by Dennis Crouch
None of the parties were happy with the outcome in Arthrex v. Smith & Nephew (Fed. Cir. 2019) and all three have now petitioned for en banc review:
In its decision, the Federal Circuit held that the appointment process for PTAB judges (APJs) violates the Appointments Clause of Article II of the U.S. Constitution. The court explained that these judges are principal officers under the constitution and thus, must be appointed by the President of the United States rather than merely the Head of Department. However, the court issued a cy-près ruling in an attempt to limit the upset caused by its ruling. In particular, the court invalidated a portion of the statute that limited the PTO’s ability to remove APJs from the board. According to the court, that change was enough to reclassify the PTAB Judges as inferior officers that do not need presidential appointment. Despite its proposed “cure”, the Federal Circuit held that – in this case – the PTAB decision must be vacated and reheard in front of a new panel of APJs. “We hold that a new panel of APJs must be designated to hear the inter partes review anew on remand.”
Why is no-one happy?:
- The Patentee would like the case wholly thrown out and argues that the CAFC’s savings-cut was both incorrect and insufficient to convert principal officers to inferior officers.
- Both the Patent Challenger and USPTO as intervenor want the original final written decision reinstated (cancelling the claims) and argue that the en banc court should find the APJs were already inferior officers. They also argue that, if APJs are principal officers then the en banc court should reconsider the appropriate remedy for such an appointments clause violation.
More to come on this.