Last Week in the Federal Circuit (May 10-14): The Arthrex and No-Appeal-Bar Gifts Keep on Giving

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The Federal Circuit had a busy week, issuing 18 opinions—8 of them precedential.  One of those cases put a new spin on two PTAB-related issues we’ve covered extensively on this blog:  Arthrex (which held PTAB judges were unconstitutionally appointed) and the AIA’s no-appeal bar.  Read on for this week’s statistics and our case of the week.

Precedential opinions:  8

Non-precedential opinions:  8 

Rule 36:  12

Longest pending case from argument:  Free Stream Media Corp. v. Alphonso Inc., No. 19-1506) (251 days)

Shortest pending case from argument (non-Rule 36): New Vision Gaming v. SG Gaming, Inc., No. 20-1399 (34 days)

Case of the week:  New Vision Gaming & Development, Inc. v. SG Gaming, Inc. Nos. 20-1399 & 20-1400 

Panel:  Judges Newman, Moore, and Taranto, with Judge Moore writing the majority opinion and Judge Newman concurring in part and dissenting in part

You should read this case if:  you have an Arthrex challenge not raised before the agency or you have an IPR or CBM with a forum-selection clause issue

The majority opinion in our case of the week is just one paragraph long.  But this short precedential decision packs a punch, resolving one important issue and implicating several more.

The issue the Court resolved concerns Arthrex.  The appellant here challenged the Board’s decision in a CBM review on Arthrex grounds, but did so for the first time on appeal.  Was the Arthrex challenge waived?  No, the Court held, not where the Board’s decision and the Board rehearing petition both came before the decision in Arthrex issued.  The Court noted that it had previously reached that conclusion in a non-precedential order, but now with this decision, the Court has made that holding precedential.

As we’ve observed before, the Court has continued to apply its decision in Arthrex in some cases while the case is under review at the Supreme Court.  Add this case to the list:  the Court vacated and remanded on Arthrex grounds.

The majority stopped there, but Judge Newman did not.  Her separate opinion concurred on the Arthrex issue but dissented from the majority’s decision not to reach other issues in the case.  

One of those issues concerns a contractual forum-selection clause.  Years ago, the parties here entered a patent licensing agreement, which included a clause providing that disputes would be resolved in state or federal court in Nevada.  Does that clause bar the PTAB from conducting CBM review of the patent licensed in that agreement?  The Board answered “no,” reasoning that no “contractual estoppel defense” appears expressly in any statute or rule governing the Board.  But Judge Newman cited precedent generally requiring enforcement of forum-selection clauses.  And she noted a non-precedential Federal Circuit decision indicating that petitioning for PTAB review could violate a forum-selection clause.  While Judge Newman’s opinion did not ultimately state a firm answer to the question, she argued that the Court should have resolved the question before sending the case back to the PTAB.

She thought the same about a related question the Court declined to reach:  Is the Board’s decision not to enforce a forum-selection clause appealable?  Both SG Gaming (which prevailed before the Board) and the PTO (as intervenor) argued that this issue falls within the judicial-review bar in 35 U.S.C. § 324(e).  That provision for CBM review—like the judicial-review bar for IPRs, 35 U.S.C. § 314(d)—makes the “determination by the Director whether to institute” review “final and nonappealable.”  According to SG Gaming and the PTO, the decision to conduct review despite a forum-selection clause is a decision whether to institute review, and therefore nonappealable.  But Judge Newman disagreed, arguing that the “rejection of the parties’ choice of forum is indeed subject to judicial review” because that decision concerns the Board’s “conduct” of review rather than its institution of review. 

While Judge Newman disagreed with the majority’s decision not to reach these issues in this case, it seems all but certain that these interesting, important questions will be back before the Court someday.

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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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