Oil States and SAS are out

By Jason Rantanen

Oil States Energy Services v. Greene’s Energy Group: Inter partes review does not violate Article III or the 7th Amendment.  Patents are public rights for purposes of this question.  This holding is a self-proclaimed narrow one that “should not be misconstrued as suggesting that patents are not property for the purposes of the Due Process Clause or Takings Clause.” Thomas for the majority; Breyer with a concurring opinion (joined by Ginsburg and Sotomayor), Gorsuch dissenting (joined by Roberts).  Opinion here: Oil States v. Greene’s Energy

SAS Institute v. Iancu: When the USPTO institutes an inter partes review, it must decide the patentability of all of the claims the petitioner challenged, based on the plain text of § 318(a).  Gorsuch for the majority; Ginsburg dissenting (joined by Bryer, Sotomayor, and Kagan); Breyer dissenting (joined by Ginsburg and Sotomayor, and Kagan in part).  Opinion here: SAS v. Iancu

Off to teach Administrative Law, so more to come later.

Update: Prof. Tom Cotter has a longer summary on his Comparative Patent Remedies blog: http://comparativepatentremedies.blogspot.com/2018/04/us-supreme-court-upholds-inter-partes.html

 

 

207 thoughts on “Oil States and SAS are out

  1. 28

    Speaking of the Constitution and public versus private rights issues…

    Is there are Constitutional (public vs. private) law jurisprudence, in the context of a grant of something which is intended to be a property right (private-ish right), where the property right is time limited, for which the “public rights” issues surrounding the grant are time limited? i.e. that the period of revocation or period during which public interests supporting the “public right” give way to actual vestment?

    I’m imagining (because I am not versed in constitutional or public vs private rights law) something like a principle that in such a context the public right surrounding grant must die away for the intended grant to come into fruition?

    Any thoughts?

    1. 28.1

      In the olden days this was generally captured under the view that an inventor’s natural right to their invention, an inchoate right, became a fully legal property right at the time of grant.

      Supreme Court cases (well, take your pick which flavor now) even made mention of this passage at the time of grant and why that event was important to the nature of the property.

      As how this applies to Franchises rather than Property, well, I am pretty sure you can guess and be accurate just as much as anyone else (under the rule of man as opposed to the rule of law).

  2. 27

    So I guess patents are no longer considered Intellectual Property. They are an Intellectual Franchise.

    1. 27.1

      Is there any accident to the word association that comes up most often with the word “franchise” is “McDonalds”…?

    1. 26.1

      You always seem to like Mann, but when it comes to patent law, Mann is way out of his league, with much of his writing unmoored from any real understanding of this particular area of law.

      Of course, given your “Ends justify the Means” logic, as long as anyone parrots what you want to hear, you are going to get all excited.

    2. 26.2

      Two key points support the view that patents are matters of purely “public right.” The first is the notion, illustrated by quotations from earlier cases, that the patent is a “creature of statute law” that “take[s] from the public rights of immense value, and bestow[s] them upon the patentee.”

      If patents are public rights because it “take[s] from the public rights of immense value, and bestow[s] them upon the patentee.”, what is land?

      After all land is not created by any one unlike inventions. If inventions are bestowed by public to owner, then land is definitely bestowed by public to the owner.

      link to en.wikipedia.org
      “The Homestead Acts were several United States federal laws that gave an applicant ownership of land, typically called a “homestead,” at no cost. In all, more than 270 million acres of public land, or nearly 10% of the total area of the U.S., was given away free to 1.6 million homesteaders;….”

      So do we have any private property rights left with this logic?

      1. 26.2.1

        Two key points support the view that patents are matters of purely “public right.”

        Er, the Court did not say that “patents are matters of purely ‘public right.'” That is your own mischaracterization of the opinion. The Court said that grant of a patent is a matter of public rights.

        People really need to get past this bifurcative thinking on this subject. It is not an either/or situation. A patent is not purely public or private. It has aspects of both public and private rights. If you do not understand this insight from Oil States, then you really do not understand patents.

        If patents are public rights because it “take[s] from the public rights of immense value, and bestow[s] them upon the patentee.”, what is land?… If inventions are bestowed by public to owner, then land is definitely bestowed by public to the owner.

        Er, no. Land never starts by belonging to “the public.” Land starts by belonging to no one. Meanwhile, the Homestead Act did not distribute “public” land. It distributed government land. There is a real difference there. Just try showing up on a military base without authorization and saying “hey, this land belongs to the government and I am a citizen, so I own a joint interest on this property” and see how far that gets you.

        1. 26.2.1.1

          This bifurcation is NEW. And the one swallows all meaningful aspects of the other.

          That you (contimue) to not recognize this is most telling.

          1. 26.2.1.1.1

            Given that nature of the so called “rights” at odds here (BTW real rights do not conflict) as between a public rights at issue surrounding granting and actual property rights (purportedly the aim of the grant)… would some time limit for revocation be appropriate?

            Since the real right (property) is time limited, could not the issues surrounding grant (public rights) also be time limited?

            e.g. a revocation within 3 years would be constitutional but a revocation after 3 would not?

            SCOTUS did not do it this time, but since they like to legislate, who is to stop them from coming up with a time limit: when it comes to granting something which is supposed to be a right which eventually vests, the decision to grant in the public rights realm is time limited in its ability to be reversed.

            Seems insane, but it fits the “logic”, no?

            1. 26.2.1.1.1.1

              I do not think your thesis floats, as you must equate two things that are not equal.

              I do not think that “constitutional” would control what you are trying to do.

              Think (although under a different section of the Constitution, so the analogy only goes so far) of incontestability of Registered Trademarks….

              as to “SCOTUS did not do it this time, but since they like to legislate, who is to stop them

              Some of us refuse to let one branch arise above the Constitution (and so easily disregard the fact that ALL THREE branches are below the Constitution and its checks and balances). Get sleepy with the “oh well, SCOTUS is writing law again” – in areas that the Constitution explicitly provides for a different branch, and soon enough you have the Court believing that they are Supreme – even Above the Constitution.

              By the way, I do believe that such was one of James Madison’s greatest fears…

              1. 26.2.1.1.1.1.1

                I see that I have had a moment of weakness.

                All I can muster up for now is a distant analogy of the most opaque and elliptical kind.

                Breaking a specific principle through inadvertence or mistake is one thing, however, a breach of integrity; the conscious act of breaking with The Principle of Being Principled, is another matter altogether.

                1. Ah, but not everyone shares that belief in The Principle of Being Principled.

                  “Men judge generally more by the eye than by the hand, for everyone can see and few can feel. Every one sees what you appear to be, few really know what you are.”

                  As I have often lamented, the Ends do not justify the Means – especially in Law (The Principle of Being Principled behind why we have law).

                  Most all of what I “fight” on these boards IS that lack of The Principle because the shortsightedness of “sight” is felt to be more important than the “what you are.”

  3. 25

    Bottom line:

    EITHER patents are not property (no matter the feeble dicta from Thomas),

    OR Congress created (hiding an elephant in a mousehole) a NEW and separate right from that which most normal and learned patent attorneys understand as the patent right.

    In the first case, one may see the Thomas attempt akin to Hans Brinker attempting to stop an unstoppable wave of necessary ramifications if indeed patents are not property.

    In the second case, one may still have property (of a sort), but the Congress in-artfully created a new (parallel?) right that in all essence swallows up anything meaningful remaining of the property right.

    In the second case, what we have is basically the ability to nullify ANY natural right (life, liberty, property – you know – the fundamental drivers of the great American experiment). All Congress has to do is create a “shadow” right – a public one – and that public one is a “right of challenge,” and since such fully fits into a “franchise” or “public” or however you want to label it, some administrative state could be created to SOLELY adjudicate the parallel, (shadow), “public” version while “technically” leaving the traditional Article III matter standing on its own and leave that shell to the courts.

    In this manner, the Court here has actually contributed to a path of removing the judicial branch from meaningful adjudication of ANYTHING that the (bought) branch of Congress or the pure-political branch of the Executive may desire (and yes, Anon2, I also find this action to be ultimately puzzling for the Left Liberal philosophies).

    1. 25.1

      This is complete gibberish and you (along with your fellow glibertarian nertcases) are the last people on earth to opine about what “normal and learned patent attorneys” understand about anything.

  4. 24

    Imagine the following pre-AIA scenario:

    Magni Corp and Lesti Corp both invent essentially the same radio transmitter. Each is operating independently of the other. Neither knows that the other has invented this radio transmitter. Magni files on 2 May 1954 and Lesti files on 4 May 1954. Lesti launches the product on the market on 2 Aug 1955 and Magni—caught by surprise—quickly launches its competing product a few weeks later on 18 Aug 1955.

    Meanwhile despite the fact that Lesti filed after Magni, Lesti’s examiner is quicker off the ball, and by 2 Nov 1955 Lesti has its patent, while Magni is still waiting for its first office action. Lesti asserts its patent against Magni. Magni defends—unsuccessfully—on the grounds that Lesti’s claims are anticipated by a publication from one of Magni’s own employees. The court ends up concluding that Lesti’s patent is valid and infringed, and issues an injunction ordering Magni off the market.

