Standing Requirements For Appealing PTAB Decisions: Recent Developments

• Published date: 28 July 2020
• Subject Matter: Intellectual Property, Litigation, Mediation & Arbitration, Food, Drugs, Healthcare, Life Sciences, Patent, Personal Injury, Food and Drugs Law
• Law Firm: Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
• Author: Mr Michael Flibbert and Michelle (Yongyuan) Rice

When seeking to invoke federal jurisdiction, a party must meet the constitutional minimum for standing under Article III.

To establish standing, a party must show it has (1) suffered an injury in fact (2) that is fairly traceable to the opposing party's challenged action, and (3) a favorable judicial decision would likely redress that injury.¹

Although a party need not have Article III standing to appear before the Patent Trial and Appeal Board (PTAB), it must establish standing when appealing an unfavorable PTAB decision to the Federal Circuit.

If the appellant has been accused of infringing the challenged patent, it can show injury based on this potential infringement liability.

In May 2020, the Supreme Court denied another certiorari petition seeking review of the Federal Circuit's dismissal of a PTAB appeal based on lack of standing,² after denying two standing related certiorari petitions in 2019.³

The Federal Circuit's case law therefore remains controlling on standing. In a line of recent decisions following AVX Corp v. Presidio Components Inc., 923 F.3d 1357 (Fed. Cir. 2019) and JTEKT Corp. v. GKN Auto. Ltd., 898 F.3d 1217 (Fed Cir. 2018), the Court has further elaborated on the standing requirements an appellant must meet to appeal from the PTAB.

PROVING OR CHALLENGING INJURY IN FACT

The injury requirement remains the principal focal point of the standing analysis. To show an injury, an appellant must demonstrate "an invasion of a legally protected interest" that is "concrete and particularized" and "actual or imminent, not conjectural or hypothetical."⁴

The injury requirement, and standing in general, has primarily been a concern for patent challengers or PTAB petitioners.

Patent owners generally will have standing to appeal PTAB decisions that invalidate their patent claims. The injury to a patent owner should be self evident given the potential loss of its patent rights.

Patent owners, however, should be mindful that they must also maintain standing throughout an appeal.

For example, transfer of patent rights, such as assignment to a third party, could moot any injury and thereby deprive the (now former) patent owner of standing.

A patent challenger seeking to appeal an unfavorable PTAB decision must submit sufficient evidence demonstrating injury to obtain review at the Federal Circuit.

If the appellant has been accused of infringing the challenged patent, it can show injury based on this potential infringement liability.

Absent existing infringement allegations, patent challenger appellants have sought to establish injury based on the risk of current or future infringement, economic harm, competitive or reputational injury, and the estoppel effect under 35 U.S.C.A ' 315.

However, of these various arguments, evidence of potential infringement liability has been most persuasive in establishing standing to appeal.

A. POTENTIAL INFRINGEMENT LIABILITY

1. Infringement risk must be personal to the appellant

Potential infringement liability has emerged as the single most important factor in the Federal Circuit's injury analysis.

To prove an injury through potential infringement liability, an appellant must show an infringement risk borne by and personal to the appellant itself.

That is, the appellant must be the entity that has or will perform the allegedly infringing activity and that would bear the potential liability for any infringement of the challenged patent.

For instance, in Argentum Pharm. LLC v. Novartis Pharm Corp., 956 F.3d 1374 (Fed. Cir. 2020), Argentum appealed a PTAB decision upholding the patentability of a Novartis patent related to Novartis' Gilenya drug.

Argentum argued that because it was pursuing a potentially infringing generic version of Gilenya, it faced an imminent litigation threat.

Argentum's CEO, however, testified that the Abbreviated New Drug Application (ANDA) for the...