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U.S. Supreme Court Largely Upholds IPR Proceedings In 'Arthrex'
[Editor's Note: As this issue was going to press, the U.S. Supreme Court issued a decision in U.S. v. Arthrex. A summary of the decision follows, with a more detailed analysis of the ruling and its implications for practitioners to follow in the August issue.]
On June 21, the U.S. Supreme Court issued its decision in U.S. v. Arthrex, Inc., Nos. 19-1434, 19-1452, 1901458 (June 21, 2021) (slip opinion ). The April 2021 issue of The Intellectual Property Strategist covered the oral argument before the Supreme Court (see, "Say What? Are PTAB Judges Really 'Inferior' Officers?"
Case Background
In October 2019, in Arthrex v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019), the U.S. Court of Appeals for the Federal Circuit concluded that the statutory scheme appointing Patent Trial and Appeal Board (PTAB) administrative patent judges (APJs) violates the appointments clause of the U.S. Constitution. APJs at the PTAB render decisions on the patentability of issued patents, particularly through the commonly used adversarial IPR process. The Federal Circuit held that the APJs are "principal officers," reasoning that "[t]he lack of any presidentially-appointed officer who can review, vacate, or correct decisions by the APJs combined with limited removal power lead us to conclude … that these are principal officers." Arthrex, 941 F.3d at 1335. "As such, they must be appointed by the President and confirmed by the Senate; because they are not, the current structure of the Board violates the Appointments Clause." Id.
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