Shearman & Sterling LLP multinational law firm headquartered in New York City, United States.

balance scale

Nov 01, 2016

Cuozzo Did Not Alter Federal Circuit’s Lack of Jurisdiction Over PTAB Institution Decisions

Subscribe

Jump to...

 

Since the inception of post-grant review proceedings before the Patent Trial and Appeal Board (“Board”), the Federal Circuit has consistently held that it lacks jurisdiction over the Board’s decisions as to whether to institute proceedings and reconsideration thereof.17 

Most recently, on October 20, 2016, in Medtronic, Inc. v. Robert Bosch Healthcare Systems, Inc.,18 the Federal Circuit denied Medtronic’s petition for rehearing, and, in doing so, reaffirmed its prior decisions that reconsideration of inter partes review (“IPR”) institution decisions are “final and nonappealable” under 35 U.S.C. § 314(d), and that nothing in the Supreme Court’s Cuozzo decision changed this result. 

In April 2013, Bosch sued Cardiocom for patent infringement in district court. Three months later—in July 2013— Cardiocom petitioned for IPR of two Bosch patents, identifying itself as the sole real party in interest (“RPI”). The following month, Medtronic announced it had acquired Cardiocom; and, in December 2013, Cardiocom filed a notice in the proceedings that it “acknowledges that Medtronic, Inc. should now be included as an additional real party in interest,” but Cardiocom “should remain as a real party in interest as well, as a wholly-owned subsidiary of Medtronic, Inc.”19 Thereafter, the Board denied institution of both IPRs because Cardiocom failed to show a reasonable likelihood that any of the challenged claims were unpatentable on the asserted grounds.20 

After the Board’s denials, Medtronic filed additional IPR petitions on the same patents, listing itself as the sole RPI. Cardiocom could not be listed as an RPI or else the newly filed petitions would have been time-barred under U.S.C. § 315(b).21 In its pre-institution preliminary responses, Bosch argued that the petitions should be denied for failure to identify “all real parties in interest” under 35 U.S.C. § 312(a)(2) because Cardiocom is also an RPI. 

Over Bosch’s objections, the Board instituted Medtronic’s petitions, holding that Bosch had not established that Cardiocom was an RPI. But, after institution, the Board granted-in-part Bosch’s motions for additional discovery regarding the RPI issue, and Bosch then moved to terminate the proceedings for failure to name all RPIs (namely, Cardiocom). Bosch’s argument rested on the following asserted facts: Cardiocom was the defendant in district court infringement suits concerning the two patents; Cardiocom had previously filed its own IPR petitions; Cardiocom’s senior executives communicated with Medtronic while the Medtronic petitions were being prepared; and Cardiocom paid a portion of the fees for preparing the Medtronic petitions. The Board was persuaded, vacated the institution decisions, and terminated the proceedings. 

Medtronic appealed, and Bosch moved to dismiss for lack of jurisdiction. The original Federal Circuit panel agreed with Bosch, and dismissed for lack of jurisdiction. Medtronic petitioned for rehearing, and while it was pending, the Supreme Court issued its Cuozzo decision. In light of Cuozzo, the Federal Circuit recalled its mandate, and requested supplemental briefing to “address the question of what action this court should take on the issue of appealability in view of the Supreme Court’s decision in Cuozzo.”

The Supreme Court held in Cuozzo that Section 314(d) bars review in cases where the “grounds… consist of questions that are closely tied” or “closely related” to the “application and interpretation of statutes related to the Patent Office's decision to initiate inter partes review.”22 On rehearing, the Federal Circuit held in Medtronic that “under Cuozzo a decision whether to institute inter partes review proceedings pursuant to § 314(a) (the issue in Cuozzo) and a reconsideration of that decision (the situation here) are both barred from review by § 314(d).”23 The Federal Circuit reasoned that “[i]t is difficult to conceive of a case more ‘closely related’ to a decision to institute proceedings than a reconsideration of that very decision. It would be strange to hold that a decision to institute review would not be reviewable but a reconsideration of that decision would be reviewable.”24 

With Medtronic and other recent decisions, the Federal Circuit continues effectively to limit appellate review to only the Board’s final written decisions, making it ever more important for petitioners to satisfy the Board that they have properly identified all RPIs and otherwise complied with the Section 312(a) requirements governing petitions for inter partes review.

Footnotes

16 Leahy-Smith America Invents Act, Pub. L. No. 112-29 § 18(c), 129 Stat. 284, 331 (2011).  
17 E.g., Husky Injection Molding Sys. Ltd. v. Athena Automation Ltd., No. 15-1726, – F.3d –, 2016 WL 5335500 (Fed. Cir. Sept. 23, 2016) (no jurisdiction over inter partes review institution decision that assignor estoppel did not apply to Patent Office); Wi–Fi One, LLC v. Broadcom Corp., No. 15–1944, – F.3d –, 2016 WL 4933298 (Fed. Cir. Sept. 16, 2016) (no jurisdiction over Board’s reconsideration post-institution of statutory time bar in inter partes review proceeding); Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356 (Fed. Cir. 2016) (no jurisdiction over inter partes review institution decision); GTNX, Inc. v. INTTRA, Inc., 789 F.3d 1309 (Fed. Cir. 2015) (no jurisdiction over instituted-but-later- vacated-and-terminated covered business method review proceeding due to time bar).
18 No. 15-1977, – F.3d –, 2016 WL 6123900 (Fed. Cir. Oct. 20, 2016). 
19 Cardiocom, LLC v. Robert Bosch Healthcare Systems, Inc., IPR2013-00439, Paper 25; Cardiocom, LLC v. Robert Bosch Healthcare Systems, Inc., IPR2013-00439, Paper 22. 
20 Medtronic, 2016 WL 6123900, at *1. 
21 Section 315(b) provides that “[a]n inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.” 
22 Cuozzo Speed Technologies, LLC v. Lee, 136 S.Ct. 2131, 2141–42 (2016). The Supreme Court left open the possibility that institution decisions may be reviewable “to ‘set aside agency action’ that is ‘contrary to constitutional right,’ ‘in excess of statutory jurisdiction,’ or ‘arbitrary [and] capricious.’” Id. at 2142. However, the Federal Circuit—as it did here—has generally rejected such challenges. 
23 Medtronic, 2016 WL 6123900, at *2. 
24 Id.

Authors and Contributors

Mark Hannemann

Partner

Litigation

+1 212 848 7696

+1 212 848 7696

New York

Thomas R. Makin

Partner

Litigation

+1 212 848 7698

+1 212 848 7698

New York

Matthew Berkowitz

Partner

Litigation

+1 650 838 3737

+1 650 838 3737

Menlo Park

Patrick Colsher

Associate

Litigation

+1 212 848 7708

+1 212 848 7708

New York

Eric Lucas

Associate

Litigation

+1 212 848 4955

+1 212 848 4955

New York