IPRs: Federal Circuit Affirms Nonappealability of PTAB Institution Decision

The Patent Trial and Appeal Board (PTAB) decides petitions to institute post-grant proceedings, including inter partes reviews (IPRs).  PTAB institution decisions, as contrasted with the merits of any final written decision, are nonappealable.[1]  Despite the statutory language barring appealability, from time to time litigants have attempted to appeal institution decisions to the Court of Appeals for the Federal Circuit (e.g., Achates Reference Publ., Inc. v. Apple Inc.),[2] and even to the US Supreme Court (Cuozzo Speed Techs. LLC v. Lee).[3]  Such efforts have been unsuccessful.

Recently, in Wi-Fi One, LLC v. Broadcom Corp.,[4] the Federal Circuit again affirmed a PTAB decision to institute an IPR proceeding, refusing to limit the scope of non-appealability of such decisions to the particular statutory section that expressly calls out such non-appealability.

In Wi-Fi One, the patent owner argued that the petitioner, Broadcom, was in privity with certain other entities whom the patent owner had sued more than a year before Broadcom filed the IPR petition, thereby making Broadcom’s petition time-barred.[5]  The PTAB disagreed, finding that the patent owner failed to establish privity, and had not even adduced sufficient facts supporting privity to warrant discovery into the issue.

On appeal, the patent owner argued that the nonappealability of PTAB institution decisions was limited to decisions under 35 U.S.C. § 314(d), and not to decisions relying on other statutory provisions, such as 35 U.S.C. § 315(b) (time limit for filing a petition) or 35 U.S.C. § 312(a) (sufficiency of a petition).  The patent owner argued that the Supreme Court decision in Cuozzo overruled the earlier Federal Circuit ruling in Achates.

The Federal Circuit, discussing both Cuozzo and Achates, held that Cuozzo and Achates were consistent, and that Cuozzo did not overrule Achates, implicitly or otherwise.  The Federal Circuit noted first that in Cuozzo, the Supreme Court stated:

[I]n light of § 314(d)’s own text and the presumption favoring review, we emphasize that our interpretation applies where the grounds for attacking the decision to institute inter partes review consist of questions that are closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review. This means that we need not, and do not, decide the precise effect of § 314(d) on appeals that implicate constitutional questions, that depend on other less closely related statutes, or that present other questions of interpretation that reach, in terms of scope and impact, well beyond “this section.”[6]

Based on this discussion, the Federal Circuit held that 35 U.S.C. §§ 312 and 315 govern the decision to institute an IPR, as does 35 U.S.C. § 314.[7]  The court held further that, in Cuozzo, the Supreme Court “extended the preclusion of judicial review to statutes related to the decision to institute,” and “did not limit the rule of preclusion to substantive patentability determinations made at the institution stage”.[8]

The patent owner also argued that the ban on reviewability is limited to issues arising under 35 U.S.C. § 314, because the language of that statutory provision refers specifically to nonreviewability of IPR institution decisions “under this section” (meaning 35 U.S.C. § 314).  However, the Federal Circuit noted that it had expressly rejected that argument in Achates.[9]

The patent owner argued that issues such as whether a petition is time-barred should be reviewable because the PTAB allows parties to argue such issues at trial, and not just pre-institution.  The Federal Circuit also rejected this argument, citing Achates and noting that allowing such arguments at trial just means that the PTAB is able to reconsider its own decisions, even the nonappealable ones, at various stages of the proceeding.[10]

Wi-Fi One provides yet another example of the leeway that the PTAB has in deciding whether to institute a post-grant proceeding.  Unless the PTAB really goes off the rails and, for example, makes institution decisions on bases which are statutorily prohibited (for example, allowing arguments of indefiniteness under 35 U.S.C. § 112 in an IPR, where only prior art arguments are permitted),[11] the Federal Circuit (and the Supreme Court) are very unlikely to question such institution decisions.

[1]           35 U.S.C. § 314(d).

[2]           803 F.3d 652 (Fed. Cir. 2015).

[3]           579 U.S. ___, 136 S. Ct. 2131 (2016).

[4]           2016 U.S. App. LEXIS 16942 (Fed. Cir., September 16, 2016).

[5]           35 U.S.C. § 315(b).

[6]           2016 U.S. App. LEXIS 16942 at *8 (citing Cuozzo, 136 S. Ct. at 2141-2142).

[7]           Id. at *10.

[8]           Id.

[9]           Id. at 11.

[10]         See id. at *11-12 (citing Achates, 803 F.3d at 658).

[11]         See, e.g., Cuozzo, 136 S. Ct. at 2141-2142.

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