BRI is Permissible Standard in IPR; USPTO Decisions to Institute IPR May Not Be Appealed

The Leahy-Smith America Invents Act (“AIA”) established the procedure of inter partes review (“IPR”) by which the USPTO may permit third parties to request reexamination of issued patents in light of prior art. The AIA states at 35 U.S.C. §314(a) that a petitioner seeking IPR must show that there is a “reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.” Section 314(d) further provides that “the determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable.”

Broadest Reasonable Interpretation (BRI) Permissible Standard for Claim Construction in IPR

Earlier today, in Cuozzo Speed Technologies v. Lee, the U.S. Supreme Court unanimously approved of the application of the “broadest reasonable interpretation” (BRI) standard for construing patent claims. The Court reasoned that the BRI standard is a reasonable exercise of the rulemaking authority delegated to the USPTO by Congress because the AIA was ambiguous in establishing a standard for claim construction. According to the Court, the AIA merely granted the USPTO broad authority to issue regulations governing IPR without requiring any particular claim construction standard.

The Court rejected Cuozzo’s argument that the BRI standard is unreasonable on the ground that IPR is intended to establish a trial-like procedure for reviewing issued patents. Rather, the Court asserted that IPR is instead a sort of “hybrid” proceeding intended not only to resolve disputes between petitioners and patentees, but also to protect the public interest in ensuring that patents are kept within their legitimate scope in light of prior art. The BRI standard, according to the Court, is not unfair to a patent holder, as the patent holder would have had the opportunity to make claim amendments during prosecution.

USPTO Determination Whether to Institute IPR is Final and Non-Appealable

Furthermore, the Cuozzo Court upheld 35 U.S.C. §314(d). The Court held that the statutory text expressly provides that a USPTO determination whether to institute IPR is final and non-appealable. It is worth noting, however, that the Court’s decision does not preclude a challenge on a constitutional basis. Rather, the Court held that a patent holder may not challenge the USPTO’s determination that a petitioner has satisfied its burden of showing a reasonable likelihood of prevailing with respect to at least one claim.

In light of the Cuozzo decision, patent holders may have little recourse against a determination to institute IPR. Thus, this decision further highlights the importance of careful, precise claim drafting and amending throughout prosecution, both to avoid potential claim cancelation and costly IPR. However, it is noteworthy that the Court left the door open for constitutional challenges to the institution of IPR, which will likely soon come into play as Cooper v. Lee and MCM v. HP both address constitutional challenges to IPR.



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