SCOTUS Heeds SG’s Call to Deny Google’s Challenge of PTAB Settled Expectations Doctrine

On Monday, the U.S. Supreme Court issued an order list that included a denial of Google’s petition for writ of certiorari challenging the U.S. Patent and Trademark Office’s (USPTO’s) development of the “settled expectations” doctrine at the Patent Trial and Appeal Board (PTAB). This latest setback to industry-wide efforts opposing the duration of a patent’s life in force as a consideration leading to discretionary denials of inter partes review (IPR) proceedings comes a few weeks after the U.S. Solicitor General urged denial of Google’s cert petition, agreeing with the Federal Circuit that such a challenge was not available on mandamus review.

This January, the U.S. Court of Appeals for the Federal Circuit issued an order denying Google’s petition for mandamus relief after IPR proceedings at the PTAB challenging VirtaMove’s patent claims were denied in part because those claims had been in force for 14 years, creating settled expectations in those patent rights for VirtaMove. In April, Google filed a cert petition criticized by independent inventor interests while being supported by the computer and automotive industries in amici filings that urged the Court to grant cert.

VirtaMove Brief in Opposition: Express Statutory Discretion Evades Chevron’s Overrule

On July 13, patent owner VirtaMove filed a brief in opposition to Google’s petition arguing that Google was pursuing mandamus relief in an effort to evade statutory provisions against the appealability of IPR institution decisions codified at 35 U.S.C. § 314(d). Citing the requirements for mandamus review laid out in the Supreme Court’s 2004 ruling in Cheney v. U.S. District Court for the District of Columbia, VirtaMove argued that Google has adequate means to attain relief through infringement litigation or an Administrative Procedures Act (APA) action in U.S. district court, has not identified a statutory provision creating a clear and indisputable right to mandamus relief, and that mandamus relief is inappropriate because of Section 314(d)’s appealability bar.

VirtaMove argued that the America Invents Act’s (AIA) text only places restrictions on IPR institutions without ever commanding that such proceedings be instituted, reinforcing the agency’s discretion in determining whether to institute IPR petitions. Because discretion is expressly granted by statutes like Section 314(a), which provides that the Director “may not authorize” an IPR unless the petitioner has a reasonable likelihood to prevail, VirtaMove argued that such discretion is not founded upon Chevron deference to agency interpretation of vague statutes, which has been recently overruled by the Supreme Court’s 2024 ruling in Loper Bright Enterprises v. Raimondo.

Google’s repeated characterizations of the settled expectations rule as a “statute of limitations” for IPR challenges significantly misrepresents the impact of settled expectations, according to VirtaMove, who highlighted that the rate at which the PTAB exercises discretion denying IPRs challenging patents in force for six years differs from the overall rate of discretionary denial grants by only 4 percentage points. Mandamus relief is further inappropriate here where settled expectations, only one factor considered in the discretionary denial analysis, is not clearly dispositive to the denial of institution.

U.S. Solicitor General: Mandamus Relief Not Foreclosed, But Inappropriate Here

Google’s cert petition was also opposed by the U.S. Solicitor General, who acknowledged in the brief for the federal respondent that Section 314(d)’s provision that IPR institution decisions are “nonappealable” rather than “nonreviewable” does not foreclose mandamus relief. However, the SG’s brief agreed that Google did not meet the Cheney requirements for mandamus relief, though the SG found that Google’s lack of alternative means for review reflected “a considered congressional judgment” that decisions not to institute should not be appealable.

Supreme Court rulings in Cuozzo Speed Technologies v. Lee (2016) and U.S. v. Arthrex (2021) confirm the agency’s “unreviewable discretion” in IPR institution decisions, the SG’s brief adding that no statutory provision prescribes any particular factors for agency consideration when making such decisions. While Google seeks to distinguish Cuozzo and Arthrex by alleging that the USPTO exceeded its statutory authority, the SG argued that statements relied upon by Google to that effect concerned judicial authority to review final written decisions ending IPR proceedings under 35 U.S.C. § 319. “[Google’s] approach, taken to its logical conclusion, would fundamentally transform the legal regime that governs the Director’s discretionary institution decisions in cases where no statutory bar to institution applies,” the SG’s brief reads.

Google Reply Brief: AIA’s Text Reflects Policy Choice on IPR’s Availability Throughout Patent Term

In its reply brief filed September 29, Google argued that the Solicitor General’s brief confirmed the urgent need for Supreme Court review of the time bar established under settled expectations doctrine, which is irreconcilable with Congress’ decision to enact time bars for other administrative proceedings but not for IPRs. Noting that congressional intent is discernible by examining both what Congress did and did not do, as the Court held in 2018’s National Association of Manufacturers v. Department of Defense, the lack of a statutory limitations period on IPR proceedings reflected the important policy choice that patent rights should be subject to administrative cancellation throughout their term.

According to Google, Section 314(d) only renders individual institution decisions unreviewable, not claims that the agency has exceeded statutory authority on policies governing those decisions. Google also argued that respondents’ focus on the mandamus standard was a “misconceived tactic” as its case presented exactly the kind of extraordinary circumstances warranting mandamus review; namely, the agency’s unreviewable authority to eliminate the IPR pathway “for those patents most likely to be invalid.”