Summary
The Federal Circuit denied a petition for writ of mandamus seeking to compel the USPTO to accept requests for Director rehearing of decisions denying institution of inter partes review (IPR) and post-grant review (PGR). The court held that the Director’s policy of refusing party-initiated rehearing of institution decisions does not violate the Appointments Clause under *United States v. Arthrex* because the Director retains discretion to review such decisions *sua sponte* and there is no statutory or regulatory barrier to that authority. The court distinguished *Arthrex*, noting that institution decisions are statutorily committed to the Director and delegated to the PTAB, preserving clear lines of accountability. The petition also failed to meet the demanding standard for mandamus relief.
Topics
Practice areas
Questions Presented
- Whether the USPTO's categorical refusal to accept requests for Director review of institution decisions violates the Appointments Clause of the U.S. Constitution.
Holdings
- The delegation of authority to the Board for institution decisions and the Director's policy refusing to accept party requests for Director rehearing do not violate the Appointments Clause. The Director has discretion to review institution decisions sua sponte, and there is no structural impediment to her authority.
Key quotations
“PAN argues that the Director's current policy of refusing to accept such requests is contrary to the Appointments Clause of the U.S. Constitution, Art. II, § 2, cl. 2, as interpreted by the Supreme Court in United States v. Arthrex, Inc., 141 S. Ct. 1970 (2021).” (at 2)
“By 'assign[ing] APJs 'significant authority' in adjudicating the public rights of private parties, while also insulating their decisions from review and their offices from removal,' the statute ran afoul of the Appointments Clause. Id. at 1986 (citation omitted).” (at 5)
“We read the Supreme Court's decision in Arthrex as confirming that the statutory and regulatory provisions concerning institution do not violate the Appointments Clause. After reviewing the administrative scheme, and specifically noting that 'the Director has delegated [institution] authority to the PTAB itself,' Arthrex, 141 S. Ct. at 1977, the Court concluded that the Director 'controls the decision whether to institute,' id. at 1980.” (at 9-10)
“We rejected the contention that, irrespective of the Director's authority, failure to 'guarantee litigants the opportunity to obtain Director review of adverse [] decisions' constitutes a violation of the Appointments Clause. Piano Factory, 11 F.4th at 1374.” (at 13)
Factual background
Palo Alto Networks (PAN) filed IPR and PGR petitions challenging patents owned by Centripetal. The PTAB denied institution of both proceedings. PAN then filed Requests for Director Rehearing, but the USPTO refused to accept them, stating that it does not accept requests for Director review of institution decisions. The Director subsequently issued guidance confirming that she retains authority to review institution decisions sua sponte and has exercised that authority in other cases.
Procedural history
PAN filed IPR and PGR petitions challenging patents owned by Centripetal. The PTAB denied institution. PAN then filed Requests for Director Rehearing, but the USPTO refused to accept them because it does not accept requests for Director review of institution decisions. PAN filed this mandamus petition.