Cuozzo Speed Techs., LLC v. Lee

Decision Date20 June 2016
Docket NumberNo. 15–446.,15–446.
Citation195 L.Ed.2d 423,136 S.Ct. 2131,119 U.S.P.Q.2d 1065
Parties CUOZZO SPEED TECHNOLOGIES, LLC, Petitioner v. Michelle K. LEE, Under Secretary of Commerce for Intellectual Property and Director, Patent and Trademark Office.
CourtU.S. Supreme Court

Garrard R. Beeney, New York, NY, for petitioner.

Curtis E. Gannon, Washington, DC, for respondent.

Garrard R. Beeney, Stephen J. Elliott, James T. Williams, Sullivan & Cromwell LLP, New York, NY, Jeffrey B. Wall, Sullivan & Cromwell LLP, Washington, DC, for petitioner.

Sarah Harris, General Counsel, Thomas W. Krause, Acting Solicitor, Scott C. Weidenfeller, Acting Deputy Solicitor, Robert J. McManus, Associate Solicitor, United States Patent and, Trademark Office, Alexandria, VA, Donald B. Verrilli, Jr., Solicitor General, Benjamin C. Mizer, Principal Deputy Assistant, Attorney General, Malcolm L. Stewart, Deputy Solicitor General, Beth S. Brinkmann, Deputy Assistant Attorney, General, Curtis E. Gannon, Assistant to the Solicitor General, Mark R. Freeman, Melissa N. Patterson, Attorneys, Department of Justice, Washington, DC, for respondent.

Justice BREYER delivered the opinion of the Court.

The Leahy–Smith America Invents Act, 35 U.S.C. § 100 et seq., creates a process called "inter partes review." That review process allows a third party to ask the U.S. Patent and Trademark Office to reexamine the claims in an already-issued patent and to cancel any claim that the agency finds to be unpatentable in light of prior art. See § 102 (requiring "novel[ty]"); § 103 (disqualifying claims that are "obvious").

We consider two provisions of the Act. The first says:

"No Appeal.—The determination by the Director [of the Patent Office] whether to institute an inter partes review under this section shall be final and non-appealable." § 314(d).

Does this provision bar a court from considering whether the Patent Office wrongly "determin[ed] ... to institute an inter partes review," ibid., when it did so on grounds not specifically mentioned in a third party's review request?

The second provision grants the Patent Office the authority to issue

"regulations ... establishing and governing inter partes review under this chapter." § 316(a)(4).

Does this provision authorize the Patent Office to issue a regulation stating that the agency, in inter partes review,

"shall [construe a patent claim according to] its broadest reasonable construction in light of the specification of the patent in which it appears"? 37 CFR § 42.100(b) (2015).

We conclude that the first provision, though it may not bar consideration of a constitutional question, for example, does bar judicial review of the kind of mine-run claim at issue here, involving the Patent Office's decision to institute inter partes review. We also conclude that the second provision authorizes the Patent Office to issue the regulation before us. See, e.g., United States v. Mead Corp., 533 U.S. 218, 229, 121 S.Ct. 2164, 150 L.Ed.2d 292 (2001) ; Chevron, U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984).

I
A

An inventor obtains a patent by applying to the Patent Office. A patent examiner with expertise in the relevant field reviews an applicant's patent claims, considers the prior art, and determines whether each claim meets the applicable patent law requirements. See, e.g., 35 U.S.C. §§ 101, 102, 103, 112. Then, the examiner accepts a claim, or rejects it and explains why. See § 132(a).

If the examiner rejects a claim, the applicant can resubmit a narrowed (or otherwise modified) claim, which the examiner will consider anew, measuring the new claim against the same patent law requirements. If the examiner rejects the new claim, the inventor typically has yet another chance to respond with yet another amended claim. Ultimately, the Patent Office makes a final decision allowing or rejecting the application. The applicant may seek judicial review of any final rejection. See §§ 141(a), 145.

For several decades, the Patent Office has also possessed the authority to reexamine—and perhaps cancel—a patent claim that it had previously allowed. In 1980, for example, Congress enacted a statute providing for "ex parte reexamination." Act to Amend the Patent and Trademark Laws, 35 U.S.C. § 301 et seq. That statute (which remains in effect) gives "[a]ny person at any time" the right to "file a request for reexamination" on the basis of certain prior art "bearing on the patentability" of an already-issued patent. §§ 301(a)(1), 302. If the Patent Office concludes that the cited prior art raises "a substantial new question of patentability," the agency can reexamine the patent. § 303(a). And that reexamination can lead the Patent Office to cancel the patent (or some of its claims). Alternatively, the Director of the Patent Office can, on her "own initiative," trigger such a proceeding. Ibid . And, as with examination, the patent holder can seek judicial review of an adverse final decision. § 306.

