The Federal Circuit as a federal court.

AuthorGugliuzza, Paul R.
PositionIntroduction through III. Separation of Powers at the Federal Circuit C. The Federal Circuit as a Legislature, p. 1791-1828

ABSTRACT

The U.S. Court of Appeals for the Federal Circuit has exclusive jurisdiction over patent appeals and, as a consequence, the last word on many legal issues important to innovation policy. This Article shows how the Federal Circuit augments its already significant power by impeding other government institutions from influencing the patent system. Specifically, the Federal Circuit has shaped patent-law doctrine, along with rules of jurisdiction, procedure, and administrative law, to preserve and expand the court's power in four interinstitutional relationships: the court's federalism relationship with state courts, its separation of powers relationship with the executive and legislative branches, its vertical relationship with trial courts, and its horizontal relationship with the regional circuits. The Article leverages this descriptive contribution to consider whether specialized or semispecialized courts will inevitably exclude other institutions from shaping the law within their domain. Although judicial behavior will likely vary depending on the court's jurisdictional model, the Federal Circuit's power enhancement arguably relates to the court's dual missions to construct a uniform patent law and to provide expert adjudication in patent cases.

TABLE OF CONTENTS INTRODUCTION I. THE FEDERAL CIRCUIT AND THE PATENT SYSTEM A. Federal Circuit Patent Jurisdiction B. A Patent Crisis? II. FEDERAL CIRCUIT FEDERALISM A. Federal Question Jurisdiction B. The Federal Circuit as a State Court C. Jurisdictional Expansion and Institutional Dynamics III. SEPARATION OF POWERS AT THE FEDERAL CIRCUIT A. The Federal Circuit as Agency Administrator 1. Denial of Deference to Fact-Finding 2. Deciding New Issues on Appeal B. How the Executive Branch Pushes Back C. The Federal Circuit as a Legislature D. Competition for Patent Power: Institutional Themes Reconsidered IV. THE VERTICAL RELATIONSHIP: THE FEDERAL CIRCUIT, THE DISTRICT COURTS, AND THE ITC A. The Federal Circuit and the District Courts 1. Enhancing Power Through Patent Law: The Federal Circuit as a Fact-Finder 2. Enhancing Power Through Procedure: The Federal Circuit as a District Court B. The Federal Circuit and the ITC V. THE HORIZONTAL RELATIONSHIP: THE FEDERAL CIRCUIT AND THE REGIONAL CIRCUITS A. Explicitly Expanding the Reach of Federal Circuit Law B. Implicitly Expanding the Reach of Federal Circuit Law VI. POWER EXPANSION: CAUSES AND CONSEQUENCES A. Into the Black Hole: Judicial Behavior on a Specialized Court B. Directions for Future Inquiry: The Perils of Semispecialization and the Possibility of Limited Specialization CONCLUSION INTRODUCTION

One court, the U.S. Court of Appeals for the Federal Circuit, has an enormous influence on patent law and innovation policy. Some of this influence is by design, as the Federal Circuit has near-exclusive jurisdiction over patent appeals. (1) This Article shows how the Federal Circuit has supplemented this already significant authority by impeding other government institutions from shaping patent law. The Federal Circuit's consolidation of power raises questions about whether this semispecialized court will embrace legal reforms that may be needed to ensure the patent system promotes, rather than thwarts, innovation. (2)

The existing scholarship on the power dynamics of the patent system is rich and important (3) but has examined institutional relationships mostly in isolation, independently documenting power struggles between the Federal Circuit and institutions such as the Patent and Trademark Office (PTO), (4) the U.S. district courts, (5) and the International Trade Commission (ITC). (6) This Article, by contrast, comprehensively examines the Federal Circuit's interactions with all other government bodies that encounter patent law. This multidimensional analysis supports what scholars of judicial behavior have previously theorized: that specialized or semispecialized courts might naturally tend to expand their power. (7) Yet the analysis also generates deeper questions about why this power expansion occurs.

This Article begins with a descriptive task, using federal courts theory to map the Federal Circuit's four key relationships, namely, its relationships with state courts (the federalism relationship), other branches of the federal government (the separation of powers relationship), the district courts and the ITC (the vertical relationship), and the regional circuits (the horizontal relationship). In all four relationships, the Federal Circuit has obstructed other institutions from shaping patent law.