    Meanwhile, Magni’s patent prosecution attorney (who was not in communication with Magni’s litigation attorney) copies Lesti’s claims into Magni’s pending application, and an interference is declared. The result is that all of Lesti’s claims are held invalid by the BPAI under §102(g)(1).

    Notice what has happened here. An Art. III court has sustained the validity of Lesti’s claims against a §102 challenge, and an Art. I tribunal (the BPAI) has subsequently come along and invalidated them under §102. In other words, the exact same phenomenon that is supposedly the seventh sign of the apocalypse of the U.S. patent system—viz., the ability of an Art. I tribunal to tank claims even after they were sustain by an Art. III court—was entirely permissible even pre-AIA. If this state of affairs constitutes the sure and certain destruction of constitutional democratic republicanism, it is odd that our constitutional democratic republic has persisted so long in the face of such strong poison.

    Could it be, perhaps, that the critics of yesterday’s decision are overstating its significance just a mite?

    1. 24.1

      Find an actual case where that scenario happened. Because under the old code, an interference proceeding would start anew after BOPAI was finished – rendering BOPAI opinion basically advisory. Once in trial court, with the full due process rights of witnesses and cross-examination, that court would have to power to apply res judicata and law of the case, etc. to resolve the issues between the parties. Just like any other scenario wherein two Art III courts need to resolve overlapping subject matter and claims. So your scenario is only part of the story concerning how interferences played out under the old code – and therefore, misleading and incorrect.

  5. 23

    I really don’t understand the majority’s discussion regarding McCormick. McCormick appears to me as clearly holding that the only forum available to invalidate a patent is a district court (absent consent of the patent owner). How could the following language be anything other than a holding regarding separation of powers: “to attempt to cancel a patent upon an application for reissue when the first patent is considered invalid by the examiner . . . would be in fact an invasion of the judicial branch of the government by the executive.”

    See below for the full quote from McCormick

    “Had the original patent been procured by fraud or deception, it would have been the duty of the Commissioner of Patents to have had the matter referred to the Attorney General with the recommendation that a suit be instituted to cancel the patent; but to attempt to cancel a patent upon an application for reissue when the first patent is considered invalid by the examiner would be to deprive the applicant of his property without due process of law, and would be in fact an invasion of the judicial branch of the government by the executive.”

    1. 23.1

      I agree that the better reading of McCormick is that it was speaking of a constitutional difficulty, rather than merely describing a statutory reality. However, McCormick is not 100% clear on this point, and the Court here exploited that slight unclarity. Two points, in this regard: (1) the Court is not actually bound by its own precedents, even when they are 100% clear; and (2) this is hardly the first time that the Court has used a slight unclarity in its prior precedents to totally upend the real significance of the previous precedent. Funk Bros., for example, was decided on the basis of “invention,” which has historically meant “obviousness,” and yet both Chakrabarty and Myriad have styled Funk Bros. as a sort of subject-matter eligibility case. I agree that this sort of squirrliness is regrettable and unsettling, but it is rather par for the course with this Court.

      Reason 1,000,001 why it would be better if the Court were simply stripped of jurisdiction over patent cases.

      1. 23.1.1

        Two points, in this regard: (1) the Court is not actually bound by its own precedents, even when they are 100% clear; and (2) this is hardly the first time that the Court has used a slight unclarity in its prior precedents to totally upend the real significance of the previous precedent.

        Reason 1,000,001 why it would be better if the Court were simply stripped of jurisdiction over patent cases.

    2. 23.2

      Yep. If SCOTUS had intellectual honesty, it would have overturned McCormick explicitly and render the new law of Oil States. Instead it pretends that this administrative power was always there, just waiting to be discovered. Thomas pulled the same trick in Ebay v. MercExchange by not overturning, but actually explicitly upholding Continental Paper Bag, but apparently gutting it’s holding.

      1. 23.2.1

        I forgot Thomas wrote Ebay. I also seem to remember Kennedy’s concurrence better. Wow, with Alice and now Oil States, has any judge done more damage to the patent system in the last dozen years?

        1. 23.2.1.1

          Thomas gave us eBay, Myriad, & Alice, which all both appalling. Kennedy gave us KSR, Festo, & Bilski, which are also appalling. Breyer gave us Mayo, which is, pound-for-pound, perhaps more appalling than any given one of the previously mentioned, but it is only one. For my money, the sum awfulness of Kennedy’s contribution is worse than the other two, but individual milage may vary on this question.

          1. 23.2.1.1.2

            Breyer gave us Mayo, which is, pound-for-pound, perhaps more appalling than any given one of the previously mentioned, but it is only one.

            Go ahead and try to explain why, Greg.

            First show everyone that you even understand the facts of the case. Best of luck to you.

          2. 23.2.1.1.4

            Breyer gave us Mayo, which is, pound-for-pound, perhaps more appalling than any given one of the previously mentioned…

            On further reflection, while I stand by this contention, I do have to say that comparing Mayo with KSR is a hard call on which is the more awful. In the end I go with Mayo, but if others were to say that KSR is worse, I would be hard pressed to gainsay them.

    3. 23.3

      Mike that is a really good points. I also think that the majority opinion citing to Lemley’s UVA paper about the privy counsel was outrageous. (The importance of this is whether it common law in England at the time of the US was formed, because if it was then it should be under Article III.)

      The majority used a paper (with no peer review and no recourse if the author was unethical including just making up facts) as factual proof that the privy counsel continued to canceled patents or was still empowered to cancel patents past 1756. That is just mind bending. They may as well have quoted from a blog post from an anonymous poster.

      And consider that Gorsuch and Roberts both contended that the majority’s position on the privy counsel was wrong.

      Just unbelievable that a law journal paper (basically trash) is used as fact in one of the most important cases in patent law in the last 200 years.

      1. 23.3.1

        I do wish Ned were here. The harshest words I’ve ever seem he write were towards Lemley and his mischaracterization of the Privy Counsel.

      2. 23.3.2

        They may as well have quoted from a blog post from an anonymous poster.

        With all due respect, Night Writer, such a quote would most likely have MORE veracity.

        Just saying.

  6. 22

    Let’s take an objective look at where the Oil States decision leaves us. The total number of unsuccessful judicial attacks since 2013 on the constitutionality of the AIA, especially IPRs, must be at least half a dozen by now? With numerous amicus briefs raising every possible ground for attacking the constitutionality of IPRs, as well as some briefs in the prior Sup. Ct. Cuozzo IPR decision. Not even to mention hundreds of personal opinions in blog comments. The Supreme Court in Oil States has now finally put this issue to rest for good. Not a single Fed. Cir. judge, and now only 2 Sup. Ct. judges, have supported any IPR constitutionality attacks. Legislation and/or sustainable rule changes and/or Fed. Cir. decisions are thus the only realistic ways to change IPRs.
    One can hope that finally we will see more substantive and useful advice in blog comments on how to avoid or deal with IPRs, and how to improve them. That is, far less clogging of blogs with mere personal rants wasting readers time and making enough incorrect judicial predictions to make even weather forecasters look good by comparison. There are valid arguments for improvements and clarifications in IPRs that could be made. In particular, further improvements in the progress already made recently on IPR claim amendments, serial IPRs, the IPR time bar, and joinders.

    1. 22.2

      You are right Paul. We have a pay to play patent system. It is settled. Independent inventors need not apply. Google, Apple, and Elon Musk will supply our domestic innovation. The rest we will import from China.

      1. 22.2.1

        We have a pay to play patent system.

        Because life would be soooooo much better for everyone if patents were handed out like candy to every “independent inventor” who wants one. Then we could all run out and buy patent litigation insurance, or pay a hundred licenses on junk patents every time we use a computer, which would be totally different from “pay to play” because “the right people” would be getting the money they’re entitled to because reasons.

        I gotta say these crocodile tears from the maximalists are getting sweeter by the hour. Keep ’em flowing, folks! The rivers are getting dry here.

      1. 22.3.1

        IWT, this decision is properly decided on Constitutional Law issues, not economics issues, and thus not relevant to comments here. Most of us have never engaged in debates on various blog allegations of IPR economic impact on the economy as a whole [versus just patent litigation and licensing, where an impact is indisputable]. Allegations by economics experts with data support need to be addressed to Congress.

        1. 22.3.1.1

          This is the farthest thing from properly decided under Constitutional law issues – and you of all people who has steadfastly refused to even bother engaging on ANY merits of a Constitutional law discussion are the LAST person qualified to make that type of statement.

          And by LAST, I place you even under Malcolm.

    2. 22.4

      In particular, further improvements in the progress already made recently on IPR claim amendments, serial IPRs, the IPR time bar, and joinders.

      Too true. It would be all to the best if Congress were to make clear: (1) that each petitioner gets one shot per patent; (2) that institution decisions are reviewable for compliance with the one year bar and for identity of privities; and (3) that amendments are to entered as of right when they are presented in the pre-institution patent owner reply.

    3. 22.5

      Well ask the guys in the dock over in the SEC trial court. Currently the issue is pending cert. They are making some of the same arguments, but there the SEC can fine and suspend and bar from the profession actual persons.

      To be denied the advantages of a full adversarial proceeding, is (or at least under our old Constitution) a violation of due process.

    4. 22.6

      IPR’s and 101 problems are irretrievably connected.

