Digest of Intellectual Ventures II LLC v. JP Morgan Chase & Co., No. 2014-1724 (Fed. Cir. April 1, 2015) (precedential). On appeal from SDNY. Before O’Malley, Bryson and Hughes.

Procedural Posture: Defendants-Appellants-JP Morgan Chase et al. (“JPMC”) sought interlocutory review of the district court’s denial of its motion to stay. CAFC ruled that it does not have jurisdiction and dismissed.

  • Covered Business Methods (Section 18): After application of the four factor test set forth in § 18(b)(1) of the AIA, the district court denied JPMC’s motion to stay the case pending the result of four covered business method reviews (“CMBRs”) it was planning to file. JPMC subsequently filed two of the four CMBRs and also filed a notice of appeal arguing that the Federal Circuit has jurisdiction to hear an interlocutory appeal of a denial of a motion to stay relating to CMBR proceedings under § 18 of the AIA. After review of the statutory language, the congressional record, and the legislative history, the court concluded that the statute differentiates a petition from a proceeding and concluded that it does not have jurisdiction over an interlocutory appeal before the PTAB grants a petition and institutes a CMBR proceeding.

Hughes, dissenting:

  • Covered Business Methods (Section 18): The majority’s “conclusion relies on an overly narrow textual analysis and is at odds with the overall purpose of the AIA and the specific purpose of the CBM procedure” and improperly limits CAFC review to only stay decisions predicated on an already instituted CBM proceeding. The purpose of § 18 is to provide a cheaper, faster administrative alternative for reviewing business method patents. Congress indicated that the program is meant as an alternative to civil litigation and intended stays to be granted in all but the rarest of circumstances. The majority’s “purely textual analysis cannot be squared with the overall legislative purpose of the AIA and § 18” and is “inconsistent with Congress’s desire for uniformity in stay decisions.” In addition, the majority’s distinction between pre- and post-CBM review institution may create anomalies.