Today, the Supreme Court granted certiorari in Oil States Energy Services v. Greene’s Energy Group, No. 16-712 (June 12, 2017), to decide whether post-grant proceedings created under the America Invents Act (“AIA”) are unconstitutional. The specific question presented is: “Whether inter partes review (‘IPR’)—an adversarial process available in the Patent and Trademark Office (‘PTO’) to analyze the validity of existing patents—violates the Constitution by invalidating patent rights through a non-Article III forum without a jury.”
In 2011, Congress passed the AIA to combat what it perceived as inefficiencies in patent litigation, and created several vehicles for challenging the validity of existing patents, including the IPR process. IPRs allow the PTO’s Patent Trial and Appeal Board (“Board”), comprised of Administrative Law Judges ("ALJs"), to review existing patents and consider certain patentability grounds in an adversarial setting. Importantly, IPRs do not involve juries. According to petitioner Oil States, IPRs violate the Seventh Amendment of the Constitution because they extinguish private property (i.e., patent rights) in the absence of a jury. It is Oil States’ position that, under the Seventh Amendment, a party who may be deprived of private property has a constitutional right to have the dispute tried before a jury in an Article III forum—not in an agency proceeding.
Respondent Greene’s Energy argues that the Seventh Amendment does not apply because Congress permissibly assigned the adjudication of patent validity to non-Article III tribunals (i.e., the Board). Further, Greene’s Energy maintains that patent rights are quintessential “public rights,” which may be adjudicated in non-Article III tribunals. The U.S. Government submitted a brief in opposition to Oil States, emphasizing the latter point.
While the question presented to the Supreme Court focuses on IPRs, the impact of the Court’s ultimate decision could potentially be far-reaching. Of course, other post-grant proceedings created under the AIA, such as post grant reviews (“PGR”) and covered business method (“CBM”) reviews, could be implicated by the decision. But the reach of the Court’s ruling could also extend to any proceeding that challenges the validity of any registered intellectual property right in a non-Article III forum. For example, the petitioner’s arguments could theoretically apply to ex parte proceedings (which provide another vehicle for challenging patents before the PTO), or trademark cancellation proceedings (which provide a similar vehicle for challenging registered trademarks before the PTO). Even patent cases heard before the U.S. International Trade Commission (“ITC”) may be subject to the Court’s forthcoming decision, because the ITC provides another forum where patents may be invalidated by an ALJ in the absence of a jury.