In 2011, as part of the American Invents Act (“AIA”), Congress significantly restructured the way in which previously issued patents could be challenged. In some cases, existing post-issuance proceedings, like ex parte reexamination and reissue proceedings, were kept intact as such proceedings existed prior to the AIA. In other cases, existing post-issuance proceedings, like inter partes reexamination, were replaced with new proceedings, such as the inter partes review proceedings (“IPRs”). In addition, brand new proceedings were created, such as post-grant review proceedings (“PGRs”), covered business method patent review proceedings (“CBMs”), and supplemental examination proceedings. In each instance, Congress made policy choices as to who could (or could not) bring and/or participate in such proceedings, and who could (or could not) raise challenges to decisions made by the government in such proceedings. See SAS Instit. v. Iancu, 584 U.S. ___ (slip op. at 6) (2018) (confirming different structure of reexamination proceedings and IPRs, and recognizing Congressional “structural” choices are deserving of deference; “Congress’s choice to depart from the model of a closely related statute is a choice neither we nor the agency may disregard.”).
In a series of decisions, starting with Consumer Watchdog v. Wisconsin, Alumni Research Foundation, 753 F.3d 1258 (Fed. Cir. 2014), the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit”) began to second guess the legislative choices made by Congress as to who could appeal from an adverse ruling from an inter partes reexamination proceeding at the U.S. Patent and Trademark Office (“PTO”). Although this was a pre-AIA proceeding, the Federal Circuit’s determination has foreshadowed a trend at the Federal Circuit to overturn legislative choices with the Federal Circuit’s own judgment under the guise of Article III standing. In particular, in Consumer Watchdog, the panel dismissed an appeal authorized by statute by Consumer Watchdog, a public advocacy group, for lack of standing under Article III, because it purportedly lacked an “injury-in-fact.” By definition, this argument makes no sense. When Congress created the legal right for Consumer Watchdog to petition the government to revoke WARF’s patent franchise, and the government denied that requested relief, Consumer Watchdog was injured, even though the injury would not have existed without the statute. See, e.g., Warth v. Seldin, 422 U.S. 490, 514, 95 S. Ct. 2197, 45 L. Ed. 2d 343 (1975) (“Congress may create a statutory right or entitlement the alleged deprivation of which can confer standing to sue even where the plaintiff would have suffered no judicially cognizable injury in the absence of statute.”); Linda R.S. v. Richard D., 410 U.S. 614, 617 n.3, 93 S. Ct. 1146, 35 L. Ed. 2d 536 (1973) (“Congress may enact statutes creating legal rights, the invasion of which creates standing, even though no injury would exist without the statute.”). Article III does not preclude the Court from hearing an appeal from such a deprivation of the statutory right, even though no injury would exist without the statute.
Since Consumer Watchdog, the Federal Circuit has continued to apply and expand its misplaced standing requirements by dismissing appeals of unsuccessful petitioners in IPR proceedings for lack of standing on the grounds that it “has not substantiated its alleged injury in fact.” See Phigenix, Inc. v. ImmunoGen, Inc., 845 F.3d 1168, 1176 (Fed. Cir. 2017). See also RPX Corp. v. Chanbond LLC, No. 2017-2346, Order on Motion at 6 (Fed Cir. Jan. 17, 2018) (dismissing appeal and concluding “RPX lacks Article III standing to appeal the Board’s decision affirming the patentability” of the challenged claims in an IPR).
