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Supreme Court Prohibits Time-Bar Appeals In PTAB Cases

Kevin E. Noonan, Ph.D.April 20, 2020 (snippets Alert)

Today, in Thryv, Inc. v. Click-to-Call Technologies, LP[i], the Supreme Court ruled that the provisions of 35 U.S.C. § 315(b)[ii], which preclude a petitioner from filing an inter partes review petition more than one year after being served with a complaint alleging infringement, are barred from judicial review under 35 U.S.C. § 314(d).[iii] The Court’s decision reversed an en banc Federal Circuit opinion that the time bar was reviewable.

In an opinion by Justice Ginsberg, joined by the rest of the Court except Justice Gorsuch, who wrote a dissenting opinion joined by Justice Sotomayor, the Court was succinct:

“The agency’s application of § 315(b)’s time limit, we hold, is closely related to its decision whether to institute inter partes review and is therefore rendered nonappealable by § 314(d).”[iv]

The Court’s basis was the statutory language, that § 314(d) renders “final and nonappealable” the Director’s decision whether to institute an inter partes review, a holding the Court attests is consistent with Cuozzo Speed Technologies, LLC v. Lee:[v]

“[O]ur interpretation applies where the grounds for attacking the decision to institute inter partes review consist of questions that are closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review.”[vi]

According to the majority, the time bar question is “closely tied” to the statutory provisions precluding judicial review because §315(b) sets forth a circumstance in which “[a]n inter partes review may not be instituted.”[vii]

The majority voiced policy concerns that if a patent owner was allowed to appeal Board determinations under §315(b) such appeals would “tug against that objective [providing an efficient mechanism for weeding out “bad patents”], wasting the resources spent resolving patentability and leaving bad patents enforceable.”[viii] The Court foresaw that a patent owner would appeal on §315(b) untimeliness grounds “only if she could not prevail on patentability, [and consequently] §315(b) appeals would operate to save bad patent claims.”[ix] The Court also noted that its decision was consistent with the statutory scheme, which “so consistently elevat[es] resolution of patentability above a petitioner’s compliance with §315(b)” because the Board’s adjudication on the merits is thereby preserved.[x]

This decision is consistent with earlier decisions by the Court interpreting the statutory regime of inter partes review, including Cuozzo Speed Technologies and SAS Institute Inc. v. Iancu.[xi] These decisions taken together strongly suggest that if Congress wants an administrative agency to have authority that cannot be challenged by a reviewing Court it needs to expressly grant that unreviewability status to the agency by statute. As a consequence of these decisions, the only challenge that may be available to a frank disregard of the §315(b) time limit by the Board would be to raise such a challenge on due process grounds, an option that the Court left open explicitly in Oil States Energy Serv. LLC v. Greene’s Energy Group LLC.[xii]

The dissent by Justice Gorsuch provides a different interpretation of the statute and would limit the scope of the §314(d) reviewability bar to the institution decision and not bar any other provisions of the statute relating to inter partes review. In view of the dissenting Justices:

“Today the Court takes a flawed premise—that the Constitution permits a politically guided agency to revoke an inventor’s property right in an issued patent—and bends it further, allowing the agency’s decision to stand immune from judicial review. Worse, the Court closes the courthouse not in a case where the patent owner is merely unhappy with the merits of the agency’s decision but where the owner claims the agency’s proceedings were unlawful from the start. Most remarkably, the Court denies judicial review even though the government now concedes that the patent owner is right and this entire exercise in property-taking-by-bureaucracy was forbidden by law.”[xiii]

The dissent expresses a worry that patentees as property holders are placed at bureaucratic mercy without recourse to courts. “No matter how wrong or even purposefully evasive, the Director’s assessment of a petition’s timeliness is always immune from review” is the consequence of the majority decision, according to the dissent, and even without any ill intention (“[t]he Board can err”) such errors are beyond the scope of judicial review (at least with regard to any issue involving institution decisions).[xiv]

The concerns expressed in the dissent are consistent with Justice Gorsuch’s dissent in Oil States; what may be more interesting is Justice Sotomayor joining in expressing these concerns (although the Justice did not join the part of the dissenting opinion where these concerns were most strongly raised).

The opinion can be found at https://www.supremecourt.gov/opinions/19pdf/18-916_f2ah.pdf.

Kevin E. Noonan, Ph.D. is a partner with McDonnell Boehnen Hulbert & Berghoff LLP and serves as Chair of the firm’s Biotechnology & Pharmaceuticals Practice Group. Dr. Noonan is an experienced biotechnology patent lawyer who brings more than 20 years of extensive work as a molecular biologist studying high-technology problems in serving the unique needs of his clients. noonan@mbhb.com

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[i] Thryv, Inc. v. Click-to-Call Technologies, LP, No. 18-916 (S. Ct. Apr. 20, 2020).

[ii] 35 U.S.C. §315(b).

[iii] 35 U.S.C. § 314(d).

[iv] Thryv, Inc., No. 18-916 at 2.

[v] Cuozzo Speed Technologies, LLC v. Lee, 136 S.Ct. 2131, 2137 (2016).

[vi] Thryv, Inc., No. 18-916 at 7, citing Cuozzo Speed Technologies, LLC v. Lee, 136 S.Ct. 2131 (2016).

[vii] Id.

[viii] Id. at 9.

[ix] Id.

[x] Id.

[xi] SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018). 

[xii] Oil States Energy Serv. LLC v. Greene’s Energy Group LLC, 138 S. Ct. 1365 (2018).

[xiii] Thryv, Inc., No. 18-916 at 1.

[xiv] Id. at 8.