Supreme Court Takes Up Constitutionality of Inter Partes Review
On June 12, 2017 the U.S. Supreme Court granted certiorari in the case of Oil States Energy Services v. Greene’s Energy Group. There, Greene’s filed a petition in the United States Patent and Trademark Office (“PTO”) seeking inter partes review of claims 1 and 22 of Oil States’ U.S. Patent No. 6,179,053. The Patent Trial and Appeal Board (“PTAB”) granted the petition, and after trial held that those claims were unpatentable.
Oil States appealed that decision to the Federal Circuit, arguing that the PTAB unpatentability determination was incorrect, and also arguing that the PTAB had no authority to invalidate the claims of an issued patent, which can only be done by a jury and/or an Article III judge. At the PTAB, decisions are made by Administrative Law Judges, who are not appointed for life and are not confirmed by the U.S. Senate like Article III judges are. The Federal Circuit affirmed without opinion.
Oil States then sought review in the Supreme Court, again raising the issue that the PTAB lacked the power to invalidate the claims of an issued patent. The PTAB was created by a revision of US patent law in 2012, less than 5 years ago. Some critics of the PTAB argue that it is too anti-patent, and is misusing its authority to deny due process to patent owners. The Supreme Court agreed to hear the case, limited to the following question: “Whether inter partes review, an adversarial process used by the Patent and Trademark Office (PTO) to analyze the validity of existing patents, violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.”
Inter partes review has proven to be a popular mechanism for reviewing issued patents among potential infringers, generally being faster and less costly than litigation in the Federal Courts. Should the Court find the process to be unconstitutional, it would fundamentally change the defense strategy of those opposing issued patents, as that strategy has developed since 2012. No hearing date has been set.
Glenn E. Karta is a shareholder at Shores & Oliver, P.C. More information about our firm can be found at www.shoresoliver.com