In 1999 and 2002, Congress enacted statutes that established another, similar procedure, known as "inter partes reexamination ." Those statutes granted third parties greater opportunities to participate in the Patent Office's reexamination proceedings as well as in any appeal of a Patent Office decision. See, e.g., American Inventors Protection Act of 1999, § 297 et seq. (2006 ed.) (superseded).

In 2011, Congress enacted the statute before us. That statute modifies "inter partes reexamination, " which it now calls "inter partes review ." See H.R.Rep. No. 112–98, pt. 1, pp. 46–47 (2011) (H.R. Rep.). Like inter partes reexamination, any third party can ask the agency to initiate inter partes review of a patent claim. But the new statute has changed the standard that governs the Patent Office's institution of the agency's process. Instead of requiring that a request for reexamination raise a "substantial new question of patentability," it now requires that a petition show "a reasonable likelihood that" the challenger "would prevail." Compare § 312(a) (2006 ed.) (repealed) with § 314(a) (2012 ed.).

The new statute provides a challenger with broader participation rights. It creates within the Patent Office a Patent Trial and Appeal Board (Board) composed of administrative patent judges, who are patent lawyers and former patent examiners, among others. § 6. That Board conducts the proceedings, reaches a conclusion, and sets forth its reasons. See ibid .

The statute sets forth time limits for completing this review. § 316(a)(11). It grants the Patent Office the authority to issue rules. § 316(a)(4). Like its predecessors, the statute authorizes judicial review of a "final written decision" canceling a patent claim. § 319. And, the statute says that the agency's initial decision "whether to institute an inter partes review" is "final and nonappealable." § 314(d) ; compare ibid. with §§ 312(a), (c) (2006 ed.) (repealed) (the "determination" that a petition for inter partes reexamination "raise[s]" "a substantial new question of patentability" is "final and non-appealable"), and § 303(c) (2012 ed.) (similar in respect to ex parte reexamination).

B

In 2002, Giuseppe A. Cuozzo applied for a patent covering a speedometer that will show a driver when he is driving above the speed limit. To understand the basic idea, think of the fact that a white speedometer needle will look red when it passes under a translucent piece of red glass or the equivalent (say, red cellophane). If you attach a piece of red glass or red cellophane to a speedometer beginning at 65 miles per hour, then, when the white needle passes that point, it will look red. If we attach the red glass to a plate that can itself rotate, if we attach the plate to the speedometer, if we connect the plate to a Global Positioning System (GPS) receiver, and if we enter onto a chip or a disk all the speed limits on all the Nation's roads, then the GPS can signal where the car is, the chip or disk can signal the speed limit at that place, and the plate can rotate to the right number on the speedometer. Thus, if the speed limit is 35 miles per hour, then the white speedometer needle will pass under the red plate at 35, not 65, and the driver will know if he is driving too fast.

In 2004, the Patent Office granted the patent. See U.S. Patent No. 6,778,074 (Cuozzo Patent). The Appendix contains excerpts from this patent, offering a less simplified (and more technical) description.

C

Petitioner Cuozzo Speed Technologies, LLC (Cuozzo), now holds the rights to the Cuozzo Patent. In 2012, Garmin International, Inc., and Garmin USA, Inc., filed a petition seeking inter partes review of the Cuozzo Patent's 20 claims. Garmin backed up its request by stating, for example, that the invention described in claim 17 was obvious in light of three prior patents, the Aumayer, Evans, and Wendt patents. U.S. Patent No. 6,633,811 ; U.S. Patent No. 3,980,041 ; and U.S. Patent No. 2,711,153. Cf. Goodyear Tire & Rubber Co. v. Ray–O–Vac Co., 321 U.S. 275, 280, 64 S.Ct. 593, 88 L.Ed. 721 (1944) (Black, J., dissenting) ("[S]omeone, somewhere, sometime, made th [is] discovery [but] I cannot agree that this patentee is that discoverer").

The Board agreed to reexamine claim 17, as well as claims 10 and 14. The Board recognized that Garmin had not expressly challenged claim 10 and claim 14 on the same obviousness ground. But, believing that "claim 17 depends on claim 14 which depends on claim 10," the Board reasoned that Garmin had "implicitly" challenged claims 10 and 14 on the basis of the same prior inventions, and it consequently decided to review all three claims together. App. to Pet. for Cert. 188a.

After proceedings before the Board, it concluded that claims 10, 14, and 17 of the Cuozzo Patent were obvious in light of the earlier patents to which Garmin had referred. The Board explained that the Aumayer patent "makes use of a GPS receiver to determine ... the...

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