Latham & Watkins Patent Trial and Appeal Board Practice
June 22, 2016 | Number 1983
Supreme Court Affirms PTAB’s “Broadest Reasonable”
Claim Construction Standard
Supreme Court sides with Patent Office’s rulemaking authority.
On Monday, June 20, 2016, the US Supreme Court issued its eagerly awaited Cuozzo 1 decision, affirming
the Federal Circuit’s decision. 2 Specifically, the Court:
•
Unanimously affirmed the Patent Office’s application of the broadest reason interpretation (BRI) in
claim construction in PTAB proceedings — finding it to be a reasonable exercise of the Patent
Office’s rulemaking authority.
•
In a majority opinion, against the dissent of two justices, confirmed that the America Invents Act (AIA)
bars challenges to the Patent Office’s decision to institute inter partes review. 35 U.S.C. § 314(d)
BRI Claim Construction Standard
The Supreme Court upheld the Patent Office’s use of the BRI standard, rejecting Cuozzo’s argument that
the Patent Office should be required to use ordinary meaning, the standard used in district courts.
Justice Stephen Breyer, writing for a unanimous Court, analyzed the Patent Office’s use of BRI under
Chevron deference, which holds that agencies have leeway to enact reasonable rules when a statute is
ambiguous. Because the AIA does not specify the proper claim construction standard for inter partes
review, the Court found it was reasonable for the Patent Office to use BRI, consistent with the Patent
Office use in other contexts for over 100 years.
The Court concluded that the Patent Office’s regulation requiring BRI “represents a reasonable exercise
of the rulemaking authority that Congress delegated to the patent office.” Cuozzo, J. Breyer Op. at 17.
“For one thing, construing a patent claim according to its broadest reasonable construction helps to
protect the public. A reasonable, yet unlawfully broad claim might discourage the use of the invention by a
member of the public.” Id.
In reaching this conclusion, the Court rejected Cuozzo’s arguments that BRI results in too many patents
being invalidated. First, the opportunity to amend means that the use of BRI is “not unfair to the patent
holder in any obvious way.” Id. at 18–19. Second, the patent system has long recognized different tracks
in the Patent Office and district courts, supporting the use of different claim construction standards.
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No Appeal of Institution Decision
The Court also decided that the Patent Office’s decision whether to institute AIA review cannot be
challenged on appeal — although this ruling drew a dissent by two justices.
Justice Breyer’s majority opinion emphasized the express language of the statute, which says that the
Patent Office’s institution decision is “final and non-appealable.” Thus, a contrary ruling “would undercut
one important congressional objective, namely, giving the Patent Office significant power to revisit and
revise earlier patent grants.” Id. Aa 8. As he wrote: "We doubt that Congress would have granted the
patent office this authority . . . if it had thought that the agency's final decision could be unwound under
some minor statutory technicality related to its preliminary decision to institute inter partes review.” Id.
The Court did conclude that while ordinary issues in institution decisions are not reviewable, serious
constitutional questions about whether the Patent Office exceeded its authority might still be reviewable
under the Administrative Procedures Act. The majority’s opinion “do[es] not categorically preclude review
of a final decision where a petition fails to give ‘sufficient notice’ such that there is a due process problem
with the entire proceeding, nor does our interpretation enable the agency to act outside its statutory limits
by, for example, cancelling a patent claim for ‘indefiniteness under §112.’” Id. at 11.
Justice Samuel Alito wrote the dissent, joined by Justice Sonia Sotomayor. In his view, the Patent Office’s
decision to institute inter partes review cannot be immediately appealed, but findings in such decisions
should be reviewable during an appeal of a final decision.
Conclusion
Cuozzo likely leaves the status quo in place, and PTAB proceedings at the Patent Office remain a
powerful tool for challenging patents. The Patent Office and courts will continue to try to find a proper
balance between the rights of petitioners and patent owners.
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Los Angeles
Jonathan D. Link
jonathan.link@lw.com
+1.202.637.2243
Washington, D.C.
Jonathan M. Strang
jonathan.strang@lw.com
+1.202.637.2362
Washington, D.C.
Philip X. Wang
philip.wang@lw.com
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Los Angeles
Latham & Watkins
June 22, 2016 | Number 1983 | Page 2
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PTO Issues New Final Rules for PTAB Proceedings (March 31, 2016)
Let PTAB Decide
Inter Partes Review: Lessons Learned and Emerging Trends
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Endnotes
1
Cuozzo Speed Technologies, LLC v. Lee, No. 15-446, slip. op. (June 20, 2016); 579 U.S. ___ (2016), available at
http://www.supremecourt.gov/opinions/15pdf/15-446_ihdk.pdf.
2
In re Cuozzo Speed Technologies, LLC, 793 F. 3d 1268 (Fed. Cir. 2015)
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June 22, 2016 | Number 1983 | Page 3