Fresh From the Bench: Latest Federal Circuit Court Case

CASE OF THE WEEK

Arthrex, Inc. v. Smith & Nephew, Inc., Appeal No. 2018-2140 (Fed. Cir. May 27, 2022)

In a return to the Federal Circuit, this case again sets precedent concerning Patent Office Director review of Patent Trial and Appeal Board (PTAB) decisions.  In a prior iteration of the appeal, the Supreme Court held that inter partes reviews (IPRs), created by the America Invents Act, were unconstitutional because the PTAB judges who decide them are not appointed pursuant to the Appointments Clause of the U.S. Constitution.  The Supreme Court remedied this by judicially reforming the statute to allow the Director of the Patent Office to review IPR decisions, and remanding the case “to the Acting Director of the Patent Office for him to decide whether to rehear” the case.  See our write-up of the Supreme Court’s decision here.

On remand, Arthrex requested “rehearing by the Director.”  However, the Director office was vacant, as was the Deputy Director office.  Arthrex’s rehearing petition was thus heard by the Commissioner for Patents, pursuant to a standing directive in the case of vacancies at the top of the Patent Office.  The Commissioner denied rehearing.  Arthrex appealed, questioning whether the Commissioner’s decision was sufficient under the Supreme Court’s prior decision and under the Federal Vacancies Reform Act and the Constitution’s Separation of Powers.

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By Nika Aldrich

Edited by:  Nika Aldrich and Scott D. Eads, Schwabe, Williamson & Wyatt