These decisions reflect a fundamental misapplication of the jurisprudence associated with Article III standing in the context of an appeal from a decision by the government to deny an authorized petitioner requested relief. The statutorily granted right of a petitioner in an IPR to bring and participate in an IPR, and its appeal (see 35 U.S.C. §§ 311(a), 319) is the type of “particularized” injury which Courts have long recognized confers standing to the petitioner to challenge the denial of its requested relief. Compare Pub. Citizen v. United States Dep’t of Justice, 491 U.S. 440, 449, 109 S. Ct. 2558, 105 L. Ed. 2d 377 (1989) (“As when an agency denies requests for information under the Freedom of Information Act, refusal to permit appellants to scrutinize the ABA Committee’s activities to the extent FACA allows constitutes a sufficiently distinct injury to provide standing to sue. Our decisions interpreting the Freedom of Information Act have never suggested that those requesting information under it need show more than that they sought and were denied specific agency records.”), with Lujan v. Defenders of Wildlife, 504 U.S. 555, 573-74, 112 S. Ct. 1735, 118 L. Ed. 2d 352 (1992) (rejecting standing where plaintiff raised “only a generally available grievance about government—claiming only harm to his and every citizen’s interest in proper application of the Constitution and laws, and seeking relief that no more directly and tangibly benefits him than it does the public at large”).
As set forth more fully in our white paper, we contend that when Congress grants a petitioner in an IPR proceeding the right to petition the government to seek specific relief (invalidate one or more claims on the previously issued patent franchise), and when the government (arguably improperly) denies such relief, the denial of such relief is a sufficient injury in fact to provide the Courts with constitutional authority under Article III to hear appeal from that denial by the unsuccessful petitioner. In such cases, the “imperatives of a dispute capable of judicial resolution” are “sharply presented issues in a concrete factual setting” where self-interested parties vigorously advocate opposing positions. United States Parole Comm’n v. Geraghty, 445 U.S. 388, 403,100 S. Ct. 1202, 63 L. Ed. 2d 479 (1980). As Congress recognized in Section 319 of the Patent Act, this imperative is met by “any party to the inter partes review” who is “dissatisfied with the final written decision” and who appeals such decision. 35 U.S.C. § 319; see also Oil States Energy Servs. LLC v. Greene’s Energy Group LLC, 584 U.S. ___ (slip op. at 4) (2018) (“A party dissatisfied with the Board’s decision can seek judicial review in the Court of Appeals for the Federal Circuit. § 319. Any party to the inter partes review can be a party in the Federal Circuit. Ibid.”). By limiting standing to parties of the inter partes review, Congress is not seeking to expand the standing requirement to every citizen seeking to require the government to be administering the law, but limits the class to those with the particularized injury defined by statute. Thus, the concerns of Lujan are more than adequately met by the statute as drafted by Congress, and further limitations on standing by Article III are not needed, nor appropriate.
Likewise, since an appeal must be against a Final Written Decision of the PTAB to which a party to the proceeding was “dissatisfied,” the Congressionally defined injury in combination with the specific adverse Final Written Decision, provide sufficient boundaries to make such an appeal concrete and not hypothetical.
Of course, Congress can further limit the availability of such a challenge (as it has in other instances, like ex parte reexamination), but once a petitioner is authorized by Congress to make such a petition for relief and participate in an appeal of the denial of such relief and has suffered the Congressionally defined injury of being “dissatisfied” with an adverse Final Written Decision, the Courts have sufficient constitutional authority to proceed with reviewing the allegedly unlawful denial by the government.
The following excerpt from our White Paper summarizes our analysis of how the Federal Circuit should be deciding standing issues associated with a dissatisfied petitioner in an appeal from an adverse final written decision in an IPR:
At its roots, the Federal Circuit’s analysis fails to recognize that this is the easy case which should “ordinarily [raise] little question” to establish constitutional standing.
Congress created a statutory right for any person other than the patent owner to petition the government (via the PTAB) to institute an inter partes review and seek a specific relief in the form of invalidation and cancellation of the claims challenged in the petition. 35 U.S.C. §311(a) (“Subject to the provisions of this chapter, a person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent.”). See also Oil States, slip op. at 4 (“Any person other than the patent owner can file a petition for inter partes review.”).
If instituted, the petitioner is entitled to participate in the proceeding with “at least 1 opportunity to file written comments,” usually in the form of a Reply Brief. See 35 U.S.C. § 316(a)(13) (“providing the petitioner with at least 1 opportunity to file written comments within a time period established by the Director”); see also 37 C.F.R. § 42.23.
