United States: Potential Havoc At The PTAB

The US Supreme Court granted certiorari on issues that could wreak havoc with pending patent cases

Last Friday, the Supreme Court of the United States (SCOTUS) granted certiorari to consider two hotly contested issues that may have a very strong impact on inter partes reviews (IPR)1 at the Patent Trial and Appeal Board (PTAB).

The first issue centers on the appropriate claim construction standard to be used in AIA trials, specifically: Whether the Court of Appeals for the Federal Circuit (CAFC) erred in holding that, in IPR proceedings, the Board may construe claims in an issued patent according to their broadest reasonable interpretation (BRI) rather than their plain and ordinary meaning.

The second issue involves judicial review of final and non-appealable decisions, specifically: Whether the CAFC erred in holding that, even if the Board exceeds its statutory authority in instituting an IPR proceeding, the Board's decision whether to institute an IPR proceeding is judicially unreviewable.2

A decision in the affirmative could wreak havoc for those parties with AIA trials pending at the United States Patent and Trademark Office (USPTO) or appeals pending before the CAFC. The SCOTUS decision could result in expensive rebriefing and reversals, which may lead some to seek a legislative remedy to avoid this tumult.


When Congress enacted the AIA, it did not expressly define the claim construction standard to be used for AIA trials, but delegated to the USPTO broad authority to "prescribe regulations ... establishing and governing inter partes review."3 The USPTO decided to use BRI for several reasons. First, Congress required the PTAB to decide "patentability,"4 not validity as district courts do, so the USPTO chose to use the same claim construction standard that it uses in other proceedings deciding patentability. Second, the USPTO wanted to maintain its 30-year precedent of claim interpretation across multiple related or merged proceedings (such as reexaminations and reissues). Third, the patent owner may motion to amend claims during AIA trials. The use of BRI in AIA trials has been very controversial, however. Critics argue that the BRI standard is not justified because the PTAB, which hears AIA trials, denies the vast majority of motions to amend and that the distinction between patentability and invalidity has led the PTAB to cancel claims that a district court could have upheld. District courts determine validity based on the plain and ordinary meaning of the claims as understood by a person of ordinary skill in the art at the time of the invention.5 This can be a more narrow interpretation than the BRI used by the PTAB. In addition, district courts, unlike the PTAB, presume that claims are valid, which makes it more difficult for accused infringers to succeed. Thus, the burdens to demonstrate invalidity in a district court are greater than those to demonstrate unpatentability in the PTAB.

Many stakeholders, largely led by the chemical and life sciences industries, have been lobbying for the PTAB to use the plain and ordinary meaning standard for unexpired patents, and they might get it. These stakeholders are concerned that AIA trials reduce the value of their patents, as the USPTO could cancel a patent that a district court, with its higher burdens, could uphold. In contrast, others argue that the ability to amend, and the estoppel and time-bar provisions sufficiently protect patent owners.

BRI or plain and ordinary meaning?

A panel of the CAFC6 held that the USPTO may use the BRI standard in AIA trials. However, the CAFC's 6-5 decision to deny en banc review provoked strong dissents stating that Congress intended AIA trials to be an alternative to district court litigation, and therefore higher district court standards should apply. There are strong opinions and detailed arguments on both sides that are beyond the scope of this alert, which focuses on the ramifications of a reversal of Cuozzo.

The appropriate claim construction standard has significant implications for planning and conducting AIA trials. If an AIA trial has reached finality, i.e., all appeals have been exhausted, then the case is likely over. If an AIA trial is pending at any stage, however, the petitioner and patent owner should plan for contingencies, such as having to rebrief claim construction. Petitioners drafting petitions for an AIA trial might consider a strategy of proposing two constructions: one under BRI and the other under the plain ordinary meaning. In this way, the petitioner might preempt having to reargue the issues using a different construction standard. However, this puts additional pressure on condensing arguments within the page limits and might limit options for changing constructions in the district court. Petitioners and patent owners who are already in AIA trials might consider adding arguments about how the plain and ordinary meaning might differ, or not differ, from the BRI.

