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Implications for USPTO's Rulemaking Authority

**Introduction**

The legal landscape surrounding the rulemaking authority of the United States Patent and Trademark Office (USPTO) is under intense scrutiny, particularly in the wake of the *Chestek PLLC v. USPTO* case. This case, which challenges the USPTO’s implementation of certain procedural rules without following the notice-and-comment rulemaking process, has reached the U.S. Supreme Court with a petition for a writ of certiorari. The outcome could have far-reaching implications for the agency’s regulatory powers, potentially altering the way the USPTO conducts its rulemaking activities in the future.

**Background: The Core of the Chestek Case**

The *Chestek* case centers on the USPTO’s requirement for trademark applicants to provide their domicile address (defined as their permanent legal residence or principal place of business), rather than just a mailing address. This rule, implemented in 2019, was designed to curb fraudulent filings by foreign applicants using U.S. mailing addresses. However, the requirement has sparked significant controversy, particularly from Chestek PLLC, whose refusal to provide a home address due to privacy concerns led to the rejection of a trademark application.

Chestek’s core argument against the rule is that the USPTO violated the Administrative Procedure Act (APA) by not following the notice-and-comment rulemaking process. Specifically, Chestek contends that 35 U.S.C. § 2(b)(2) mandates that the USPTO adhere to APA procedures for all rules, including those considered procedural, thereby ensuring public participation in the agency’s rulemaking process.

**The Government’s Opposition and Legal Arguments**

In response to Chestek’s petition, the U.S. Solicitor General filed a brief opposing certiorari, arguing that the USPTO’s actions were consistent with the APA. The government’s position is that purely procedural rules, such as the domicile address requirement, are exempt from notice-and-comment procedures under 5 U.S.C. § 553(b)(A). Therefore, the USPTO was not required to engage in the notice-and-comment process for this particular rule.

The government also challenges Chestek’s interpretation of § 2(b)(2), asserting that the APA’s procedural rule exception does not render the statute meaningless. The government points out that even if § 2(b)(2) is confined to procedural rules, it still has practical significance, such as the right to petition for rule changes under § 553(e). Furthermore, the government raises the issue of whether § 2(b)(2) permits substantive rulemaking, referencing the Supreme Court’s comments in *Cuozzo Speed Technologies, LLC v. Lee* that cast doubt on the Federal Circuit’s interpretation of § 2(b)(2) as limited to procedural rules.

**The Broader Impact: Similarities with Apple v. Vidal**

The *Chestek* case has notable similarities to another APA case pending before the Federal Circuit, *Apple v. Vidal*, which challenges the USPTO’s discretionary denial rules under the NHK-Fintiv framework. Like *Chestek*, the *Apple* case questions whether the USPTO should have conducted notice-and-comment rulemaking before implementing substantive policies that significantly impact patent and trademark applicants. The outcome of these cases could set critical precedents for how the USPTO and other federal agencies exercise their rulemaking authority.

**Potential Outcomes and Implications**

If the Supreme Court takes up the *Chestek* case, it could have significant implications for the USPTO’s rulemaking processes. A ruling in favor of Chestek could require the USPTO to engage in notice-and-comment rulemaking for a broader range of rules, including those currently classified as procedural. This would likely increase transparency and public participation in the agency’s decision-making but could also slow down the implementation of new rules.

On the other hand, if the Court sides with the government, the USPTO may continue to exercise its rulemaking authority without engaging in the notice-and-comment process for procedural rules. This outcome would maintain the status quo but could lead to further challenges from stakeholders who feel excluded from the rulemaking process.

**Conclusion**

The *Chestek* case presents a critical moment for the future of the USPTO’s rulemaking authority and the application of the APA. As the legal battle unfolds, patent and trademark practitioners should closely monitor developments, as the outcome could reshape the landscape of administrative law and the regulatory powers of the USPTO. The implications extend beyond trademark law, potentially influencing how procedural and substantive rules are implemented across various federal agencies.

For those navigating the complexities of patent and trademark law, staying informed about these developments is essential for effective legal strategy and compliance with evolving regulations.

Gayatri Gupta