Argument Recap / Featured

Yesterday the Supreme Court heard oral arguments in Thryv, Inc. v. Click-to-Call Technologies, LP, a case addressing whether a patent owner has the right under the patent statute to appeal a determination by the Patent Trial and Appeal Board that a petition for inter partes review was not filed after a statutory deadline. In short, while Justice Gorsuch appeared to agree with the Federal Circuit’s conclusion that patent owners have that right, several other Justices, and particularly Justice Kagan, seemed to harbor significant doubt that Congress had not eliminated the ability to appeal in this circumstance.

Adam Charnes argued on behalf of Thryv. In his opening argument, he contended that “[t]he text of the America Invents Act, the statutory history, the statute’s policy goals, and this Court’s decision in Cuozzo all confirm that [35 U.S.C. §] 314(d) precludes judicial review of the [U.S. Patent and Trademark Office] Director’s time-barred determination under Section 315(b).” Justice Gorsuch, however, seemed unconvinced. He asked Charnes a series of questions challenging the position that Article III courts have no power to review appeals of unauthorized decisions by the agency in question. Charnes, in response, suggested that in an egregious hypothetical case, mandamus relief might be available even if a traditional appeal is not. And, in response to the underlying concern with separation of powers, Charnes submitted that “separation of powers requires this Court to respect Congress’s withdrawal of jurisdiction to the courts as much as implying jurisdiction where it should exist.”

Justice Ginsburg asked Charnes to explain “what [to] do” with the Court’s recent decision in SAS Institute, which, characterizing the Court’s earlier decision in Cuozzo, “says 314(d) precludes judicial review only of the Board’s initial determination under 314(a) that there is a reasonable likelihood that the patent claims are unpatentable.” Charnes maintained that “that’s not a complete description of [the Court’s holding in] Cuozzo,” and that in SAS “the Court had no need to describe Cuozzo more broadly.”

Jonathan Ellis argued on behalf of the United States, urging reversal of the Federal Circuit’s conclusion that judicial review is available in the circumstances of the case. He argued that Congress “focused judicial review on the issue that matters most to the system as a whole, the final patentability analysis and the final written decision after trial.” In response to a question by Chief Justice Roberts about the separation of powers, Ellis argued that “the presumption of judicial reviewability is primarily about congressional intent,” and that “in a case where you have an express bar on judicial review, you’ve gone a long way down the road” toward overcoming the presumption.

Addressing Justice Gorsuch’s concern with unreviewability, Ellis argued that even if judicial review prohibits the Director from canceling a patent using inter partes review because of a time-bar, “the Director could have taken the exact same materials . . . submitted with a petition for inter partes review . . . but then instituted an ex parte reexamination.” Justice Gorsuch, however, would have none of it. “Sure,” he said, “There are a million other things that could happen, but this is what happened and [your position is] we can’t review it.” Justice Alito, by contrast, seemed to indicate agreement with Ellis when he stated, “I think you have a strong argument under Cuozzo.”

Justice Kavanaugh eventually asked about one of the key facts underlying the respondent’s view of the case, the fact that the no-appeal provision, § 314(d), states that what is not appealable is the determination “under this section,” while the time-bar is not located in the same section but instead in § 315. “If we had ‘under this chapter’ here, that would solve your problem,” he suggested. Ellis responded “I don’t think we need that. . . . [N]o one . . . doubts that there are other aspects [of the patent statute] that go into that determination” under § 314. At this point Justice Kagan jumped into the discussion, suggesting that, according to Cuozzo, “it goes beyond 314 but . . . it only goes to questions that are closely related to the reasonable likelihood determination” under 314(a). Ellis responded that this would not a “plausible reading of what was going on in Cuozzo,” but Justice Ginsburg quickly pointed out that in Cuozzo “it was a particularity requirement, and that was described as a minor statutory technicality, but, here, we’re not deadline with a minor statutory technicality; we’re dealing with a time bar.” Ellis responded that “to the extent that’s a minor technicality, this one fits into the same bucket.”

Daniel Geyser argued on behalf of Click-to-Call Technologies, seeking an affirmance. He began his argument by “underscoring the truly extraordinary nature” of the argument by Thryv and the United States that “Congress delegated the judicial function to an administrative agency, gave that agency the unfettered discretion to say what the law is, and then instructed that no Article III court at any time at any level may review the agency’s interpretation of the statutory limits on its own power.”

Chief Justice Roberts asked Geyser his first questions. In response to the suggestion that the time-bar is not important because “it’s simply a question of do you go this route or can you go that route,” and that “the fundamental question that’s at issue about patentability is going to be reached,” Geyser explained that the time-bar is “not a minor statutory technicality” but instead “a significant protection for patent owners.” In one of the lighthearted moments of the day, Chief Justice Roberts joked that, “[w]ell . . . I don’t think it’s what we were fighting over at Yorktown.”