One additional important relationship, that of the Federal Circuit with the U.S. Supreme Court, is too complex to examine fully in this space. The Article, however, provides numerous examples of Federal Circuit rules of jurisdiction and procedure that are inconsistent with general legal principles established by the Supreme Court. (8) These examples of Federal Circuit exceptionalism support a theory that the Federal Circuit has also attempted to enhance its power vis-a-vis the Supreme Court and are consistent with scholarship suggesting that specialized courts are peculiarly resistant to Supreme Court supervision. (9)

From a normative perspective, the mere fact of institutional power enhancement is not necessarily condemnable. In expanding its power, however, the Federal Circuit has sometimes abandoned its ostensible role of patent appellate court to play roles better suited to other institutions. For example, the Federal Circuit has acted as a state court in extending its jurisdiction to include many claims created by state law, has acted as a fact-finder by refusing deference to district court interpretations of patent claims, (10) and has acted as an agency administrator by dictating the process of patent examination at the PTO. (11) This shape shifting relates to important problems in the patent system, such as the unpredictability of claim construction. (12) Moreover, the Federal Circuit's consistent power expansion finds few analogues in the regional circuits, which regularly cede power over federal law to state courts (13) and appear to be less searching in their appellate review of district court decisions. (14)

Why then, at least in cases in which existing doctrine mandates no clear outcome, does the Federal Circuit seem to favor the power-enhancing result? This expansionary drift could be analogized to the behavior of a specialized government agency. (15) Yet other complex influences may lead the court to incrementally expand its authority. For example, existing literature suggests that specialized courts might develop a "mission" to serve the policy that justified their creation. (16) Congress gave the Federal Circuit a clear mandate to bring uniformity to patent law, (17) and the court frequently cites legal uniformity as a reason to limit the power of other government bodies. (18) Also, the Federal Circuit is a singular institution and an experiment in institutional design; it is the only Article III court of appeals with jurisdiction defined by case subject matter, not geography. (19) The court has arguably helped ensure its continued existence by affirming the legal, social, and political importance of patent law and by enhancing the importance of the court to the patent system. (20)

But the Federal Circuit is not just a patent court. It also has jurisdiction over appeals involving international trade, veterans benefits, government contracts, and other matters. (21) The court's power enhancement in patent law contrasts with the court's nonpatent decisions, which often grant deference to inferior tribunals and are characterized by relatively high affirmance rates. (22) A complete inquiry into power dynamics in nonpatent cases is difficult, however,

for many of those cases are governed by statutes that limit the scope or rigor of appellate review. (23) Still, scholars of institutional design have suggested that administrative agencies charged with multiple objectives tend to give prominence to one of those goals due to agency culture, history, monitoring difficulties, and political concerns. (24) A similar dynamic could manifest in a semispecialized court, with the court enhancing its power in cases that are central to its mission, such as patent cases in the example of the Federal Circuit, and surrendering power in fields that the bar, the academy, and the public often ignore.

It is therefore worthwhile to consider prophylactic measures to ensure against marginalization of a semispecialized court's less visible matters. One alternative, which I have introduced in previous work, is a model of limited specialization. (25) As applied to the Federal Circuit, a model of limited specialization would maintain the court's exclusive jurisdiction over patent law, remove its exclusive jurisdiction in most other areas, and instead grant the court nonexclusive jurisdiction over a wide variety of nonpatent cases. (26) This reimagined court would more closely resemble a regional circuit, which might make it identify less closely with a mission to unify patent law and less likely to expand its power in ways that harm the patent system. (27)

This Article proceeds as follows. The first Part provides background on the Federal Circuit and the patent system. The next four Parts identify and deconstruct the Federal Circuit's interinstitutional relationships, showing how the court has generally protected and expanded its power relative to other government institutions. The final Part uses this institutional analysis to assess the potential effects of specialization on judicial decision making. It concludes that specialized courts might naturally expand their power to carry out the purposes for which they were created, to increase the prestige of the institution and its popularity with the bar, and to protect the court from abolition or jurisdictional change. The dynamics at play are highly nuanced, however...

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