The petitioner also has a right to participate in an oral hearing. 35 U.S.C. § 316(a)(10) (“providing either party with the right to an oral hearing as part of the proceeding”); see also 37 C.F.R. § 42.70.
As the Supreme Court explained in SAS, “[i]f an inter partes review is instituted and not dismissed,” at the end of the trial the Board “shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner.” SAS, slip op. at 3 (quoting 35 U.S.C. § 318(a)).
The personal nature of the requested relief was emphasized by the Supreme Court in SAS:
So when §318(a) says the Board’s final written decision “shall” resolve the patentability of “any patent claim challenged by the petitioner,” it means the Board must address every claim the petitioner has challenged.
In all these ways, the statute tells us that the petitioner’s contentions, not the Director’s discretion, define the scope of the litigation all the way from institution through to conclusion.
SAS, slip op. at 5, 9 (emphasis added).
Thus, the Petitioner defines the scope of the proceeding, and identifies the contentions which must be addressed by the PTAB in its final written decision, if a proceeding is instituted and not settled.
Any person not a patent owner can be a petitioner, and as the Supreme Court recognized in Cuozzo, “[p]arties that initiate the proceeding need not have a concrete stake in the outcome; indeed, they may lack constitutional standing. See § 311(a); cf. Consumer Watchdog v. Wisconsin, Alumni Research Foundation, 753 F.3d 1258, 1261-1262 (C.A.Fed.2014).” Cuozzo, 136 S. Ct. at 2143-44. Of course, however, for purposes of determining standing under Article III, the Congressional grant of the substantive right to petition for a relief under the AIA is enough to confer standing to appeal an adverse decision denying such a relief, even if the petitioner “would have suffered no judicially cognizable injury in absence of the statute.” Warth, 422 U.S. at 514; see also Linda R.S., 410 U.S. at 617 n.3.
The AIA goes one step further in that Congress explicitly provided that any party which suffers the injury of being “dissatisfied” with the Board’s decision, may appeal to the Federal Circuit, and further provides that any party at the PTAB can participate on appeal. 35 U.S.C. § 319. The Supreme Court recognized this broad Congressional grant in Oil States:
A party dissatisfied with the Board’s decision can seek judicial review in the Court of Appeals for the Federal Circuit. §319. Any party to the inter partes review can be a party in the Federal Circuit. Ibid
Oil States, slip op. at 4.
The AIA further provides as an additional injury to an unsuccessful petitioner, that an estoppel will attach with the adverse final written decision. 35 U.S.C. § 315(e). If an appeal is not timely made under the statute, this estoppel may not be reversed down the road if such a petitioner is ever accused of infringement during the twenty-year life of a patent. See 35 U.S.C. § 142; 37 C.F.R. § 90.3(a)(1) and (b)(1).
Justice Gorsuch’s comparison of the IPR statute with the ex parte reexamination statute in SAS is illuminating. Congress provided in the ex parte reexamination statute that only the patent owner involved in a reexamination proceeding can seek judicial review by the Federal Circuit. See 35 U.S.C. § 306. If Congress had wanted to confer standing to only limited types of parties to IPR proceedings, “it knew exactly how to do so–it could have simply borrowed from the statute next door.” SAS, 138 S. Ct. at 1355. The fact is that it did not and instead explicitly provided in the IPR statute that “[a]ny party to the inter partes review shall have the right to be a party to the appeal [in the Federal Circuit],” 35 U.S.C. § 319. As Justice Gorsuch cautioned in SAS, “Congress’s choice to depart from the model of a closely related statute is a choice neither [the Court] nor the agency may disregard.” SAS, 138 S. Ct. at 1355.
