Federal Circuit Loosens Constraints on Appeals of PTAB Decisions
January 11, 2018
Judicial review of post-grant patent proceedings at the Patent Trial and Appeal Board (PTAB) is limited, but a federal court of appeals has somewhat loosened the restriction. On January 8, 2018, in Wi-Fi One, LLC v. Broadcom Corporation,1 the U.S. Court of Appeals for the Federal Circuit held that a patent owner is entitled to judicial review on the question of whether a petitioner is time-barred by statute from filing a petition. The original panel had confirmed that under then-existing precedent, the Federal Circuit may not review the PTAB's decision to institute a post-grant patent review.2
Congress created PTAB post-grant patent reviews to address concerns about low-quality patents burdening the courts and the economy, but sought to strike a balance between efficient challenges to such patents and gamesmanship by petitioners. In particular, Congress barred petitioners who had been sued for infringement from filing a petition more than one year after the suit commenced.3 In Wi-Fi One, the patent owner contended that the petitions were barred because the petitioner was in privity with real parties-in-interest who had been sued for infringement more than one year earlier. The PTAB denied the challenge, and a motion for discovery to support the challenge, as time-barred. The Federal Circuit declined to issue a writ of mandamus against the PTAB, so the cases were instituted and ultimately decided on the merits, with the patent owner preserving its standing challenge through the entire proceeding.
The Supreme Court recently addressed the question of whether an institution decision could be judicially reviewed. In Cuozzo Speed Technologies v. Lee, the Court addressed whether the substantive reasons the PTAB gave for its institution decision were appealable and concluded that such review was not permitted, while broadly suggesting that any exceptions to the bar against review of institution decisions would be rare.4 The Federal Circuit has generally followed this guidance, although it earlier had concluded that it could review "PTAB compliance with any requirement that involves the ultimate authority of the PTAB to invalidate a patent" that was preserved through the final PTAB decision.5 The Federal Circuit previously considered the question of whether the PTAB's determination of the time bar under 35 U.S.C. Section 315(b) was reviewable and concluded that it was not.6 Against this background, the original Wi-Fi One panel concluded that it could not review the issue, although Judge Reyna suggested in a concurrence that the court should reconsider its position.
The Federal Circuit reconsidered the question en banc7 with additional briefing from the U.S. Patent and Trademark Office and 13 amici curiae. Judge Reyna, writing for the nine-judge majority, explained that agency decision making comes with a strong presumption of reviewability that can only be overcome by "clear and convincing" evidence of Congressional intent to limit review. The majority held that a bar on reviewing PTAB institution decisions did not extend to review of PTAB compliance with the statutory time limit for petitioners because it does not go to the non-reviewable "merits of the petition." One judge in the majority, Judge O'Malley, wrote a separate concurrence explaining a distinction between the PTAB's discretion to institute a case on the merits and its authority to act at all. She concluded that a Congressional limit on agency action did not fall within the review bar.
Four judges, including the two judges from the majority of the original panel, dissented. They contended that the Supreme Court had left little scope for judicial review of any PTAB action forming part of the institution decision. They understood Congress to have drawn a bright line between the institution stage and the trial stage. From this, they concluded that any issue resolved during the institution stage is unreviewable.
Overall, the majority decision better comports with both the plain statutory language and with general administrative law principles. The dissent is anchored, however, on Supreme Court language that may suggest that this particular judicial-review bar of PTAB decisions is broader than most. The question may require another trip to the Supreme Court before it is finally resolved. Even as it stands, however, the en banc decision leaves many questions open. For example, what other statutory provisions are limits on PTAB authority and thus reviewable? Moreover, should petitioners be allowed to seek review of such questions if they are the sole basis for a decision not to institute?
For further information about the Wi-Fi One decision, review of PTAB decisions, or any other questions relating to post-grant review of patents, please contact Mike Rosato, Matt Argenti, Steve Parmelee, Richard Torczon, or any member of the post-grant review practice at Wilson Sonsini Goodrich & Rosati.
Adam Burrowbridge contributed to the preparation of this WSGR Alert.