      IMO, 101 reform can’t happen until there is procedural reform to resolve “well understood” and “directed to” as matters of law, in the precise mold of claim construction. A process without a result is an absurdity, and the nature of the result must be understood as the core of the subject matter of a process. “Directed To” must be understood to identify PHOSITA- to say definitively in which art or endeavor the invention is located. No reliable 103 or 112 analysis is possible without that 101 inquiry for process patents, and IPR’s can’t do that at all, and Art III is on a purely individual luck of the judicial draw basis under Alice.

      If 101 reform happens, it would almost certainly be enhanced and empowered by allowing 101 decisions in IPR’s. Otherwise it’s all just pre-season play before a 101 challenge in a district court should you eventually lose with the PTAB and CAFC. Art. III buys another several years-all the way back to the CAFC on the 101, if subject matter is kept out of IPR’s.

      If IPR’s do evolve to faster, cleaner, and fair dispute resolution tools v. random district courts, that’s probably a good thing for everyone.

      They can’t get there until the courts or Congress cure the subject matter and obviousness/written description ills that bedevil Art. III courts just as well.

      So a statutory change or 101 case at the Supreme Court (which they seem to be conspicuously avoiding by not conferencing on any 101 petitions) will be needed to really fix the problem with IPR’s , and those changes more than likely wont address the ground truth: Information inventions are the locus of almost all of the problems.

      Information inventions are where the art in question may be information processing as information processing, or where the art is really applying information processing to the art or endeavor being modeled, simulated, or transacted – from stock trading to cartoon animation.

      Is our PHOSITA an animator or a computer programmer? Is it an animator with a computer programmer at their disposal or is it an expert in User Interface and algorithmic programming? Is it the juror off the street?

      Certain kinds of information are amenable to those inquires, but certain kinds are not. My thoughts on that question here:

      link to papers.ssrn.com

      1. 22.7.1

        The cheerleader is just pulling one of those “Oh, just s h u t up now” snide shots from the sidelines.

      2. 22.7.2

        NW, yes I understand the desire to complain about IPRs, even though it wastes a lot of blog-reader time. But what bugs me is mere unsupported unrealistic personal wishes being presented to the lay public as if it were legal reality, when it is not, instead of any realistic constructive suggestions.

        1. 22.7.2.1

          What “bugs you more” is of ZERO import.

          As to the rest of your spin, there has been plenty of support and realistic legal points and counter points presented – to which you have “valiantly” refused to ever actually engage on the merits.

          I also notice that you remain steadfastly silent on the academics who peddle things that truly are unsupported and unrealistic personal wishes, but with the wool pulled over the eyes have become “legal reality.” – which is a FAR MORE pernicious problem and something that SHOULD set even you off.

          As I posted previously – I place you lower than Malcolm in regards to the topic here.

          (and yes, that should sting more than just a little)

  7. 21

    The argument of the two Oil States dissenters is interesting in that if it had been adopted it would have rendered unconstitutional, without any qualifications, any and all non-consentual PTO proceedings involving any issued patents! That is, not just IPRs, but all reexaminations, all AIA post-grant proceedings, and most interferences and derivation proceedings. [The vast majority of interferences seek cancellation of issued patent claims, although these Justices may well not be aware of that.]

    1. 21.1

      That was Ned’s (eventual) position as well, no?

      Reading the Constitution broadly, beyond it’s plan language, as a sort of suicide pact or a straitjacket against reasonableness. I’ll never understand it.

    2. 21.2

      You say that as if that would have been a bad thing….

      It would not have been a bad thing.

      We see which side of the fence that you are on Paul – and it is not the pro-innovator side.

      1. 21.2.1

        We see which side of the fence that you are on Paul – and it is not the pro-innovator side.

        Remember, folks: this is from the same guy who whines endlessly about “one-bucketing”.

        But he’s a very serious person! Totally not a transparent hypocrite who talks out of both sides of his mouth.

    3. 21.3

      Right about ex parte but wrong about interferences and derivation proceedings. That was settled law 100 years ago.

      1. 21.3.1

        Not really. Yes, it was settled in the sense that everyone agreed that interferences are fine. There is no principled difference between interferences and IPRs, however, except that everyone took their patents subject to the expectation of interferences, whereas only a comparative handful of present-day patentees took subject to the expectation of IPRs. The idea that interferences are constitutionally supportable in principle, that but IPRs are not (retroactivity considerations aside) is pure special pleading.

          1. 21.3.1.1.1

            Your response at 24.1 above is fine and fair as far as it goes, and I will cheerfully give you that one. I cannot cite a case that mirrors my hypo. I confess that it is merely a hypo of my own contrivance, although I still have not seen reason to believe that my hypo was a legal impossibility under the old law.

            If, however, you are to assert in 21.3 that Paul is “wrong about interferences and derivation proceedings. That was settled law 100 years ago,” then you need to swallow your own medicine and cite a case. As I have already mentioned yesterday at 10:46 pm, res judicata and collateral estoppel cannot have reached as far as you seem to suppose, lestwise Graham could not have gotten to the SCotUS on a record in which the patent was sustained in the Fifth Circuit and tanked in the Eighth. If you are going to argue that res judicata might not stop one Art. III court from reaching a different conclusion than another Art. III court, but that it would have stopped an Art. I tribunal from coming to a different conclusion than an Art. III court, you need to cite some authority for that proposition.

    4. 21.4

      That’s the point Ned was making – on slamming counsel for Oil States screwing up the case law and logic of the arguments. He believed – which turns out to be true – a fatal concession was the position that ex parte is ok. In my view, ex parte reexamination WAS sound under the original code wherein 35 USC 145 provided a right to de novo trial in a court of record. Therefore it was a court revoking the patent and therefore squares with holding of McCormick. Under the new code, 35 USC 145 is gone, and therefore ex parte reexamination is just as infirm as IPR’s and for the same reasoning.

  8. 20

    First they came for the patents that were not filed first, and I did not speak out, because I had a patent attorney.
    Then they came for the patents with no trespass signs, and I did not speak out, because I had licenses.
    Then they came for the patents based on abstract ideas, and I did not speak out, because I had better claims.
    Then they came for my patent, and there was no judge left to speak for me.
    I am the american inventor of the 21st century, stripped of my only property.

    1. 20.1

      But you still have your government franchise (good until some politically connected entity wants to strip it from you).

  9. 19

    Article I, Section 8, clause 8 of the Constitution gives Congress the power to secure for inventors the exclusive right to their “discoveries,” and clause 18 gives Congress the power to “make all Laws which shall be necessary and proper” for executing the foregoing power.

    Oil States did not challenge the AIA under those provisions.

    Instead, Oil States raised a fatally doomed property rights challenge under Article III which was wagged by the tail of the Seventh Amendment. It was a non-starter because all property rights are limited in nature and property rights to patents are limited by Congress. Even Justice Thomas understands this very simple, dispositive issue:

    “The Patent Act provides that, “[s]ubject to the provisions of this title, patents shall have the attributes of personal property.” 35 U. S. C. §261. This provision qualifies any property rights that a patent owner has in an issued patent, subjecting them to the express provisions of the Patent Act. See eBay Inc. v. MercExchange, L. L. C., 547 U. S. 388, 392 (2006). Those provisions include inter partes review. See §§311–319.”

    A more interesting challenge would be whether Congress has made “all Laws necessary and proper” to secure the exclusive right to inventors.

    1. 19.1

      property rights to patents are limited by Congress.

      Therein lies the legal error – once a property right is created, even Congress must abide by the OTHER Constitutional protections that kick in to protect property.

      The right questions were not asked here.

      Thus the wrong results have been achieved.

    2. 19.2

      A more interesting challenge would be whether Congress has made “all Laws necessary and proper” to secure the exclusive right to inventors.

      LOL

      I’m sure I’m not the only one who can hear the bottom of the barrel being scraped. And I’m watching a Led Zeppelin video.

    3. 19.3

      Great go for it. Looking forward to your necessary and proper arguments. Hint: See my Hayburn’s arguments below for a better line of attack.

  10. 18

    For those still arguing the old McCormick Harvesting case, note that it was disposed by the Court just as previously predicted here:
    “..McCormick Harvesting Machine Co., supra, at 609; accord, American Bell Telephone Co., 128 U. S., at 364. But those cases were decided under the Patent Act of 1870. See id., at 371; McCormick Harvesting Machine Co., supra, at 611. That version of the Patent Act did not include any provision for post-issuance administrative review. Those precedents, then, are best read as a description
    of the statutory scheme that existed at that time. They do not resolve Congress’ authority under the Constitution to establish a different scheme.”

    1. 18.1

      See above concerning property right protections that even Congress is not free to disregard.

      By not asking the right questions, the wrong result has been obtained.

  11. 17

    In view of speculation below that the Oil States decision might differ for a pre-AIA patent, note that this decision is ON a pre-AIA patent. The opinion itself states: “In 2001, Oil States obtained a patent… ” [The subject patent]

    1. 17.1

      Sure, but as Justice Thomas wrote (slip op. at 16–17) “[W]e address only the precise constitutional challenges that Oil States raised here. Oil States does not challenge the retroactive application of inter partes review… .” In other words, even though the patent at issue here was a pre-AIA patent, that is not an issue decided here. It is not a violation of stare decisis to ignore distinctions that—while implicitly present in a previous case—are not argued in a previous case, and thus not truly part of the holding.

