party"). From a policy perspective, the Court reasoned that allowing an award of attorney's fees even when the USPTO was unsuccessful "would be a radical departure from longstanding fee-shifting principles adhered to in a wide range of contexts."

The decision can be found here: