INTRODUCTION I. SPECIALIZATION AT THE TRIAL COURT LEVEL A. What We Knew B. What We Know C. What This Does Not Answer D. What the AIA Could Add II. SPECIALIZATION'S ADVANTAGES AND DISADVANTAGES A. General Arguments for Specialization B. Arguments Against Specialization Skepticism C. The Specialization Already in Place D. What Commentators Have Suggested E. Effects to Consider III. RECOMMENDATIONS A. What Should Be Considered B. What Patent Tribunals Should Look Like Going Forward CONCLUSION INTRODUCTION
Specializing the judiciary is a contentious topic in an American legal system that assumes generalist judges can handle any case that comes before them. However, it has been acknowledged that patent law requires some form of specialization, whether it is among lawyers who prosecute patents before the Patent and Trademark Office (PTO) or the judges on the appellate court that reviews patent cases. Congress also recently passed a law that went even further to build patent law expertise in the judiciary, creating the Patent Pilot Program to allow participating district courts to designate specific judges to hear patent cases in that district. (1)
But, while this is an admirable experiment to promote specialization for patent litigation at the trial court level, the Patent Pilot Program may have been misguided in the way it addressed the problems identified in patent law jurisprudence. As the program is now seven years into its ten-year duration, (2) and the midpoint report on the program has been issued by the Federal Judicial Center, (3) this Note aims to look at whether the program is achieving its goals of creating expert judges for patent cases (4) or whether at the end of its duration Congress should consider other means of patent reform.
Part I of this Note will review studies that occurred prior to the passage of the Patent Pilot Program to evaluate what was already known about both patent litigation in district courts and district courts' relationship with the Federal Circuit. Part I will then go on to review the information from the five-year report and discuss qualities unique to patent law that lack data. Finally, Part I will address the passage and implementation of the American Invents Act (AIA) (5) that occurred after the Patent Pilot Program began. Part II will look at the arguments for and against specialization before reviewing several suggestions of how to specialize trial courts for patent litigation. Part III of this Note will address what should be prioritized in patent litigation reform and then lay out recommendations concerning the Patent Pilot Program and how to reform district court litigation of patent cases going forward.
SPECIALIZATION AT THE TRIAL COURT LEVEL
In 2011, Congress enacted the Patent Pilot Program, which adjusts how patent cases are transferred between judges in federal district courts. (6) Thirteen districts volunteered; in these districts, at least one designated judge can have any patent case originally assigned to another judge in that district voluntarily reassigned to a designated judge. (7) This pilot program will last for ten years, with regular reports published comparing the empirical differences between patent cases handled by designated judges and nondesignated judges. (8) The reports evaluate the effect of judicial designation by looking at the extent to which the program has succeeded in developing expertise in patent cases among the designated district court judges; the extent to which the program improved the efficiency of the courts involved due to that expertise; the difference between designated judges and nondesignated judges in terms of the rate of reversal by the Court of Appeals for the Federal Circuit on the issues of claim construction and substantive law; the difference between designated judges and nondesignated judges in terms of the period of time elapsed from the date a case is filed to the date a trial begins or summary judgment is entered; evidence of forum shopping; and an assessment of whether Congress should either extend or make the program permanent. (9)
While there was general support for this program and some evidence supporting its setup, (10) there was reason to believe that just building experience among generalist judges was not the solution to certain stated goals of the program, like reducing claim construction reversal rates.
What We Knew
The concept of building up district court judges' patent expertise by increasing experience to improve patent litigation is not without analogs. The International Trade Commission (ITC) is an independent, quasijudicial federal agency that adjudicates cases involving imported products that allegedly infringe intellectual property rights. (11) Because that adjudication is a large part of the ITC administrative law judges' (ALJs) dockets, ALJs are considered patent law experts due to their experience. (12) Prior to the implementation of the Patent Pilot Program, data was available indicating that building expertise through exposure would not correct certain identified issues in patent litigation-- specifically, the rate at which claim construction is overturned by the Federal Circuit. (13)
David L. Schwartz cautioned against holding an optimistic view of what problems the Patent Pilot Program would solve. (14) He found that claim construction rulings by ALJs were not overturned at a lower rate than those by generalist district court judges. (15) The district courts with the five busiest patent dockets at the time of his study (16) had an average claim construction reversal rate of 30.7 percent, while the ITC's reversal rate on claim construction was 31.0 percent. (17) He also looked at whether individual ALJs were overturned less often if they had accrued more experience and found that ALJs with ten or more claim construction cases did have a lower reversal rate than compared to the ITC's average overall. (18) However, Schwartz noted that while these numbers are relevant when considering how to fix the patent litigation system, the small number of cases--only twenty-nine--that were appealed from the ITC with claim construction issues limits the robustness of his findings. (19)
There was indirect, contradictory evidence from a study done by Adam Shartzer that found a difference in reversal rates in cases appealed from district court judges with more experience in patent law. (20) The study compared the reversal rates of the fifteen district court judges across the country who had heard the most patent cases to the average reversal rate of the district courts in the top 15 percent of districts that hear patent cases. (21) This study took a broader approach and looked to measure overall reversal rates--not just reversals on claim construction. (22) As the Patent Pilot Program's goal was to address not only claim construction reversal rates but an assortment of identified problems, Shartzer noted that a better metric was whether increased experience interacting with the Federal Circuit increased expertise. (23) He tested this by evaluating if judges who had more cases appealed to the Federal Circuit had higher affirmance rates. (24) Results showed that the judges in districts with the top 15 percent of the patent docket were reversed at a rate of 11.53 percent, while all district court judges across the country were reversed at a rate of 15.07 percent. (25) More compelling to the conclusion that more experience interacting with the Federal Circuit increases expertise was the finding that the fifteen judges who sat for the most cases appealed to the Federal Circuit were reversed in an average of only 4.51 percent of cases. (26)
The influence of these two studies depends on the different goals identified by each author. How the data produced from the Patent Pilot Program is framed also depends on this question, as does the utility of the program in general. If the main goal for evaluation is lowering claim construction reversal rates, then data collected prior to the pilot program foreshadows whether the program will be considered a success: studies indicated that when it comes to claim construction, there was not strong evidence that having judges sit on more cases would have an appreciable impact. (27) Schwartz himself lists a few different possibilities for this, none of which were addressed by the Patent Pilot Program. (28) However, claim construction reversal rates alone may just be a bad metric. (29) The Patent Pilot Program sets out several goals to evaluate, which are lost in the concentration on claim construction. (30) It is the other purposes--evaluating expertise on other substantive issues of patent law, increasing efficiency of litigation, and gauging specialization's effect on forum shopping--that should be kept at the forefront when evaluating the data collected in the first five years of the Patent Pilot Program.
What We Know
The five-year report mandated by Congress was issued in April 2016. (31) It evaluated several features of the program: judge participation in the pilot program by district; designated and nondesignated judges' experience with patent litigation; filings and terminations in each of the thirteen pilot districts, including method of termination and how long cases stay open before terminating; the effect of staying cases for proceedings in other tribunals; the prevalence of Markman hearings and appointments of third-party experts; the frequency with which summary judgment is entered; appeals of patent cases from pilot courts; and the choice of venue for patent filings relative to civil filings as a whole. (32)
The data the Federal Judicial Center used in its analysis included thirteen district courts participating in the Patent Pilot Program with a total of sixty-six designated judges. (33) As the goals of the program are tied to the idea that experience increases expertise among designated judges, the report begins with an evaluation of the...