In April 2018, the Supreme Court issued Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, 138 S. Ct. 1365, and SAS Institute v. Iancu, 138 S. Ct. 1348, a highly anticipated pair of decisions concerning post-grant proceedings at the Patent Trial and Appeal Board (PTAB).
Oil States resolved two constitutional challenges: (1) whether inter partes review (IPR) violates Article III because it allows an administrative agency rather than an Article III court to divest a patentee of his or her property rights and (2) whether it violates the Seventh Amendment because it allows administrative judges rather than juries to adjudicate patent validity. Regarding the Article III challenge, the Court held that IPR does not violate Article III, because patents are public rights. Granting patents is one of the constitutional functions that may be carried out by either the executive or legislative branch, and IPR is merely a reconsideration of those public rights by the executive agency that granted them. Turning to the Seventh Amendment challenge, the Court held that IPR does not violate the Seventh Amendment, because when Congress properly assigns a matter for adjudication in a non-Article III court, the Seventh Amendment does not prohibit adjudication of that action by a non-jury fact finder.
The Court was careful to emphasize the narrowness of its holding in this case and explicitly stated that it did not foreclose future constitutional challenges of IPR under the Due Process Clause or the Takings Clause. One can almost read the Court’s disclaimer as an invitation to future constitutional challenges or as a clue to future litigants as to which arguments to pursue. In the year since the Court left this door open, many have tried to guess what those arguments might look like and how successful they would be. The most likely grounds for future constitutional challenges to IPR are based on those the Court suggested as well as challenges based on the retroactive application of IPR to pre-America Invents Act (AIA) patents.
Retroactive Application
A common argument against IPR is that its retroactive application to pre-AIA patents is a prohibited deprivation. These arguments are not strictly constitutional but rather are based on the well-established presumption against retroactivity inherent in the Supreme Court’s jurisprudence and constitutional provisions such as the Ex Post Facto Clause. Landgraf v. USI Film Products, 511 U.S. 244 (1994). The Federal Circuit has previously rejected similar arguments against ex parte reexamination, finding that retroactive application of ex parte reexamination was not a prohibited deprivation, because patents are within the scope of the public rights doctrine. Patlex Corp. v. Mossinghoff, 758 F.2d 594 (Fed. Cir. 1985). The Court in Landgraf also stated that while...
