Supreme Court Preview: What Can a Patent Owner Do When the PTAB Institutes an IPR That the Statute Doesn’t Permit?

The statute that created inter partes review (IPR) defines certain situations when IPR is not available. For example, IPR is not available if the petitioner was served with a complaint alleging infringement of the challenged patent more than a year earlier. But if the PTAB institutes an IPR that the statute does not permit, does the patent owner have any way to challenge that institution decision? The obvious answer might seem to be appealing the institution decision to the Federal Circuit Court of Appeals, but the same statute also says the PTAB’s institution decision is “final and nonappealable.” Next month in Thryv, Inc. v. Click-to-Call, the Supreme Court will consider whether patent owners can ask the Federal Circuit to keep IPR within its statutory confines.

The question of the Federal Circuit’s power to review the PTAB’s institution decisions has percolated for years. In 2016, the Supreme Court held that the PTAB’s substantive determination to initiate an IPR trial is not appealable to the Federal Circuit. Yet, the Supreme Court left open the possibility of the Federal Circuit reviewing certain institution decisions that, for example, implicate constitutional questions or the statutory limits on the PTAB’s authority. And in 2018, the Federal Circuit concluded that whether the one-year time bar applies to a petition is a question of the PTAB’s statutory authority and thus one reviewable on appeal.

The case pending before the Supreme Court concerns whether the Federal Circuit was correct in classifying the one-year time bar as reviewable on appeal. The PTAB had instituted IPR, and the patent owner appealed at the conclusion of the proceeding, arguing that the IPR was improper because the petitioner had been served with a complaint alleging infringement of the patent many years earlier. The Federal Circuit treated the one-year time bar question as one that is appealable and held that the PTAB was not allowed to institute the IPR.

The Supreme Court agreed to address whether the statute permits appeal regarding whether the one-year time bar applies. The petitioner and the federal government argue that the statute barring appeal of the institution decision is clear, and it precludes the patent owner from asking the Federal Circuit to overrule the PTAB’s interpretation of the one-year time bar. The patent owner contends that Congress did not intend to bar all appeals of institution decisions.

The main consequence of the Supreme Court’s decision will be on whether the PTAB or the Federal Circuit gets the final say about what the statutory limits on institution mean. Notably, the decision will not likely affect how the specific issue that gave rise to this case – whether the one-year time bar is tolled when the underlying district court litigation was dismissed without prejudice – will apply in the future.  The federal government announced in its briefing to the Supreme Court that it “reconsidered” its interpretation and now agrees with the Federal Circuit that a dismissal without prejudice does not toll the time bar.

Oral arguments in Thryv, Inc. v. Click-To-Call Technologies are scheduled for December 9, 2019.