Is the USPTO’s IPR Process Constitutional?

By Thomas Goldstein
May 20, 2016

scotus-supreme-court-pillars-frontI represent MCM Portfolio LLC, which is seeking Supreme Court review of a recent decision of the United States Court of Appeals for the Federal Circuit upholding the constitutionality of the inter partes review (IPR) procedures created by the America Invents Act (AIA). The petition is available here. Amicus briefs in support of the petition are being filed May 31.

We argue that IPR violates Article III of the Constitution, which vests the judicial power in the federal courts, and also the Seventh Amendment, which guarantees a right to a jury in civil litigation, because it allows a non-court, the Patent Trial and Appeals Board (PTAB), to adjudicate and eliminate valuable property rights without a jury’s involvement.

Background

The AIA created a post-grant adjudicatory procedure to review the validity of patents.  Thus, a “person who is not the owner of a patent” can petition the U.S. Patent and Trademark Office (PTO) to institute a review before the newly created PTAB. The permissible grounds include those available under § 102 (novelty) and §103 (obviousness) of the Patent Act. If the PTO determines that the petitioner has a reasonable probability of prevailing on any of its arguments, it institutes proceedings.  The PTAB then conducts a trial before a three-judge panel and decides whether to cancel the claims.

IPR not only resembles civil litigation, it is designed as an alternative to it. For example, if a petitioner has already filed a civil action challenging the validity of a patent claim, it may not also institute IPR to challenge that same claim.  If a party petitions and then files a civil action, the civil action will be automatically stayed unless the patentee moves to lift the stay or files a counterclaim alleging infringement.  The decisions in IPR also estop petitioners from raising similar grounds in civil actions.  Like civil actions, the private parties to them may settle IPR proceedings.  And adverse decisions in IPR are appealed to the United States Court of Appeals for the Federal Circuit, just like other patent cases—and review is deferential, for substantial evidence.

IPR has been lethal to patent owners. To date, more than 4000 petitions have been filed, and in approximately 85% of cases where trial is complete, at least one patent claim has been held invalid by the PTAB.  It is no exaggeration to say that the shift from jury trials to IPR has been one of the most substantial blows to inventors to date.

[Supreme-Court]

The Argument

In this case, Hewlett-Packard (HP) initiated and won an IPR against MCM, invalidating four claims in one of MCM’s patents as obvious. MCM argued (1) that HP’s petition was time-barred,(2) that IPR violates Article III and the Seventh Amendment, and (3) that HP’s prior art did not read on the challenged claims. The PTAB rejected these arguments, and the Federal Circuit affirmed.

The Federal Circuit decided first that it had no jurisdiction to review the argument that the petition was time-barred. That question is at issue in a pending Supreme Court case. (See Cuozzo Speed Techs. LLC v. Lee, No. 15-446.) While a favorable result in Cuozzo could stave off a substantial number of meritless petitions, it cannot challenge the fundamental infirmities of the IPR itself.

MCM’s constitutional arguments, on the other hand, present such a challenge. With respect to those, the Federal Circuit held that because patent rights are “public rights,” i.e., rights that are created by the federal government, Congress can delegate their adjudication to administrative tribunals. The court of appeals also reasoned that its own precedent upholding the prior procedure of inter partes reexamination bound it to uphold IPR. We now intend to seek review of that ruling.

The Federal Circuit misinterpreted the Constitution and imperiled the intellectual property rights of countless patentees. The court of appeals’ “public rights” argument falters because although patents are the subject of federal law, patent rights closely resemble other private property rights that must be adjudicated by Article III courts, with the attendant jury trial requirements.

Summary

As the Supreme Court has explained, the Seventh Amendment requires a jury trial when historical practice gave an issue to the jury.  Patents, of course, trace their genesis to English common law. In early America, juries decided factual issues in direct actions to revoke patents because patents constitute “a property which is often of very great value,” and in cases involving such property, “the constitution has secured to the citizens a trial by jury.” The Federal Circuit has also held that disputed facts involving patent validity must be tried to a jury.  By denying the similarities between IPR and these two forms of civil litigation, the Federal Circuit seriously erred.

