Practical Takeaways from the Recent GTNX and Cuozzo Decisions

In two recent decisions, In re Cuozzo Speed Technologies, LLC, 778 F.3d 1271 (Fed. Cir. 2015), and GTNX, Inc. v. INTTRA, Inc., Nos. 15-1349, -1350, -1352, -1353 (Fed. Cir. June 16, 2015), the Federal Circuit continues to develop on the scope of appellate review and claim construction for post-grant proceedings at the Patent Trial and Appeal Board (PTAB). Practical developments in this space include:

• Federal Circuit Lacks Jurisdiction to Review PTAB Institution Decisions as Part of a Direct Appeal. GTNX and Cuozzo build on the Court’s holding in Jude Medical, Cardiology Division, Inc. v. Volcano Corp., 749 F.3d 1373 (Fed. Cir. 2014), that it lacked jurisdiction to review PTAB institution decisions before a final written decision. In Cuozzo, the Court held that it also lacks jurisdiction to review an institution decision after a final decision issues because the PTAB’s reliance on prior art not identified in the petition alone “provides no ground for setting aside the final decision.” GTNX extends these decisions, with the Court holding that it cannot review decisions where the PTAB vacates an institution decision and terminates a proceeding after institution but prior to issuing a final written decision. Taken together, these cases signal the Federal Circuit’s reluctance to second-guess institution decisions that are not final written decisions.

• Federal Circuit May Have Jurisdiction to Review PTAB Institution Decisions Via a Writ of Mandamus—Although It Has Not Granted Any Yet. Although the Court concluded that the AIA precludes review of institution decisions via direct appeal, review may still be available through a writ of mandamus. In GTNX, the Court considered whether to grant mandamus relief, explaining that a party must demonstrate a sufficient need under the “clear and indisputable” standard for this writ. The Court denied the writ, however, because it determined that GTNX did not demonstrate “a clear, indisputable right to have the [PTAB] maintain the proceeding.”

• The PTAB Should Use “Broadest Reasonable Construction” for Claim Interpretation. The PTO’s regulations, enabled by the AIA, require the PTAB to interpret claims using the “broadest reasonable construction” rather than the “plain and ordinary meaning” standard applied in district court. Cuozzo affirmed the PTAB’s application of the broadest reasonable construction, referencing more than 100 years of PTO use and judicial approval of the standard. This potential for broader constructions at the PTAB than at the district court may provide greater leeway in asserting invalidity.

• For Claim Construction, the Court Will Review Facts for “Substantial Evidence” and Law “De Novo.” Relying on the Supreme Court’s decision in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (2015), Cuozzo signaled that review of PTAB claim construction will likely mirror that of district court decisions in which factual findings are reviewed for “substantial evidence” while the ultimate construction of the claim is reviewed “de novo.” Where “there [are] no issue[s] . . . as to extrinsic evidence,” Cuozzo explains that appellate review is de novo.

The unique space that the PTAB occupies between substantive law and PTO regulations, as well as its relative youth, ensures further debate over these developments will continue into the future.