by Dennis Crouch
Collabo Innovations, Inc. v. Sony Corporation (Supreme Court 2019)
Everyone will admit that a lot has changed in patent law since Collabo’s U.S. Patent 5,952,714 issued in September 1999. Although ex parte reexamination was available, the American Inventors Protection Act (AIPA) authorizing inter partes reexamination was not enacted until November 1999. However, inter partes reexamination only applied to patents issued from applications filed after November 1999. Pub. L. 106–113 Then, in 2011, Congress created inter partes review — and this time made it retroactive.
After Collabo sued Sony for infringement, Sony responded with petitions for inter partes review. The PTO instituted review and found the claims unpatentable by a preponderance of the evidence and the Federal Circuit affirmed. With regard to Collabo’s due process and takings claim, the court found itself bound by a parallel decision in Celgene Corp. v. Peter, 931 F.3d 1342 (Fed. Cir. 2019). Celgene is pending petition for en banc rehearing on the question:
Whether retroactive application of inter partes review (“IPR”), to patent claims issued before the America Invents Act (“AIA”), constitutes an unconstitutional taking?
[Celgene Petition Rehearing]. I’ll note here a fact difference between these cases is that Collabo’s patents were never subject to Inter Partes Reexamination while Celgene’s patents were.
In its new petition, Collabo asks the following two questions:
1. Does the retroactive application of inter partes review to a patent that issued before the passage of the AIA violate the Takings Clause of the Fifth Amendment?
2. Does the retroactive application of inter partes review to a patent that issued before the passage of the AIA violate the Due Process Clause of the Fifth Amendment?
In Oil States (2018), the Supreme Court upheld AIA Review proceedings — finding that the process did not violate requirements of either Article III or Seventh Amendment. However, the Supreme Court expressly left-open the potential for future challenges on grounds of takings and due process:
We emphasize the narrowness of our holding. We address the constitutionality of inter partes review only. . . . [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, even though that procedure was not in place when its patent issued. Nor has Oil States raised a due process challenge. 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.
The basic setup here is that the AIA makes it easier to invalidate patents with its lower presumption; lower standard of proof; and (until recently) broader interpretation of patent scope. It is also true, in my opinion, that no one has a constitutional right to assert an invalid patent. The deeper question then is whether AIA review is merely a procedural change to more efficiently get to the validity question, or does it unduly undermine the ‘vested rights’ of patent holders.