Patent Death Squad Judges Can Be Fired, U.S. Appeals Court Says
Patent Death Squad Judges Can Be Fired, U.S. Appeals Court Says
(Bloomberg) -- A U.S. appeals court ruled Thursday that judges on a patent review panel were unconstitutionally appointed, casting a cloud over some of its work.
The ruling ordered a new hearing before different judges at the U.S. Patent and Trademark Office’s review board in a challenge filed by Smith & Nephew Plc over an Arthrex Inc. patent for a surgical device. The court suggested other pending patent challenges may suffer the same fate.
The Court of Appeals for the Federal Circuit said that, under a 2011 law that created the reviews before the panel, called the Patent Trial and Appeal Board, judges had so much authority they should have been appointed by the president and confirmed by the Senate.
The three-judge Federal Circuit panel said it could fix the constitutional problem by stripping out the part of the law that barred the judges from being fired without cause. The ruling means that the patent office’s director -- who is confirmed by the Senate -- will have greater power to fire the judges.
The PTAB, as it is known, has been extremely popular with companies like Apple Inc. and Google Inc. that are looking for a cheaper and faster way to invalidate patents. Drugmakers like Allergan Plc and other critics have called it a “death squad” for the high rate of patents being canceled.
The Supreme Court last year upheld the right of the board to affirm or cancel patents after a review.
The board issues some 500 decisions a year. The Federal Circuit said not every case would be suspect, though. Many companies that have already had cases decided didn’t raise the constitutional question so waived their rights for new hearings, Circuit Judge Kimberly Moore wrote for the court.
Paul Fucito, a spokesman for the Alexandria, Virginia-based agency, said the patent office had no comment on the ruling.
The case is Arthrex Inc. v. Smith & Nephew Inc., 18-2140, U.S. Court of Appeals for the Federal Circuit (Washington).
To contact the reporters on this story: Susan Decker in Washington at sdecker1@bloomberg.net;Greg Stohr in Washington at gstohr@bloomberg.net
To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, ;Joe Sobczyk at jsobczyk@bloomberg.net, Wendy Benjaminson
©2019 Bloomberg L.P.