      1. 17.1.1

        Greg, a counter-argument is that as the decision states: “Patent claims are granted subject to the qualification that the PTO has “the authority
        to reexamine—and perhaps cancel—a patent claim..” That has been true, and known to applicants, from the time of the first reexamination statute, not just from the date of IPRs and other AIA proceedings, as well as interferences.

        Also, lets face it, as a practical matter, it is highly unlikely for the Sup. Ct. to take up yet another cert challenge to IPR constitutionality so soon after finally deciding this one.

    2. 17.2

      “Oil States does not challenge the retroactive application of inter partes review, even though that procedure was not in place when its patent issued.”

  12. 16

    From the holding: That inter partes review occurs after the patent has issued does not make a difference here. Patents remain “subject to [the Board’s] authority” to cancel outside of an Article III court, …and this Court has recognized that franchises can be qualified in this manner…

    Elswhere: Patent claims are granted subject to the qualification that the PTO has “the authority to reexamine — and perhaps cancel — a patent claim” in an inter partes review.

    …one of the precedents cited by Oil States acknowledges that the patentee’s rights are “derived altogether” from statutes, “are to be regulated and measured by these laws, and cannot go beyond them.

    precedents [to the contrary] are best read as a description of the statutory scheme that existed at that time. They do not resolve Congress’ authority under the Constitution to establish a different scheme

    modern invention patents under the current Patent Act … gives the PTO continuing authority to review and potentially cancel patents after they are issued.

    Because Congress gets to say what a “patent” is, how long it lasts, how it can be revoked and invalidated, etc, and the only limit on that definition is the Constitution. Under the Constitution, Congress doesn’t even have to implement ANY patent system at all if it chooses not to.

    Two immensely chuckle-worthy observations: (1) the phrase “bundle of sticks” appears nowhere in the majority, concurring or dissenting opinions; (2) Gorsuch (!!!!) seriously tries to invoke the concept of an “independent” (LOL) “judiciary”. Stolen Seat Neil! LOLOLOLOL

  13. 15

    Looks like SAS split down the ideological divide.

    Quite a decision in Oil States. And despite MM claiming to have totally predicted it I do not recall his having given the specific grounds that the court came up with to justify holding the way it did. But, they held that way so that’s that.

    1. 15.1

      6,

      Can you elucidate what exactly you think it is that the Court used as their “specific grounds.”….?

      I am curious as to seeing these “grounds” in black and white, for a number of reasons.

      One, to compare to the “grounds” of what is understood by property.

      Two, over at another blog, there was a discussion between Anon and Ned Heller in which that Anon postulated that the Court might “create” a new wrinkle outside of what patents as property was known to mean, and that THAT new wrinkle was a new (and different) public right separate from the (traditionally understood) patent right.

      Sounds as if THAT was the “winning” logic here…

      (caveat: I still have not bothered with reading the Oil States decision – I will let myself cool down and approach it with some objectivity)

      1. 15.1.1

        a new (and different) public right

        “Public rights” were never clearly defined, they are whatever the Supreme Court says they are, and the nature of patents (as statutorily defined) and their validity was such that it was easy to imagine why they would be deemed to have a significant “public” component.

        That was one of my first observations when this ridiculous “controversy” was cooked up.

        1. 15.1.1.1

          Except not – leastwise in ANY cogent manner.

          You really should wait until the conversation between Anon and Ned is displayed before you attempt to take credit for something that you had absolutely ZERO part in.

      2. 15.1.2

        It’s a bald declaration that patents are public rights. Everything else is dicta, and pretty misleading circular dicta at that.

      3. 15.1.3

        I didn’t read it the whole way through. Busy today, and also Ned just died so I’ll probably not bother with it for awhile.

        1. 15.1.3.1

          fair enough – look forward to it when you have a chance to give it a decent think through.

    2. 15.2

      I do not recall his having given the specific grounds that the court came up with to justify holding the way it did.

      Well get your memory checked because I explained why patents were public rights, I explained why that court of chancery baloney was baloney, and I explained how Congress defined patents statutorily as qualified rights that were subject to agency revocation upon a showing of invalidity and due process. I did that about fifty times probably before I got bored as heck.

      1. 15.2.1

        I’m in a swing state and used to vote for Democratic presidential candidates. Thanks for reminding me that I need to vote for Republican presidential candidates in the future to put more justices like Gorsuch on the Supreme Court.

        1. 15.2.1.1

          I need to vote for Republican presidential candidates in the future to put more justices like Gorsuch on the Supreme Court.

          LOL Yummy rich white men with brains stuck in the 18th century.

          You can never get enough of those. The best people ever.

          1. 15.2.1.1.1

            Nope, you can’t get enough of those! Especially when Kennedy and/or Ginsburg die and/or retire and more conservative justices are added to Supreme Court to extend the conservative dominance of the Supreme Court decades into the future.

            Hope you enjoy seeing legislation passed by a Democratic President and/or Congress being shredded at the Supreme Court.

            And once again, I need to thank you for reminding me I need to vote Republican for President to make sure this happens!

            1. 15.2.1.1.1.1

              Hope you enjoy seeing legislation passed by a Democratic President and/or Congress being shredded at the Supreme Court… I need to vote Republican for President to make sure this happens!

              Of course, if you prefer to see Democratic legislation “shredded,” then you should vote Republican. That is, after all, how the system works—if you do not like one party’s legislative priorities, then you vote for another party.

              One is rather hard pressed, however, to square this with the assertion in 15.2.1 that you “used to vote for Democratic… candidates.” I am inclined to think that you are not being straight with us here.

              1. 15.2.1.1.1.1.1

                Greg,

                With what the damage the US Supreme Court, the Obama administration and the AIA have done to the U.S. Patent System, I have been forced into the corner where I have now become a “one issue voter” and that issue is: protect inventors in the U.S. patent system. I no longer feel I have the luxury to care about candidates’ stances on social issues, for example.

                With respect to Congress, there have been pro-patent and anti-patent candidates on both sides of the aisle, but with respect to a presidential candidate, I do not want to vote for a President who will appoint anti-patent clowns such as Ginsberg, Sontomayor, Kagan and Breyer to the Supreme Court.

            2. 15.2.1.1.1.2

              “And once again, I need to thank you for reminding me I need to vote Republican for President to make sure this happens!”

              MM really doesn’t understand that he literally does his party a disservice whenever he opens his mouth.

                1. Never said that the AIA was not enacted by a large bi-partisan vote. Still doesn’t make it a good law.

          2. 15.2.1.1.2

            “LOL Yummy rich white men with brains stuck in the 18th century.”

            Said MM while 3 of the current justices ID as Jewish (remember 2% of the overall population). Right now by my count we have a self-IDed justice count of 4 evil white cis hetero christian capitalist males, 2 brave jewish cis hetero jewish capitalist females, 1 brave jewish cis hetero jewish capitalist male, 1 noble african american cis hetero christian capitalist male, and 1 wise latina cis hetero christian capitalist female.

            Remember Mr. Rational, if you don’t want to be ruled by the 2% or other minorities then you’re a RA CIST. Remember that bigot. They’re all the same as you! And me! And MM! And everyone else! We’re all the same! Except for those of us who are diverse and they’re more the same than others!

            But diversity on the USSC talk is not what’s big right now. Apparently the incel rebellion has commenced. I told MM about this problem getting worse and worse and now people are dead.

            link to youtube.com

      2. 15.2.2

        ..and I showed you why “due process” was NOT in fact met for ALL of what you showed.

        All that you have here is a broken scoreboard. That is not a shattered backboard (your dreams notwithstanding).

  14. 14

    Tom Cotter:

    The bottom line is that patents are “public rights,” a “public franchise,” and thus the federal government may entrust the adjudication of these rights to a non-article III tribunal:

    Inter partes review falls squarely within the public-rights doctrine. This Court has recognized, and the parties do not dispute, that the decision to grant a patent is a matter involving public rights—specifically, the grant of a public franchise. Inter partes review is simply a reconsideration of that grant, and Congress has permissibly reserved the PTO’s authority to conduct that reconsideration. Thus, the PTO can do so without violating Article III (pp. 6-7).

  15. 13

    Anyone else catch these interesting lines from the SAS opinion?

    “Cuozzo concluded that §314(d) precludes judicial review only of the Director’s “initial determination” under §314(a) that “there is a ‘reasonable likelihood’ that the claims are unpatentable on the grounds asserted” and review is therefore justified. Id., at ___ (slip op., at 9).”

    “SAS does not seek to challenge the Director’s conclusion that it showed a “reasonable likelihood” of success sufficient to warrant “institut[ing] an inter partes review.” 35 U. S. C. §§314(a), (d).”

    To me, these lines are significant. The Court appears to limit the Cuozzo holding to only precluding review of whether “there is a ‘reasonable likelihood’ that the claims are unpatentable on the grounds asserted.”

    1. 13.1

      Was there any other possible conclusion based on the wording of the Statute and the reasoning of the Supreme court decision?

      1. 13.1.1

        Yes, time bar estoppel, assignor estoppel. All of which have nothing to do whether there is a reasonable likleihood that a claim is unpatentable.

