Medtronic: On Rehearing the Court Restates that IPR Termination Decision is Not Appealable

by Dennis Crouch

On rehearing in Medtronic v. Robert Bosch, the Federal Circuit panel has reaffirmed its earlier determining that the PTAB’s vacatur of an IPR institution decision is a decision as to “whether to institute an inter partes review” and therefore is “final and nonappealable.”  The original Medtronic decision had been released prior to Cuozzo v. Lee (2016) and the rehearing decision now explains that “nothing in Cuozzo is to the contrary.”

Although I continue to cringe at the prospect of no appeal, the decision here makes logical sense based upon the statutory and procedural structure. Here, the termination decision was based upon the petitioner’s failure to identify all real parties at interest — a core requirement of a complete petition.  Base upon that failure, the Board determined that the petitions were incomplete and therefore “cannot be considered.”  With that conclusion, the Board terminated the petitions and vacated the prior institution decisions.   In this framework, it makes sense for the termination/vacatur to be a decision on institution and thus not subject to appeal.  I could imagine a different scenario where the PTAB terminates an IPR based upon some other ground that is not a petition requirement — such as failure to prosecute or improper post-institution attorney conduct. In that hypothetical situation, the termination would be substantially divorced from the institution and – in my view – would no longer fall under the no-appeal requirement.

An additional difficulty with all of this stems from the pending Ethicon petition and the difference between action by the Director and action by the PTAB.  The statute separates the roles – indicating that the PTO Director’s role is in determining “whether to institute” an IPR.  Under the statute, the PTAB then steps in to conduct the trial.  Those separate roles were then combined by PTO regulation which states “The Board institutes the trial on behalf of the Director.” 37 CFR 42.4.   A question – unanswered in this case – is whether the Director’s regulatory delegation above should be interpreted to also extend to vacating and terminating petitions.  I’m not sure that it does. 

Dennis Crouch

About Dennis Crouch

Law Professor at the University of Missouri School of Law. Co-director of the Center for Intellectual Property and Entrepreneurship.

62 thoughts on “Medtronic: On Rehearing the Court Restates that IPR Termination Decision is Not Appealable

  1. The Lumentum case was declared precedential after this Medtronic case was decided by the PTAB. This now precedential case involved a petitioner which was acquired. That resulted in a change of information as to the real party in interest. PO argued that failure to timely update mandatory notices was a basis for terminating the IPR proceeding. The Board rejected this, holding that the RPI disclosure requirement applies at the time a petition is filed. Thus, lapses in disclosure can be cured without a terminating sanction. This conclusion made the Panel deny PO’s motion to terminate because, while Section 312(a) sets forth requirements that must be satisfied for the Board to consider a petition, a lapse in compliance with RPI does not deprive the Board of jurisdiction. link to uspto.gov

    1. Of course, Achates held that even a bold and willful violation of §315 does not deprive the Board of jurisdiction. So long as someone, somewhere could have filed a valid petition, the Board’s decision to grant the petition is simply unreviewable—Congressionally specified prohibitions be hanged. The IPR statutes, you see, are rather like the Pirate Code—more suggestions than actual requirements.

      1. Lol – I see what you did there Greg.

        You want to make the plain words of the reviewability of the institution decision appear to be not binding because the Office may have treated other portions (what is required in the petition) has “not binding.”

        This conflates things in an unhelpful manner (along the lines of “two wrongs make a right”).

        The problem is that you are mis-aiming and trying to “nail” the same party with two different problems belonging to two separate parties.

        While indeed there may be a “piece of truth” to Office culpability if the Office flaunts requirements, the rule of law – as written by Congress – remains as it is plainly written. That separate item cannot be bootstrapped because of what the Office does in other places.

        The Office cannot be blamed because it may of deficiencies elsewhere, but is faithfully following the law that the Congress provided in saying “no appeal of the institution decision.”

        You need to aim at Congress for writing that piece of law – not at the PTAB.

        I have provided a clear path for such aiming (and more than one court had echoed my writing on the subject; hint: Constitutional challenge).

        Without reflecting who has had influence on you, even some of your recent posts have begun to explore that which I have long asked to be explored.

        You are welcome.