MCM’s petition provides the best hope for correcting that error.

The Author

Thomas Goldstein

Thomas Goldstein is an appellate advocate, best known as one of the nation’s most experienced Supreme Court practitioners having argued 38 cases. He has been counsel on more successful petitions for certiorari over the past decade than any other lawyer in private practice. Tom is also the co-founder and publisher of SCOTUSblog. Tom’s recognitions include being named by the National Law Journal as one of the nation’s 40 most influential lawyers of the decade and (in both 2006 and 2013) one of the nation’s 100 most influential attorneys. Tom is also the co-founder and publisher of SCOTUSblog – a web-site devoted to comprehensive coverage of the Court – which is the only weblog ever to receive the Peabody Award.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 51 Comments comments.

  1. Anon31415 May 20, 2016 2:45 pm

    The arguments seem reasonable but I have a question that does not appear to be answered in the brief (perhaps I missed it). Why would an IPR be unconstitutional when a patent interference hearing is not? A patent interference 35 USC 135 can revoke claims from a granted patent and that procedure is done administratively without jury trial.

    Doesn’t the long history of patent interference suggest that these types of trials are acceptable for patents. It looks like as early as 1836 an interference could be determined by the Commissioner over a granted patent.

    http://www.ipwatchdog.com/2011/06/19/first-u-s-patent-laws-were-first-to-file-not-first-to-invent/id=17747/

  2. ValuationGuy May 20, 2016 2:46 pm

    I agree with you and am glad you (finally!!!) filed the petition after multiple delays/extensions.

    The only item in your brief that I had any issue with was your position that the constitutionality of RE-EXAM was unquestioned as I believe that any externally generated (i.e. requested by someone OTHER than the patent owner himself) re-exam following the issuance of a patent is almost as blatant a violation of the Seventh Amendment as the IPR process.

    While I agree that the IPR (with the near-absolute inability to freely amend claims) is worse…..the cancellation of ANY claims after issuance (destroying private property) is clearly an Article III court issue….not the highly political PTAB (kangaroo court) with its institutional mentality that BRI is acceptable after a patent issues.

  3. Jim Ruttler May 20, 2016 3:55 pm

    It doesn’t seem possible that IPRs are constitutional, but I’m concerned that the Court seems to ignore such formalities with patent law and rewrites the law as it sees fit to accomplish public policy objectives. For example, the Constitution states as follows:

    To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

    And Section 101 states as follows:

    Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.

    Yet, we operate in an environment where discoveries are not patentable and the breadth of 101 has been judicially limited to a sliver of inventions.

  4. Edward Heller May 20, 2016 6:00 pm

    Valuation Guy, from the petition: “Finally, it is worth emphasizing that while other administrative reexamination and review proceedings may also be problematic, IPR stands alone in terms of the magnitude of the threat to property rights and the flagrancy with which Congress chose to bypass Article III Courts and juries.” Pet. at 26-27.

  5. Ned Heller May 20, 2016 6:04 pm

    3. I also agree that any concession that reexaminations are constitutional only gets one into trying to explain why one is constitutional and the other not.

  6. Anon May 21, 2016 9:25 am

    I think your aim is off in trying to blame the Federal Circuit for answering a question that was badly asked of them.

    Your comment of “While a favorable result in Cuozzo could stave off a substantial number of meritless petitions, it cannot challenge the fundamental infirmities of the IPR itself.” is just not correct.

    You have your eyes closed to one of the most major infirmities of the IPR itself -and it is an infirmity that flows directly from the simple, powerful, and unambiguous words that Congress has chosen regarding the separate point of the initiation decision itself.

    Addressing this very point in time of the initiation decision, Mr. Heller has refused to comply with a simple request of mine – perhaps you will show more fortitude.

    Compare and contrast the bundle of sticks that make up your property right that is a granted patent (for argument’s sake I am accepting the view that a granted patent is a property right – not a public right) from the point immediately after the initial grant to the point immediately after the IPR initiation decision (prior to any IPR decision on the merits).

    Do you have the same bundle of sticks?