        1. 13.1.1.1

          Yes, now I see. Interesting.

          So, the indication is, not simply ANY purported determination to institute is nonappealable.

          So is it, [THE determination by the Director (whether to institute an inter partes review) UNDER the section] is non-appealable.

          or is

          [THE determination by the Director (whether to institute an inter partes review UNDER the section)] is non-appealable.

          Hmmm

        2. 13.1.1.2

          Sorry my other post had misplaced brackets:

          Yes, now I see. Interesting.

          So, the indication is, not simply ANY purported determination to institute is nonappealable.

          So is it:

          A. [THE determination by the Director whether to institute (an inter partes review) UNDER the section] is non-appealable.

          or is it

          B. [THE determination by the Director WHETHER to institute (an inter partes review under the section)] is non-appealable.

          Hmmm

    2. 13.2

      Indeed. I noticed that too. Very encouraging, in my opinion. Much mischief has been done by the CAFC’s overly aggressive reading of §314(d).

  16. 12

    Excellent result in Oil States. Congrats to Justice Thomas. It’s a bit unexpected, I must admit, to see Thomas building a little legacy out of his patent law opinions.

    1. 12.1

      The Patent Act provides that, “[s]ubject to the provisions of this title, patents shall have the attributes of personal property.” 35 U. S. C. §261. This provision qualifies any property rights that a patent owner has in an issued patent, subjecting them to the express provisions of the Patent Act. See eBay Inc. v. MercExchange, L.L.C., 547 U. S. 388, 392 (2006). Those provisions include inter partes review. See §§ 311–319 (p.11).

      It’s not the scoreboard that’s broken, “anon.” What you just saw is the backboard shattering into a zillion pieces because of my incredible slam dunk.

  17. 11

    Thank you for playing, maximalists.

    Nobody could have predicted any of this, after all.

    You actually just dodged a bullet but you’re all too naive, blinkered and self-absorbed to understand that.

    Now please return to getting Congress to expand 101 to include methods of thinking about a correlation while you do something else “not in the human mind”. LOL

    1. 11.1

      You actually just dodged a bullet but you’re all too naive, blinkered and self-absorbed to understand that.

      Oh, do please explain that (in something complete and cogent – not your usual empty threat of “if not this then something worse.”

  18. 10

    It would appear that the onus of protecting individual patent rights now falls on Iancu, since Congress, SCOTUS, and everyone else are not prepared to do so (or are acting against it).

    Now that they have punted the job to Iancu, the protection of individual rights now fall squarely on his shoulders.

    I can only hope that to the extent he is able to do so within his authority and the current law of the land, that he makes up for the clear lack of regard for this important right shown by the other government bodies. That he can serve as their champion, in the spirit of the best principles of freedom and individual rights upon which the US was founded.

    1. 10.1

      “It would appear that the onus of protecting individual patent rights now falls on Iancu, since Congress, SCOTUS, and everyone else are not prepared to do so (or are acting against it).”

      Don’t forget Trumpadumpdeedump!

      1. 10.1.1

        “Don’t forget Trumpadumpdeedump!”

        Ooops, yeah I guess I forgot…
        maybe we could also count on the White H…

        what was I saying?
        Hmmm forgot again.

  19. 9

    Now that I have finally worked my way through Justice Gorsuch’s less-than-admirably prose style, I have to say that I admire the outcome in SAS as well. The statute is clear enough, and they apply the statute as written. I am especially heartened to see that the Court was not overawed by the “unreviewable” clause of §314(d). The early CAFC jurisprudence did much mischief by over-reading that clause, and Cuozzo did not altogether put an end to that tendency to over-reading. It is good to see the Court using this case to pare back what is and is not really “unreviewable.”

  20. 8

    Regarding SAS, does anyone have any thoughts on whether the PTO has to proceed on all grounds too? Or just one ground per claim? It doesn’t seem to take the issue on directly but the way it’s written is suggestive.

  21. 7

    So is the Due Process remark together with the narrow holding regarding retroactive application a signal that pre-AIA patents may have a positive audience at the SCt?

      1. 7.1.1

        If so, it seems the marking point should be whether the patent application was filed (or at least published) before the AIA was enacted since that is when the inventor made the quid pro quo of exchanging disclosure of the invention for the patent right. And I would not assume that the Supreme Court would grant certiorari again, but is instead leaving space for the Federal Circuit to rule as much. And I would not assume the Federal Circuit would automatically rule as much, unless the different outcome under the AIA is the result of a change in the substantive standard of patentability rather than availability of an IPR. Keep in mind the majority ruled that IPR is just a correction of the examination process.

          1. 7.1.1.1.1

            What does “issued” even mean now?

            Since pre-grant and post-grant have no “effective” meaning and all…

            1. 7.1.1.1.1.1

              What does “issued” even mean now?

              You can start the damages clock and start sueing people.

              In court, the challenger has the burden of proving invalidity.

              Same as it ever was.

              1. 7.1.1.1.1.1.1

                If you cannot see the green light for this type of stuff never even making it to court, you are slower than I thought (and that was glacial).

          2. 7.1.1.1.2

            Why when issued? It can no longer be argued that a patent application becomes property when it issues as a patent. All you have now is a “public right” granted by the benevolence of the government.

            1. 7.1.1.1.2.1

              It’s a different issue than the public/private debate.

              Where did the Court say a patent owner no longer owns their patent?

    1. 7.2

      Retroactive meaning what exactly? That a patent WAS a private right which could only be revoked by an independent judiciary before Oil States, but NOW a patent is a public right which therefore can be administered by PTAB like administrative proceedings? Would appear to me that it a patent is a public right, that would be a retroactive holding.

      1. 7.2.1

        Retroactive meaning that you took your patent with certain settled expectations about how it might be challenged, and then found yourself suddenly in a world in which it was subject to additional mechanisms of challenge. It is a lot more fair to say that AIA patents are subject to IPR than to say that all patents (pre- and post-AIA) are subject to IPR challenge.

        1. 7.2.1.1

          Greg: Retroactive meaning that you took your patent with certain settled expectations about how it might be challenged, and then found yourself suddenly in a world in which it was subject to additional mechanisms of challenge. It is a lot more fair to say that AIA patents are subject to IPR than to say that all patents (pre- and post-AIA) are subject to IPR challenge.

          From the get-go this was always the most viable line of attack (although any victory would be necessarily relatively narrow). The issue boils down to whether these alleged “additional mechanisms of challenge” provided more or less “protection” for the patentee relative to the then-existing mechanisms of challenge (e.g., inter partes re-exams). Bear in mind that the issue is ultimately for an Article III court (the CAFC) to weigh in on. The “end of the road”, as it were, is indistinguisable.

        2. 7.2.1.2

          I would have agreed before Oil States holding patent fall under the public rights doctrine. Under a public rights doctrine, the right is to be regulated by a statutory and administrative scheme the quid pro quo is to submit to the regulatory scheme, not to obtain a property right that is accorded the traditional protection codified by the Constitution.

      2. 7.2.2

        It’s a taking issue vs. a jury issue is the indication I’m seeing.

        Today the Court said an Article I review is ok in these circumstances. However, applying these changes to already issued patents could be considered a taking. For post-AIA patents, you the grant was conditioned on the AIA review.

        I’m not trying to argue the merits, just trying to understand the signals some on the Court may be sending.

        Why else does Thomas make such a statement?

        1. 7.2.2.2

          My take is that the “private right” applies to the “provisional right” of the patent. The “provisional right” is the patent grant subject to the patent being valid. It is provisional since the patent is always subject to validity. You can assign/transfer the “provisional right” to others as a private property right, and the transferee becomes the owner of this “provisional right”.

          1. 7.2.2.2.1

            Greenacre- your logic does not hold as that provisional right disappeared at grant and what we have here is a post-grant disappearance.

            The power allocated by the Constitution was to “secure” rights – and this decision makes it literally impossible for granted patent rights to be secure.

            With the caveat that I have not absorbed this decision, the “dance” of “still-property-but-somehow-also-public-right” should please no one.

            No one, that is, that understands the law, understands what property means, understands what “to secure” property means, and no one that recognizes that a strong patent system was what was originally desired by the set up and distribution of powers to the various branches to run a patent system.

            This is literally the worst of all worlds.

            1. 7.2.2.2.1.1

              that provisional right disappeared at grant

              Per Congress’s description of the patent right, your statement is absolutely incorrect.

              The patent “grant” is indeed a “provisional right”: it is revokable upon agency review.

              My goodness let it go already. This was a done deal ages ago.

              1. 7.2.2.2.1.1.1

                You completely missed the point of Greenacre’s post and my reply.

                Pay attention – these legal terms have actual meaning beyond your crowing.

                1. ..and how does that square with the “secure” necessary for the Constitutional power to even begin to apply?

                  Sorry, g, that just does not wash.

                2. how does that square with the “secure”

                  Perfectly.

                  What’s the problem?

                  You’ve secured a qualified right.

                  What’s the problem? Framers were “absolutely opposed” to such a thing and they made that “crystal clear” in their Constitution? Give us a break already. The only thing the Framers were clear about is that blacks were subhuman.

                3. Replying to the 2:46 post below.
                  Secure is a continuing scale. It means more than 0%, but it does not guarantee 100%. Patents only come with a presumption of validity.

