A Federal Circuit decision stripping job protections from patent office tribunal judges “utterly fails” to cure a constitutional issue with how they were appointed, Arthrex Inc. told the Supreme Court.
In Arthrex Inc. v. Smith & Nephew Inc., the U.S. Court of Appeals for the Federal Circuit found Patent Trial and Appeal Board judges had so much power they should have been nominated by the U.S. President and confirmed by the Senate. The court severed job protections to change them from principal to inferior officers who could be appointed by the Secretary of Commerce.
That remedy, however, “was no remedy at all,” Arthrex said in asking the Supreme Court to review the controversial case.
“Even without tenure protections,” Arthrex said, PTAB judges “are still principal officers because they still have the power to issue final decisions on behalf of the agency without any possibility of review by a principal officer.”
Since Arthrex, the Federal Circuit has vacated and remanded a slew of PTAB disputes for new proceedings before tribunal judges. Arthrex rival Smith & Nephew Inc. and the government have also challenged the decision.
Even as the surgical device maker argued for the high court to review the case, it said the best fix may lie with Congress. Lawmakers could provide for presidential appointments of PTAB judges, have the patent office director supervise the judges “in a transparent matter by reviewing their decisions,” or even “abandon inter partes review entirely,” it said in its high court petition.
But letting the current decision stand, “in which subordinates revoke valuable property rights to appease their superiors and avoid unemployment, subject to no agency head review, cannot possibly be considered an improvement,” Arthrex said.
The issue of PTAB judge appointment has gained attention in Congress. House lawmakers held a hearing in November to discuss the implications of the Federal Circuit ruling, though further action has yet to be undertaken.