By Tom Engellenner
Several recent cases from the Court of Appeals for the Federal Circuit have confirmed that Congress has given the U.S. Patent Office a great deal of discretion in deciding whether or not to initiate a trial when a petition for patent review under the America Invents Act (AIA) is filed by a challenger. In each instance the Federal Circuit noted it was relying upon the clear wording of the statute that established the new procedures for administratively challenging patents. Under 35 U.S.C. §314(d), “The determination by the Director whether to institute an inter partes review (IPR) under this section shall be final and nonappealable.” (The same “nonappealable” language is found in the sections of AIA governing covered business method (CBM) and post grant review (PGR) challenges).
In St. Jude Med. v. Volcano Corp., Fed. Cir., No. 2014-1183, 4/24/14, the Federal Circuit ruled on an appeal filed St. Jude Medical Cardiology Division Inc. after the Patent Trial and Appeal Board (PTAB) denied St Jude’s petition for inter partes review of a patent on systems for cardiovascular imaging owned by Volcano Corp. (U.S. Patent No. 7,134,994). In ruling on the petition the PTAB never reached the merits of St. Jude’s arguments but instead found the petition to be barred under 35 U.S.C. 315(b) because St Jude had not challenged the patent within one year of having been served with complaint (or counterclaim) alleging infringement of the patent. In this case, litigation between the two parties had been going on for numerous years and the counterclaim of patent infringement of the patent had been raised by Volcano years before the enactment of the AIA. Volcano’s counterclaim was later dismissed without prejudice by stipulation of the parties.
In re Dominion Dealer Solutions, LLC, Fed. Cir., No. 14-109, 4/24/14, involved a petition for a writ of mandamus filed by Dominion to order the PTAB to institute an inter partes review trial on five patents owned by AutoAlert, Inc. after the PTAB had found that Dominion had failed to meet its burden of showing a “reasonable likelihood of prevailing” on any of the grounds it asserted for invalidity. Again, the Court noted the non-appealable language of 35 U.S.C. §314(d) and denied relief.
Interestingly, Dominion also filed a parallel action in the U.S. District Court for the Eastern District of Virginia, arguing that the Section 314(d) “nonappealable” language applies only to appeals to the Federal Circuit, and not to civil actions under an older provision of the patent laws (35 U.S.C. §145) that permits federal district court review of U.S. Patent Office decisions more generally. However, Dominion got no relief from the federal district court either. U.S. District Judge Robert E. Payne ruled that the plain language of the AIA, the legislative history and statutory scheme, showed an intent by Congress to bar petitioners who were not granted inter partes reviews from appealing the decision to any federal court.
In ruling on Dominion’s mandamus petition, the Court declined to endorse Judge Payne’s broader conclusion because the issue of district court jurisdiction was not before it. Writing for the Federal Circuit panel, Judge Taranto ruled that “Dominion has no ‘clear and indisputable’ right to challenge a non-institution decision directly in this court, including by way of mandamus. That is all we need to decide.”Foreseeing the possibility of an appeal by Dominion from the district court decision on whether the “nonappealable” language of Section 314(d) applies to Section 145 actions, Taranto said, “We need not decide that issue here.”
The third decision handed down by the Federal Circuit last month was In re Procter & Gamble Co., Fed. Cir., No. 121, 4/24/14, which also involved a petition for a writ of mandamus but this time by the Patent Owner. In the Proctor & Gamble case, the PTAB ruled in favor of Team Technologies, Inc., and initiated an IPR trial based on Team Technologies’ petition. Proctor & Gamble’s petition for mandamus was denied by Federal Circuit, noting both the “nonappealable” language of the AIA and P&G’s ability to seek relief from any final judgment of the PTAB that adversely affects the patent by appeal under 35 U.S.C. §319. “[T]his is not one of the rare situations in which irremediable interim harm can justify mandamus, which is unavailable simply to relieve P&G of the burden of going through the inter partes review,” noted Judge Taranto.