    There is an infirmity at the very point of the initiation decision itself – but the Court will gladly not provide an answer to a (rather tough) unasked question. It is not the Federal Circuit “to blame” for how Congress has written the law (and written the law to be a taking without recompense or chance for review).

    The law concerning the initiation point is simple – and extremely clear in its simplicity. I have seen attempts to insert more into the tiny and clear section of law as written by Congress; attempts to insert other laws such as those concerning executive agency actions, or ABA regulations, but all of those attempts gloss over what Congress actually wrote. Did Congress write poorly? Sure (and such poor writing is evident in many places of the AIA). But that too is not the right question. The answer to that incorrect question would seek to change what Congress DID write. The right question is to be simply more direct: Can Congress DO what they DID? Congress wrote a section of law that violates other constitutional protections regarding property when they wrote the (perhaps too simple) directive that the initiation decision by a non-Article III, executive agency employee – entirely separate from any further decision on the merits – provides no recompense, and is unreviewable (period). The point of my exercise for Mr. Heller (and one that he admits to in his other complaints), is that the bundle of sticks <b.is changed from one point in time to another, and that change – uncompensated, and unreviewable – has very real and deleterious effects on the property in question.

    Congress may not write a law that allows such a taking.

    But if you do not ask – point blank – the Court to consider this question, they will gladly NOT consider this question.

  7. Paul F. Morgan May 21, 2016 7:54 pm

    Anon, re your above argument for pushing the issue that “the [IPR] INITIATION decision by a non-Article III executive agency employee .. is unreviewable” [by act of Congress], is that not the number 2 cert question already raised and pending in Cuozzo? If the Sup. Ct. sustains that statute as so sweeping interpreted by the Fed. Cir. in Cuozzo it seems highly unlikely to be attackable here. If the Sup. Ct. rejects the Fed. Cir. interpretation of that statute and re-interprets it more narrowly, to clearly allow some kind of review of an illegally instituted IPR, that would also make a constitutionality challenge here difficult on those grounds.

  8. Paul F. Morgan May 21, 2016 8:18 pm

    Ned, lets examine your argument that “while other administrative reexamination and review proceedings may also be problematic, IPR stands alone in terms of the magnitude of the threat to property rights and the flagrancy with which Congress chose to bypass Article III Courts and juries.”
    But how do you plan to actually distinguish current reexaminations and other post-grant patent reviews from the same unconstitutionality attack as IPRs? It cannot be just because IPRs are faster and have become more popular. Nor does the difficulty of claim amendments in IPRs distinguish jury trials, since none at all are allowed there, and the new statistical report showed that only about 10% of patent owners in IPRs have ever even requested claim amendments, there or by reissues.

  9. Anon May 21, 2016 8:45 pm

    Mr. Morgan,

    Not surprisingly, you have managed to avoid entirely any comment on the meat of the post that I have provided.

    Maybe instead of the dancing around the subject and what the Court may or may not do, and what this action or inaction may or may not portend, perhaps you want to take a shot at talking substantively about my post?

  10. Anon May 21, 2016 8:49 pm

    And to answer you directly – the Court may answer the question asked (whether the Federal Circuit is following what Congress wrote) WITHOUT touching on the point that I raised – your attempt here is nothing more than attempting to insert the wrong question.

    There are enough people chasing the wrong question, thank you – let’s not have you attempt to confuse that issue here.

  11. Paul F. Morgan May 21, 2016 8:52 pm

    P.S. Ned, how would ITC Section 337 import exclusion actions avoid your same unconstitutionally challenge? They are also administrative proceedings in which patent validity can be challenged, on far more grounds. If the subject patent claims are held invalid in an ITC proceeding and that is sustained in a Fed. Cir. appeal are not those claims, as a practical matter, just as worthless as those removed by a post-grant PTO proceeding? What about claim amendments in ITC proceedings?

  12. David May 21, 2016 9:44 pm

    If IPR is unconstitutional, so is reexamination. It is a true either/or scenario.

    Disappointing that the author didn’t address Roberts’ recusal, and what, if anything, he thinks that means for this particular challenge.

  13. Night Writer May 21, 2016 10:02 pm

    My prediction: the SCOTUS is going to hold IPRs are unconstitutional. Simple reason: it would mean all that work would come back into the federal courts.

