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Recent Challenge to the America Invents Act Denied by Court of Appeals for the Federal Circuit
Recent Challenge to the America Invents Act Denied by Court of Appeals for the Federal Circuit

The Court of Appeals for the Federal Circuit (CAFC) issued another ruling upholding the constitutionality of the America Invents Act (AIA). The AIA was a sweeping reform of patent law that had been working its way through congress in one form or another for many years before being implemented in 2013.

One of the primary changes brought about by the AIA was changing the former "first to invent" patent system to a "first inventor to file" patent system. The AIA also made some less well-known, although important, changes including an ability for third parties to challenge the validity of an issued U.S. patent in a venue other than a federal U.S. District Court. In particular, the AIA established a way to challenge an issued patent in front of a U.S. Patent Office administrative review panel—the Board of Patent Appeals and Interferences (BPAI)—in what is known as an Inter Partes Review.

In MCM Portfolio LLC v. Hewlett-Packard Co. (CAFC Case No. 2015-1091, Dec. 2, 2015), Hewlett-Packard challenged the validity of a patent owned by MCM in an Inter Partes Review, asserting a number of the patent's claims were invalid. The U.S. Patent Office administrative review panel, which does not impanel juries, determined that the challenged claims were indeed invalid.

MCM appealed this ruling to the CAFC, asserting that the Inter Parties Review procedure itself was unconstitutional because any action revoking a patent must be tried in a federal U.S. District Court with the protections offered by the Seventh Amendment, such as a trial by jury. The CAFC, which hears cases based on the record developed in the court below and also does not impanel juries, cited U.S. Supreme Court precedent upholding the constitutionality of the Inter Partes Review procedures.

The CAFC found that one of the purposes behind the America Invents Act was to provide a quicker and less expensive venue in which a patent could be challenged to counteract the lengthy and expensive nature of patent infringement lawsuits. The CAFC also found there was a long history of federal administrative agencies conducting administrative trials to adjudicate the statutory rights that the particular administrative agency was tasked with overseeing, which has been upheld by the U.S. Supreme Court. As such, there was nothing unconstitutional with the ability to challenge patents at the U.S. Patent Office in front of a board of administrative law judges.

Other challenges to the AIA have had similar results upholding the constitutionality of the Act. (See, e.g., MadStad Engineering v. United States Patent and Trademark Office (CAFC 2014) in which the CAFC dismissed a lawsuit alleging the first inventor to file regime was unconstitutional.) While there will undoubtedly be additional challenges to key provisions of the AIA, it seems the amount of work put into passing the AIA by Congress is paying off and that the key provisions of the America Invents Act will likely remain generally unchanged.

For additional information on these recent Supreme Court rulings and how they can affect your registered patents, trademarks, copyright issues and more, please contact Attorney.

Douglas Gallagher is a partner and a registered patent attorney with degrees in physics and aerospace engineering. His practice focuses on protecting the intellectual property assets of small, medium and large businesses while helping them avoid the intellectual property rights of others. He has assisted clients with patent, trademark, trade secret and copyright issues in a wide variety of fields, including the medical device, aviation, automotive, manufacturing, sporting equipment and telecommunications industries.




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