PRIVATE OR PUBLIC RIGHT? Who Should Adjudicate Patentability Disputes and Is the Current Scheme Really Constitutional?

AuthorBaynard, Jasmyne M.

INTRODUCTION I. INTER PARTES AND POST-GRANT PROCEEDINGS: NEW ADMINISTRATIVE INNOVATION IN PATENT LAW A. Pre-AIA: Administrative Review under the Patent Act of 1952 B. Post-AIA Administrative Review-Inter Partes Review and Post-Grant Review II. CONSTITUTIONAL CHALLENGES FOR ADMINISTRATIVE REVIEW: COOPER V. LEE AND MCM PORTFOLIO LLC V. HEWLETT-PACKARD CO. A. Cooper v. Lee B. HP Decision from Federal Circuit III. THE CONSTITUTIONALITY OF INTER PARTES REVIEW UNDER THE SEVENTH AMENDMENT A. Claim 1: A patent is a private right 1. Judges, Juries and the Seventh Amendment Rights of Inventors B. Claim 2: A patent right is a public right. IV. PROPOSED SOLUTIONS CONCLUSION INTRODUCTION

"The patent bargain is the foundation upon which the patent system is built: in exchange for protections for an invention, the inventor agrees to make public their inventions so that others may build upon it." (1) The patent bargain creates a presumption of protection for the inventors, yet categorizing the patent a public right or a private right has diminished expectations for inventors and confusion for the masses. On October 11, 2016, the Supreme Court denied two petitions for writ of certiorari that challenged the constitutionality of Patent Trial and Review Board proceedings on the basis of the patent owner's Seventh Amendment right to a jury trial and Article III separation of powers. (2) The latter of those cases is the cornerstone for which this comment rests. In Cooper v. Lee, (3) Petitioner J. Carl Cooper asked the United States Supreme Court to review a section of the Leahy-Smith America Invents Act that established "inter partes review," (IPR) a procedure for administrative review of a patent. (4) Making a number of constitutional challenges, Cooper asserts that inter partes review empowers an executive agency tribunal to assert judicial power cancelling a private property right. (5) Moreover, Cooper stresses that patent disputes among private parties are disputes that have been known in the common law courts of 1789, afforded a trial, and cannot be adjudicated by an advisory opinion. (6) After a tumultuous trip through the legal system in an attempt to finally determine the constitutionality of the IPR system, the high court has again left us pondering the issue of patent adjudication. With its denial of the petitioner's writ for certiorari, the Court has again refused to declare whether patent rights are a private or public right. What does this mean for patent owners going forward? The waters are murky, but we will continue to see the adjudication of patent disputes by a non-Article III tribunal.

This Comment examines a key question for patent administrative law: whether the grant of a patent is a public right, (i.e. a right that is primarily a concern of the public and can only be conferred by the government) thus subject to revocation by an administrative agency? In analyzing this concern, this Comment will address three subjects. First, this Comment will explore how section 311 of the Patent Act (7) established the process of inter-partes proceedings and section 321 (8) established the post-grant review of patents. Second, this Comment will outline the case law challenging the constitutionality of section 311 and section 321. (9) Third, this Comment will examine the competing perspectives of whether a patent is a public or private right. This Comment has important implications for whether section 311 and section 321 are constitutional exercises of congressional power. Finally, this Comment will attempt to foreshadow how the outcome of current case law will affect the patent bargain and adjudication scheme.


