Will The Supreme Court Put The Brakes On The IPR Trend? Cuozzo Speed Tech., LLC v. Lee

Not so fast: the United States Supreme Court is set to review the America Invents Act's ("AIA") fast-track inter partes review ("IPR") process. On January 15, 2016, the Supreme Court granted certiorari in Cuozzo Speed Technologies, LLC v. Lee, No. 15-446, to address two questions: (1) whether the United States Patent and Trademark Office ("PTO") acted within its rulemaking authority by adopting the rule that patent claims be given their "broadest reasonable interpretation" during IPR proceedings; and (2) whether a party may challenge, on appeal to the Federal Circuit, any part of the PTO's decision to institute an IPR.

Whatever the Supreme Court decides, patent owners and potential challengers alike should watch Cuozzo carefully. Challenging a patent's validity in IPRs has become a mainstay whenever a party is sued for patent infringement in district court. Defendants view IPRs as a cost-effective, efficient alternative to often lengthy district court litigation, even though the AIA's estoppel provisions require accused infringers to make certain invalidity challenges in only one forum or the other. How the Supreme Court answers these two questions could make IPRs less favorable to patent challengers or more like district court litigation, either of which may lead parties to rethink when it makes sense to bring an IPR. The Court is expected to hear arguments in April and should issue its decision before the Supreme Court's summer recess in late-June/early-July this year.

THE BROADEST REASONABLE INTERPRETATION STANDARD

The first issue involves the PTO's long-established practice of construing claims in a patent or application according to their "broadest reasonable interpretation" when determining the claim's patentability. The broadest reasonable interpretation arguably produces broader constructions than the standard federal courts apply when construing claims in litigation. This difference has been justified in part because, during PTO proceedings, a patent owner or applicant generally has the opportunity to amend its claims to avoid a potentially broad invalidating construction. Thus, the Federal Circuit has upheld the PTO's application of the broadest reasonable interpretation standard as reasonable. Proponents of the standard argue that it benefits the public by reducing the possibility that a patent claim is allowed under a narrow interpretation and given a broader interpretation in subsequent patent infringement litigation.

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