Justia Patents Opinion Summaries

Articles Posted in Constitutional Law
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Mobility’s patent, titled “System, Apparatus, and Methods for Proactive Allocation of Wireless Communication Resources,” is “generally directed to the allocation of communication resources in a communications network.” The Patent Trial and Appeal Board determined that five claims of the patent were unpatentable as obvious.Mobility sought a remand under the Supreme Court's 2021 Arthrex decision, challenged the merits of the Board’s decision, and raised for the first time several constitutional challenges, including a challenge to the structure of the Board. Mobility argued that Board members have an interest in instituting AIA proceedings to generate fees to fund the agency and ensure future job stability and that individual administrative patent judges (APJs) have a personal financial interest in instituting AIA proceedings in order to earn better performance reviews and bonuses.Federal Circuit held that Mobility’s constitutional arguments are without merit. The President, not the agency, submits the budget, and Congress sets the USPTO budget and controls whether the USPTO has access to surplus funds. A remand of the “Appointments Clause” challenge is required under the Arthrex decision to allow the Acting Director to review the final written decision of the APJ panel pursuant to newly established USPTO procedures. View "Mobility Workx, LLC v. Unified Patents, LLC" on Justia Law

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Administrative Patent Judges (APJs) conduct adversarial proceedings for challenging the validity of an existing patent before the Patent Trial and Appeal Board (PTAB), 35 U.S.C. 6(a), (c). The Secretary of Commerce appoints PTAB members, including APJs, except the Director, who is nominated by the President and confirmed by the Senate. APJs concluded that Arthrex’s patent was invalid. The Federal Circuit concluded that the APJs were principal officers who must be appointed by the President with the advice and consent of the Senate; their appointment was unconstitutional. To remedy this violation, the court invalidated the APJs’ tenure protections, making them removable at will by the Secretary.The Supreme Court vacated. The unreviewable authority wielded by APJs during patent review is incompatible with their appointment by the Secretary to an inferior office. Inferior officers must be “directed and supervised at some level by others who were appointed by Presidential nomination with the advice and consent of the Senate.” While the Director has administrative oversight, neither he nor any other superior executive officer can directly review APJ decisions. A decision by the APJs under his charge compels the Director to “issue and publish a certificate” canceling or confirming patent claims he previously allowed. Given the insulation of PTAB decisions from executive review, APJs exercise power that conflicts with the Appointments Clause’s purpose “to preserve political accountability.”Four justices concluded that section 6(c) cannot constitutionally be enforced to prevent the Director from reviewing final APJ decisions. The Director may review final PTAB decisions and may issue decisions on behalf of the Board. Section 6(c) otherwise remains operative. Because the source of the constitutional violation is the restraint on the Director’s review authority not the appointment of APJs, Arthrex is not entitled to a hearing before a new panel. View "United States v. Arthrex, Inc." on Justia Law

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Christy applied for a patent on its “ambient air backflushed filter vacuum” invention. The patent claiming that invention issued in 2006. Christy paid the patent's $1,000 issuance fee and the $490 3.5-year, $1,800 7.5-year, and $3,700 11.5-year maintenance fees. Christy and its licensee sued competitors for patent infringement. One competitor filed petitions for inter partes review (IPR). The Federal Circuit affirmed the Patent Trial and Appeal Board’s invalidity decision. Aggrieved by the cancellation of 18 claims of the patent, Christy filed a class-action suit, seeking compensation from the government, with a Fifth Amendment takings claim and, alternatively, an illegal exaction claim, seeking compensation amounting to the issuance and maintenance fees, Christy’s investments made in the technologies, and attorney fees spent in defending the IPR.The Federal Circuit affirmed the dismissal of the suit. The cancellation of patent claims in an IPR does not amount to a compensable taking. Christy’s argument regarding the fees fails because the law requires payment of the fees without regard to any later result of post-issuance proceedings, 35 U.S.C. 41, 151. Christy identifies no statute, regulation, or constitutional provision compelling the fees’ refund if claims are later canceled in post-issuance proceedings. Without showing how the PTO’s actions contravened the Constitution, a statute, or a regulation, Christy cannot state an illegal exaction claim. View "Christy, Inc. v. United States" on Justia Law