    Examination remains the crucial element of the quid pro quo patent bargain. (10) The federal government's patent power stems from a specific constitutional provision, which authorizes Congress "[t]o promote the [p]rogress of [s]cience and useful [a]rts, by securing for limited [t]imes to authors and [i]nventors the exclusive [r]ight to their respective [w]ritings and [discoveries." (11) This clause provides inventors who obtain patents a great deal of power, while simultaneously creating limitations to those who are denied patentability. (12) As a member of the patent board for several years, Thomas Jefferson recognized the difficulty in "drawing a line between the things which are worth to the public the embarrassment of an exclusive patent, and those of which are not." (13) "Jefferson, like other Americans, had an instinctive aversion to monopolies" and his theory of patent ownerships was based on the economic concerns of promoting technological advances rather than protecting inventors' moral rights to their discoveries. (14) The inherent problems of the patent bargain inspired the development of statutory provisions that would weed out inventions that were not worthy of the exclusive right of patentability, while outweighing the restrictive effect of the patent monopoly. (15) As such, any inventor who wishes to obtain a patent on a particular invention or claimed form of art must first file an application with the United States Patent and Trademark Office (USPTO), that contains a specific oath by the applicant that they are the true creator of the invention at bar. (16) A USPTO examiner will then review the application and determine whether the claims present in the application are patentable. (17) If the applicant meets the statutory requirements, the USPTO will issue a patent to the inventor. (18) However, controversy arises to the question of whether a patent can be reviewed after issuance of a decision by the USPTO. (19) Administrative review of the issuance of patents can be separated by two significant time periods: The Patent Act of 1952, and the America Invents Act of 2011 (AIA). (20) The two periods are commonly known as Pre-AIA and PostAIA.

    1. Pre-AIA: Administrative Review under the Patent Act of 1952

      Before 1980, a party could only challenge the validity of an issued patent through the courts in jury trials. (21) In 1980, Congress enacted the first statute which allowed for an administrative alternative to federal court litigation for patent issuance disputes known as "exparte reexamination." (22) Section 302 of the Patent Act authorized an ex parte reexamination in which a patent owner or third party could request that the USPTO reexamine that patentability of an issued patent. (23) Upon granting a petition for ex parte review, the USPTO would reexamine the question of patentability and issue a final office action that could lead to reexamination of an issued patent. (24) Ex parte reexamination was limited as only the patent owner could seek administrative appellate review of any rejection by the USPTO. (25) In a review of this procedure, Congress determined that ex parte reexamination was inadequate because it failed to allow third party requestors to participate in the review process. (26)

      Beyond its practical infirmities, Section 302 of the Patent Act of 1952 was also challenged on constitutional grounds. The United States Court of Appeals for the Federal Circuit (Federal Circuit) considered whether the ex parte reexamination procedure was constitutional in two key cases: Patlex v. Mossinghoff and Joy Technologies, Inc. v. ManBeck.27 First, in Patlex, a 1985 case, the Federal Circuit examined how vested property or other interests are protected by the Fifth Amendment, the Seventh Amendment, or Article III, against the retrospective effect of patent reexamination. "If so, did the provisions of Public Law 96-517 or any of its implementing regulations effect a deprivation of protected interests?" (28) Under 35 U.S.C. [section] 261, which provides that "[s]ubject to the provisions of this title, patents shall have the attributes of personal property," (29) appellants argued that the section must be interpreted to mean that the inventor's bundle of rights following the issuance of a patent are protected with the same constitutional muster as tangible property rights. (30) "It is beyond reasonable debate that patents are property." (31) As such, the appellant asserted that he "has been deprived of the right to have validity determined by a jury and an Article III court, both of which rights are founded in the Constitution." (32) The Federal Circuit was not persuaded by the appellants' arguments and upheld the constitutionality of ex parte reexamination by the USPTO. (33) Specifically, the Federal Circuit did not read McCormick Harvesting as forbidding Congress from authorizing reexamination to correct governmental mistakes, even against the will of the patent owner. (34) Even so, the court again failed to determine the extent of Congress's reexamination authority and how that impacts the protections afforded to inventors. So, litigation continued.

      In Joy Technologies, Inc. v. ManBeck, the Federal Circuit once again considered whether or not ex parte reexamination proceedings violate the Seventh Amendment or Article III of the Constitution. (35) The petitioner in Joy requested that the court of appeals "review the district court's conclusion that the reexamination statute does not unconstitutionally deprive a patentee of a jury trial and the court's imposition of costs against Joy pursuant to 35 U.S.C. [section] 145." (36) Joy further questioned the vitality of the Patlex ruling. (37) Rejecting the petitioner's arguments and relying heavily on the ruling in Patlex, the court of appeals held that that the ex parte reexamination proceedings do not violate the Seventh Amendment or Article III of the Constitution. (38) "Together, Patlex and Joy settled the question of whether the PTO can adjudicate the validity of issued patents for a generation." (39) Yet, thirty years later, the Court has been asked again to consider whether administrative tribunals reviewing the validity of issued patents violates the...

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