                4. Secure is a continuing scale.

                  Balderdash – I can guarantee you that the LEGAL meaning of securing is NOT the “continued scale” that is the result here.

                  Your “take it what I give you and be thankful for it” attitude does NOT match the legal framework from which the patent system was built and for which property rights were designated in the Quid Pro Quo.

        2. 7.2.2.3

          The ‘takings issue’ concerning a patent right is the basis of jurisdiction to sue the United States government in the Court of Claims for infringement wherein it has waived some of its sovereign rights by statute. The declaration today in Oil States that a patent falls under the public rights exception means there can be NO TAKING by the administrating agency doing it’s, you know administrating, subject to it’s statutory scheme. The declaration of the public rights exception would be retroactive IMHO, there is no reason to think otherwise, once you lose the mooring of a patent is not covered by the public rights exception, the regulatory scheme is paramount and retroactive. Just like a new law concerning an FCC spectrum license would govern old grants.

        3. 7.2.2.4

          The holding of Oil States is that a patent falls under the public rights doctrine meaning that the statutory scheme of the regulating agency is paramount. You: ” Why else does Thomas make such a statement?” Me: Who cares? It’s just dicta, and pretty misleading at that. No one is going to be prevailing on any novel hybrid theory that sometimes a patent is a private right not falling under the public rights exception. And I doubt Congress will act to restore the US Patent right, until the entire system is burned to the ground. On the bright side, I hear PTAB now has a 92% kill rate. Name another federal agency that invalidates 92% of it’s challenged work product?

          1. 7.2.2.4.1

            until the entire system is burned to the ground.

            Nobody could have predicted that Chicken Little would show up. Look! He’s still wearing that dirty “Stop KSR!” T-shirt.

  22. 6

    What a disgrace. The day the music died. The Thomas opinion just skips over Hayburn’s case and the dual jurisdiction issues embedded therein. Making the bald declaration that a patent is a public right, however, would appear to resolve the issue if Congress just finished the job and strips the Courts of all jurisdiction over any patent. Then it would at least comport with Hayburn’s case. Congress should just get it done and give PTAB jurisdiction over infringement, money damages and injunctions too. At least the public would know where it stands, hire K Street to adjudicate your patent, it will be a great boon to former PTO Officers and PTAB members to lobby the PTAB.

    1. 6.2

      They said the granting and the revocation of a patent is a public right. They did not say that the patent itself is a public right. I do think the Court was incredibly wrong regarding McCormick. That case was not couched in any form of statutory scheme. Moreover, that case cited to other constitutional cases.

      1. 6.2.1

        They said the granting and the revocation of a patent is a public right. They did not say that the patent itself is a public right.

        Exactly. That is what the Court said, and the Court said this because it is correct. Patents are not public rights, tout court. The validity of a patent is a matter of public right. The enforcement of a patent is a private right, and therefore can only be adjudicated by Art. III courts. Of course, the AIA did not try to place the power to adjudicate infringement in the PTO, so the observation that the Congress cannot place the power to adjudicate infringement with the PTO is neither here nor there for purposes of the case in front of us.

      2. 6.2.2

        Huh? The way I read it the patent grant is a public right. That is the holding of the case. This is like the FCC granting a spectrum license to the high bidder. And since it’s a public right, it can be administered, for example, a statute that can revoke the spectrum license for XXX conduct before some PTAB like body. Where I think this is all wet, is that a patent grant is not a ‘right to do anything’ it is only a right to prevent others from practicing the claimed invention. Ergo, a very different right than a patent to operate a toll bridge, a ‘king’s charter’ for tea or a spectrum license. Of course a grant to operate a toll bridge is a ‘private property’ meaning that someone must be receiving the right and hold the right ergo a ‘private right.’ Care to clarify???

        1. 6.2.2.1

          The way I read it the patent grant is a public right.

          Correct. Slip op. at 7: “the decision to grant a patent is a matter involving public rights…” (emphasis in original). In other words, the patent itself is not a public right. The right to exclude that comes with the grant of a patent is a private right, subject only to private enforcement in Art. III courts. Similarly, the ownership of the patent is a private matter whose determination lies uniquely with the courts. The validity of the grant itself (i.e., not whether a given entity can be excluded from the scope, but rather what is the scope) is a matter of public rights, and therefore susceptible to arbitration in both the courts and the agency.

          1. 6.2.2.1.1

            “the ownership of the patent is a private matter whose determination lies uniquely with the courts.”

            Wouldn’t that mean that the USPTO cannot cancel or revoke a patent for any reason via a USPTO procedure as it would revoke ownership of the patent?

            This is why this case makes little sense to me. The question shouldn’t be whether the USPTO has a right to correct or revoke a patent, rather, the question should be what process should the USPTO be required to perform for such a correction to occur. In my view, the USPTO should be required to file an action at a district court in order to revoke the patent.

            1. 6.2.2.1.1.1

              Wouldn’t that mean that the USPTO cannot cancel or revoke a patent for any reason via a USPTO procedure as it would revoke ownership of the patent?

              No. Changing the scope of a patent’s claims is not the same thing as changing the ownership of the patent. Even if the PTAB invalidates every claim in a patent, the person who owned the patent before IPR still owns it after the IPR. If there is a re-issue to be filed, it is that owner who can file for re-issue.

              The PTAB does not (cannot) in any wise affect the ownership of the patent. That is determined by ordinary contract principles (or testamentary principles), and is adjudicated only by the courts (either the state courts or the Art. III courts).

        2. 6.2.2.2

          You (the Royal You – the Efficient Infringer You) have a public right to what was once considered private property.

          How is that not clear?

          1. 6.2.2.2.1

            As held by the Supreme Court, a patent is a public right AND private property. It is inaccurate to describe an alleged infringer as possessing a public right.

            1. 6.2.2.2.1.1

              Naturally I agree, but as Upton Sinclair wisely observed, “[i]t is difficult to get a man to understand something, when his salary depends upon his not understanding it.”

        3. 6.2.2.3

          The act of granting a patent is a public right. In other words, the process available to inventors for obtaining a patent is a public right. But the patent itself, is private property of the inventor. The patent is thus a private right whereas the process of granting a patent is a public right.

          1. 6.2.2.3.1

            I don’t think you have a complete grasp on the ‘public rights’ exception doctrine. The public rights doctrine is not about a public right per se, like a right to enjoy a sunny day. In a nut shell, if something is declared a ‘public right’ traditionally this was some ‘new’ right created by Congress, such as a welfare right, or a pension right, then that ‘right’ can be governed and regulated by an agency statutory scheme. Like a right to appeal SS benefits to an admin court. Meh, just read the Gorsuch dissent.

            1. 6.2.2.3.1.1

              I don’t think you have a complete grasp on the ‘public rights’ exception doctrine.

              Two responses:

              (1) I do not think that anyone has “a complete grasp on the ‘public rights’ exception.” As Justice Thomas observed, the case law on this doctrine is… messy.

              (2) Nevertheless, today’s opinion really goes a way toward clarifying this doctrine. A lot of confusion stems from a too-bifurcative style of thinking about this question, where something is either a public right, or a private right. There is an unwillingness to think in terms of a category of rights that intersects both categories (“quasi-private” rights, as Justice Thomas has elsewhere styled them) and displays characteristics of each category. However, if once you open your eyes to the existence of this third category, so much about our law (our IP law, to be sure, but also our law more broadly) makes so much more sense.

              1. 6.2.2.3.1.1.1

                Makes far less sense with the new law written by the Judicial Branch.

                No matter how different you want it to be – there is no way this creates clarity.

                None.

                Two options creates one boundary – your “quasi” item creates AT LEAST two boundaries (and those boundaries may overlap!)

          2. 6.2.2.3.2

            Still begs the question:

            You have obtained a granted patent.

            Now – now that the grant process is done – what do you have – is that personal property or a public right?

            (hint: those saying both are NOT being inte11ectually honest).

            Another hint: “to Secure” – this is the source of the Constitutional power. What does this mean given the effective LACK of securing that “post-grant” means something merely the same as “pre-grant”….?

            As I said, some inte11ectual honesty is desperately needed here,

            1. 6.2.2.3.2.1

              “to Secure” – this is the source of the Constitutional power. What does this mean

              You were just told what it means by a solid majority of the Supreme Court who (predictably) agrees with me, not you.

            2. 6.2.2.3.2.2

              An issued patent grants the private right to exclude others from practicing the claims of the patent, including the right to sue for violation of this private right. How does revokability by the PTO (premised on a patent being a public right) change the nature of this private right?

              As for “to secure” in the Constitution, which is a separate issue, you are presuming an agreed definition of this term. An administratively revokable patent is more secure than nothing. Whether an administratively revokable patent meets the Constitutional standard of “secure” is an open question–not a premise.

              1. 6.2.2.3.2.2.1

                “Whether an administratively revokable patent meets the Constitutional standard of “secure” is an open question–not a premise.” Well that was answered today. “Secure” means TPAB can revoke at any time for the full life of the patent – no matter how many TPAB cases, D.Ct trials, jury trial and bench, affirmed appeals, injunctions, money judgments, injunctions etc. affirming the patent came before – comity, ‘full faith and credit’ Res Judicata be damned, there is never ever repose to original title to the patent. Now, it is always ‘by your leave’ tribute to the Kings Court. Better learn to genuflect.

