Standing can be a defining element in an IP case appeal

One aspect of inter partes review (IPR) that has been a source of major contention is that it is an administrative judicial process that operates separately from the normal processes of the U.S. legal system. But, as we noted in an earlier post, the U.S. Supreme Court has ruled it doesn’t violate the Constitution.

Another element of IPR that some find disconcerting is that the law allows any person who does not own a patent to petition the U.S. Patent Trial and Appeal Board (PTAB) to initiate an action. That means that any entity, even one with no actual standing, can seek to invalidate an existing patent. But, based on the outcome of one recent challenge, it’s clear that lack of standing may limit the right of appeal to federal court at times.

The importance of standing

The right of any party, winner or loser, to appeal a legal case to federal court is a basic tenet of the U.S. legal system. However, it is also an accepted standard under Article III of the Constitution that parties seeking redress in federal court must be able to show the action in question resulted in their suffering damages or injury.

In the case we write about here, a merits panel of the Court of Appeals for the Federal Circuit dismissed the losing party’s appeal of an IPR decision because the company that initiated the challenge failed to show it had suffered any actual injury.

What the court essentially said was that while standing is not required to raise challenges through administrative law processes at executive branch agencies, such as the PTAB, it is necessary for a case to cross over to the judicial branch.

A debate can be had, and is in fact underway, about whether the Federal Circuit’s refusal to hear this appeal is something that warrants consideration by the U.S. Supreme Court. We don’t seek to contribute to that discussion here. We do feel that this case reflects how complicated complex patent law is and why working with skilled attorneys is important.

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