On average, the U.S. Supreme Court historically hears fewer than one patent case each term. For example, in the 14 years between 1982 and 1995, the Court decided only five patent cases. In the seven years between 1995 and 2001, it decided another seven cases. More recently, however, the Supreme Court has been very active in the patent area. Since 2002, it has heard arguments in 28 cases. It decided 6 cases in the October 2013 term alone.

The Supreme Court is continuing its high level of patent activity in the current October 2014 term. It has heard oral argument in one patent case and recently granted certiorari in two other cases. Below is a brief summary of the patent issues the Court will confront this term:

Claim Construction Review Standard. In Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., No. 13-854, the Court will address the correct standard for appeals court review of a district court claim construction ruling. The case was argued on October 15, 2014. To decide this case, the Court will need to revisit its ruling in Markman v. Westview Instruments, Inc., 517 U.S. 370 (1996), holding that parties have a Seventh Amendment right to jury trial in patent infringement actions, but the trial judge is responsible for interpreting the patent claims. As a result of Markman, district courts in patent lawsuits typically conduct evidentiary proceedings concerning the underlying technology, the patent, and the patent prosecution history in order to construe disputed terms in the patent claims. The U.S. Court of Appeals for the Federal Circuit applies a de novo standard of review to these claim construction decisions, affording no deference to the district court’s factual findings. Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448 (Fed. Cir. 1998). In Teva, the petitioner argues that de novo review is inconsistent with Fed. R. Civ. P. 52(a), which states that a district court’s findings of fact “must not be set aside unless clearly erroneous, and the reviewing court must give due regard to the trial court’s opportunity to judge the witnesses’ credibility.” Teva also argues that de novo review is an affront to district court judges, who spend significant time grappling with claim construction decisions. The respondent argues that de novo review is appropriate because in the “mongrel” practice of patent claim construction, the meaning of a claim ultimately is a legal determination, even if it is based on underlying facts. In addition, it argues that de novo review is necessary to maintain consistency and uniformity across the patent system. At oral argument, significant discussion concerned the viability of a hybrid approach, in which the Federal Circuit would review certain subsidiary facts under the “clearly erroneous” standard, but some Justices seemed to question whether such an approach was practical.

Good Faith Defense To Active Inducement Liability. On December 5, 2014, the U.S. Supreme Court granted certiorari in Commil USA v. Cisco Systems, Inc., No. 13-896. The Court will consider whether an accused infringer’s good faith belief that a patent is invalid is a defense to induced infringement under 35 U.S.C. § 271(b). The appeal stems from a 2-1 opinion at the Federal Circuit. Commil USA, LLC v. Cisco Sys., Inc., 720 F.3d 1361 (Fed.Cir.2013). The trial court ruled that Cisco was liable for active inducing its customers to infringe Commil’s patent. A split Federal Circuit panel reversed, because Cisco had a good faith belief that the patent was invalid. The majority reasoned that an invalid patent cannot be infringed, so a good faith belief that a patent is invalid precludes the intent required to cause infringement under § 271(b). Commil argues in the appeal (and the dissenting Federal Circuit judge agreed) that a determination of invalidity may dispose of liability, but infringement is “an entirely separate question capable of determination without regard to its validity[.]” Medtronic, Inc. v. Cardiac Pacemakers, Inc., 721 F.2d 1563 (Fed. Cir. 1983). Thus, it argues, the intent to infringe required under §271(b) can exist independent of the validity issue. This case may affect the ability of manufacturers and distributors of products used by customers to infringe method patents to rely on an opinion of counsel that a patent is invalid, and thus no liability for indirect infringement exists. The Court has not scheduled oral argument on this appeal.

Patent Misuse. The third patent case to be heard this term presents an issue at the intersection of patent law and antitrust law. In Brulotte v. Thys Co., 379 U.S. 29 (1964), the Supreme Court ruled that a patent license requiring the licensee to pay royalties post-expiration of the licensed patent is a per se violation of the antitrust laws. In addition, the same conduct constitutes patent misuse, and may render a patent unenforceable in a subsequent infringement action. The petitioner in Kimble v. Marvel Enterprises, Inc., No. 13-720, asks the Court to overturn that per se rule. The Brulotte rule has been widely criticized as outdated. For example, Scheiber v. Dolby Labs., Inc., 293 F.3d 1014 (7th Cir. 2002), Judge Richard Posner criticized the rule as being wrong, lamenting that the Seventh Circuit had “no authority to overrule a Supreme Court decision no matter how dubious its reasoning strikes us, or even how out of touch with the Supreme Court’s current thinking the decision seems.” The U.S. Department of Justice and Federal Trade Commission also have criticized the rule in recent guidelines analyzing anticompetitive provisions in intellectual property license agreements. In recent years, the Supreme Court has modernized its analysis of antitrust concerns relating to intellectual property. See, e.g., Illinois Tool Works, Inc. v. Independent. Ink, Inc., 547 U.S. 28 (2006) (overruling its prior decisions that, in an antitrust tying claim, a patent does not necessarily confer market power upon a patentee). The Kimble case may be a vehicle for it to dispense with the Burlotte rule as well. Oral arguments have not been scheduled.