                Thomas, Kennedy and Alito – seriously Alito? Oil States could not get Alito? Ned warned of the crap oral arguments and briefings put forward – Thanks Oil States for screwing up 200 years of patent law. You should have hired Waxman, at least he can make cogent arguments and have explained Hayburn’s case.

                1. [T]here is never ever repose to original title to the patent.

                  Correct. Just as there has never been repose to the title. Even pre-AIA, no matter how many times a challenger failed to invalidate, it was always possible that the next challenger might succeed. It was ever thus. If the patent system has not collapsed yet from this lack of “repose to original title,” I am not clear why we should expect it to do so now.

  23. 5

    Welcome to the Supreme Court writing new law as to what is and what is not property.

    The score board remains broken.

    Those celebrating a broken scoreboard will remain missing the point that the score board remains broken.

    1. 5.1

      I think the majority reasoning basically leaves the average person almost no rights. You go before an agency and they are going to do to you what they want.

      The whole public vs. private right thing is nonsense. The fact is that you cannot have a life without their “public rights” and so you have no “private rights” without your “public rights.” Ergo if you lose your “public rights” you lose your “private rights.”

      1. 5.1.1

        I think the majority reasoning basically leaves the average person almost no rights. You go before an agency and they are going to do to you what they want.

        Surely this overstates the matter, no? For one thing, you have exactly as many rights under this scheme as you would have if the PTO examination process worked correctly (as everyone agrees that it is supposed to do) in the first place. You are, in other words, no worse off than you would be in a world in which things go as they are meant to go.

        Secondly, you quite definitely do have a recourse if the PTAB mis-treats you. You have a right of appeal to the courts. This is really as much of a guarantee of fair treatment under the law as is possible this side of the eschaton. If you find that unsatisfactory, I cannot disagree with you, but in a fallen world one will rarely find perfection.

        1. 5.1.1.1

          >>You are, in other words, no worse off than you would be in a world in which things go as they are meant to go.

          Greg, please. So you just ignore the issue of the independent judiciary? You ignore the issue of harassment with many IPRs being filed. Etc.

          You have a right to an appellant court, which is quite different.

          Gorsuch’s main point was that this was a common law matter and as such you should be entitled to an independent judge.

          1. 5.1.1.1.1

            There is also, of course, the issue that with the fact that the appointment of judges to the PTAB and the assignment of judges to a particular panel is political, because the the USPTO is under the executive branch. And the possibility that a corporation will effectively “buy” the appointment of PTAB judges and the stacking of PTAB panels by contributing $$$ to the President’s party, appears to be more than hypothetical:

            link to ipwatchdog.com

            link to ipwatchdog.com

            1. 5.1.1.1.1.1

              “property” has been turned into a dark mirror of a “public franchise” of which is “free” (well, the opposite of free, really) to be twisted and turned according to the explicit political branch of the executive and the all-but-paid-for political branch of the legislature.

              Any (remaining) shell of property will be just that: a shell.

              Have fun with your “paper copies” – turn them into wall paper or kindling while the real meat of the legal rights are “franchised” to the well-monied established powers that be.

              MOST people who know and appreciate patent law understand exactly why this has been a horrendous decision, and quite easily see through the Efficient Infringer rhetoric.

      2. 5.1.2

        In Hayburn’s case the ‘right’ in question was the right to receive a war pension under the statute. Now that’s a public right if there ever was one. But even there, the Court said they could not adjudicate the matter as judges with the remedy of being placed on the pension roles because maybe even years later, independently, the SOS could remove a name from the pension role if he found ‘mistake.’

        1. 5.1.2.1

          That is a really good point. What meaning does an Article III court have when an administrative agency can just reverse it whenever it wants to.

          1. 5.1.2.1.1

            No administrative agency can “reverse” an Art. III court. Just because the PTAB can pronounce a given claim unpatentable, even after a court has held it valid does not mean that the PTAB is “reversing” the court.

            If I claim “a method of heating a room, the method comprising kindling a fire,” then my claim should rightly fail for anticipation. If, however, you show up in court and challenge my claim by citing the product insert for ibuprofen, then you deserve to lose, because the product insert for ibuprofen does not disclose my invention. If someone else later shows up in front of the PTAB and cites Harry Potter and the Deathly Hallows, they deserve to win, because that printed publication does disclose my invention.

            When the PTAB invalidates my claim—even after the court sustained my claim against your challenge—that is not an instance of the PTAB “reversing” the court. It simply reflects the fact that one challenger carried his burden where another did not.

            1. 5.1.2.1.1.1

              I know the law Greg. It amounts to a reversal. What it means is that you can lose whatever you had without the right to an Article III court.

            2. 5.1.2.1.1.2

              Correct, the PTAB is not ‘reversing’ a court. What the PTAB is doing is stripping the power of the Courts to make ‘dispositive judgments’ by collaterally attacking the underlying claims being adjudicated.

              And yes, that is Hayburn’s case.

              The plan of the Constitution places the judicial power in the courts, whose judgments are not thereafter subject to revision or rejection. Neither the legislative nor the execu- tive branch has the authority to revise judicial determina- tions. See Chi. & S. Airlines, Inc. v. Waterman S.S. Corp., 333 U.S. 103, 114 (1948) (“Judgments, within the powers vested in courts by the Judiciary Article of the Constitution, may not lawfully be revised, overturned or refused faith and credit by another Department of Government.”); Gordon v. U.S., 69 U.S. 561, 561 (1864) (judgments of Article III courts are “final and conclusive upon the rights of the parties”). In Plaut v. Spendthrift Farm, Inc., 514 U.S. 211 (1995), the Court explained that:
              The record of history shows that the Framers crafted this charter of the judicial department with an expressed understanding that it gives the Fed- eral Judiciary the power, not merely to rule on cases, but to decide them, subject to review only by superior courts in the Article III hierarchy—with an understanding, in short, that “a judgment conclu- sively resolves the case” because “a ‘Judicial Power’ is one to render dispositive judgments.”
              Id. at 218–19 (quoting Frank H. Easterbrook, Presidential Review, 40 Case W. Res. L. Rev. 905, 926 (1990)). The Court traced the history of judicial finality to Hayburn’s Case, 2 U.S. (2 Dall.) 409 (1792), which “stands for the principle that Congress cannot vest review of the decisions of Article III courts in officials of the Executive Branch.” Plaut, 514 U.S. at 218. link to patentlyo.com

              What I am saying today is that the majority in Oil States does not address the issue concerning the current scheme of dual jurisdiction. They didn’t because they can’t

              1. 5.1.2.1.1.2.1

                What the PTAB is doing is stripping the power of the Courts to make ‘dispositive judgments’…

                When did the courts ever have the power to make “dispositive” judgments. No court has ever been able to say any more than “this challenger has not carried his burden to prove invalidity.” No court has ever been able to affirm the validity of a given claim against all future challenges.

                1. Oh, since the ratification of the Constitution, Hayburn’s and Marbury and the founding of the republic, since the creation of a SCOTUS that is when Courts have had to power to make dispositive judgments. Justice Story is going to haunt your dreams tonight Greg, and ask – what law school did you attend? And then why do embarrass and insult your school with such comments?

                2. If Justice Story appears to me in a dream to warn me of my error, I will cheerfully repent. Somehow, however, I am hard pressed as yet to see an error.

                  Do you seriously mean to contend that it is your understanding that pre-AIA, a patent that was once challenged was forever secure? How, then, do you explain the patents at issue in Graham v. John Deere, which survived challenge in the 5th Circuit but failed in the 8th? It has always been the case that different tribunals are allowed to reach different decisions about the same patent. This is not a modern development of the AIA.

        2. 5.1.2.2

          In Hayburn’s case… the Court said they could not adjudicate the matter as judges… because maybe… later… the SOS could remove a name from the pension role if he found ‘mistake.’

          I think that you are over-reading Hayburn if you think that there is a contradiction here. In Hayburn’s case the Court said that it could not take jurisdiction in a matter in which some non-Art. III forum could undo the decision in the same case.

          The PTAB has no power to over-rule a court’s decision. If a court says, for example, that Pete has infringed Jane’s patent, then Pete really has infringed. The PTAB cannot say “boo” about that infringement determination. Similarly, if Pete has challenged Jane’s patent in the process of defending himself against the infringement charge, and the court says that Pete has not proven anticipation by clear & convincing evidence, the PTAB has no power to gainsay that determination.

          However, if Sandra should later challenge Jane’s patent in front of the PTAB, Hayburn is no obstacle to the PTAB finding anticipation. This is a different case, involving different parties. The judgment against Pete continues in effect, even if Jane’s patent claims do not.

          1. 5.1.2.2.1

            Read it again. The Court would not sit as Judges because of the separate means by witch the SOS could remove a pensioner from the pension role. Holding they would sit as Commissioners on Saturdays to here the pleas of the war vets and render opinions as commissioners and not Art III judges. Get it? If they sat as a Federal Judge – a ruling must be dispositive – and not subject to collateral attack on the underlying claims – PTAB is exactly the situation Rayburn’s ruled verboten. You must be a PTAB ‘judge’ to be this obtuse.