  14. Edward Heller May 22, 2016 7:33 am

    Paul, we do not defend the constitutionality of reexaminations. However, until the AIA, they did have a right to a trial de novo. When an agency has statutory jurisdiction, but not constitutional, providing a right to a trial in court with a right to jury trial may wash away the constitutional violation. See, Executive Benefits.

    ITC, one’s patent is not revoked in an ITC proceeding, and its judgments are not collateral estoppel.

  15. Anon May 22, 2016 8:26 am

    Mr. Heller, thank you for swatting away Mr. Morgan’s “wrong questions.”

    But will you or Mr. Goldstein ever address the “right questions” as I have laid them out? Will either of you ever take the simple steps of comparison and direct your attention to the action of Congress at the point of initiation, quite separate from any further actions on the merits?

  16. Paul F. Morgan May 22, 2016 10:20 am

    Anon, why don’t you just present here your superior constitutional argument in the format of a clear and unambiguous one sentence cert petition question [as the law requires] instead of just complaining that you are being misunderstood?
    Thank you for your admission that Cuozzo may moot the issue of the constitutionality of the IPR statute prohibiting any appeal of IPR institutution decisions [as interpreted by the Fed. Cir.]

  17. Anon May 22, 2016 11:31 am

    Mr. Morgan – you ask for something already given.

    See the post above at 4.

    This is not the first time that you so ask for something already there.

    You asking again serve then only as a thinly veiled attempt to slam the plainly stated item under some cloud of “if you only presented your issue clearly.”

    This board is NOT a cert petition – nor is it designed to be so. The “complaint” is well justified – and you already have the issue clearly explicated before you (I will note that yet again you have avoided actually addressing that issue!)

    Your “thanking me” is obviously premature as well. You miss the fact that asking the wrong question just might not generate the right answer to the right question.

    Your “gamesmanship” is as transparent as it is poor.

    Step up to the plate, good sir – be direct on the issue as I have already presented it.

  18. Night Writer May 22, 2016 12:05 pm

    @11 I meant will not. Paul obviously has a hidden agenda and Hellers are worse. No point in arguing or discussing anything with them.

  19. Night Writer May 22, 2016 12:10 pm

    Yes Hellers and without a ROM the computer doesn’t change, right? The iron age equivalent of that argument would be that interchangable gears does not count unless they are welded. You are so unethical.

  20. Anon May 22, 2016 2:44 pm

    Mr. Morgan’s agenda has clearly been with the “infringer’s lobby” as he has indicated that he does not work for those obtaining or having patents, and his “defense” of “all-things-IPR” has been fairly consistent, no matter what the issue under discussion about IPRs has been.

    Mr. Heller too has an all-too-clear agenda, but paradoxically is in a prime position to actually defend a strong patent right.

    The immediate thread here – aligned with Mr. Heller’s cause, as it is, pertains to that possible defense of a strong patent right – which makes the reluctance to actually discuss the very pertinent legal point that I have clearly presented all the more quizzical. This particular point does not have anything to do with either software patents or business method patents – the topics that typically set Mr. Heller into his “anti-patent” mode.

    And yet, silence on the points raised – not even acknowledging the issue itself (while over on that other blog, he does complain about the treatment of the patent within the office and after the initiation point – but such treatment ONLY comes about because of what happens AT the initiation point. It is indeed a bizarre happenstance that Mr. Heller finds himself in, and his refusal to engage on the merits only raises more questions as to his advocacy.

  21. Edward Heller May 22, 2016 2:54 pm

    anon31315, since 1836, all losing parties to an interference had remedy in district court. See, e.g., Patent Act of 1836 at Sec. 16. Executive Benefits Ins. Agency v. Arkison, 134 S. Ct. 2165, 573 U.S., 189 L. Ed. 2d 83 (2014) held that a trial de novo with a right to jury trial cured any constitutional violation.

  22. Edward Heller May 22, 2016 2:57 pm

    David, Roberts can vote on Cooper v. Lee. It would be odd for the court to take that case and not take MCM. Perhaps they take both if they take Cooper?

