In its landmark decision in Oil States Energy Servs., LLC v. Greene’s Energy Grp., 138 S.Ct. 1365 (2018), the Supreme Court held that post-grant proceedings under the AIA violated neither Article III nor the Seventh Amendment. But the Court expressly did not answer whether a party could successfully challenge those proceedings on takings or due process grounds—or challenge their retroactive application. In its recent petition for writ of certiorari, it appears Collabo Innovations has asked the Court to consider precisely those questions. Petition for Writ of Certiorari, Collabo Innovations, Inc. v. Sony Corp., No. 19-601 (Nov. 7, 2019).
U.S. Patent No. 5,952,714 (the ’714 patent) issued in 1999. At that time, there were only two ways to challenge a patent: district court litigation or ex parte reexamination. Over a decade later, the AIA’s post-grant proceedings, including inter partes reviews (IPRs) were introduced, and were expressly made by Congress to apply retroactively.
In November 2015, Collabo sued Sony, alleging patent infringement. Sony then filed petitions for IPRs against the patents in suit, including the ’714 patent. The Board instituted the IPR and found most of that patent’s claims unpatentable. Collabo appealed to the Federal Circuit, arguing, among other things, that the Board’s institution of the IPR against its 1999 patent was an unconstitutional retroactive application of the law, violating the Due Process and Takings clauses.
Before the Federal Circuit ruled on Collabo’s appeal, it decided Celgene Corp. v. Peter, 931 F.3d 1342 (Fed. Cir. 2019). In Celgene, the court held that retroactively applying the IPR provisions of the AIA was not an unconstitutional taking. The court then affirmed the Board’s decision in Collabo’s appeal, citing Celgene.
Collabo filed its petition for writ of certiorari, asking two questions: first, whether the retroactive application of inter partes review to a patent that issued before the passage of the AIA violates the Takings Clause of the Fifth Amendment; and second, whether that retroactive application violates the Due Process Clause of the Fifth Amendment.
In its petition, Collabo points out the strong presumption against retroactive legislation. In addition to that presumption, Collabo cites Supreme Court precedent stating that the property rights granted by a patent at the time of its issuance cannot later be narrowed or eliminated without violating the Takings Clause. Especially troubling to Collabo is the adversarial, adjudicatory nature of IPR proceedings, during which patents do not have the presumption of validity that they enjoy in district court litigation. And, Collabo points out, patent owners have no absolute right to amend in IPR proceedings, in contrast to the rights provided patentees during ex parte reexaminations.
To support its due process argument, Collabo argues that Congress’ decision to retroactively apply inter partes review is arbitrary and irrational. In 1999, patent owners could not have known that their patents may one day be subject to IPR proceedings. By retroactively limiting patentee’s rights in granted patents, Congress did not provide those patentees due process, Collabo argues.
Sony’s response to the petition is due December 9, 2019.