Congressional grant of the right not only to petition the government for a relief, irrespective of whether there is a judicially cognizable injury in the absence of the statute, but also to bring an appeal when that party suffers the intangible harm of being “dissatisfied” with the government’s decision is an example of the simple case that Lujan recognized should “ordinarily” present “little question” that a petitioner who did not receive requested relief has been injured. 504 U.S. at 561-62. The fact that an estoppel further is attached (35 U.S.C. § 315(e)) which cannot be later challenged only emphasizes that a real injury in fact has occurred.
A petitioner in an IPR is an “object of the action or inaction at issue” in an appeal from the PTAB’s denial of the relief requested by a petitioner in its IPR petition. By definition, since it is the petitioner’s petition to invalidate one or more claims of a patent franchise that has been denied in a final written decision by the PTAB, concerns about “particularization” are easily met.
Further, a petitioner, which is the object of the action or inaction, has suffered not only a particularized injury (for having its requested relief denied), but also a concrete one as defined by the Congressionally mandated harm of the PTAB issuing a purportedly improper Final Written Decision to which the petitioner was “dissatisfied.” 35 U.S.C § 319; see Spokeo, Inc. v. Robbins, 136 S. Ct. 1540, 1549, 1553 (2016).
Thus, as the Supreme Court recognized was within its authority, Congress has created a statutory right to petition the government to take a second look at previously issued patent franchise in an IPR proceeding, the alleged deprivation of which confers standing upon the petitioner to appeal the government’s decision to the Federal Circuit, “even where the [petitioner] would have suffered no judicially cognizable injury in the absence of the statute.” See, e.g., Warth, 422 U.S. at 514 (“Congress may create a statutory right or entitlement the alleged deprivation of which can confer standing to sue even where the plaintiff would have suffered no judicially cognizable injury in the absence of statute.”); Linda R.S., 410 U.S. at 617 n.3 (“Congress may enact statutes creating legal rights, the invasion of which creates standing, even though no injury would exist without the statute.”).
Further, since Congress defined a legislative injury of “dissatisfaction” from an adverse “final written decision,” concerns about “concreteness” are also easily met. Since the appeal must address a final written decision, there is nothing hypothetical about these cases.
Moreover, upon issuance of the PTAB’s adverse final written decision, a petitioner also suffers an actual or imminent, not conjectural or hypothetical, invasion of its legally protected interest because it would be estopped from requesting or maintaining a proceeding (e.g., seeking another IPR or an reexamination) before the Patent Office or asserting invalidity in a federal district court action or an ITC proceeding based on any grounds that were, or reasonably could have been raised during the IPR. See 35 U.S.C. § 315(e); Lujan, 504 U.S. at 560. If not allowed an opportunity to timely appeal this adverse final written decision as Congress authorized, such a petitioner will be estopped down the road during the 20-year life the patent (and potentially related patents) from undoing the wrong that was alleged to have occurred without any judicial oversight.
Likewise, an appeal from a final written decision denying the petitioner relief requested in its petition will no doubt, if successful, result in “a judgment preventing or requiring action that will redress it.” Cf. Lujan, 504 U.S. at 561-62 (“When the suit is one challenging the legality of government action or inaction, the nature and extent of facts that must be averred (at the summary judgment stage) or proved (at the trial stage) in order to establish standing depends considerably upon whether the plaintiff is himself an object of the action (or forgone action) at issue. If he is, there is ordinarily little question that the action or inaction has caused him injury, and that a judgment preventing or requiring the action will redress it.” (emphasis added)).
The harder issues that Lujan and Spokeo addressed are simply not present in an appeal by a losing petitioner from an adverse final written decision, irrespective of whether that petitioner is currently the subject of a risk of patent infringement.
