By Dennis Crouch
Following a 6-5 split by the Federal Circuit, Cuozzo filed a petition for writ of certiorari – asking two important questions (as paraphrased by me):
- During a post-issuance inter partes review (IPR) proceeding, is it proper for the Patent Trial & Appeal Board (PTAB) to construe claims according to their “broadest reasonable interpretation” rather than their proper construction being applied in court?
- Is the PTAB’s decision whether to institute an IPR proceeding judicially unreviewable even if the PTAB exceeds its statutory authority in instituting the IPR?
See Cuozzo Takes IPR Challenge to the Supreme Court.
Eight different friend-of-the-court briefs have now been filed and the U.S. Government’s responsive brief is due December 9, 2015.
The majority of the briefs focus solely on the claim construction issue and make three basic arguments:
- Policy: IPRs are designed as validity judgments rather than a new examination of the patent; and claim amendments are almost always prohibited. Because IPRs are acting in parallel with court proceedings, the different standards create instability and uncertainty while using the same claim construction as an infringement-court would promote efficiency. All this undermines the PTO’s reasons justifying application of BRI construction rather than standard construction.
- Deference: Congress did not give the PTO rulemaking authority to decide to implement BRI in these Inter Partes Review proceedings and as a result, the agency’s interpretation should not be given administrative law deference.
- Conflict: The broad standard effectively negates the presumption of validity associated with each and every patent right. The broad standard subtly justifies the PTO to avoid the preclusive effect of prior court decisions.
One amicus brief (NYIPLA) also argued that the Federal Circuit should be able to review whether the PTO exceeded its authority in instituting an IPR, despite statutory language stating that the decision is not appealable. NYIPLA argues that the statute simply bars interlocutory appeals, but that the statute does not “narrow the issues that can be raised in an appeal” of a final written decision under §319.
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I’ll note here that none of the briefs at the petition stage raise the MCM/Cooper/Affinity arguments that the whole IPR proceedings are unlawful because “a patent, upon issuance, is not subject to revocation or cancellation by any executive agent, including by any part of the USPTO.” Citing McCormick Harvesting Mach. Co. v. Aultman, 169 U.S. 606 (1898). In McCormick, the Supreme Court wrote:
[W]hen a patent has … had affixed to it the seal of the Patent Office, it has passed beyond the control and jurisdiction of that office, and is not subject to be revoked or cancelled by the President, or any other officer of the Government. It has become the property of the patentee, and as such is entitled to the same legal protection as other property. . . . The only authority competent to set a patent aside, or to annul it, or to correct it for any reason whatever [without the patentee’s consent], is vested in the courts of the United States, and not in the department which issued the patent.
I would expect that, if the petition here is successful, some parties will file briefs that collaterally attach the IPR framework and to soften the Supreme Court for the eventual petitions.
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Briefs
I have yet to read an argument persuading me there is a substantive difference between BRI and the so-called “one correct interpretation, alternatively the interpretation gleaned under Philips and its progeny.
Here is another interesting ignored fact: Contrary to some of these current assertions, IPRs are NOT the only post-grant PTO proceeding in which issued patent claims are removed under a BRI claim interpretation standard, and in which amendment of subject patent claims is difficult.* That has gone on in thousands of PTO interferences for more than a century!
*A far more limited patent claim amendment opportunity than in an IPR . Note, e.g., MPEP Section 2308.02 “Added or Amended Claims [R-08.2012]
… A patentee may file a reissue application in support of a motion to add or amend a claim. ..”
Why are you posting a misleading statement such as this?
Clearly, your view on this matter is necessarily – and materially – altered by the replies afforded by Ned Heller on the subsequent opportunity for a full Article III “vetting.”
Ig nored fact….?
No.
Please do not post partial truths, for they are the stuff of forked tongues.
Paul, a reissue is a new patent application. If the patentee wants the new patent, he pays the issue fee and surrenders the old.
This is not a post grant proceeding in the sense you state.
Dennis, here is something that badly needs one of your statistical surveys, or at least a PTAB statistical inquiry? On one side are frequent allegations that it is impossible to amend claims in an IPR, and thus BRI is improper. A major issue for the subject cert petition. So far, few IPRs issuing with amended claims have been publicly noted. But, it is unknown in how many IPR’s claim amendments have actually been proposed but refused?
Some IPR practitioners say that the risk of non-infringement and “intervening rights” is more of a discouragement of claim amendments than the IPR system. It is also argued that most of the refused claim amendments are refused because they were not even attempted until near the end of the IPR proceeding’s statutory deadline, even though the patent owner had the prior art in hand and explained from the beginning.
