For two months they have sat on the Supreme Court docket, casting a pall over the Patent Trial and Appeal Board. The briefs of Oil States Energy Services LLC and some 25 amici curiae take direct constitutional aim at the PTAB. They argue that patents are a private right that can be extinguished only by an Article III court. The high court has set a Nov. 27 hearing.

Now it's finally time for the respondents and their amici to try to save the PTAB. Greene's Energy Group LLC, the U.S. solicitor general and a handful of amici have begun filing response briefs. They're seeking to shift the focus from Article III to Article I, which they say gives Congress the power to reevaluate patents using procedures such as inter partes review (IPR).

“The justification for patents is not that an inventor has a natural right to preclude others from making or using his invention, but that patent protection will ultimately benefit the public by providing an incentive to innovate,” the government states in the solicitor general's brief. “Governmentally conferred franchises designed to serve such purposes create 'public rights,' whose scope and continuing effectiveness may be resolved by non-Article III tribunals.”

The SG's brief eliminated any lingering doubt in the patent bar that the Trump administration might back away from a full-throated endorsement of the IPR process, which was signed into law by President Barack Obama as part of the 2011 America Invents Act.

Patent owners have tried a couple of times to shoot down IPRs, a form of administrative review that many of them regard as second-class justice where the odds are tilted against them. Technology companies, retailers and many others have hailed IPRs as a cost-effective tool for eliminating weak patents that are easily abused. After turning down previous petitions that raised the issue, the high court granted cert last spring in a dispute between two energy services companies over a fracking patent.

While Justice Anthony Kennedy is often seen as the court's swing vote on abortion and other politically sensitive issues, Greene's Energy and the SG seem to be zeroing in on Justice Clarence Thomas, liberally quoting three different opinions of his for the notion that patents are public rights—or at least “quasi-private” rights—that Congress can hand out with strings attached, such as the potential for IPRs.

They also use Thomas' words to buttress their argument that patent validity was historically determined by the English crown, or the Privy Council that advised it, rather than in that country's courts. Because patents have no roots in common law, no Article III protections attach, they argue—though they're quick to add that it isn't necessary to plumb English history to decide the case.

Amicus briefs also have been trickling in. So far, the technology giants that use IPRs most—Apple, Samsung and Google—haven't been heard from. But three nonprofits that tend to be aligned with them on patent policy—Public Knowledge, the Electronic Frontier Foundation and Engine Advocacy—are supporting IPRs.

The Oil States challengers received surprisingly strong amicus backing from consumer products and industrial companies such as Johnson & Johnson and 3M Co. They joined a handful of pharmaceutical companies, agricultural giants and a prominent libertarian think tank in calling for an end to IPRs.

The pro-IPR forces can now boast one biotech company as amicus, Silicon Valley's Gilead Sciences Inc. Gilead has joined SAP America Inc., Xilinx Inc. and others, represented by John Vandenberg and Andrew Mason of Klarquist Sparkman. And a group of 72 law professors led by Stanford's Mark Lemley, Chicago-Kent College of Law's Greg Reilly and Duke Law School's Arti Rai are supporting the PTAB and IPRs, in opposition to a group of 27 led by George Washington's Adam Mossoff.

“Inter partes review is a quintessential example of constitutionally-permissible administrative adjudication,” the Lemley group argues.

PROMOTING THE PROGRESS OF SCIENCE

Greene's Energy argues that, for hundreds of years, Congress has asserted the power to correct mistakenly issued patents, whether through interference proceedings, ex parte reexaminations or inter partes reexaminations. Though the Supreme Court has never formally blessed reexaminations, it's clear they flow from Congress's Article I power to award patents “for limited times” that “promote the progress of science and useful arts,” argues a Foley & Lardner team led by partner Christopher Kise.

“U.S. patent rights thus derive not from the common law, but exclusively from statutes enacted to advance a paramount public purpose,” Kise writes in Greene's Energy's brief.

Kise says the dispute between Oil States and Greene's Energy shows why Congress authorized the U.S. Patent and Trademark Office to take a second look at patents via IPRs. When Oil States obtained its patent on fracking technology, it didn't disclose to the patent office that the same inventor had applied for a similar patent in Canada a year earlier, Kise writes. After Oil States sued Greene's Energy in district court, Greene's did a prior art search, found the Canadian patent and filed its IPR. The PTAB found the Oil States patent was anticipated by the Canadian patent and ordered it canceled.

“The PTO, while proficient and diligent in advancing its core mission [of issuing patents], is not perfect,” Kise writes. “IPR is an integral part of Congress's regulatory framework for maintaining the proper scope of patent monopolies.”