  23. David May 22, 2016 2:58 pm

    Ned – incorrect. Advisory orders requiring dist court enforcement plus de novo trial court review cure the constitutional harm. See Schor and Crowell.

    De novo review by the trial court of an administrative order that otherwise carries legal effect (i.e. Reexam) on a question of law does not fix the separation of powers violation.

  24. Edward Heller May 22, 2016 3:00 pm

    Paul, regarding ITC, such actions do not revoke patents; and ITC “decisions” do not have collateral estoppel effect.

  25. Edward Heller May 22, 2016 3:05 pm

    David@23, I know that Roberts would agree with that position. But, after reading both Executive Benefits and Wellness v. Sharif, I think the majority would not.

    Regardless, that precise issue is not before the court and they will not decide it, I think.

  26. David May 22, 2016 5:16 pm

    Ned – again, incorrect. But for an appeal to the district court for de novo review, the administrator would resolve the private right with finality. Executive Benefits doesn’t say that; Schor doesn’t say that; Crowell doesn’t say that.

    If the licensing entities want to the question the constitutionality of IPR, they have to make peace with the collateral damage that is coming to reexam.

    If you start parsing reexam from ipr the argument collapses. As the saying goes, pigs get fat, hogs get slaughtered.

  27. Edward Heller May 22, 2016 10:05 pm

    David, all you are saying is that the claims cannot be cancelled pending review de novo by a court of law. I think that is actually how the prior regime worked.

  28. David May 23, 2016 1:02 am

    Reexam is constitutional because the CAFC in Patlex held that the validity of an issued patent is a public right.

    Reexamination cancels issued patent claims. Reexamination does not render advisory opinions.

  29. Edward Heller May 23, 2016 12:12 pm

    David, reexamination does not cancel anything. A certificate of correction does. It is not issued until the appeal process is over.

  30. David May 23, 2016 12:25 pm

    And what happens if the patentee does not pursue an appeal?

  31. staff May 23, 2016 1:53 pm

    ‘We argue that IPR violates Article III of the Constitution, which vests the judicial power in the federal courts, and also the Seventh Amendment, which guarantees a right to a jury in civil litigation.’

    We agree. The Constitution merely acknowledges and codifies the historically recognized rights of inventors. As then future president James Madison wrote in Federalist No. 43 , “The utility of the clause will scarcely be questioned. The copyright of authors has been solemnly adjudged, in Great Britain, to be a right of common law. The right to useful inventions seems with equal reason to belong to the inventors. The public good fully coincides in both cases with the claims of the individuals.”

    These then are property rights in every sense and as such demand the same treatment afforded all property rights -a lawful court and jury.

    Also, see measure 3 in our Statement of Position as below.

    For our position and the changes we advocate to truly reform the patent system, or to join our effort, please visit us at https://aminventorsforjustice.wordpress.com/category/our-position/
    or, contact us at tifj@mail.com

  32. Edward Heller May 23, 2016 3:39 pm

    David@34, arguably, he has voluntarily waived his rights. See, Wellness v. Sharif.

  33. Edward Heller May 23, 2016 3:52 pm

    Staff, the founding fathers saw patent rights to be equally as much common law rights as are copyright rights. The argument of the founding father to put their protection in the Federal Government, rather than to continue to protect them at the state level, was urged upon the founding fathers by the states themselves so as to better protect these common law rights.

    But the source of the rights were and always have been England and the common laws courts. See, e.g., Pennock v. Dialogue, 27 US (2 Pet.) 1 (1829) at 18.

    “It is obvious to the careful inquirer, that many of the provisions of our patent act are derived from the principles and practice which have prevailed in the construction of that of England. It is doubtless true, as has been suggested at the bar, that where English statutes, such for instance, as the statute of frauds, and the statute of limitations; have been adopted into our own legislation; the known and settled construction of those statutes by courts of law, has been considered as silently incorporated into the acts, or has been received with all the weight of authority. Strictly speaking, that is not the case in respect to the English statute of monopolies; which contains an exception on which the grants of patents for inventions have issued in that country. The language of that clause of the statute is not, as we shall presently see, identical with ours; but the construction of it adopted by the English courts, and the principles and practice which have long regulated the grants of their patents, as they must have been known and are tacitly referred to in some of the provisions of our own statute, afford materials to illustrate it.”