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Decker developed the patented inventions while employed at the University of Texas and assigned the patents to UT. Gensetix obtained an exclusive license in the patents. The license agreement provides that, Gensetix must enforce the patents. The parties agreed to cooperate in any infringement suit and that nothing in the agreement would waive UT's sovereign immunity. Gensetix sued Baylor, alleging infringement and requested that UT join as a co-plaintiff. UT declined. Gensetix named UT as an involuntary plaintiff under FRCP 19(a). The district court dismissed, finding that UT is a sovereign state entity, so that the Eleventh Amendment barred joinder of UT, and that the suit could not proceed without UT.The Federal Circuit affirmed in part. UT did not voluntarily invoke federal jurisdiction; the Eleventh Amendment prevents “the indignity of subjecting a State to the coercive process of judicial tribunals” against its will. It is irrelevant that the license agreement requires the initiation of an infringement suit by Gensetix or cooperation by UT. The court erred in dismissing the suit without adequate analysis of Rule 19(b)'s factors: the extent to which a judgment might prejudice the missing required party or the existing parties; the extent to which any prejudice could be lessened; whether a judgment rendered in the required party’s absence would be adequate; and whether the plaintiff would have an adequate remedy if the action were dismissed. View "Gensetix, Inc. v. Baylor College of Medicine" on Justia Law

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In 2019, the Federal Circuit (Arthrex) held that the appointment of the APJs by the Secretary of Commerce, 35 U.S.C. 6(a), violated the Appointments Clause. The Patent and Trademark Office and Cisco argued that the Federal Circuit erred in extending Arthrex beyond the context of inter partes reviews to an appeal from a decision of the Patent Trial and Appeal Board in an inter partes reexamination. They claimed that administrative patent judges (APJs) should be deemed constitutionally appointed officers at least when it comes to their duties reviewing appeals of inter partes reexaminations.The Federal Circuit rejected the argument. The fact that an inferior officer on occasion performs duties that may be performed by an employee not subject to the Appointments Clause does not transform his status under the Constitution. Courts should look not only to the authority exercised in the case but to all of the appointee’s duties when assessing an Appointments Clause challenge. An APJs’ duties include both conducting inter partes reviews and reviewing appeals of inter partes reexaminations. Although no discovery is held and no trial conducted in inter partes reexaminations, the proceedings are otherwise similar. The Director’s authority over the Board’s decisions is not meaningfully greater in the context of inter partes reexaminations than in inter partes reviews. View "Virnetx Inc. v. Cisco Systems, Inc." on Justia Law

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Arthrex’s patent is directed to a knotless suture securing assembly. On inter partes review, heard by a three-judge panel consisting of three Patent Trial and Appeal Board Administrative Patent Judges (APJs), several claims were found to be unpatentable as anticipated. Arthrex appealed and argued that the appointment of the APJs by the Secretary of Commerce, as set forth in 35 U.S.C. 6(a), violates the Appointments Clause, U.S. Const., art. II, section 2, cl. 2. The Federal Circuit agreed and vacated the decision. The statute as currently constructed makes the APJs principal officers, requiring appointment by the President as opposed to the Secretary of Commerce. The court considered review within the agency over APJ panel decisions, the Director’s supervisory powers, and that APJs can only be removed from service for “misconduct [that] is likely to have an adverse impact on the agency’s performance of its functions,” 5 U.S.C. 7513. Under existing law, APJs issue decisions that are final on behalf of the Executive Branch and are not removable without cause. To remedy the violation, the court concluded that severing the portion of the Patent Act restricting removal of the APJs is sufficient to render the APJs inferior officers and remedy the constitutional appointment problem. View "Arthrex, Inc. v. Smith & Nephew, Inc." on Justia Law