Patent owner-appellants should also appeal whether the PTAB used the correct claim construction standard and wait for the decision from the SCOTUS. Petitioner-appellants should seek a final decision as soon as possible to avoid having the case remanded to the PTAB. The CAFC recently did just that when a patent expired (which requires using the plain and ordinary meaning) between a decision from the PTAB and a decision from the CAFC.7 Therefore, the PTAB's caseload could increase dramatically if it faces remands requiring re-doing claim construction on all AIA trials with non-final appeals.

Besides remediating the problem while in an AIA trial, parties can also be proactive and file amicus briefs. Assuming that the SCOTUS reverses the CAFC, Congress could act by passing legislation to clarify retroactively that the PTAB's use of BRI was correct. Note that Congress has considered several reform bills that establish the plain and ordinary meaning as the standard for AIA trials; though none are close to passing, at least partially due to opposition to changing the standard. Parties seeking congressional action should begin thinking about specific legislative proposals now so that they will be ready when the SCOTUS decides the issue this summer. Congress is unlikely to take an interest in the issue until it becomes choate.

Judicial review of final, non-appealable decisions?

On the second issue, the CAFC would not review the PTAB's decision on institution because it is final and non-appealable. Since Cuozzo, the CAFC has consistently held that courts cannot review decisions on institution via appeal or mandamus.8 This holding, however, conflicts with those limited cases in which the CAFC has held that decisions on institution are appealable for the sole issue of determining whether patents are CBM-eligible.9

There is a strong possibility that the SCOTUS will determine that decisions on institution are subject to some form of judicial review, given its recent decision in Mach Mining, LLC v. EEOC, which mandates a "strong presumption" favoring review of agency action.10 Therefore, the SCOTUS will likely allow for some review of administrative action, such as when the agency exceeds its statutory authority.


Whatever the SCOTUS may decide on either issue, the court's decision will have a significant impact on AIA trials. Amicus briefs are likely due between late February to early April, depending on who the brief supports and filing dates, so interested parties should retain counsel now to prepare them. Several professional organizations, including the Intellectual Property Owner's Association (IPO) and the American Intellectual Property Law Association (AIPLA) will likely file amicus briefs in support of replacing the current BRI claim construction standard with the plain and ordinary meaning. Many non-life-sciences companies, on the other hand, favor continuing to use the BRI. Therefore, there are likely to be several amicus briefs with strong views on both sides of these issues.


1 The decision should also affect post-grant reviews (PGRs) and reviews for covered business methods (CBMs). The America Invents Act (AIA) established IPRs, PGRs, and CBMs, known collectively as AIA trials.

2 Cuozzo Speed Technologies LLC v. Lee, Docket No. 15-446.

3 35 U.S.C. § 316(a)(4).

4 35 U.S.C. § 318(a).

5 Phillips v. AWH Corp., 415 F.3d 1303, 1316 (Fed. Cir. 2005).

6 In re Cuozzo Speed Technologies, LLC, 778 F.3d 1271 (Fed. Cir. 2015, revised Jul. 8, 2015).

7 Biomet Orthopedics, LLC, et al. v. Puget Bioventures, LLC, appeal no. 2015-1468 (Jan. 14, 2016).

8 See e.g., St. Jude Medical, Cardiology Division, Inc., v. Volcano Corp., 749 F.3d 1373 (Fed. Cir. 2014) and Sightsound Technologies, LLC v. Apple Inc., Slip Op., appeal nos. 2015-1159 and 2015-1160 (Fed. Cir. 2015).

9 Versata Development Group v. SAP America, Inc., 793 F.3d 1306 (Fed. Cir. 2015).

10 135 S. Ct. 1645, 1651 (2015); see also, Bowen v. Mich. Acad. of Family Physicians, 476 U.S. 667, 670 (1986).

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