Also, there has not yet apparently been any Fed. Cir. IPR appeal decision raising a dispute about an IPR refused claim amendment?
[This is not taking into consideration reported pending rule changes to make claim amendments easier in IPRs.]
Some IPR practitioners say that the risk of non-infringement and “intervening rights” is more of a discouragement of claim amendments than the IPR system.
Of course that’s true. And the explanation for the lack of most other amendments is that the claims are irredeemable j nk, i.e., there was no patent-worthy innovation in the application. That’s commonplace but you’ll never hear the IPR-bashers admit it because in their world a 70% allowance rate for patent applications drafted by people who believe they “invented” the concept of shoving an ad in your face is some sort of natural law rather than what everyone else understands it be (abject incompetence or worse).
PM the risk of non-infringement and “intervening rights” is more of a discouragement of claim amendments than the IPR system.
Of course that’s true. And the explanation for the lack of most other amendments is that the claims are irredeemable baloney, i.e., there was never any patent-worthy innovation in the application. That’s a normal situation but you’ll never hear the IPR-bashers admit it because in their world a 70% allowance rate for patent applications drafted by people who apparently believe they “invented” communication over the Internets is some sort of natural law rather than what everyone else understands it be (evidence of agency incompetence or worse).
I think folks that try to “prove” the patentability of new claims in a IPR are fools. They should file a reissue application if an IPR is instituted citing the institution decision for grounds. They can then file all the amended claims they want and have them examined properly.
Ned,
That is very clever. The only fly in the ointment I can see is:
35 U.S.C. 315 Relation to other proceedings or actions.
(d) MULTIPLE PROCEEDINGS.—Notwithstanding sections 135(a) [derivation proceedings], 251, and 252 [reissue], and chapter 30 [reexamnation], during the pendency of an inter partes review, if another proceeding or matter involving the patent is before the Office, the Director may determine the manner in which the inter partes review or other proceeding or matter may proceed, including providing for stay, transfer, consolidation, or termination of any such matter or proceeding.
I haven’t check the Rules.
Troubled, we had a reissue put on hold pending. But the very same claims that were subject to the IPR were pending.
I think the Board may allow examiners to consider new claims with additional limitations.
Ned,
For completeness, I checked 37 CFR 42.122(b). Apparently, petitioner can also seek joinder, but no later than one month after institution.
Paul,
A footnote in the PhRMA brief states that the number of allowed amendments has been:
4 (four).
That sounds about right, but the relevant question is in how many more IPRs were claim amendments actually timely requested and refused?
As understood, no claim amendment was ever requested in the subject Cuozzo IPR, and Cuozzo not even objecting to BRI as being too broad a claim scope reading. Rather Couzzo was [illogically] arguing that a BRI claim reading was too narrow to suit their infringement case. Thus, I am still waiting for someone to explain why this cert petition and these supporting amicus briefs are not an improper cert request for a legal “advisory opinion” since Cuozzo can have no personally affected benefit or interest [no case or controversy] in this appeal outcome?
As a reminder, no claim broadening claim amendment has ever been legal in any post-grant proceeding other than a reissue filed less than two years from the patent issue date.
That sounds about right, but the relevant question is in how many more IPRs were claim amendments actually timely requested and refused?
Are you sure we shouldn’t be dividing that number (four) by the number of amendments allowed in other proceedings over the same time period?
Just kidding.
Since the argument based on the 1898 Sup.Ct. decision in McCormick Harvesting Mach. Co. v. Aultman still continues, it is worth looking at what it was actually deciding. Namely the statutory interpretation of the then reissue statute. Specifically, holding that when a patent owner abandons a reissue [in which presumably claims were rejected] can the patent owner get back intact the original patent with the original claims? The decision even refers to a prior reissue statute which might have had a different result? There is no suggestion in this decision that Congress could not ever constitutionally enact a statute [like the reissue statute, the interference statutes, the two reexamination statutes, or the AIA] that would have allowed the PTO to reject or cancel original patent claims of an issued patent. In fact, had that not been occuring in interference decisions from long before this McCormick Harvesting decision?
Great point.
Paul,
“Upon application being made for such reissue the Patent Office was authorized to deal with all its claims, the originals as well as those inserted first in the application, and might declare them to be invalid, but such action would not affect the claims of the original patent, which remained in full force, if the application for a reissue were rejected or abandoned.”
McCormick at 612.
The original patent is not surrendered upon application for reissue. It is surrendered and then replaced by the reissue patent. There are two different patents involved.
In the case of reexaminations, the claims being reexamined and cancelled are the claims in the original patent.
