Federal Circuit Reverses Course and Holds That the PTAB’s Time-Bar Determinations in Institution Decisions are Appealable

Recently, the en banc Federal Circuit held that a determination by the Patent Trial and Appeal Board (PTAB) on whether a petitioner is time-barred from challenging a patent in an inter partes review (IPR) is judicially reviewable. Wi-Fi One, LLC v. Broadcom Corp., 878 F.3d 1364 (2018). In doing so, the en banc Federal Circuit overruled its earlier precedent in Achates Reference Publishing, Inc. v. Apple Inc., 803 F.3d 652 (Fed. Cir. 2015), which held that the PTAB’s time-bar determinations in institution decisions are not appealable due to the “No Appeal” provision of 35 U.S.C. § 314(d).

Applicable Statutory Provisions

The PTAB cannot institute an IPR proceeding for a patent if the petitioner, or the real party-in-interest or privy of the petitioner, was served with a complaint for infringement of the patent more than one year before the IPR petition was filed. 35 U.S.C. § 315(b). Under the “No Appeal” provision of § 314(d), the PTAB’s determination “whether to institute an inter partes review” is “final and nonappealable.”

Background

In Wi-Fi One, the patent owner (Wi-Fi One) argued that the PTAB should not have instituted IPR proceedings against its patents because the petitioner (Broadcom) was in privity with a time-barred district court litigant who had been served with a complaint for infringement of the patents more than one year before Broadcom filed the IPR petitions.

The original Federal Circuit panel indicated that it was bound by the Federal Circuit’s earlier decision in Achates. The Federal Circuit panel explained that § 314(d) “‘prohibits this court from reviewing the Board’s determination to initiate IPR proceedings based on its assessment of the time-bar of § 315(b), even if such assessment is reconsidered during the merits phase of proceedings and restated as part of the Board’s final written decision.’”  Wi-Fi One, LLC v. Broadcom Corp., 837 F.3d 1329, 1333 (Fed. Cir. 2016) (quoting Achates, 803 F.3d at 658).

On January 4, 2017, the Federal Circuit agreed to reconsider en banc the panel’s decision that time-bar determinations are not appealable. The question on rehearing was “Should this court overrule Achates Reference Publishing, Inc. v. Apple Inc., 803 F.3d 652 (Fed. Cir. 2015) and hold that judicial review is available for a patent owner to challenge the PTO’s determination that the petitioner satisfied the timeliness requirement of 35 U.S.C. § 315(b) governing the filing of petitions for inter partes review?” Wi-Fi One, LLC v. Broadcom Corp., 851 F.3d 1241 (Fed. Cir. 2017).

Strong Presumption Favoring Judicial Review  

On rehearing, the en banc Federal Circuit held, by a vote of 9 to 4, that time-bar determinations in institution decisions are appealable. The majority decision, written by Judge Reyna, noted the Supreme Court’s recognition in Cuozzo that there is a “‘strong presumption’ in favor of judicial review.” Wi-Fi One, 878 F.3d 1364 (quoting Cuozzo Speed Technologies, LLC v. Lee, 136 S.Ct. 2131, 2140 (2016)). Based on this “‘strong presumption’ favoring judicial review of administrative actions, including the Director’s IPR institutions,” the majority indicated that time-bar determinations should be appealable unless Congress provided a “‘clear and convincing’ indication that it intends to prohibit review.” Wi-Fi One, 878 F.3d 1364 (quoting Cuozzo, 136 S.Ct. at 2140).

The majority concluded that Congress did not provide a “clear and convincing” indication that it intended to prohibit review of the PTAB’s time-bar determinations under § 315(b). The majority explained that the “No Appeal” provision of § 314(d) limits appeals to PTAB determinations pertaining to “whether to institute an inter partes review under this section.” The court indicated that § 314(a) is “the only subsection addressing substantive issues that are part of the Director’s determination ‘under this section,’” and that § 314(a) sets forth a threshold for institution that is based on a “preliminary patentability determination.” The court therefore found that the “No Appeal” provision of § 314(d) was limited to the PTAB’s “preliminary patentability determinations” under § 314(a).

The majority distinguished time-bar determinations from decisions to institute, stating that “§ 315(b) controls the Director’s authority to institute IPR that is unrelated to the Director’s preliminary patentability assessment.” The majority explained that §315(b) “has nothing to do with the patentability merits or discretion not to institute.” Thus, the majority held that the “No Appeal” provision of § 314(d) does not apply to determinations concerning whether a time bar applies under § 315(b).

The majority noted that the Supreme Court in Cuozzo “expressly left open the potential for review, under certain circumstances, of decisions to institute IPR.”   The majority explained that the time-bar provision of § 315(b) is not “closely related” to the Director’s determination whether to institute an IPR based on the information presented in the IPR petition. The court explained that the Supreme Court’s focus in Cuozzo on whether the petitioner demonstrates a “reasonable likelihood” of prevailing based on the information in the IPR petition “strongly points toward unreviewability being limited to the Director’s determinations closely related to the preliminary patentability determination or the exercise of discretion not to institute.”

The majority explained that the § 315(b) time-bar “limit[s] the agency’s to authority to act under the IPR scheme,” and “[e]nforcing statutory limits on an agency’s authority to act is precisely the type of issue that courts have historically reviewed.” Thus, the majority concluded that time-bar determinations under § 315(b) are judicially reviewable.

Conclusion

In Wi-Fi One, the majority emphasized that its “holding applies only to the appealability of § 315(b) time-bar determinations.” However, based on the majority’s logic, it seems that the Federal Circuit may be amenable to permitting appeals of other issues that are not “closely related” to the PTAB’s initial determination under § 314(a) of whether the petitioner has shown a reasonable likelihood of prevailing with respect to at least one of the claims challenged in the petition.

Submit a Comment

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>