This week, the Federal Circuit decided Versata II, a companion case to Versata Development Group, Inc. v. SAP America, Inc., No. 2014-1194 (Versata I) that issued last week. Versata I held that the proper claim construction standard for a CBM is broadest reasonable interpretation, and the PTAB’s CBM validity determinations are appealable. Versata II decided whether the PTAB’s decision to institute a CBM can be challenged.

In this case, the patent owner sued the United States Patent Office in the U.S. District Court for the Eastern District of Virginia, and sought to set aside the PTAB’s decision to institute a CBM review on its patent. The district court held that it lacked subject matter jurisdiction to decide the issue; the Federal Circuit affirmed.

AIA §18, which covers reviews of CBM patents, does not articulate a rule on this issue. But 35 U.S.C. § 324, which is part of the Post Grant Review chapter, does articulate the following rule: “[t]he determination [by the PTAB] whether to institute a post-grant review under this section shall be final and nonappealable.” The Federal Circuit held that the PTAB’s decision to institute a CBM cannot be challenged in the courts because AIA §18(a)(1) incorporates the relevant procedures from § 324.

Versata Development Group, Inc. v. Michelle K. Lee, No. 2014-1145 (July 13, 2015).