    It is there highly pertinent to the issue at hand as to how validity was decided in England. To cut the matter short, at least from 1602, in the Case of Monopolies decided by Lord Coke, validity was a matter for the common law courts, were, of course disputed facts were tried to a jury.

  34. David May 23, 2016 4:28 pm

    Foregoing an appeal does not constitute waiver of an Article III violation.

    You are creative, I will give you that. If IPR is to become advisory, reexamination will as well.

  35. Ron Katznelson May 23, 2016 5:22 pm

    Anon,
    I happen to agree with your point that there is an IPR institution problem. But for my benefit – and this is not an harassment attempt – please do articulate the question to SCOTUS you would pose in a stand-alone form on the threshold of instituting an IPR that I can understand. I can see several points that have been raised and I am unsure what exactly you mean.

    For example, I see serious due process problems with the “reasonable likelihood” threshold for instituting an IPR. The standard of “reasonable” is much lower than 50% as it is equal to 1 minus the probability of the “unreasonable doubt” limit bordering “reasonable” doubt. Thus, less than 1% probability can be deemed as “reasonable” likelihood. A patent is presumed valid and invalidating it requires the challenger to meet the clear and convincing evidence (CCE) standard. This standard cannot depend on the tribunal that adjudicates those rights – it is based on the countervailing asymmetries in the risk of loss to the disputants due to an adjudication error. (See my amicus brief in i4i v Microsoft, http://bit.ly/MS-v-i4i-Brief ). Instituting an IPR under this threshold immediately involves substantial disfigurement of the patent right and the patent value. Short of using the CCE standard, there could be several Constitutional infirmities: (i) Due process, (ii) Takings, or (iii) Article III violation for diversion of an issue from Article III court which applies the CCE. Are these the issues you are concerned about? Which part of the Constitution would your question address as being violated by “what Congress did”?

  36. Night Writer May 23, 2016 6:44 pm

    The big picture: 1000 federal district court judges, 100-200 patent judges. CJ Roberts is in charge of the federal courts. No way is he going to increase the work load by 10 % by ruling IPRs are Unconstitutional. Just not going to happen.

  37. Edward Heller May 23, 2016 7:40 pm

    David, You are truly arguing Roberts position in Wellness. He was joined only by Scalia and by Thomas. That means he is now in the minority 6-2.

    But the consent or lack of consent in a situation like IPRs has never been litigated and decided. But given Wellness, the handwriting is on the wall.

  38. Edward Heller May 23, 2016 7:43 pm

    Night, read Roberts in Wellness. You have him all wrong.

    Wellness: https://scholar.google.com/scholar_case?case=1726045641934009746&q=wellness+v.+sharif&hl=en&as_sdt=2006

  39. Eric Berend May 24, 2016 10:37 pm

    Shall we all now go back to the heart of the matter, here?

    The U.S. Constitution is the acknowledged basis and power from which all U.S. Patent law emanates. The specific clause describing its role as regards inventions *per se*, reads, “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries” (Article I, Section 8, Clause 8).

    *Nota bene*, “…by SECURING for limited Times to Authors and Inventors…” (capitalized emphasis added).

    The said Inter Partes Review (“IPR”) proceeding is the very antithesis of this Constitutional imperative.

    By empowering many and potentially infinite ‘bites at the apple’ against an already granted Constitutional property right, the very concept of “…Securing…” is substantially to wholly undermined by these said IPR. The extension of standing to essentially any citizen or corporate party multiplies the scope of its application, so as to create an unequal bargaining position which violates the legal doctrine of unconscionability.

    The latter assertion here is far from extraordinary; the concept has its roots in British jurisprudence from times similar to that which the Founding Fathers of the U.S. drew upon for their legal sources[1]; and is readily expressed today in property law in the U.S. For example: the financial and litigation burden of tenants versus landlords has seen this doctrine upheld in cases in New York State and in its law[2] and motivated adoption of the Uniform Residential Landlord and Tenant Act in whole or in part by at least 23 States[3], upon a far less daunting mountain than to climb than the said IPR, in defending one’s property interest.