Oil States and its supporters argue that patent validity is a private right that should be adjudicated in an Article III courtroom. The PTAB has trampled on patent owner rights by, for example, stacking judicial panels to reach desired outcomes, allowing serial petitions and refusing to let patent owners amend their claims, they argue. They say the adversarial nature and trial-like characteristics of IPR require Article III protections.

Greene's and Kise respond that patents are a public right because they are “integrally related to particular federal government action.” They point to Thomas' dissent in the claim construction case Teva v. Sandoz, in which he endorsed the idea that patents are “privileges” or “franchises” created “purely for reasons of public policy.”

There's more finesse on the issue of adversarial proceedings. Greene's and the SG's office argue that IPRs aren't truly adversarial, because any third party can file an IPR, and the PTO can substitute in for parties.

IPR is “simply one mechanism by which the USPTO seeks to leverage knowledge possessed by persons outside the government to assist it in making a decision within its bailiwick,” the SG's brief argues.

MIDDLE-GROUND SCENARIOS

The SAP America amicus brief calls IPRs “substantially identical” to the reexamination procedures Congress created in 1980. Every patent applicant since then has known that a patent might be subject to a second look, the brief argues. And, since passage of the America Invents Act in 2011, everyone has known that “defending patentability in an inter partes review, when needed, would be one condition for maintaining any patent obtained.”

That argument seems to put on the table one baby-splitting possibility for the Supreme Court: allowing IPRs, but only for patents issued after 2011.

Some Oil States supporters have proposed another compromise: keeping the PTAB and IPRs, but making the decisions advisory only. The question then would become who is the PTAB advising—a judge, who might be quick to defer to the PTAB's expertise, or a jury?

The professors led by Lemley would prefer that the Supreme Court not reach the Seventh Amendment issue. The justices don't need to look past Article I, they argue. But, if the court does go that far, they contend that juries have only recently become a factor on patent validity, which historically was decided by judges in courts of equity.

“If the Seventh Amendment is concerned with preserving the fundamental essence of a right to jury trial as it existed in history,” Lemley writes, “it makes little sense to find such a right to exist in a practice that was uncommon before 1978 and not truly prevalent until the late 1980s.”

Durie Tangri

For two months they have sat on the Supreme Court docket, casting a pall over the Patent Trial and Appeal Board. The briefs of Oil States Energy Services LLC and some 25 amici curiae take direct constitutional aim at the PTAB. They argue that patents are a private right that can be extinguished only by an Article III court. The high court has set a Nov. 27 hearing.

Now it's finally time for the respondents and their amici to try to save the PTAB. Greene's Energy Group LLC, the U.S. solicitor general and a handful of amici have begun filing response briefs. They're seeking to shift the focus from Article III to Article I, which they say gives Congress the power to reevaluate patents using procedures such as inter partes review (IPR).

“The justification for patents is not that an inventor has a natural right to preclude others from making or using his invention, but that patent protection will ultimately benefit the public by providing an incentive to innovate,” the government states in the solicitor general's brief. “Governmentally conferred franchises designed to serve such purposes create 'public rights,' whose scope and continuing effectiveness may be resolved by non-Article III tribunals.”

The SG's brief eliminated any lingering doubt in the patent bar that the Trump administration might back away from a full-throated endorsement of the IPR process, which was signed into law by President Barack Obama as part of the 2011 America Invents Act.

Patent owners have tried a couple of times to shoot down IPRs, a form of administrative review that many of them regard as second-class justice where the odds are tilted against them. Technology companies, retailers and many others have hailed IPRs as a cost-effective tool for eliminating weak patents that are easily abused. After turning down previous petitions that raised the issue, the high court granted cert last spring in a dispute between two energy services companies over a fracking patent.

While Justice Anthony Kennedy is often seen as the court's swing vote on abortion and other politically sensitive issues, Greene's Energy and the SG seem to be zeroing in on Justice Clarence Thomas, liberally quoting three different opinions of his for the notion that patents are public rights—or at least “quasi-private” rights—that Congress can hand out with strings attached, such as the potential for IPRs.

They also use Thomas' words to buttress their argument that patent validity was historically determined by the English crown, or the Privy Council that advised it, rather than in that country's courts. Because patents have no roots in common law, no Article III protections attach, they argue—though they're quick to add that it isn't necessary to plumb English history to decide the case.

