Court of Appeals for the Federal Circuit Sides With PTAB in Inter Partes Review Appeal
In a decision imparting more certainty to the Post Grant Review process, the Court of Appeals for the Federal Circuit (the “CAFC”) held that it lacks jurisdiction to review the Patent and Trademark Office’s (the “PTO’s”) decision to institute inter partes review (“IPR”). It also concluded that the PTO properly adopted the broadest reasonable interpretation standard for reviewing claims under IPR proceedings.
In this case, In re Cuozzo Speed Technologies, LLC, the patentee challenged the PTO’s basis for instituting an IPR proceeding on several patent claims. But the CAFC concluded that 35 U.S.C. § 314(d) prohibits review of the PTO’s decision to institute IPR. The CAFC based this holding on the fact that § 314(d) provides that the PTO’s decision is both “nonappealable” and “final.” However, the CAFC left open the possibility of appellate review on mandamus, in instances where the “PTO has clearly and indisputably exceeded its authority” in granting a petition to institute IPR.
The CAFC also confirmed that the PTO properly adopted its own broadest-reasonable-interpretation claim construction standard for IPR proceedings. Despite the fact that this claim-construction standard is not incorporated into the IPR provisions of the America Invents Act (the “AIA”), the CAFC found that § 316 of the Patent Act authorizes the PTO to conduct rulemaking and its adoption of the broadest reasonable interpretation standard falls within this power. In addition, the CAFC found that the AIA’s legislative history demonstrated that Congress implicitly adopted the broadest-reasonable-interpretation standard in enacting the AIA, because even though Congress “was well aware that the broadest reasonable interpretation standard was the prevailing rule,” nothing revealed an intent to change it.
This decision is important in maintaining the power of the IPR as an effective strategy for defending against claims of patent infringement outside of court. The knowledge that once a decision to institute an IPR is granted, that decision cannot be overturned (except on rare occasions where mandamus may be appropriate), provides the requester greater certainty and removes one potential threat that the IPR could be undone on appeal. Moreover, as with reexamination proceedings, the broadest-reasonable-interpretation standard provides the petitioner more flexibility in applying prior art to the claims than might otherwise be available under narrower constructions.