Like a FOIA petitioner who is entitled to challenge in Court whether the government gave it the information requested, a petitioner in an IPR is entitled to challenge on appeal to the Federal Circuit whether the PTAB gave it the relief it requested. Cf., e.g., Department of Justice v. Reporters Comm. for Freedom of Press, 489 U.S. 749 (1989); Department of Justice v. Julian, 486 U.S. 1 (1988); United States v. Weber Aircraft Corp., 465 U.S. 792 (1984); FBI v. Abramson, 456 U.S. 615 (1982); Department of Air Force v. Rose, 425 U.S. 352 (1976). See also Public Citizen v. U.S. Dep’t of Just., 491 U.S. 440, 449-450 (“Our decisions interpreting the Freedom of Information Act have never suggested that those requesting information under it need show more than that they sought and were denied specific agency records.”).
The Federal Circuit’s rulings in Consumer Watchdog, Phigenix, and RPX that the petitioners lacked standing to appeal an adverse final written decision in an IPR are incorrect. The Court rejected the arguments that petitioners met the Article III requirement of injury in fact based on the denial of their statutory right to appeal a final written decision favorable to patentability. See Consumer Watchdog, 753 F.3d 1258; Phigenix, Inc., 845 F.3d 1168; RPX v. Chanbond, No. 2017-2346, Order on Motion at 4 (Fed. Cir. Jan. 17, 2018).
In contrast, the Supreme Court held in Linda R.S. v. Richard D. that Congress may enact statutes creating legal rights, the invasion of which creates standing, even though no injury would exist without the statute. 410 U.S. 614 (1973). In addition, the Court similarly held in Warth v. Seldin that Congress may create a statutory right, which if denied, can confer Article III standing to sue, even where the plaintiff would have suffered no judicially cognizable injury in the absence of the statute. 422 U.S. 490 (1975). In accordance with these Supreme Court precedents, the D.C. Circuit ruled in Zivotofsky v. Secretary of State that when Congress creates a statutory right, the deprivation of this right is enough to satisfy Article III standing. 444 F.3d 614 (D.C. Cir. 2006) (Appellant had standing under Article III because the individual right to have “Israel” listed as his place of birth on his passport, conferred to him by Congress, was violated). Thus, the Federal Circuit decisions are not only contrary to Supreme Court precedent, but create a Circuit split over the meaning of such precedent.
The more recent Supreme Court precedent, including Lujan and Spokeo, continue to endorse the continuing vitality of Warth on this point of law. See Spokeo, 135 S. Ct. 1540; Lujan, 504 U.S. at 561-62.
The Federal Circuit failed to recognize Consumer Watchdog, Phigenix, and RPX as easy cases to determine constitutional standing, and was wrong in dismissing appeals, authorized by statute, of an unsuccessful and dissatisfied petitioner for lack of standing on the grounds that it had not sufficiently alleged an injury-in-fact. The unsuccessful petitioner in an IPR proceeding, as the object of the statute, has suffered a particularized and concrete injury in fact. The harm is particularized because the petitioner is the one whose petition was denied. It is also concrete in that the petitioner suffered in the intangible harm of being “dissatisfied” as defined by Congress in Section 319. The unsuccessful petitioner has also suffered an actual or imminent, not conjectural or hypothetical, harm based on estoppel triggered upon issuance of the adverse final written decision. Thus, an unsuccessful petitioner meets the requirements of Article III standing, even if the petitioner would not have suffered an injury in the absence of the statute.
In the AIA, Congress gave any person other than the patent owner the substantive right to petition the government to take a second look at a previously issued patent franchise in an IPR proceeding. 35 U.S.C. § 311(a); see also Oil States, slip op. at 2. Congress further expressly provided that a party dissatisfied with the Board’s decision in such a proceeding can seek judicial review by the Federal Circuit and be a party in such an appeal. 35 U.S.C. § 319; see also Oil States, slip op. at 4.
Thus, Congress created a statutory right (the right to file a petition and if instituted obtain a proper final written decision), which if deprived confers standing on the petitioner, even if the petitioner “would have suffered no judicially cognizable injury in absence of the statute.” Warth, 422 U.S. at 514; see also Linda R.S., 410 U.S. at 617 n.3. The Federal Circuit’s holdings in Consumer Watchdog, Phegnix and RPX to the contrary are wrong and should be reversed.