    Fortunate is the inventor who has the resources to fully participate in the IPR process. The prospect of an unknown number of said proceedings, able to be brought at any time during the patent’s term, carries the potential to bankrupt all but the most deep-pocketed individual, partnership or corporation. The ability to develop a patented invention is thus rendered functionally insecure.

    Therefore these said IPR proceedings are indubitably Unconstitutional, upon several essential bases stemming from both established civil common law which provenance was incorporated into U.S. jurisprudence and from the original U.S. Constitutional empowerment; and here, explicated upon arguments not necessarily raised in the above described ‘MCM Portfolio, LLC’ subject case submitted for SCOTUS review.

    References:
    1. As early as 1750, an unconscionable bargain was recognized as a form of fraud by an English court, in ‘Earl of Chesterfield v. Janssen’, 28 Eng. Rep. 82, 100 (Ch. 1750). Ref: 1 J.Story, EQUITY JURISPRUDENCE Sect. 188 (13th Ed., 1886)
    2. The doctrine of unconscionability is applicable to leases. See, Section 10:12 of Landlord and Tenant Practice in New York, wherein this principle of law is discussed…A corollary principle to the implied covenant of good faith and fair dealing is the right of both parties not to be bound by unconscionable lease provisions. A provision may be found unconscionable when it was obtained without the meaningful consent of the party against whom it operates and when its terms are unreasonably favorable to the proponent.” Malik v Toss 29, Inc. 2007 NY Slip Op 50618(U) [15 Misc 3d 1112(A)].
    Also see: New York State Real Property Law 235-c of 1976.
    3. A listing describing some degree of URLTA compliance by each State can be found at: http://www.ncsl.org/research/environment-and-natural-resources/state-adoptions-of-urlta-landlord-duties.aspx

  40. Night Writer May 25, 2016 8:42 am

    @38: IDK Ned. I’ll have to look at that closer. I remember when it came out but didn’t read it. But, the big picture is the amount of work that patents is to a way overburdened judiciary. Did you know they were trying to set up a system of masters that were patent experts to handle these cases at the dist. level, but that was very hard to do.

  41. Night Writer May 25, 2016 9:44 am

    @39

    What would everyone think if Congress took the patent judges and made them fed. dist. judges with special jurisdiction? We could set up a validity court. That seems like the fair way to go. I know I didn’t spell out the details, but the Constitution provides all the powers to make limited jurisdiction and then the validity trial could be more encompassing. Also, that would solve the over burdened fed. court system problem.

    Actually, I think that would solve all the problems. What if the patent judges did the entire trial so that you went to the patent judges for all patent matters and that is all they did? That would work.

  42. Night Writer May 25, 2016 10:16 am

    All of you need to get the bigger picture. The judiciary is about the same size with 4 to 10 times the number of cases. It is broken. Patents are like huge chunk of work that they don’t particularly like and would love to be rid of.

  43. Anon May 25, 2016 10:30 am

    Night Writer,

    Add into any such Congressional action to properly set up such an Article III inferior court system the appropriate protection of jurisdiction stripping patent appeals from the Supreme Court – elsewise, nothing will really change.

  44. David Boundy May 25, 2016 10:36 am

    Anon @ 6, 9, 17 —

    I share the consternation of several others in this thread, I couldn’t answer you if you asked me to, because I don’t see your question. A constitutional argument requires you to identify three things specifically, here (without asking those of us new to the converstation to figure out what you’re talking about) —
    a. the specific constitutional provision that’s being violated
    b. specific wording of the statute that conflicts
    c. an explanation of the clash
    Without those three put right next to each other so we can see the clash, I (for one) can’t follow you. Nobody’s avoiding your question, we can’t see your question.

