Published in Landslide® magazine, Volume 10, Number 2 , a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved. This
information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
Starting Point: The Constitution
Let’s revisit rst year of law school—the basic constitutional
principles for separation of powers. Article I, section 1, vests
“All legislative Powers” in Congress. Article III, section 1,
vests “The judicial Power” in the courts.
The executive branch and its agencies are not the leg-
islature. Administrative judges have neither presidential
appointment nor Senate conrmation to be “judges” or to have
Article III law making authority. So executive branch agencies
have no inherent power to make laws—but they do so all the
time. How does the USPTO get power to make laws?
By delegation from Congress. Various statutes, including
5 U.S.C. §301 and 35 U.S.C. §2(b), §3(a)(2)(A), §3(b)(2)
(A), §316(a), and §326(a), delegate rule making authority to
the USPTO and the Director. The Supreme Court enforces con-
stitutional limits on the relative powers of the executive and
legislative branches. The current truce line permits Congress
to delegate rule making authority, but the delegation must be
express or clearly implied, and the agency must follow the pro-
cedures set by Congress in promulgating executive branch laws.2
The starting point for understanding rule making is to
understand the defaults:
• The Constitution assigns legislative authority to Congress.
Executive agencies have rule making authority only to the
extent, and only on the terms, delegated by Congress.3
• Binding rules exist in writing, in validly promulgated
form. An agency may only enforce rules that have been
validly promulgated. Agencies can bind themselves and
their employees by informal guidance documents and
similar “light” procedure, but not the public.
• In the context of ex parte prosecution, if the USPTO
has no statute or regulation to either require or forbid
an act, everything an applicant might want to do is per-
mitted and optional.
When Is a Rule a “Rule,” and When Do the Requirements
for “Rule Making” Apply?
The term “rule” is broadly dened in 5 U.S.C. §551(4),
encompassing far more than the regulations codied in the
Code of Federal Regulations. A “rule” is anything an agency
purports to apply generally or prospectively, whether binding
or only advisory, whether promulgated as a rule to bind the
public or as self-regulation of agency employees. One of the
key administrative law cases from the DC Circuit notes that
the denition of “rule” in §551(4) “include[s] nearly every
statement an agency may make,” and that exceptions to statu-
tory rule making procedures are “limited.”4
If the USPTO raises an objection, rejection, or requirement
based on a legal principle arising on its own authority (that is,
other than a statute or court decision), the USPTO must show
that it complied with applicable rule making procedure to pro-
mulgate a rule that is validly binding against the public.
Laws Governing Rule Making
In roughly the order of adoption, this section catalogs the key
laws and policies emanating from the Executive Ofce of the
President that govern agency rule making.
None of these laws is self-executing. Each facially requires
an agency to take certain actions, but only rarely are agencies
penalized for noncompliance. Some rule making laws create a
tribunal within the executive branch to provide regulatory over-
sight during the rule making phase, and parties may make their
concerns known there. Almost all provide that agency nonper-
formance renders a rule potentially unenforceable. However,
after a rule issues, as a practical matter, self-correction by
agencies is uncommon (and when user fees are at issue, essen-
tially nonexistent), and the only venue for redress is judicial
review. And regardless of whether the venue is administrative
or judicial, neither remedy will occur unless an aggrieved party
complains, represented by a competent, informed advocate.
Without a properly represented complainant, the default is that
agency rule making power is greater than statutes provide.
The Housekeeping Act, 5 U.S.C. §301, was one of the rst laws
enacted by the rst Congress. The Housekeeping Act authorizes
any head of any executive branch department to prescribe regula-
tions governing the agency’s own employees, and the performance
of the agency’s business. There are almost no procedural prereq-
uisites for rules governing agency employees—when an agency
head says so, agency employees are bound.
Administrative Procedure Act
The Administrative Procedure Act (APA) is divided into two broad
sections, now 5 U.S.C. chapters 5 and 7. Chapter 5 of the APA, 5
U.S.C. §§551–559, species duties of agencies as they go about
their day-to-day business of rule making, adjudicating, conducting
hearings, and the like: the fundamental obligation on an agency
under chapter 5 is to explain the agency’s rationale, and to do so in
a way that demonstrates “reasoned decisionmaking.”5
Much of this article will focus on §553, which governs
rule making. Section 553 requires agencies to give the pub-
lic proper notice of proposed rules, and an opportunity for
the public to provide input on those proposed rules. To allow
informed comment, the agency must explain its rationale, and
make available any data, testing, models, software, or other
analytical support for the proposed rules.
5 U.S.C. §553 – Rule making.
(a) This section applies, according to the provisions thereof,
except to the extent that there is involved—
(2) a matter relating to agency management or