Appeal of First IPR to Federal Circuit - Part II: Oral Argument

On November 3, 2014, the Federal Circuit heard oral argument in In re: Cuozzo Speed Technologies LLC, No. 2014-1301(MP3 recording available here), an appeal from the first IPR filed under the AIA and the first IPR final written decision. Garmin Int’l, Inc. v. Cuozzo Speed Techs. LLC, IPR2012-0001, Paper 59 (Nov. 13, 2013) (Final Written Decision). Judges Newman, Dyk, and Clevenger probed claim construction standards, appellate review of an institution decision, and the inability to successfully amend in IPR.

The appellant, Cuozzo, asserted the Board made three errors but counsel for Cuozzo only had time to identify and address the first two. First, the Board violated the “particularity” requirements of 35 U.S.C. § 314(a) when it instituted on clams 10 and 14 based on grounds not raised for those claims but raised for a dependent claim. Appellant’s roadmap was quickly derailed by questions on whether an institution-related decision was appealable and whether the statute barring appeal was meant to merely bar interlocutory appeals.

Second, appellant argued the Board incorrectly applied the broadest reasonable interpretation (BRI) standard instead of the Phillips standard. Judge Dyk questioned whether it mattered which standard was applied where the preferred embodiment would still be included in the scope of the construed claim (because then the obviousness arguments could still apply). Appellant also argued the USPTO exceeded it rulemaking authority.

The USPTO intervened, with Solicitor Nathan Kelly arguing for the Office. The Solicitor took three positions. First, that the decision to institute is unappealable and unreviewable; second, that the BRI was the correct claim construction standard; and third, that the Board’s denial of the motion to amend was proper.

First, the Solicitor argued that the decision to institute was final and entirely unreviewable on appeal absent a constitutional claim against the decision. Judge Dyk suggested there is evidence that Congress intended the Board to have the discretion whether to not institute, but that preventing mandamus for decisions to institute might not have been Congress’ intent. Judge Newman questioned whether this was efficient. Judge Clevenger noted that in this case the USPTO could “have your cake and eat it too” because it arguably did not matter if the panel reviewed the institution decision because the grounds for the dependent claim necessary apply to the claims from which they depended.

On the second and third points, Judge Newman noted that “it’s not so easy” to amend claims in an IPR. Mr. Kelley agreed, suggesting Congress did not intend for it to be easy. Besides, the Solicitor pointed out, the specification did not support these amended claims.

In all, it was a lively argument important to the future of U.S. patent law.