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SCOTUS Says Times Up For Appealing PTAB’s Application of § 315(b) for Inter Partes Review

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On April 20, 2020, in Thryv, Inc. v. Click-to-Call Technologies, LP, the Supreme Court held that the Patent Office’s application of the one-year time limit for filing an inter partes review after filing a complaint alleging patent infringement “is closely related to its decision whether to institute [an] inter partes review and is therefore rendered nonappelable by § 314(d).”1 The Supreme Court reiterated its finding in Cuozzo and confirmed that the decision of whether the time limit in 35 U.S.C. § 315(b) bars a petition for inter partes review is one of the “matters ‘closely tied to the application and interpretation of statues related to’ the institution decision.” Justice Ginsberg pointed out that “a § 315(b) challenge easily meets that measurement” because it “sets forth a circumstance in which ‘[a]n inter partes review may not be instituted.’”

The Cancellation Of Click-to-Call Patent Claims

In 2013, Thryv, Inc. (“Thryv”) petitioned the USPTO’s Patent Trial and Appeal Board (“PTAB”) to institute an inter partes review (“IPR”) of a patent owned by Click-to-Call Technologies, LP (“Click-to-Call”) directed to technology for anonymous telephone calls.  The PTAB, instituted the IPR and canceled several claims of U.S. Patent No. 5,818,836.  Click-to-Call appealed the decision, challenging only the Board’s determination that § 315(b) did not preclude inter partes review. The PTAB found that § 315(b) did not bar institution because the 2001 suit brought by an exclusive licensee of the ’836 Patent was dismissed without prejudice.

The Federal Circuit Weighs In

The Federal Circuit dismissed Click-to-Call’s appeal for lack of jurisdiction. The Federal Circuit agreed with Thryv and the Patent Office Director (who intervened on appeal) that § 314(d)’s bar of an appeal of the institution decision precludes judicial review of the agency’s application of § 315(b).  But, thereafter, the en banc Federal Circuit held in Wi-Fi One, LLc v. Broadcom Corp., that “time-bar determinations under § 315(b) are appealable” notwithstanding § 314(d).2 The majority of the Federal Circuit in Wi-Fi One held that § 314(d) does not displace the usual presumption favoring judicial review of agency actions related to § 315(b) because “[t]he 315(b) timeliness determination . . . is not closely related to the institution decision addressed in § 314(a).”

The Supreme Court Overturns The Federal Circuit

In Cuozzo Speed Technologies, LLC v. Lee, the Supreme Court held that § 314(d) can bar appeals of matters “closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review.”3 Relying on Cuozzo, the Supreme Court found that “[s]ection 315(b)’s time limitation is integral to, indeed a condition on, institution.” Justice Ginsburg’s opinion remarked that Congress entrusted the institution decision to the Patent Office to “avoid the significant costs, already recounted of nullifying a thoroughgoing determination about a patent’s validity.” Allowing § 315(b) appeals would waste the resources spent resolving patentability and leave bad patents enforceable. In addition, permitting § 315(b) appeals would merely forestall the cancellation of claims and deter “efficient resolution of patentability” because a new challenger could file an IPR petition challenging the same claims. Stating that the true purpose of § 315(b) is to “minimize burdensome overlap between inter partes review and patent-infringement litigation,” the Supreme Court held that § 314(d) bars any appeal of the Patent Office’s application of § 315(b)’s time limitation.

Justice Gorsuch Dissent

Justice Gorsuch, joined by Justice Sotomayor, dissented, arguing that the Constitution does not “permit[] a politically guided agency to revoke an inventor’s property right in an issued patent” and “closes the courthouse . . . where the owner claims the agency’s proceedings were unlawful from the start.” Justice Gorsuch also argued that § 314(d) was limited to § 314 because § 314 is the only section that authorizes the Director to institute inter partes review. Justice Gorsuch concluded that the majority’s opinion was predicated on dicta from Cuozzo and the majority has essentially “hand[ed] over judicial powers involving the disposition of individual rights to executive agency officials.”

What This Means For You

The holding in Thryv suggests that the Supreme Court takes a broad view of the types of matters that are “closely tied” to the PTAB’s decision to institute an IPR. Therefore, patent owners should not rely solely on defects they believe exist in the PTAB’s decision to institute an IPR and should instead focus on the substantive portions of the review. However, the Court took the time to mention that it was not disturbing its decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018) and patent owners may still rely on an “all or nothing” approach to IPR institution.

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1 No. 18-916, 2020 WL 1906544 (U.S. Apr. 20, 2020).

See 878 F. 3d 1364 (2018).

3 See 136 S. Ct. 2131 (2016).

This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.