Dickinson v. Zurko

LOCATION: North Carolina General Assembly

DOCKET NO.: 98-377
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: United States Court of Appeals for the Federal Circuit

CITATION: 527 US 150 (1999)
ARGUED: Mar 24, 1999
DECIDED: Jun 10, 1999

Ernest Gellhorn - Argued the cause for the respondents
Lawrence G. Wallace - Argued the cause for the petitioner

Facts of the case

Mary E. Zurko, and others, applied for a patent upon a method for increasing computer security. The Patent and Trademark Office (PTO) patent examiner concluded that Zurko's method was obvious in light of prior art and, therefore, denied the application. The PTO's review board, the Board of Patent Appeals and Interferences, upheld the examiner's decision. Zurko sought review in the Court of Appeals for the Federal Circuit. In reviewing PTO's decision to deny Zurko's patent application, the Federal Circuit analyzed the PTO's factual finding using a "clearly erroneous" standard of review, which generally governs appellate review of district court findings of fact (court/court review), rather than the less stringent standards set forth in the Administrative Procedure Act (APA), which permit a court to set aside agency findings of fact found to be arbitrary, capricious, an abuse of discretion, or unsupported by substantial evidence. The court found the PTO's factual finding to be clearly erroneous. The Federal Circuit then heard the matter en banc. After examining relevant precedents, the en banc court concluded that its use of the stricter court/court standard was legally proper. The Solicitor General, representing the Commissioner of Patents and Trademarks, Q. Todd Dickinson, sought certiorari.


Must the Court of Appeals for the Federal Circuit use the framework set forth in the Administrative Procedure Act when reviewing the Patent and Trademark Office's findings of fact?

Media for Dickinson v. Zurko

Audio Transcription for Oral Argument - March 24, 1999 in Dickinson v. Zurko

William H. Rehnquist:

We'll hear argument next in No. 98-377, Q. Todd Dickinson v. Mary Zurko.

Spectators are admonished, do not talk until you get out of the courtroom.

The Court remains in session.

Mr. Wallace.

Lawrence G. Wallace:

Thank you, Mr. Chief Justice, and may it please the Court:

The question in this case is whether the standards of judicial review specified by the Administrative Procedure Act apply to the Federal Circuit's review of decisions of the Patent and Trademark Office's Board of Patent Appeals and Interferences rejecting claims of unsuccessful patent applicants.

The en banc court of appeals held that those standards do not apply, but neither that court nor the respondents contend that by their terms these detailed provisions of the Administrative Procedure Act... neither of them contest that by their terms they would directly apply and would prescribe review of the board's factual findings under the substantial evidence standard set forth in section 706(2)(E) of Title 5, set forth on page 5 of our brief.

Sandra Day O'Connor:

Can I interrupt you, Mr. Wallace, and I know you don't care for that very much, but let me do it anyway.


Let's talk about the standard of the scope of review under the statute, 706, which says that under the APA the reviewing court will hold unlawful agency action found to be arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law, subsection (A).

Now I would have thought that was the standard that we would be talking about.

Somehow the Government, having espoused that for years, has now backed off, says no, it's under (E), unsupported by substantial evidence in a case subject to sections 556 and 557 of this title or otherwise reviewed on the record of an agency hearing provided by statute.

I don't see how (E) applies to this situation.

Now, is the Government espousing that or what?

I mean, it's very peculiar and I'd like you to speak to that for a minute, if you would.

Lawrence G. Wallace:

One does not preclude the other.

We would not say that agency action should be upheld if it's arbitrary, capricious, or an abuse of discretion.

We're not arguing that that standard is precluded.


Sandra Day O'Connor:

Well, why aren't you arguing that it's required under the statute?

I don't see how (E) covers this situation--

Lawrence G. Wallace:

--(E)... we think (E) comes in because under the patent code, the court of appeals is reviewing these determinations of the Board on the record before the Board.

The patent code specifies that review in the court of appeals is to be on the administrative record, and while these are not hearings subject to sections 556 and 557 of the act, they are in our view, and we conceded before the en banc court, otherwise reviewed on the record of an agency hearing provided by statute.

--That doesn't mean--

The Board proceedings are provided for in the patent code, and--

Antonin Scalia:

--Mr. Wallace, I thought the distinction was, indeed, I wrote a law review article on this--


--in the days when I knew something about administrative law.

I thought that the distinction is that the arbitrary-capricious standard, the first standard, applies to all determinations, determinations of policy, determinations of fact that are not based on a closed record and so forth, and that the substantial evidence test is merely one instance of what constitutes arbitrary or capricious action when you are... when you are making a determination on a closed record.

That is to say, if you have a closed record and there is not even substantial evidence in that record to support your factual determination, substantial evidence being the amount of evidence that would take a jury case to the jury, if you don't have that, it has to be arbitrary or capricious anyway.