On October 11, 2016, the US Supreme Court denied petitions for certiorari filed in two cases by parties challenging the constitutionality of post grant proceedings instituted under the Leahy-Smith America Invents Act.
In the first case, Cooper v. Lee, No. 15-955, the petitioners argued that 35 U.S.C. § 318(b), which permits the USPTO Patent Trial and Appeal Board to issue certificates cancelling patent claims after inter partes review of issued patents, violates the Separation of Powers requirement of the U.S. Constitution because patent validity can only be finally determined by an Article III court. Cooper argued that the Supreme Court:
should review to confirm that final adjudications of patent validity may only occur in Article III trial courts. However, this is not to say that this Court must abolish the inter partes review process as a whole. Rather, this Court may make the process constitutionally sound by doing what it has always done under these circumstances: make the outcome of inter partes review advisory and subject to de novo treatment in an Article III trial court. Pet. for Cert. at 5.
Adopting language from Moore v. Robbins, 96 U.S. 530 (1878), the petitioners argued that inter partes review (IPR) trials have created a cloud of uncertainty over the value of patents, and that allowing the agency granting a patent to thereafter cancel it in a quasi-judicial proceedings “is utterly inconsistent with the universal principle on which the right to private property is founded.”
In the second case, MCM Portfolio LLC v. Hewlett-Packard Co., No. 15-1330, the petitioner argued that AIA IPR proceedings violate the Separation of Powers requirement and also deprive patent owners of their right to a jury trial under the Seventh Amendment. Unlike reexamination, which the petitioner described as a continuation of the initial patent examination process, IPRs under the AIA are quasi-judicial proceedings not involving examiners and devoid of the “back-and-forth” iterative process that marks examination. The petition argued that adjudication of the validity of an issued patent violates the Separation of Powers because only an Article III federal court may determine that issue. The petitioner also argued that, since colonial times, patents were property rights enforced in English courts of law, and thus are protected by a right to trial by jury. The petitioner concluded that IPR proceedings deny that fundamental right.
The Supreme Court denied both petitions without comment.