Yes Ned, that is consistent with what I had said, and further supports a position that McCormick was not actually deciding the constitutionality of a statute like the AIA.
But perhaps this entire issue could be held in abeyance on this blog to reduce all the speculative clutter? A decision from the Fed. Cir. should be coming soon on your fully briefed and fully argued attack on the constitutionality of all AIA post grant proceedings [plus all reexaminations since D.C. civil action alternatives to direct Fed. Cir. appeals ended] in your MCM Portfolio Company v. Hewlett Packard Company Fed. Cir. Case No. 15-1091 filed 1/21/15. Plus the other, Cooper v. Lee, constitutional challenge.
Paul, agreed. It is just that most patent attorneys, if not most attorneys, seem completely unfamiliar with this area of con law. That is why I respond.
Paul,
While you and Ned are free to choose or not choose to discuss the topic, your own choice of words here (“clutter”) belies the fact that you continue to proselytize along a certain mantra, and you are entirely unwilling to recognize the import of any counter points presented.
Further, your “spin” on McCromick yields a twisted version of things.
Of course, McCromick – having been decided prior to the AIA – cannot be speaking to the issue brought on by the AIA (your “not actually” is a false spin).
The points being raised are not in fact “consistent with” what you are saying. The false appearance of “we really agree” serves no one.
Either the counter points are valid or they are not. There is NO reason to cut you any slack on your desire to “stop the discussion” because you have no ready answer to those counter points.
That’s a lot like your unwillingness to actually offer a cognitive position on the plain fact that this law (the AIA) was expressly made un-separable, and thus NO “interpretation” by the judicial branch is available to put in effect the clear opposite of what Congress decided.
That’s another thing that you want to disagree with, but don’t want to discuss.
Sorry, I did not mean to deprive you of your hostility outlet, I was merely making the logical and obvious point that all the extensive personal speculations about the constitutionality of IPRs will soon become a complete waste of time with that question about to be actually decided by the Courts.
“hostility outlet”
LOL – nice attempt at diversion.
You want to actually note the substance of my post calling you out for your continued advocacy?
Oops.
Your “merely making the logical and obvious point” was not so “merely” – and for the reasons I gave.
Funny, how you don’t mind yourself continuing to plug away at something that you call “a complete waste of time, but only want to “beg off” from any dialogue when it comes to points that you have no answers to.
(and yes, I just won another bet with my Big Man in Vegas that you would continue to actually avoid making any reasonable legal counter argument when you have the chance – thanks for that!)
There was an amendment floating around Congress a while ago that was proposing that Markman claim constructions need to be used during post grant proceedings. The amendment died. So will this petition.
There is your congressional intent.
See link to patentspostgrant.com
Yung, the PTO will never be the equal of court litigation in any respect.
My point is that congress would have passed this bill if they wanted “Markman” Style claim constructions.
In statutory interpretation such non-action is rarely dispositive. If the court finds that BRI is correct, it will cite the dead legislative attempt. If the court finds that BRI is not correct, it will dismiss the dead legislative attempt as proof of nothing.
See, e.g.:
As much as they might show congressional approval for Dr. Miles, they might demonstrate a different proposition: that Congress could not pass legislation codifying the rule and reached a short-term compromise instead
LEEGIN CREATIVE LEATHER PRODUCTS, INC.,
v.
PSKS, INC., 551 us 877 (US 2007)
Well congress was aware that the BRI standards had been used during reexamination, so there’s that too.
The McCormick argument is interesting, but seems dubious. Congress can define the scope of a patent, and can make the grant of a patent conditional on things like validity, paying maintenance fees, and the possibility of post-grant proceedings to take the patent away or reduce its scope. I can see the argument that IPR proceedings are unconstitutional for patents that issued before those proceedings existed — IPRs weren’t part of the deal when the patent issued, and for Congress to retroactively devalue or take back patents in this way might be a taking. But for people applying for patents now, IPRs are part of the deal. I’m probably missing something.
As I have explained, the section of law that details what a patent right IS – was not changed by Congress in the AIA.
What you seek to do is change the heart of the nature of what a patent IS, but you cannot reconcile that such is just not what happened.
This is, of course, a different argument as to Congress may do, and you should not allow yourself to be confused by the difference.
the section of law that details what a patent right IS – was not changed by Congress in the AIA.
That’s right. Even before the AIA, a “patent” was an agency re-examinable instrument subject to forfeiture upon a showing that it was improvidently granted.
Right. With reexams available before the AIA and IPRs available after, I’m not sure what the plausible version of the McCormick argument is.
con law isn’t for everyone.
Fortunately or not, commenting on blogs is for everyone. Care to explain?
