On November 1, 2021, the Director of the U.S. Patent and Trademark Office granted the first "Director review" to Samsung SDI Co. Director review is a new interim procedure that allows a party to seek review of a final written decision of the Patent Trial and Appeal Board by the Director of the USPTO. Here, the Director vacated the Board's final written decision invalidating patent owner Samsung's lithium-ion battery patent. The decision marks the first time the Director has exercised this new authority following the U.S. Supreme Court's decision in United States v. Arthrex.
The Director review procedure is, in fact, borne out of Arthrex, in which the Supreme Court held that for the appointment of the Board's administrative patent judges to be constitutional under the Appointment Clause, decisions rendered by the APJs must be subject to review by the Director. The Court held that the unreviewable authority wielded by APJs during inter partes reviews is incompatible with their appointment by the Secretary of Commerce to an inferior office, and that only an officer properly appointed to a principal office may issue a final decision binding the Executive Branch in an IPR. It was following the Arthrex decision that the Director implemented the new interim procedure for Director review, wherein a party can request a Director review by filing a request for rehearing and notice of the request.
In the recent matter, Samsung filed a request for Director review, challenging the Board's decision invalidating its patent in an IPR filed by Ascend Performance Materials Operations, or APM. The Samsung patent is directed to an electrolyte composition including a nitrile compound additive to increase a lithium-ion cell's thermal impact durability. It issued from a provisional application filed on September 7, 2012, and a non-provisional application filed on March 14, 2013. APM argued that the claims were not entitled to the September 7, 2012 priority date due to lack of written description support in the provisional application. APM then argued that the claimed nitrile compound additive was anticipated by an NEC patent application that published on March 8, 2012, more than one year before the non-provisional filing date, thus qualifying as prior art under 35 U.S.C. § 102(b). The Board agreed and found the claims anticipated in a final written decision.
Samsung argued in its request for Director review that patent claims are awarded priority on a claim-by-claim basis based on the disclosure and that the Board failed to address the priority date of dependent claims 5 and 17. The Director concurred and ordered the Board to issue a new final written decision to address whether dependent claims 5 and 17 were entitled to the provisional application's date, as well as the patentability of claims 5 and 17, in view of the appropriate priority date.
The Director review procedure opens up a new option for parties to challenge the outcome of a final written decision. Many uncertainties remain, such as whether a Director review is more favorable than a request for rehearing to the Board or an appeal to the Federal Circuit. Answers to these questions will only emerge over time. The one current certainty is that the Director review process introduces yet another layer of complexity that must be factored into a party's enforcement or defense calculus.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
