Consumer Watchdog v. Wisconsin Alumni Research Foundation (Fed. Cir. 2014) - Appellant's Opposition to Board Decision Not Enough to Establish Injury in Fact

by McDonnell Boehnen Hulbert & Berghoff LLP

Consumer WatchdogYesterday, the Federal Circuit dismissed an appeal by Consumer Watchdog from a decision of the Patent Trial and Appeal Board affirming the patentability of claims 1-4 of U.S. Patent No. 7,029,913.  In dismissing the appeal, the Federal Circuit determined that Consumer Watchdog had failed to establish an injury in fact sufficient to confer Article III standing.

In 2006, Consumer Watchdog, which describes itself as a "not-for-profit public charity dedicated to providing a voice for taxpayers and consumers in special interest-dominated public discourse, government and politics," requested inter partes reexamination of the '913 patent, which is directed to human embryonic stem cell cultures.  The '913 patent is assigned to the Wisconsin Alumni Research Foundation (WARF).  Unsuccessful in the reexamination, Consumer Watchdog appealed the Board's decision to the Federal Circuit.

WARFOn appeal, Consumer Watchdog stated that it had filed the reexamination request because it was concerned that the '913 patent allowed WARF to completely preempt all uses of human embryonic stem cells and that WARF's "broad and aggressive assertion" of the '913 patent had put a severe burden on taxpayer funded research in Consumer Watchdog's home state of California.  As the Court points out, however, Consumer Watchdog did not allege any involvement in research or commercial activities involving human embryonic stem cells, that it is an actual or prospective competitor of WARF or licensee of the '913 patent, or that it engaged in any activity that would give rise to a possible infringement suit.

Noting that "[f]ederal courts do not have authority to entertain every dispute," the Court explains that:

[T]he federal courts have developed a variety of doctrines to clarify that Article III limits the federal courts' jurisdiction to those disputes seeking to "redress or prevent actual or imminently threatened injury to persons caused by private or official violation of law."  These doctrines -- including standing, ripeness, and mootness -- distinguish justiciable disputes from those that are not.

(citations omitted).

The opinion indicates that the instant appeal concerns the issue of standing, and that Consumer Watchdog must establish standing by showing:  (1) "it has suffered an 'injury in fact' that is both concrete and particularized, and actual or imminent (as opposed to conjectural or hypothetical)," (2) "the injury is fairly traceable to the challenged action," and (3) "it is likely, rather than merely speculative, that a favorable judicial decision will redress the injury."  Although the opinion indicates that Article III standing is not necessarily a requirement to appear before an administrative agency, "once a party seeks review in a federal court, 'the constitutional requirement that it have standing kicks in.'"  The opinion also explains that:

[W]here Congress has accorded a procedural right to a litigant, such as the right to appeal an administrative decision, certain requirements of standing -- namely immediacy and redressability, as well as prudential aspects that are not part of Article III -- may be relaxed.  However, the "requirement of injury in fact is a hard floor of Article III jurisdiction that cannot be removed by statute."

(citations omitted).

With respect to instant appeal, the Court notes that "Consumer Watchdog does not identify any alleged injury aside from the Board denying Consumer Watchdog the particular outcome it desired in the reexamination, i.e., canceling the claims of the ’913 patent."  The Court also notes that:

Consumer Watchdog does not allege that it is engaged in any activity involving human embryonic stem cells that could form the basis for an infringement claim.  It does not allege that it intends to engage in such activity.  Nor does it allege that it is an actual or prospective licensee, or that it has any other connection to the '913 patent or the claimed subject matter.  Instead, Consumer Watchdog relies on the Board's denial of Consumer Watchdog's requested administrative action -- namely, the Board's refusal to cancel claims 1–4 of the '913 patent.  That denial, however, is insufficient to confer standing.

The opinion explains that while "Congress may enact statutes creating legal rights, the invasion of which creates standing, even though no injury would exist without the statute," "[t]he statute at issue here allowed any third party to request reexamination, and, where granted, allowed the third party to participate."  As the Court points out, however, that statute "did not guarantee a particular outcome favorable to the requester."  The Court also found Consumer Watchdog's analogy of the statute at issue to the Freedom of Information Act (FOIA) or Federal Election Campaign Act (FECA) to be unpersuasive because:

Unlike the plaintiffs in the FOIA and FECA cases, Consumer Watchdog was not denied anything to which it was entitled.  Consumer Watchdog was permitted to request reexamination and participate once the PTO granted its request.  This is all the statute requires.

In dismissing the appeal, the opinion concluded by declaring that "[w]hile Consumer Watchdog is sharply opposed to the Board's decision and the existence of the '913 patent, that is not enough to make this dispute justiciable."

Consumer Watchdog v. Wisconsin Alumni Research Foundation (Fed. Cir. 2014)
Panel: Chief Judge Prost and Circuit Judges Rader and Hughes
Opinion by Circuit Judge Rader

For additional information regarding this topic, please see:

• "Consumer Watchdog Replies to United States Brief on Standing Issue," February 11, 2014
• "United States Argues That Consumer Watchdog Lacks Standing to Appeal Board Decision on WARF Patent," February 6, 2014
• "Consumer Watchdog Argues That WARF Stem Cell Patent Is Invalid under § 101," August 1, 2013



DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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