by Dennis Crouch
In re Cuozzo Speed Tech (Fed. Cir. 2015)
The Federal Circuit simultaneously released two decisions in this appeal of the first inter partes review proceeding before the Patent Trial and Appeal Board (PTAB). The first decision is a revised panel opinion holding:
- that the court lacks “jurisdiction to review the PTO’s decision to institute IPR;”
- that the PTO acted within its statutory rulemaking authority in determining that patent claims subject to an IPR should be given their “broadest reasonable interpretation” and thus that the PTAB’s broad claim construction and subsequent obviousness determination were proper; and
- that the Board properly denied Cuozzo’s motion to narrow its claims in order to avoid the prior art.
Judge Dyk wrote the majority opinion joined by Judge Clevenger; and Judge Newman dissented on almost all points. [I have not fully reviewed the revised opinion, but the holding does not appear to differ significantly from the original that I discussed here. DC]
In the second decision, the en banc court rejected Cuozzo’s petition for en banc rehearing on the Broadest-Reasonable-Interpretation (BRI) standard for administrative review claim construction. The vote was at the slimmest of margins: Six-to-Five with Chief Judge Prost, and Judges Newman, Moore, O’Malley, and Reyna voting for en banc review and Judges Lourie, Dyk, Wallach, Taranto, Chen, and Hughes voting no. Oddly, four of the six judges voting “no” to the en banc review request still felt the need to write an opinion explaining the law.
The BRI supporters write:
Congress conveyed rulemaking authority to the PTO to prescribe regulations, inter alia, “establishing and governing inter partes review,” 35 U.S.C. § 316(a)(4), and the PTO has adopted the broadest reasonable interpretation standard for IPR proceedings, 37 C.F.R. § 42.100(b). In the absence of evidence of congressional intent to abrogate the [historically grounded] broadest reasonable interpretation standard, we should not act to adopt a different standard based on our own notions of appropriate public policy. If the standard is to be changed, that is a matter for Congress. There are pending bills which would do just that.
Dissenting from the en banc denial, Chief Judge Prost (joined by four colleagues) writes:
In adjudicatory proceedings, claims [must be] given their actual meaning, not their broadest reasonable interpretation.
Challenging the grant-of-authority argument, the minority suggests that the rulemaking authority was procedural authority, not substantive authority — and that the standard for claim construction is extremely substantive. “In our view, these subsections are consistent with Congress’s previous grants of authority to prescribe procedural regulations.”
[Read the En Banc Denial Opinions]
This decision is obviously important since many of the obviousness arguments in the pending IPRs depend upon the PTO broadly construing the claim scope. The immediate take-home is the message that Patentees had better win their case at the PTAB rather than looking to the Federal Circuit for reversal. In the background, the judicial split and administrative-law aspects of the decision suggest that it is ripe for Supreme Court review.