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Oil States sued Greene's Energy for infringement of a patent relating to technology for protecting wellhead equipment used in hydraulic fracturing. Greene’s challenged the patent’s validity in court and petitioned the Patent Office for inter partes review, 35 U.S.C. 311-319. The district court issued a claim-construction order favoring Oil States; the Board concluded that Oil States’ claims were unpatentable. The Federal Circuit rejected a challenge to the constitutionality of inter partes review. The Supreme Court affirmed. Inter partes review does not violate Article III. Congress may assign adjudication of public rights to entities other than Article III courts. Inter partes review falls within the public-rights doctrine. Patents are “public franchises” and granting patents is a constitutional function that can be carried out by the executive or legislative departments without “judicial determination.’ Inter partes review involves the same basic matter as granting a patent. Patents remain “subject to [the Board’s] authority” to cancel outside of an Article III court. The similarities between the procedures used in inter partes review and judicial procedures does not suggest that inter partes review violates Article III. The Court noted that its decision “should not be misconstrued as suggesting that patents are not property for purposes of the Due Process Clause or the Takings Clause.” When Congress properly assigns a matter to adjudication in a non-Article III tribunal, “the Seventh Amendment poses no independent bar to the adjudication of that action by a nonjury factfinder.” View "Oil States Energy Services, LLC v. Greene's Energy Group, LLC" on Justia Law

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Oil States sued Greene's Energy for infringement of a patent relating to technology for protecting wellhead equipment used in hydraulic fracturing. Greene’s challenged the patent’s validity in court and petitioned the Patent Office for inter partes review, 35 U.S.C. 311-319. The district court issued a claim-construction order favoring Oil States; the Board concluded that Oil States’ claims were unpatentable. The Federal Circuit rejected a challenge to the constitutionality of inter partes review. The Supreme Court affirmed. Inter partes review does not violate Article III. Congress may assign adjudication of public rights to entities other than Article III courts. Inter partes review falls within the public-rights doctrine. Patents are “public franchises” and granting patents is a constitutional function that can be carried out by the executive or legislative departments without “judicial determination.’ Inter partes review involves the same basic matter as granting a patent. Patents remain “subject to [the Board’s] authority” to cancel outside of an Article III court. The similarities between the procedures used in inter partes review and judicial procedures does not suggest that inter partes review violates Article III. The Court noted that its decision “should not be misconstrued as suggesting that patents are not property for purposes of the Due Process Clause or the Takings Clause.” When Congress properly assigns a matter to adjudication in a non-Article III tribunal, “the Seventh Amendment poses no independent bar to the adjudication of that action by a nonjury factfinder.” View "Oil States Energy Services, LLC v. Greene's Energy Group, LLC" on Justia Law

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Under 35 U.S.C. 292(a) it is unlawful to engage in specified acts of false patent marking, such as affixing a mark that falsely asserts that the item is patented, with intent to deceive the public. Prior to 2011, the statute authorized private parties (relators) to bring a qui tam or informer’s suit for violations, but did not specify procedures or authorize the government to file its own suit to collect the penalty. The 2011 AIA eliminated the qui tam provision, but authorized actions for damages by any person “who has suffered a competitive injury as a result of a violation.” The AIA provides that marking products with expired patents is not a violation and that it applies to all pending cases. In 2010, Brooks sued, alleging that Dunlop marked a guitar string winder with the number of a patent that was both expired and invalidated. The AIA was enacted while the case was stayed, pending the outcome in another case. The district court held that the application of the AIA to pending actions did not violate the Due Process Clause and that the legislation rationally furthered a legitimate legislative purpose. The Federal Circuit affirmed. View "Brooks v. Dunlop Mfg., Inc." on Justia Law