    2. Let’s be honest. The Federal Circuit simply does not want or is not equipped to handle the work coming from the PTAB.

        1. The Federal Circuit simply does not want or is not equipped to handle the work coming from the PTAB.

          There’s a great way to eliminate a lot of that work: it begins with recognizing that patents protecting logic and information are ineligible.

          The CAFC’s f@te, in that regard, is largely in its own hands (as it has been for quite some time). They’ll figure it out eventually.

          1. Wonderful.

            Now all that you have to do is be inte11ectually honest and realize that software is not logic or information.

            Can you obtain a different form of intellectual protection (copyright) on a different aspect of software, if software is this “logic and information” that you attempt to spin it to be?

            Step up and explain that, please, Malcolm.

            Use those short declarative sentences in English that you are always on about.

            What’s that?

            Speak up son – I can’t hear you.

                1. Laughter really is the best response when someone makes an assertion that is ridiculous on its face.

                  But, hey, instead of lecturing me with your silliness, talk to all the “skilled artisans” who have filed reams of patents in which software and logic are equated.

                  Or you can dive deep into the swamps of unrivaled pedantry and dig yourself all the way to China.

                  Your choice! In either event, I’ll be sticking around for the laughs. Suprise everybody, “anon”!

                2. Funny how you want to claim “ridiculous on its face” yet cannot bother giving a simple answer about how can that same thing obtain a copyright.

                  You are not saying that “software being logic and information,” means that any ‘ol logic and or information can obtain a copyright, do you?

                  Why do you think that I remind you of the following purposes of the different IP laws:

                  Copyright: expression
                  Patent: utility

                  You seem only to want to throw around ad hominem and vacuous conclusory statements, but when asked to put your “knowledge” to the test and exclaim something rather straightforward, you never get around to giving actual answers.

                  We both know why that is, don’t we pumpkin?

                  (As for the filings, you do realize that you are not taking the terms in the proper context as would be understood by a Person Having Ordinary Skill In The Art, eh?

                  But then again, you rather enjoy taking things out of context and twisting what is understood to suit your Ends.

                3. how can that same thing obtain a copyright

                  I don’t know. How do you copyright logic, “anon”?

                  Tell everybody.

                  And remember: according to your mentor and hero, you can’t protect software with a patent claim (because patent claims don’t cover software). Of course, he might have said that when he was under the influence of something so we shouldn’t be too harsh on the poor fellow.

                4. You are doing that thing again of dodging a question and wanting the person asking you to answer it for you.

                  Or does it bother you that the L I E that you are telling just does not fit with what copyright law provides?

                5. …and I have no idea what you are talking with this “mentor” thing.

                  Please stop trying to distract from the focus here of you not answering something?

                  I thought you liked the spot light?

                  What’s the matter? The spotlight dealing with your L I E s just a little too bright for you?

                6. link to calfee.com

                  Although the “literal” copying of a copyrighted computer program’s source code or object code will ordinarily result in a finding of copyright infringement, it is not entirely clear if copyright law can afford any protection beyond that point. It is clear, however, that if the motivation behind seeking IP protection is to protect the behavior, logic, or functions of the software program, then seeking patent protection is probably the best possible course of action.

                  ROTFLMAO

                  But software isn’t logic. Nope. “anon” says so!

                  LOLOLOLOLOLOL

                7. Tell everybody how you can obtain a copyright on logic, “anon.”

                  You’re a very serious person! That’s the premise of your awesome “argument” after all. So tell everybody how you do it.

                8. As
                  I said, you are attempting to use the term out of context of the PHOSITA, as well as trying to deflect the question put to YOU to answer concerning the ability to obtain a copyright on what YOU claim software to be.

                9. …and your calfee snippet actually says the opposite of what you are trying to peddle.

                  Think: patents for utility.

        2. No, that part of the AIA was supposed to reduced very expensive and time consuming D.C. litigation suits, not Fed. Cir. appeals [on which they spend far less time per case with far less issues and evidence than D.C. case appeals.] The 2016 D.C. suit statistics do show a significant reduction, albiet other factors are also in play, like attorney fee sanctions and Alice.