Ask lead appellate counsel, he spends his days here.
Good one.
dcl, but you presume that reexaminations are constitutional. The Supreme Court in McCormick held that they were not.
Time for me to re-read McCormick. Paul Morgan’s later comment (#10) seems to read that decision differently than you do.
Dcl,
American Bell is also a big part of this.
The McCormick Harvesting argument was shot down in Patlex.
“The holding of McCormick Harvesting may also be distinguished, in view of Congressional intent to provide a separate procedure for reexamination while preserving the reissue practice. The purpose of reissuance of patents is to enable correction of errors made by the inventor, at the initiative of the inventor. The reexamination statute’s purpose is to correct errors made by the government, to remedy defective governmental (not private) action, and if need be to remove patents that should never have been granted. We do not read McCormick Harvesting as forbidding Congress to authorize reexamination to correct governmental mistakes, even against the will of the patent owner. A defectively examined and therefore erroneously granted patent must yield to the reasonable Congressional purpose of facilitating the correction of governmental mistakes”
It refuses to die.
See also Joy Tech. Inc. v. Manbeck, 959 F.2d 226, (Fed. Cir. 1992) (affirming Patlex and reiterating that patents are public rights that can be adjudicated in article I tribunals)
Except, the issue of mistake was actually addressed in McCormick.
Yung, if one assumes a patent is a public right, Joy was correctly decided.
Now look at Lockwood, post 8.2.1.1 below, a later case, where Nies and two other members of the Federal Circuit said that Lockwood necessarily overturned Patlex.
Post 8.2.1.1.
Yung, for more on Lockwood and Nies’s dissent to en banc,
link to patentlyo.com
Ned,
As I already pointed out, all you are seeing here is a rehash of those comments already made in the previous discussion threads.
Your rejoinders there are the same ones here.
How does looking at others crank up the Merry Go Round make you feel?
anon, there really is no substitute to actually reading Murray’s Lessee, Granfinanciera and Stern v. Marshall.
What seems obvious and self-evident becomes less so afterwards.
Ned,
All that I am pointing out is that those arguing against your position here are the same ones (with the same arguments) that argued against your position previously.
They have not taken your counter points into view – even as you have provided them previously.
All that they are doing is repeating their views – as if you had never responded to those selfsame views previously.
A monologue – and certainly not a dialogue.
Repeat this selfsame dance, oh about a million times, and see what type of ec(h)osytem develops…
😉
dcl, I would agree with this but for Murray’s Lessee and the fact that patent revocation proceedings were known at common law and had a right to a trial by jury.
That’s your answer?
anony, yes. That actually was the rationale of Patlex sustaining re-examinations and is the rationale of the government in the current litigation. The counter is that in Murray Lessee, the Supreme C0urt held that actions litigated in the courts of England at common law could not be removed from Article III courts. in Stern v. Marshall, Murray’s Lessee was reiterated as still being a check on the public rights doctrine.
You also might want to check out the dissent to en banc by Judge Nies and two other judges in Lockwood. There she said that the decision in Lockwood necessarily overruled Patlex. If a patentee had a right to a trial by jury for validity, conducting invalidity trial in the patent office was inconsistent with and denied that right to a trial by jury.
Murray’s Lessee link to scholar.google.com
Stern v. Marshall link to scholar.google.com
Lockwood link to scholar.google.com
My reply is held up by the moderator.
Oh, I see. You should just share links to the MCM / Cooper / Affinity briefs.
I’m surprised that your commentary here hasn’t ended up in a DOJ brief yet.
Well, they quote me all the time anony. They did so in their argument regarding 314(d). I made a pretty elaborate and apparently a convincing argument that institution decisions were not appealable from a final decision like everyone was assuming at the time we filed our Mandamus. That appeared to have changed Justice’s minds on the whole issue, and they cited our brief in support of their argument regarding non appealablity of institution decisions.
“You should just share links to the MCM / Cooper / Affinity briefs.”
“anony,” you are aware that Ned is counsel for MCM, right?
Dennis, could you unblock my post at 1:13 pm?
Well, for starters, you are missing an understanding of Hayburn’s case.
Also DCL, you aren’t missing anything. Many IP owners have been unhappy with the result in Patlex and merely wish to re-litigate it here.
Yung, but you seem not to recognize that the Supreme Court has doubled-down itself. Stern v. Marshall. Actions that were litigated at common law are not public rights and cannot be withdrawn from the courts, period. End of discussion.
The inconsistency between Patlex and the Supreme Court has even been recognized by members of the Federal Circuit itself in Lockwood.
There has never been an action at common law between a patent issuer and a patent holder.
