The U.S. Supreme Court recently agreed to decide whether a popular administrativeprocess for determining patent validity is unconstitutional.In-house intellectual property attorneys say this will surely be aclosely watched case, as the decision could have a significantimpact on the patent system.
The high court agreedon June 12 to hear Oil States Energy Services v. Greene'sEnergy Group and to determine if "inter partes review, anadversarial process used by the [U.S.] Patent and Trademark Office(PTO) to analyze the validity of existing patents, violates the[U.S.] Constitution" by eliminating a private property rightwithout the option of a jury trial.
"Suits to invalidate patents must be tried before a jury in anArticle III forum, not in an agency proceeding," said Texas-basedOil States Energy Services in a November 2016 petition to the Supreme Court, adding that an1898Supreme Court decision established that a patent cannot berevoked or canceled by a government officer because it's theproperty of the patentee and thus deserves the same legalprotections as all property. Pointing to a more recent holding, Oil States added: "ThisCourt has long held that patent 'infringement cases today must betried to a jury[.]'"
In opposition, Greene's Energy Group stated in a brief that "patents arequintessential public rights" and thus "the inter partes reviewprocedure is the sort of mechanism that Congress may permissiblycreate to administer a public-right scheme."
In an interview with Corporate Counsel, Lias J. "Jeff" Steen,executive vice president of legal and human resources at Oil StatesInternational Inc., said of the case: "Oil States is continuing todefend what was a 16-year-old patent when it went through the IPRprocess, to protect the intellectual property we had developed andused for a decade and a half. It's very important to our businessand this battle continues on to Washington in the fall." Counselfor Greene's declined to comment.
The IPR procedure, created by the America Invents Act of 2011,was designed to be more cost-effective and faster than traditionalpatent litigation. And a number of companies have found value inthis option, such as Samsung Electronics Co. and Apple Inc., which often make thelist of the most frequent filers of IPR petitions.
Gillian Thackray, vice president, associate general counsel andglobal chief counsel for intellectual property at The Clorox Co.,said she sees IPRs as one of the "important tools in the toolbox."