  45. Paul F. Morgan May 25, 2016 10:55 am

    N.W. Thanks for introducing one touch of reality to this particular blog and its comments with “All of you need to get the bigger picture. The judiciary is about the same size with 4 to 10 times the number of cases. It is broken. Patents are like huge chunk of work that they don’t particularly like and would love to be rid of.”
    I.e., the Supremes are not predisposed to reach for a rare unconstitutional overruling of an act of Congress in this case in particular. Especially the AIA, which was enacted by a large bi-partisan vote of Congressional members that would resent that treatment of their legislation. Also, what do you see in recent Sup. Ct. patent decisions that are particularly pro-patent?
    Nor is wishing that Congress is going to ride to their rescue from the AIA or any Sup. Ct. decisions they dislike facing reality.
    P.S. Individuals playing the disreputable game of “shoot the messenger” know perfectly well that I do not represent anyone but myself on any issues, and have no financial interest in their outcome [and thus can have a more realistic and objective view base on many prior years of patent law experience].
    I appreciate how much many patent attorneys hate the AIA and several Sup. Ct. decisions. But non-substantive insults against anyone not a sycophant to personal fantasies of their disappearance are useless and unprofessional. Wait to see the real outcome here for yourself.

  46. Paul F. Morgan May 25, 2016 11:04 am

    Thank you David Boundy for reinforcing my point. Anon and others apparently want to be able to say after both pending cert petitions are rejected, that if they had used HIS unconstitutional argument [which he is not willing to present in the proper and simple form of a cert petition “question”, and will undoubtedly not even present in an amicus brief] that it would have been successful.

  47. Edward Heller May 25, 2016 11:46 am

    Paul, you do raise an interesting point about the workload of the Federal Courts. But that might be from an aggregate point of view. Not all districts are overwhelmed; and patent cases flock to the courts that can get to trial soonest. Right now, strangely, that seems to be the ND of California.

    What could throw a monkey wrench in to a court system that is not overwhelmed at present because of the flexibility to choose unburdened courts to try patent cases, would be Congress passing a restrictive patent venue statute that might force most patent litigation into Delaware were many U.S. companies are incorporated.

    BTW, you are quoting Night on his view that the US Court system is broken. I am not sure it is. But if it is, I am sure the Chief Justice would do something about it other than slamming the doors of courts to patent owners to the extent their constitutional rights are abrogated by doing so.

  48. Edward Heller May 25, 2016 11:58 am

    Eric, the most forceful point you made is the lack of standing requirement so that anyone and everyone can bring IPRs until the small patent owner is finished financially. We once had a system just like IPRs where anyone could bring revocation actions. But that right of action was abolished in the Patent Act of 1836.

  49. Anon May 25, 2016 12:17 pm

    Mr. Morgan,

    Mr. Boundy’s point does NOT apply to either you or Mr. Heller who have seen the context of the question over the course of more than just this thread.

    Be that as it may, the constitutional question is indeed broken down into bite size pieces to which anyone (including Mr. Boundy) can readily digest.

    In the instant snapshot, all one has to do is follow the items that I have laid out in post 4: compare and contrast all of the sticks in the bundle of property rights that is a granted patent between the time immediately after grant and the time immediately after IPR initiation per the statutory directives as laid out by Congress.

    This is not a difficult task in and of itself.

    In fact, on other blogs Mr. Heller has complained about what the Patent Office does after the initiation point in relation to one of the sticks (the presumption of validity).

    And yet, attempting to guide Mr. Heller in an explicit statement that something is different in the two aforementioned instances of time has been nigh impossible.

    I am NOT looking for an entire Constitutional dissertation all at once (if I were, then Mr. Boundy’s observations would be much more pertinent). Instead, I seek something so very much more simple and what should be readily and easily engaged.

  50. Eric Berend May 27, 2016 9:17 am

    Night Writer @41.:

    That assumes that there is a genuine motivation to prosecute these said patent interests in a valid U.S. Constitutional manner. The wealthy, corrupt infringer companies behind these devastating so-called “reforms”, are specifically dedicated to the very opposite outcome. And, they are winning. So long as they have the upper hand as to legislative and judicial influences, there will be no surcease of same; and this fraudulent racket will continue.

  51. Anon June 1, 2016 8:02 pm

    So no one wants to take the simple comparison exercise that I laid out at post 4….

    (You do not need to write a full Constitutional thesis to take that first very simple step)