Supreme Court Refuses to Take SSL Services v. Cisco, Will Not Answer Question on Multiple Proceedings Rule at PTAB

On Monday, November 19th, the U.S. Supreme Court issued a list of orders regarding pending cases where the Court refused to take the appeal. The Supreme Court on that day denied the petition for writ of certiorari to take up SSL Services, LLC v. Cisco Systems, Inc. on appeal from the Federal Circuit. In denying certiorari, the Supreme Court refused to answer whether the Patent Trial and Appeal Board (PTAB) erred in instituting an inter partes review (IPR) proceeding in the face of federal statute barring institution of an IPR based on similar arguments and prior art raised in a previous validity challenge.

This particular case involves a patent owned by SSL Services which covers a virtual private network providing data encryption and authentication services for communication. Issued in 2000, this patent survived a total of nine validity reviews in the federal judiciary and at the U.S. Patent and Trademark Office. In August 2015, Cisco petitioned the PTAB for an IPR proceeding after the patent was asserted against it in district court, asserting the same prior art which had been brought up in validity reviews at the USPTO. The PTAB instituted the IPR on the rationale that Cisco had not been a party to the prior validity review proceedings involving the asserted prior art and all claims of the patent were cancelled in February 2017.

In its petition for writ, SSL Services argued that the PTAB’s decision to institute the IPR incorrectly denied the application of 35 U.S.C. § 325(d), the statute governing multiple proceedings at the USPTO; giving the USPTO Director authority to reject a proceeding based on substantially similar prior art or arguments already presented to the agency in a validity review. While the PTAB laid out a multi-factor test for applying the multiple proceedings rule in a 2017 precedential decision in General Plastic v. Canon, SSL Services argued that this test is legally incorrect because the factors in that test do not find support in the statute. Further, the PTAB has applied Section 325(d) to bar the institution of IPRs in far less meritorious cases, including multiple cases where the asserted prior art had only been cited in the original prosecution of the patent and not a validity challenge after the patent had issued. This has resulted in a standard for applying Section 325(d) which is unworkable, SSL Services argued.

Along with questions regarding the applicability of the multiple proceedings rule, SSL Services also invited the Supreme Court to take up this case to determine the scope of judicial review under 35 U.S.C. § 314(d). This statute says that the USPTO Director’s decision to institute an IPR is final and nonappealable, but a lack of judicial review on the agency’s multiple proceeding standard has resulted in great unpredictability. Although the Supreme Court’s decision in Cuozzo Speed Services v. Lee (2016) upheld the Section 314(d) bar on judicial review, it also suggested qualifications to this bar. This suggestion from Cuozzo led the Federal Circuit to determine en banc in 2018’s Wi-Fi One, LLC v. Broadcom Corporation that the bar on judicial review did not preclude judicial review of decisions to institute an IPR after the one-year time bar under 35 U.S.C. § 315.

While Cisco had waived its right to respond to SSL Service’s petition for writ, an amicus brief filed by the Alliance for U.S. Startups and Inventors for Jobs (USIJ) argued that the legislative history of the America Invents Act, which enacted the PTAB and IPR proceedings, clearly showed that patents shouldn’t be subjected to multiple attacks. This was an argument which the USIJ also made in a recent report on tech giants which have been filing serial and duplicative petitions at the PTAB, flouting Congressional intent behind the AIA. Further, USIJ argued in its brief that this particular case was an egregious example of unfettered attacks on patents. One of the pieces of prior art asserted by Cisco leading to institution of the IPR had already been deemed inapplicable by the Federal Circuit in appellate review of a validity challenge on the same patent. “There is no meaningful limit to the PTO’s discretion to subject patent owners to yet another expensive attack on their inventions,” the USIJ’s brief reads. “Section 325 thus becomes a dead letter.”

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  • [Avatar for Pro Say]
    Pro Say
    December 2, 2018 03:32 pm

    See no evil. Hear no evil. Speak … nothing at all.

    — SCOTUS