Justice Kagan, in particular, seemed to have the hardest time accepting Geyser’s arguments. She repeatedly referred to the “silliness” of going through the entire inter partes review, “soup to nuts, and then we get to the end and somebody says, you know, the time bar wasn’t applied correctly” and so “[w]e throw it all out and we start all over again on something that we know by now is an invalid patent.” In response, Geyser pointed out that the Board “is reversed a quarter of the time,” and anyway “Congress did say that the agency cannot exercise its review power . . . in those circumstances.” Justice Ginsburg, however, seemed to agree with Justice Kagan, sharing her view that “[t]here’s something unseemly about nullifying the determination on the merits.” Again, Geyser disagreed, explaining that “if the patent, in fact, is invalid, then it can be invalidated in a proper proceeding” and intimating his view that “construing this provision correctly will spare unauthorized future proceedings that will far make up any resources wasted in this individual case.”

Justice Kagan also explained what appears to be her view that “[under] this section” simply refers to the decision to institute inter partes review, which is made or in other words located in § 314. In response to Geyser’s contention that Thryv’s reading of “under this section” “has absolutely no meaning,” Justice Alito followed up on Justice Kagan’s point, asking “would it be possible for the Director to institute inter partes review under some other section?” Geyser maintained that “there’s an oddity with this statute” in that “there is not an express provision . . . that expressly authorizes the Director to institute review.” Kagan, though, would not agree. She said, “I think 314(a) does. . . . And so it’s 314(a) that authorizes the Director to institute, and then 314(d) says the decision to institute under this section, in other words, under 314(a), is final and unappealable.” Later, Justice Ginsburg would press the same interpretation pressed earlier by Justices Kagan and Alito.

Again, Justice Kagan expressed disbelief with respect to another aspect of Geyser’s position. “But, if you’re right, Mr. Geyser, what does this unappealability bar really amount to? When does it bar anything that anybody would want to raise as an argument?” And again, “You’re saying that Congress wrote the silliest provision that the bar on appeals applies only to something that nobody would raise because it’s been totally mooted out.” Geyser responded that “it’s not silly because Congress has a good reason to make absolutely clear that people will not interrupt the inter partes review while it’s going on with a disruptive interlocutory appeal.” And, he pointed out, everyone agrees that this is all that Congress did in prior statutory provisions related to other Board proceedings, and he contended, “the language is not markedly different.” Later, when Geyser stressed that both SAS and Cuozzo limit appeals only of preliminary patentability determinations, he again ran into challenges from Justice Kagan.

At one point, Geyser shifted his argument to explain why the time-bar “is a fundamental safeguard to protect patent owners from both harassment and abuse,” particularly given the truncated proceeding that is not equivalent to “a normal Article III proceeding.” Later in the argument he also explained that ex parte reexamination, the alternative that might be available, is “vastly” superior to patent owners given, for example, “additional amendment rights.” Justice Gorsuch then stepped in to try to elicit more details about the benefits of using the time-bar to cause inter partes review to be abandoned in favor of ex parte reexamination. Yet again, however, Justice Kagan seemed nonplussed. “But if [the inter partes review is] not with this Petitioner it can be another Petitioner. And, indeed, even when a petitioner drops out under this statute, the Board can keep the proceeding going without the petitioner. So the fact that it is this Petitioner seems utterly unimportant under this statute,” she remarked. Geyser, in response, said, “I don’t think it’s enough simply to throw up your hands and say maybe someone else could come along. Maybe they can but maybe they won’t.”

Toward the end of his argument, Geyser elicited “sympathy for your argument” from Justice Sotomayor, who focused on the idea that a petitioner should be given an avenue of judicial review on a legal question.” But she was concerned with “a potential problem” with this understanding of the case. “[S]ome amici,” she explained, “point out . . . if the [Board] agrees with you on the legal question and throws this complaint out . . . the other side won’t have an opportunity to challenge that” decision. And so, “one way or another, we’re going to preclude judicial review of a legal question,” she complained. Like Charnes’s earlier argument, Geyser pointed Justice Sotomayor to the potential for petitioners to obtain mandamus relief, but also review under the Administrative Procedure Act.

Charnes provided a brief rebuttal, emphasizing that “Congress viewed the institution decision under 314,” that the language of the prior bars on review were worded differently, that Cuozzo “specifically rejected” the argument that § 314(d) merely bans interlocutory review, and that asymmetry would result if the Court adopted the Federal Circuit’s approach.

In sum, it appears there is a significant chance that the Federal Circuit’s holding in this case—that it may review Board conclusions that time-bars do not apply—will be reversed. Such a disposition would effectively insulate the Board from review over many other preliminary decisions. As we discussed in our argument preview, insulated decisions would relate to whether a party is a real party in interest, the burden of proof for real-party-in-interest analyses, the effect of adding a corporate parent to the list of real parties in interest, the effect of post-petition mergers on real-party-in-interest analyses, and the effect of involuntary and voluntary dismissal of complaints with respect to the time-bar clock, among other issues.