Amicus briefs also have been trickling in. So far, the technology giants that use IPRs most—Apple, Samsung and Google—haven't been heard from. But three nonprofits that tend to be aligned with them on patent policy—Public Knowledge, the Electronic Frontier Foundation and Engine Advocacy—are supporting IPRs.

The Oil States challengers received surprisingly strong amicus backing from consumer products and industrial companies such as Johnson & Johnson and 3M Co. They joined a handful of pharmaceutical companies, agricultural giants and a prominent libertarian think tank in calling for an end to IPRs.

The pro-IPR forces can now boast one biotech company as amicus, Silicon Valley's Gilead Sciences Inc. Gilead has joined SAP America Inc., Xilinx Inc. and others, represented by John Vandenberg and Andrew Mason of Klarquist Sparkman. And a group of 72 law professors led by Stanford's Mark Lemley, Chicago-Kent College of Law's Greg Reilly and Duke Law School's Arti Rai are supporting the PTAB and IPRs, in opposition to a group of 27 led by George Washington's Adam Mossoff.

“Inter partes review is a quintessential example of constitutionally-permissible administrative adjudication,” the Lemley group argues.

PROMOTING THE PROGRESS OF SCIENCE

Greene's Energy argues that, for hundreds of years, Congress has asserted the power to correct mistakenly issued patents, whether through interference proceedings, ex parte reexaminations or inter partes reexaminations. Though the Supreme Court has never formally blessed reexaminations, it's clear they flow from Congress's Article I power to award patents “for limited times” that “promote the progress of science and useful arts,” argues a Foley & Lardner team led by partner Christopher Kise.

“U.S. patent rights thus derive not from the common law, but exclusively from statutes enacted to advance a paramount public purpose,” Kise writes in Greene's Energy's brief.

Kise says the dispute between Oil States and Greene's Energy shows why Congress authorized the U.S. Patent and Trademark Office to take a second look at patents via IPRs. When Oil States obtained its patent on fracking technology, it didn't disclose to the patent office that the same inventor had applied for a similar patent in Canada a year earlier, Kise writes. After Oil States sued Greene's Energy in district court, Greene's did a prior art search, found the Canadian patent and filed its IPR. The PTAB found the Oil States patent was anticipated by the Canadian patent and ordered it canceled.

“The PTO, while proficient and diligent in advancing its core mission [of issuing patents], is not perfect,” Kise writes. “IPR is an integral part of Congress's regulatory framework for maintaining the proper scope of patent monopolies.”

Oil States and its supporters argue that patent validity is a private right that should be adjudicated in an Article III courtroom. The PTAB has trampled on patent owner rights by, for example, stacking judicial panels to reach desired outcomes, allowing serial petitions and refusing to let patent owners amend their claims, they argue. They say the adversarial nature and trial-like characteristics of IPR require Article III protections.

Greene's and Kise respond that patents are a public right because they are “integrally related to particular federal government action.” They point to Thomas' dissent in the claim construction case Teva v. Sandoz, in which he endorsed the idea that patents are “privileges” or “franchises” created “purely for reasons of public policy.”

There's more finesse on the issue of adversarial proceedings. Greene's and the SG's office argue that IPRs aren't truly adversarial, because any third party can file an IPR, and the PTO can substitute in for parties.

IPR is “simply one mechanism by which the USPTO seeks to leverage knowledge possessed by persons outside the government to assist it in making a decision within its bailiwick,” the SG's brief argues.

MIDDLE-GROUND SCENARIOS

The SAP America amicus brief calls IPRs “substantially identical” to the reexamination procedures Congress created in 1980. Every patent applicant since then has known that a patent might be subject to a second look, the brief argues. And, since passage of the America Invents Act in 2011, everyone has known that “defending patentability in an inter partes review, when needed, would be one condition for maintaining any patent obtained.”

That argument seems to put on the table one baby-splitting possibility for the Supreme Court: allowing IPRs, but only for patents issued after 2011.

Some Oil States supporters have proposed another compromise: keeping the PTAB and IPRs, but making the decisions advisory only. The question then would become who is the PTAB advising—a judge, who might be quick to defer to the PTAB's expertise, or a jury?

The professors led by Lemley would prefer that the Supreme Court not reach the Seventh Amendment issue. The justices don't need to look past Article I, they argue. But, if the court does go that far, they contend that juries have only recently become a factor on patent validity, which historically was decided by judges in courts of equity.

“If the Seventh Amendment is concerned with preserving the fundamental essence of a right to jury trial as it existed in history,” Lemley writes, “it makes little sense to find such a right to exist in a practice that was uncommon before 1978 and not truly prevalent until the late 1980s.”