    3. “a lapse in compliance with RPI does not deprive the Board of jurisdiction”

      What if the initial RPI statement was false and that, if it were true, the IPR instution would have been barred under one of the provisions of 315?

  2. Dennis, re your question about “a different scenario where the PTAB terminates an IPR based upon some other ground that is not a petition requirement — such as failure to prosecute or improper post-institution attorney conduct.”
    That sounds more like a PTAB IPR trial sanction [for which the AIA provides authority] and thus an appeal might lie for an excessive sanction under the circumstances?

    1. It is at 35 USC 316 (a)(6):
      “(6) prescribing sanctions for abuse of discovery, abuse of process, or any other improper use of the proceeding, such as to harass or to cause unnecessary delay or an unnecessary increase in the cost of the proceeding; “

  3. Examiners are best at deciding whether a petition is sufficient on the merits. But when it gets into litigating whether someone is a privy or a real party in interest, that kind of matter is best handled by the Board.

    Clearly what needs to be done is to separate these matters. Have examiners look at the merits. Have the PTAB looks at litigation issues that are clearly collateral.

    Regarding the latter, these clearly collateral matters should be decided on a preliminary basis before the examiner makes his decision on institution. But, thereafter, the PTAB can and should conduct a full trial on privily and real party when there is a real dispute, where their final decision can finally decide disputes on these issues.

    This new procedure would and should throw Achates into doubt, as many of us believe it was wrongly decided in the first place.

          1. Still waiting Ned.

            Or are you realizing that your “argument” is weak because you just did not understand the reference of “this section” merely refers to the section on the institution decision itself?

            Not the first time you have eagerly over-read and under-understood something because you thought such aligned with your desired Ends.

          2. Anon, there are a number of decisions that have to be made before trial is instituted. They are scattered about the Chapter. 315 has a number of different decisions that can be made.

            The ONLY decision that is specifically barred is the decision made under 314(d), and that decision is on the merits — whether the petition is sufficient, etc.

            The Supreme Court was careful to limit its decision to decisions that are necessarily made in making this decision under 314.

            Since 315 is entirely collateral to 314, it should not be barred by 314(d). Everyone but everyone who has look at this issue seems to agree that Achates is simply wrong.

            1. You are reading FAR too much and understanding FAR too little Ned.

              Read the statute again. The direct words. Try not to complicate this for yourself.

  4. There is a good reason for that cringing.

    As any reader of any duration can remind you, the institution decision point – a legal action quite separate from any decision on the merits – is written into law by Congress (hint: actions against the PTAB are futile) to be expressly non-appealable.

    So this separate institution legal action by the executive office removes sticks from the bundle of property rights of a granted patent, significantly impairing the value of the property, with zero remuneration and with no (normal) course of review to a (proper) Article III court.

    Takings law, anyone…?

    😉

        1. And, Dennis, everywhere in the statute, including in 314, the statute says that the decision whether the institute is made under “this chapter.” Repeatedly.

          Thus, the limitation to “this section” in the non appealability section must mean something different that “this chapter.” The Supreme Court time and again in Cuozzo emphasized “this section” in its decision. Moreover, sections involved with the decision to instituted in that case were necessarily involved in the merits decision under 314(a), and the court did emphasize this, making clear that decisions remote from 314(a) were not made non appealable by 314(d).

            1. If you are going to ask which section has the specific part concerning whether or not institution decisions are appealable, do you give the section (so titled) or do you give the larger chapter?

              1. Anon, there are a number of decisions that have to be made before trial is instituted. They are scattered about the Chapter. 315 has a number of different decisions that can be made.

                The ONLY decision that is specifically barred is the decision made under 314(d), and that decision is on the merits — whether the petition is sufficient, etc.

                The Supreme Court was careful to limit its decision to decisions that are necessarily made in making this decision under 314.

                Since 315 is entirely collateral to 314, it should not be barred by 314(d). Everyone but everyone who has look at this issue seems to agree that Achates is simply wrong.

                1. (or put it this way: is there ANY other section – anywhere – that even hints at whether the (single) institution decision IS appealable?

                  Absent this critical support (since you will not – because you CANNOT – supply any); what possible reach anywhere can you pull support for your egregious over-reading of the statute?

