Federal Circuit to review availability of appeal of Patent Trial and Appeal Board institution decisions

by Dentons


On January 4, 2017, the Federal Circuit decided to address en banc the scope of review of the Patent Trial and Appeal Board’s (PTAB) decisions on institution of inter partes reviews (IPRs). To date, the Federal Circuit has routinely refused to consider appeals of decisions by the PTAB to institute IPR trials, holding that 35 U.S.C. § 314(d) prohibits review of decisions on institution because the statute states that such decisions are “final and nonappealable.”1

In September 2016, the Federal Circuit, in Wi-Fi One v. Broadcom, ruled that the PTAB’s decision to institute trial, which rejected the patent owner’s challenge that the petition was time-barred under 35 U.S.C. § 315, was not reviewable on appeal.2

The court felt constrained to follow its earlier Achates decision, which squarely held that these types of issues were “final and nonappealable.”3

The en banc Federal Circuit will decide the following question: “Should [the Federal Circuit] overrule Achates … and hold that judicial review is available for a patent owner to challenge the PTO’s determination that the petitioner satisfied the timeliness requirement of 35 U.S.C. § 315(b) governing the filing of petitions for inter partes review?”4

At issue in the rehearing en banc is the interpretation of the Supreme Court’s In re Cuozzo decision.5 In Cuozzo, the court sided with the US Patent and Trademark Office (USPTO), as well as the majority of a divided Federal Circuit, upholding the proposition that decisions on institution are generally not appealable. The court opined that the prohibition against reviewability applies to “questions that are closely tied to the application and interpretation of statutes related to the USPTO’s decision to initiate inter partes review.”

Wi-Fi has taken the position that Cuozzo “tied the limitation of judicial review to the USPTO’s ability to make its substantive patentability determination as embodied in § 314(a).” In other words, Wi-Fi argued that the Supreme Court limited the statutory bar against judicial review to the board’s determination at the time of institution of whether a particular reference raises a reasonable likelihood of prevailing. Wi-Fi also argued that the ban on appeals is limited to issues arising under § 314 (not the time bar provisions arising under § 315), because of the statutory text providing that the director’s determination of whether to institute an IPR under § 314 is not reviewable.

Wi-Fi has also implicated principles of administrative law, which could be important. For example, 5 U.S.C. § 706(2)(C) states, “The reviewing court shall … set aside agency action … found to be … in excess of statutory jurisdiction.” A decision as to whether a party is time-barred from filing an IPR petition under 35 U.S.C. § 315(d) might be such a jurisdictional issue. Unfortunately, administrative law is an area that few understand, and parties often do not fully consider all aspects of this esoteric area of the law.

The decision could have ramifications for other issues decided at institution, such as estoppel under 35 U.S.C. § 315(e)(2), whether assignor estoppel applies to PTAB cases, whether the PTAB can join parties and issues, and whether petitioners can appeal decisions to not institute. Dentons’ significant experience in IPRs and administrative law makes us well-positioned to ensure that our clients’ rights are fully preserved under the continuously evolving post-grant practice landscape.

The forthcoming en banc decision will hopefully clarify what types of issues the Federal Circuit will review from the PTAB’s decisions on institution.

  1. There was, however, one narrow exception, which was to review whether the PTAB properly found a patent to be a covered business method (CBM), and therefore eligible for a CBM post-grant review. Versata Development Group, Inc. v. SAP America, Inc., 793 F.3d 1306 (Fed. Cir. 2015).
  2. Appeal 2015-1944, Decision dated September 16, 2016.
  3. Achates Reference Publ’g, Inc. v Apple Inc., 803 F.3d 652, 658 (Fed. Cir. 2015), cert. dismissed, 136 S. Ct. 998 (2016
  4. Wi-Fi One, order dated January 4, 2017.
  5. Cuozzo Speed Tech’s, LLC v. Lee, 136 S. Ct. 2131 (2016).

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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