Oral arguments for Cuozzo Speed Technologies v. Lee were heard by the United States Supreme Court (SCOTUS) on Monday April 25, 2016. One of the primary questions SCOTUS was faced with was whether the United States government has made it too easy for companies to challenge competitors’ patents via a procedure known as inter partes review (IPR). IPR is a newly implemented review function that was put into effect with the implementation of the America Invents Act (AIA) of September 16, 2012. IPR is held in front of the Patent Trial and Appeal Board (PTAB), which is an administrative board, existing within the executive branch. IPR proceedings are in addition to the traditional route, which take place in federal court, giving opponents of a patent two avenues to invalidate a competitor’s patent.
SCOTUS is determining whether it is appropriate for the PTAB to review patent validity under a “broadest reasonable interpretation” (BRI) standard. In contrast, federal courts apply a plain and ordinary meaning standard when evaluating patent scope. This distinction is important because the BRI standard generally leads to an interpretation of broader claim scope, making it easier to find prior art that overlaps with the claim scope of the patent in question. Put another way, the BRI standard makes it easier for a reviewer to find publications that show a patent does not cover something new and non-obvious.
Chief Justice Roberts found the IPR process to be “a bizarre way to . . . decide a legal question” and noted “it’s a very extraordinary animal in legal culture to have two different proceedings addressing the same question that lead to different results.” Justice Roberts went on to suggest that the PTAB should apply the same standard as used by federal courts.
Justice Kagan seemed to blame Congress for the confusion in stating “If I look at the statute, I mean, it just doesn’t say one way or the other.”
Justice Breyer was more understanding of the USPTO’s position and suggested that the reason for the bifurcated review process was because Congress intended IPR to cut down on the “patents that shouldn’t have been issued in the first place.”
Companies that are frequent targets of patent suits, including large technology companies, such as Apple Inc. and Google Inc., have turned to IPR proceedings as a tactic in patent challenges. IPR is typically considered more efficient, both in terms of cost and time, than a federal court challenge.
The case before SCOTUS involves a patent owned by Cuozzo Speed Technologies LLC. The patent in question covers a speed-limit indicator. Cuozzo Speed Technologies LLC sued a number of companies including Garmin Ltd., General Motors Co. and TomTom NV. Garmin challenged the Cuozzo patent using the IPR procedure and the PTAB sided with Garmin, invalidating the Cuozzo patent on obviousness grounds. In turn, Cuozzo challenged the PTAB’s action in federal court, whereby the Court of Appeals for the Federal Circuit (CAFC) ultimately upheld the application of the BRI claim construction standard by the PTAB in the IPR proceedings.
The Supreme Court is expected to issue a ruling in late June of 2016.