                2. “Making the decision under 314”

                  In case you have not realized it yet, 314 is the ONLY place that describes the legal state of the institution decision vis a vis appealability:

                  The ONLY place.

                  Can you give another?

                3. Ned,

                  Once again I am faced with nothing from you but silence.

                  This is not a difficult point for you to answer, so I am left with only one conclusion: you have no answer.

                  Perhaps this will sink in with you that there is one – and only one – section which dictates the ability to appeal the separate institution decision (but given your past recycling of untenable positions or “magical” statutory constructions, I can pretty well guess that we will again ride this merry go round).

        2. So if we had a new Director and said Director – for any reason at all – let’s say an arbitrary reason – decided to end all new IPRs – said Director could rubber stamp denied on all new IPR petitions. This is final and nonappealable – and not subject to any Court review? I suppose there is always political accountability in the Executive or impeachment by the Congress? Quite the grant of discretionary power.

          1. As long as that arbitrary reason is not made manifest**, sure.

            That is the law as written by Congress.

            You cannot reach impeachment (no “cause” present for following the law).

            You may reach “accountability” at the Executive, but as you indicate, this is really (and merely) of the nature of “political” (which is of itself a different problem).

            **I mention “not made manifest” because if made manifest and that manifestation breaks some other law, you may open a different path – but as long as you do not make an otherwise untowards (even political) statement in your denial of institution, the director (or his minions) are most definitely “scott free.”

            This only goes to the point that I have been making all along: you cannot aim for (or blame) the PTAB for applying the law as written.

            Instead, one must attack the law as written – and THAT avenue is through the takings clause.

            1. It would appear then that the grant of total discretion as to whether to grant an IPR petition – and it’s final and not reviewable position – would strengthen your takings position. In other words, the guise of a quasi-judical merits ‘court’ is stripped away since is intake process is plenary.

              1. Correct – by making this action “stronger” you make the entire IPR more fragile.

                (note as well that this has nothing at all to do with the Ends involved and everything to do with the Means)

  5. DC A question – unanswered in this case – is whether the Director’s regulatory delegation above should be interpreted to also extend to vacating and terminating petitions. I’m not sure that it does.

    Good point.

    1. Not sure why it would not…

      Take for arguments sake that the authority to delegate is established.

      Why would such collateral items directly linked with the (larger) power to institute not be present?

  6. I’m sure there’s a good explanation for the actions taken but, under the circumstances, why not just immediately refile the petitions with the correct parties named? The CAFC appeal route chosen here would seem to be both more expensive and a less efficient way to get to the merits.

    1. The party requirements for an IPR are not a very big deal and so it could ordinarily be an easy re-file. I believe that the problem here is that the party in-interest that was unnamed (Cardiocom) had already been sued on the patent.

      At least according to Bosch, Medtronic’s failure to name Cardiocom in the Petitions cannot be now cured because Cardiocom was served with a complaint alleging infringement of the challenged patents more than one year ago under 35 U.S.C. § 315(b) (“An inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.”)

      1. And, if this 315(b) bar was present on the filing of the IPR, it could explain why Cardicom was not named.

        But all this willful violation of the rules to sneak one by the PTAB is, to me, fraud. The attorneys involved here need to be investigated as to what they knew and when they knew it.

        1. Note that there are also cases where the named petitioner was the entity sued for infringement, but because some unnamed parent corporation should also have been named as a real party in interest, institution was denied. And, because this happened more than a year after the named petitioner had been sued for infringement, there was no way to re-file the petition. (E.g., Zoll v Philips, IPR2013-00607, -00609; Zerto v EMC, IPR2014-01329)

          In these cases where it is likely that the unnamed real party in interest would agree to be named as a party (and there is no one-year bar for that unnamed party), this is just a trap for petitioners. There ought to be some mechanism under which non-defendant real parties in interest could be added so you don’t lose your filing date. There wouldn’t be any prejudice to the patent owner, since, if anything, there would be more entities subject to the estoppel that arises after a final written decision.

          1. Not sure your view of “no prejudice” is entirely accurate there pilgrim (think deep pockets, think more involved business dealings with possible collateral effects).

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