    2. 5.2

      Play by Play

      Individual rights -1
      State Power +1

      US society’s trajectory straight down towards Hades…
      unchanged.

      1. 5.2.1

        Oh please. Grantinga patent is an exercise of state power. A patent, via the State (or Government, if you prefer), gives rights to one entity and takes them away from the general public.

        You don’t seem to have a problem with that exercise of State power, but you disagree with correcting a mistaken grant of the power when new, material information is brought to the attention of the agency making the decision to grant the power.

        The process for issuing patents is flawed. We have, for the most part, non-legally trained individuals doing their best in far too short timeframes with imperfect information deciding to grant rights that can be used to extract money from others.

        If you want to talk about taking away rights from individuals (i.e., reducing freedom), let’s start with a discussion of whether it is appropriate for the State to be granting these rights in the first place. Under our Constitution, we agree that it is okay. Doesn’t mean that it has to be that way. We can always, by Constitutional amendment, change our view on whether this is a proper role for the State.

        However, since we are not going to have a discussion on whether the State should even be issuing patents, let’s discuss the current reality. The reality is the agency issuing patents makes mistakes. It is absurd for the agency issuing a flawed right to be unable to correct its mistakes, which impact the general public. Further, it is hardly an overreach of State power to insert a self-corrective mechanism to address known flaws in its process for granting powerful rights to individuals/entities.

        1. 5.2.1.1

          and takes them away from the general public.

          Uncontroverted error – the Quid Pro Quo means that NOTHING had been taken away from the general public.

          Whether YOU think the process flawed or not, once grant happens – the LEGAL rights inure.

          Those legal rights are protected by other portions of the Constitution.

          Those not affected by the desire to NOT see this, well, don’t see it, and seem to have no problem with the broken score board result here.

          Those that do see the problem with property all of a sudden being “magically” rewritten by the Court to be some new and different thing have a very real problem with what has happened.

          1. 5.2.1.1.1

            Sure it has. Without the patent grant, I could build and sell whatever I want. Granting a patent impinges upon my freedom to freely innovate, build and use things, etc. It is an exercise of state power that constrains what I can do.

            And, when it is granted despite not satisfying the legal requirements, it has unfairly given the patent owner the right to stop me from doing something that I could have done before grant. And, as for challenging it in court, not a lot of people or companies are interested in spending millions to prove that it was improperly granted. That type of money is only spent when the stakes are high. Easier to pay a nuisance fee.

            As for the patent right, it is given to you subject to certain conditions. One of those conditions is it can be revoked by the agency that granted if it is shown not to have satisfied the legal requirements for novelty and non-obviousness. And 7 Justices who have the final say agree that this is Constitutional.

            Don’t get me wrong. I support the idea of patents. But, until we figure out a better way to address mistakenly issued patents, I support letting the agency responsible for issuing them take a second look when information is brought to its attention that calls the original grant into question.

            And, the patent owner is given plenty of due process. The patent owner has an opportunity to explain why the grant remains proper and can appeal an adverse decision to an Article III court.

        2. 5.2.1.2

          “Grantinga patent is an exercise of state power. A patent, via the State (or Government, if you prefer), gives rights to one entity and takes them away from the general public.”

          PA: I respectfully disagree both with the above excerpt and substantially your entire post.

          IMHO A State does not grant rights. That which it can grant are not rights. Certainly, it goes without saying that a State can and often does act upon individuals. It can recognize and protect rights or it can refuse to recognize rights and can even violate them by force (examples in history are too numerous to count). A State’s failure or success with regard to its recognition and protection of rights does not in my opinion change the nature of those rights which are proper to man and required for a proper society of free individuals.

          The above is simply to be clear about why I disagree with you. I realize quite clearly that you disagree with me, and consequently I respectfully expect no agreement from you.

          1. 5.2.1.2.1

            The very nature of patent rights has been turned on its collective head. “State franchise” is so 1984 to what the original views of Locke and company viewed the patent system.

            What is really unbelievable is how many people simply cannot see the bigger picture and how the score board is broken.

            It’s as if basic US governmental structure has not been taught in the schools for generations.

        3. 5.2.1.3

          Yeah, except when it violates the Constitution and it’s promise of ordered liberty. When BTW, was the amendment that obviated the separation of powers when it concerns patents?

  24. 4

    Thomas’ opinion ends “Finally, our decision should not be misconstrued as suggesting that patents are not property for purposes of the Due Process Clause or the Takings Clause.”

    Does this mean that the next challenge will be that the Govt. must pay “just compensation” when it cancels a patent in an IPR?

    1. 4.1

      You have to expect such challenges coming down the pike. It will be interesting to see if the coalitions change in the face of such a different grounds of challenge, and if the statute actually falls as a result.

    2. 4.3

      According to the majority opinion, if a patent is cancelled in an IPR, it is the correction of a mistaken in the examination process. There will be no compensation for cancellation of a patent in an IPR.

      Be mindful of the two cases cited. I’m afraid all that ending sentence means is that when the Govt. infringes a patent without a license, it is a taking and they are liable for damages. Due process is a very low bar that all kinds of government agencies manage to crawl over.

      1. 4.3.1

        What if the Government finances a party to challenge the patent using the IPR procedure allowing the Government to cancel the patent? There’s no longer a taking so no compensation for the patent owner.

    3. 4.4

      Alternatively, when the USPTO grants an invalid patent claim, the patent claim takes from each citizen that which was in the public domain and belonged to each citizen. The public had the right to the public domain, but the public is now excluded.
      The public should be able to claim just compensation from the USPTO for the taking from the public domain.

  25. 3

    The last time an executive body (the King’s Privy Council) invalidated an invention patent on an ordinary application was in 1746, in Darby v. Betton,
    PC2/99, pp. 358–359; and the last time the Privy Council>even considered doing so was in 1753, in Baker v. James, PC2/103, pp. 320–321.

    You may not realize how huge this is. The English common law was incorporated into our laws at the time of our Constitution is the majority is saying that the Privy Counsel did not divulge this privilege until after our Constitution and Gorsuch is saying it was before our Constitution.

    1. 3.1

      Gorsuch’s dissent is right. This is a common law suit and the privy counsel was out of it by the time of our Constitution.

      Moreover, Gorsuch is right that allowing patents to be controlled by a political entity is a terrible idea.

    2. 3.2

      And the loss of the right to an independent judge is never a small thing. It’s for that reason Hamilton warned the judiciary to take “all possible care . . . to de-fend itself against” intrusions by the other branches. The Federalist No. 78, at 466. It’s for that reason I respectfully dissent.

    3. 3.3

      You don’t think the Revolution was concerned about the ‘King’s Courts’???? Heck, it’s right in the Declaration of Independence. Gorsuch is right.

  26. 2

    Lemley won again. His paper was cited and the interpretation of the privy counsel actions taken from him.

  27. 1

    Justice Thomas’ opinion is a masterwork. It makes precisely the right distinction between public rights and private property. I hope after reading this we can dispense with the nonsense that somehow patents are anything less than private property if IPRs are still constitutional.

    Incidentally, regarding whether IPRs really are constitutional, one cannot miss section III.E: “We address the constitutionality of inter partes review only… Moreover, we address only the precise constitutional challenges that Oil States raised here. Oil States does not challenge the retroactive application of inter partes review…” (emphasis added).

    You have to figure that someone out there this morning with a pre-AIA patent that was tanked in IPR is already writing their cert. petition. My best wishes are with that person. Meanwhile, this decision, resolving these challenges, reached exactly the right conclusion. IPRs deserve to go fail when applied to pre-AIA patents, but not because of the separation of powers or VII amendment arguments.

    1. 1.1

      I am having a hard time reading Justice Gorsuch’s SAS opinion because the prose is so awful. First person asides and contractions have no place in a legal opinion. This is as bad as Judge Posner’s later style.

      1. 1.1.1

        I liked both his dissent in Oil States (except for the fact that it was a dissent) and his opinion in SAS. Both substantively and stylistically.

    2. 1.2

      I hope after reading this we can dispense with the nonsense that somehow patents are anything less than private property if IPRs are still constitutional.

      The score board is broken first celebrator…

    3. 1.3

      “You have to figure that someone out there this morning with a pre-AIA patent that was tanked in IPR is already writing their cert. petition”

      I know of a cert petition with a pre-AIA patent–patent issued months before IPRs were enacted– and a jury verdict holding claims valid prior to the IPR decision that is pending before SCOTUS. It was set for conference in March, but SCOTUS requested the Respondent file a response to the cert petition (That was filed in early April)\
      So the plot thickens…

    4. 1.5

      Masterwork? It’s gobbledegook. It’s like saying that it’s ok for the SSA to decide you’re entitled to X amount each month, then years later to say, Oops, you weren’t entitled to that much, in fact you weren’t entitled to anything, now pay us back with interest.

    5. 1.6

      Thomas supposed “masterwork” ignores the obvious Executive Branch “workaround” to avoiding paying just compensation for “taking” an issued patent, i.e., the Executive Branch, through the USPTO just makes sure that any entity that challenges an issued patent at the PTAB wins it challenge. The Government could even turnaround and give the challenger a “grant” of exclusive rights to one or more of the technologies covered in the patent that was invalidated by the PTAB.

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