Supreme Court to hear case that could determine fate of patent claims heard before USPTO Patent Trial and Appeal Board

By: Audrey Ogurchak

On January 15th, the United States Supreme Court granted certiorari for the case Cuozzo Speed Technologies v. Lee.[1] This case will require the Supreme Court to address two important questions regarding the inter partes review (IPR) proceedings; (1) is it appropriate for the United States Patent and Trademark Office (USPTO) to use a different claim construction standard than used by the federal district court; and (2) are institution decisions insulated from judicial review.[2]

Inter partes review is a trial proceeding conducted by the Patent Trial and Appeals Board (PTAB) to review the patentability of one or more claims in a patent on the basis of prior art consisting of patents or printed publications.[3] The challenge may only be raised about issues regarding 35 USC §102, the novelty requirement, and 35 USC §103, the non-obviousness requirement.[4] The IPR proceeding was introduced by the America Invents Act, along with post-grant review proceedings, to replace inter partes reexamination .[5] Many patent holders aren’t too fond of the new proceedings, as, since its institution, the PTAB has allowed 80% of the claims challenged in petitions to go to trial, cancelling 95.2% of all claims for which trial was instituted.[6] Federal Circuit Chief Judge Randall Radar coined the term PTAB “death squads,” claiming that the “death squads [kill] property rights.”[7] Commentators believe that part of the reason for the high rates of claim cancellation has to do with the “broadest reasonable interpretation” (BRI) standard applied by the PTAB for claim construction, or claim interpretation.[8] A finding of invalidity is generally more likely when a patent claim is interpreted under the BRI standard from the PTAB than under the narrower Phillips standard applied by the federal district court, giving claims their “ordinary and customary meaning” from the perspective of one of ordinary skill in the art at the time of the invention.[9]

In the case before the Supreme Court this year, Cuozzo Speed Technologies (“Cuozzo”) owns US Patent No. 6,778,074 (‘074 patent) relating to a speed limit indicator and method for displaying the relative speed limit.[10] In 2012, Garmin International, Inc. and Garmin USA, Inc. (“Garmin”) petitioned the USPTO, requesting an IPR with respect to three claims of the ‘074 patent, contending that the claims were obvious under 35 USC §103(a).[11] The PTAB issued a final decision finding the claims to be obvious and denying Cuozzo’s motion to amend the ‘074 patent by substituting granted claims for the now cancelled claims.[12] On appeal, Cuozzo raised the issues that the IPR was improperly instituted by the USPTO because certain prior art was not raised by the petitioner and that the PTAB applied the incorrect standard, the BRI Standard, when evaluating the scope of the claim.[13] The majority explained that regardless of whether the USPTO should have instituted an IPR, the decision couldn’t be reviewed or challenged, even after a completed IPR proceeding.[14] The majority also explained that the BRI standard is appropriate and that Congress intended the BRI standard to be the rule when the America Invents Act was implemented.[15]

This decision is important as it may decide the fate of challenged patents before the PTAB and the possibly future of the PTAB itself. As the institution of the IPR proceedings is intended to circumvent the costly and time consuming patent litigation process of the federal circuit, it seems as though commentators and patent holders are firm in their belief that the Phillips standard should be the prevailing claim construction standard of the PTAB. Further, as the Supreme Court is in the habit of overruling the Federal Circuit in regards to patent cases, it is likely that the Supreme Court will find that the BRI standard is not appropriate.

[1] Gene Quinn, Supreme Court accepts Cuozzo Speed Technologies IPR appeal, IPWatchdog (Jan. 15, 2016), http://www.ipwatchdog.com/2016/01/15/supreme-court-accepts-cuozzo-speed-technologies-ipr-appeal/id=65076/.

 

[2] Quinn, supra note 1.

 

[3] Inter Partes Review, United States Patent and Trademark Office, http://www.uspto.gov/patents-application-process/appealing-patent-decisions/trials/inter-partes-review (last visited Feb. 2, 2015).

 

[4] United States Patent and Trademark Office, supra note 3.

 

[5] Inter Partes Review, Fish Richardson Post Grant, http://fishpostgrant.com/inter-partes-review (last visited Feb. 2, 2015).

 

[6] Rob Sterne & Gene Quinn, PTAB Death Squads: Are All Commercially Viable Patents Invalid?, IPWatchdog (Mar. 24, 2014), http://www.ipwatchdog.com/2014/03/24/ptab-death-squads-are-all-commercially-viable-patents-invalid/id=48642/.

[7] Sterne & Quinn, supra note 6.

 

[8] Clint Conner et al., Federal Circuit Confirms The Use of Broadest Reasonable Interpretation in Inter Partes Review, Dorsey (Jul. 15, 2015) https://www.dorsey.com/newsresources/publications/client-alerts/2015/07/federal-circuit-confirms-the-use-of-broadest-rea__.

 

[9] Conner, supra note 8.

 

[10] In re Cuozzo Speed Technologies, LLC, 792 F.3d 1268, 1271 (Fed. Cir. 2015).

 

[11] Cuozzo, 792 F.3d at 1272.

 

[12] Id.

[13] Cuozzo, 792 F.3d at 1272 – 73.

 

[14] Id. at 1273.

 

[15] Id. at 1279-80.