MCM Portfolio LLC v. Hewlett-Packard Company

Docket Nos. 2015-1091

December 2, 2015

Brief Summary: PTAB decision regarding 35 USC § 315(b) not reviewed due to lack of jurisdiction (§ 314(d)); IPR proceeding is not unconstitutional; Board’s obviousness determination not erroneous.

Summary: MCM appealed PTAB decision that the institution of IPR at HP’s request was not barred by 35 USC § 315(b) (one year deadline from service) and that HP’s request demonstrated a reasonable likelihood that claims of US 7,162,549 would have been obvious. MCM also argued that IPR violates Article III and the Seventh Amendment. The FC panel determined it lacked jurisdiction to review the decision regarding 35 USC § 315(b) (no appeal available under 35 USC § 314(d); In re Cuozzo, FC 2015; Achates, FC 2015) but considered the constitutional argument. MCM argued “any action revoking a patent must be tried in an Article III court with the protections of the Seventh Amendment”, citing McCormick II (US 1898) (only the patent owner, not the PTO, has the right to surrender original patent and accept reissued patent (“[t]he only authority competent to set a patent aside, or to annul it, or to correct it for any reason whatever, is vested in the courts of the United States, and not in the department which issued the patent”)). The FC panel disagreed with this reasoning, however because McCormick II “did not forbid Congress from granting the PTO the authority to correct or cancel an issued patent” as evidenced by its creation of the ex parte and inter partes reexamination proceedings, IPR, post-grant review and Covered Business Method patent review. The opinion explained that “Congress created the PTO, ‘an executive agency with specific authority and expertise’ in the patent law…and saw powerful reasons to utilize the expertise of the PTO for an important public purpose-to correct the agency’s own errors in issuing patents in the first place” (citing Kappos, US 2012). MCM’s argument also alleged “it has a right to a trial by jury under the Seventh Amendment, which is not satisfied by” an IPR proceeding. The FC panel disagreed, finding that “when Congress created the new statutory right to inter partes review, it did not violate the Seventh Amendment by assigning its adjudication to an administrative agency” (citing Curtis, US 1974 (“congressional power to entrust enforcement of statutory rights to an administrative process or specialized court”) and Atlas Roofing (US 1977) (Congress may assign the adjudication of “new statutory ‘public rights’…to an administrative agency with which a jury trial would be incompatible”)). The Board’s decision regarding obviousness was affirmed, disagreeing with MCM’s argument that combining the prior art “cannot yield a single controller chip because Kobayashi requires that its controller be able to be placed on either the reader of the card” because “[t]he test for obviousness is not whether the features of a secondary reference may be bodily incorporated into the structure of the primary reference; nor is it that the claimed invention must be expressly suggested in any one or all of the references” but “[r]ather, the test is what the combined teachings of the references would have suggested to those of ordinary skill in the art” (citing In re Keller, CCPA 1981 and In re Mouttet, FC 2012).

This entry was posted in Article III disputes, Inter Parties Review (IPR), Obviousness. Bookmark the permalink.

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