English patents were revoked routinely without any recourse.
(see link to law.berkeley.edu text accompanying footnotes 39-41).
ANYTHING by Mr. Lemley is suspect.
I did not get past the first few pages without noting a material omission in his “dogma:” laws affecting property rights also call into mind certain considerations (Mr. Lemley has attempted to divorce consideration based solely on criminal nature of things).
You would do far better YL to base your views on a better foundation than one who so evidently is already biased anti-patent.
I pointed out the footnotes specifically, so the attack on the speaker would not factor in to what is a historical and factual argument.
It is NOT an “attack on the speaker” so much as the context of that very same speaker twists things.
So no YL, my “ad hominem” is not something that you can simply “dismiss.” It is a critical evaluation of the provider of the material and noting that THAT provision is indeed suspect.
Read Mowry v. Whitney link to scholar.google.com
“It will be observed that in the case of a conflict under two patents granting the same right, the scire facias may, according to the authorities cited, be brought in the name of one of the patentees, but in the other cases, when the patent was obtained by a fraud upon the king, by false suggestion, or where it was issued without authority,”
What bothers me is the constant refrain in the amicus briefs that broadest reasonable interpretation is quite fine in a reexaminations but somehow not okay in IPRs when the issue in both is whether a claim in an issued patent is valid or invalid.
In both cases we are dealing with issued patents. Reexaminations result in a certificate that cancels claims found to be invalid. That is what IPRs do as well.
The right to amend certainly is why BRI is acceptable during regular examination before the patent issues. But after the patent issues, the patent is the property of the patent owner and we are dealing with legal rights. If the patent owner is forced to amend because of claim construction, he will lose all damages occurring prior to the issuance of the re-examination certificate. This causes significant harm to the patentee that cannot be ignored but is ignored by every single one of these amicus briefs.
All in all I have nothing in common with these amici who fail to see the big issue and undermine their position by ignoring the reality of what is going on in both reexaminations and IPRs. They are trying to be just a bit too nuanced. Focusing on the right to amend is absurd. It makes their position illogical.
This reminds me of another position that has recently been argued that even though McCormick Harvesting held that the government cannot cancel or revoke an issued patent as a result of a reexamination, that being exclusively for the courts, nevertheless defended reexaminations as being something acceptable under McCormick Harvesting. Please explain that to me, and do so slowly that I may understand.
a “right” versus what the (Article I) court deigns to grant…
As to the “They are trying to be just a bit too nuanced” I do have to chuckle, Ned, given your own predilections as to parsing what fits your own mantras and “nuancing” away those things that do not fit.
Ned,
I think IPRs are unfair, but I am also bothered by two briefs that I read.
From the IPO brief, after discussing some procedural standards in 35 U.S.C. 316, “Congress intended “court-like” standards for assessing validity to apply, including the plain and ordinary standard for determining the proper construction of patent claims.” But:
35 U.S.C. 316 Conduct of inter partes review.
(e) EVIDENTIARY STANDARDS.—In an inter partes review instituted under this chapter, the petitioner shall have the burden of proving a proposition of unpatentability by a preponderance of the evidence.
A Court-like intent should have recited clear and convincing evidence.
Both it and the AIPLA brief complain of inconsistent results. In court we have Phillips claim construction (with no chance to amend) with a requirement for clear and convincing evidence to invalidate (and maybe help from a jury). In IPRs we have BRI (with a theoretical chance to amend) with only a preponderance of the evidence required to invalidate. Given this disparity, it is not inconsistent to have a valid patent in court, but not at the PTAB.
What would be inconsistent is, if the IPR is supposed to be court-like, we should see the same results. But then we get into your complaint that the PTAB is not a court.
One possible answer to this is the presumption of validity. In an ordinary court suit, there is no cloud over the litigated patent, so it has a presumption of validity and hence a higher burden of proof to invalidate it. A proceeding requires an initial showing, a prima facie case, so to speak.
That said, there’s no reason why we can’t just accept that Congress made a policy decision and changed the patent scheme to the disadvantage of some and the advantage of others.
Another way to look at it. Congress could very well have removed the presumption of validity in all contexts, including federal court. They effectively did remove the presumption, but in a limited context.
H.O., Congress definitely undermined the entire patent system with IPRs. Pharma and Bio took their eye off the ball and the discussion of expectation in these briefs by Pharma and everyone else, and in the recent Johnson (IPO president) interview by Gene, shows only that he an many others were lulled to sleep by the propaganda produced by the backers of the AIA.
The damage is done. The only way forward is to win the constitutional argument. Congress is not going to repeal IPRs.