[00:00:13] Speaker 05:
Okay, the next argued case is number 14-1771, Ethicon Endosurgery Incorporated Against COVID-EMLP.

[00:00:23] Speaker 05:
Mr. Johnson.

[00:00:26] Speaker 04:
Thank you, Your Honor.

[00:00:27] Speaker 04:
May it please the Court, the three topics I'd like to address today are why the plain language of the American Events Act requires and in fact mandates the director to institute IPR decisions, why that same plain language

[00:00:43] Speaker 04:
precludes the board from instituting IPRs and how the board otherwise erred in misconstruing and not fairly crediting our commercial success and long felt need evidence.

[00:00:59] Speaker 04:
As the final House report to the American Invents Act makes clear, the purpose that Congress had in mind in establishing inter-parties reviews was to convert inter-parties reexaminations

[00:01:13] Speaker 04:
from examinational proceedings into adjudicative proceedings.

[00:01:19] Speaker 04:
As the House report later says in connection with the post issuance proceedings, its goal was to have these matters heard in court-like proceedings.

[00:01:31] Speaker 04:
Now in order to do that, it was unnecessary for Congress to change the manner in which the proceedings, the re-examination proceedings have been instituted.

[00:01:43] Speaker 04:
Re-examination proceedings had been instituted in the past based on a non-appealable, unreviewable discretionary decision of the director through one of her executive delegates, traditionally an examiner.

[00:01:58] Speaker 04:
There was no need to change that in order to convert the inter-party's re-examination to the inter-party's review.

[00:02:05] Speaker 04:
And Congress didn't do that.

[00:02:08] Speaker 04:
Congress continued to retain that aspect of the proceeding.

[00:02:12] Speaker 04:
by giving the director broad discretion to decide in an unreviewable context, unappealable context, the ability not only to see whether a threshold had been met, but to consider a raft of other factors that are set forth in the statute to decide whether it would be appropriate or not to institute an inter-party's review.

[00:02:36] Speaker 04:
But of course, what Congress needed to do in order to convert the examinational proceeding

[00:02:42] Speaker 04:
to an adjudicative proceeding was it needed to move the examinational part out of the executive function of the office and over to its judicial branch, if you will, its judicial function, and that's the board.

[00:02:59] Speaker 04:
So it did so by establishing the Patent Trial and Appeal Board for the first time and specifying its jurisdiction in Section 6.

[00:03:09] Speaker 04:
And what it did was, once the institution decision was made, was it said, from that point on, the board shall have jurisdiction to conduct and decide these post-grant reviews.

[00:03:24] Speaker 04:
And that's exactly what the language of the statute does.

[00:03:28] Speaker 04:
If you look at section six, section six says that the Patent Trial and Appeal Board shall conduct inter-parties reviews

[00:03:38] Speaker 04:
pursuant to Chapter 31.

[00:03:41] Speaker 04:
In Chapter 31, relating to these reviews, the references are replete to the Director's discretion to Institute, but has only two references to the Patent Trial and Appeal Board.

[00:03:59] Speaker 04:
The first in 316A, which says that the Patent Trial and Appeal Board may

[00:04:06] Speaker 04:
conduct proceedings instituted under this chapter.

[00:04:09] Speaker 04:
And again, in section 318, where it says, if instituted and not dismissed, the Patent Trial and Appeal Board.

[00:04:21] Speaker 03:
Can I just ask this?

[00:04:24] Speaker 03:
Suppose I thought, as I think I do at the moment, that there's no language in the statute, section six in the 31 series.

[00:04:35] Speaker 03:
Um, that is specifically restrictive in the way that you're arguing and that your argument is a kind of structural argument about what Congress kind of contemplated the role of the 200 odd board members would be.

[00:04:53] Speaker 03:
And that that role would be something different from, um, from the role.

[00:04:59] Speaker 03:
that is played in the institution decision.

[00:05:02] Speaker 04:
But I do believe there is restrictive language.

[00:05:04] Speaker 03:
What language says that... First of all, it is the... I get to finish my question.

[00:05:09] Speaker 03:
Yes, of course you do.

[00:05:11] Speaker 03:
What language says that the director may not delegate the director's authority to members of the board or to panels constituting the board, and even the same panel that will then decide

[00:05:29] Speaker 03:
the matter.

[00:05:32] Speaker 04:
Section six is jurisdictional.

[00:05:35] Speaker 04:
So it says what powers the board has and the committee report refers to it as jurisdictional so that the director can only delegate to the board matters within the board's jurisdiction.

[00:05:50] Speaker 04:
If the board doesn't have jurisdiction to institute and it doesn't, but only to conduct and decide,

[00:05:58] Speaker 02:
then the director clearly cannot delegate to the board and ask the board to do something.

[00:06:08] Speaker 02:
The mere fact that some part of the agency has specific functions doesn't suggest that other functions can't be delegated to that

[00:06:21] Speaker 02:
Well, the... That part of the agency.

[00:06:23] Speaker 02:
I mean, what case suggests... Well, the only source... No, you can't interrupt.

[00:06:28] Speaker 02:
You've got to let us finish the questions.

[00:06:30] Speaker 02:
That's not appropriate.

[00:06:31] Speaker 02:
What case suggests that delegation is impermissible under those circumstances?

[00:06:37] Speaker 04:
Well, I believe that the Cudahy, Fleming, and Splane cases, which are cited, read together indicate that where their statute speaks to delegation, that

[00:06:51] Speaker 04:
you can't fall back on general delegation principles.

[00:06:55] Speaker 02:
Well, that seems to me to be a different argument.

[00:06:57] Speaker 02:
You're arguing that because the statute specifically provides for delegation by the director to officials appointed by him that that precludes other kinds of delegation.

[00:07:07] Speaker 02:
I understand that argument, but that's different from saying that because the board has certain assigned functions that other functions can't be assigned by delegation.

[00:07:19] Speaker 04:
Well, I think that jurisdictional statutes are always read as being limiting in the that which is expressed excludes that which is not.

[00:07:29] Speaker 04:
And when you say the board's duties are, and when the committee report says the jurisdiction is expanded to do these duties, that that by implication means that they don't expand further.

[00:07:41] Speaker 04:
Now, if the director had independent authority to delegate

[00:07:50] Speaker 04:
then that would be a different story.

[00:07:52] Speaker 04:
But the only authority given to the office to conduct these types of proceedings, which are intended to invalidate patents, is given in section six.

[00:08:02] Speaker 04:
The director's other general authority under section two is only to grant and issue patents, which is clearly not what's involved in these.

[00:08:13] Speaker 04:
So she doesn't have a general authority to do that.

[00:08:17] Speaker 04:
She gets some authority in section six as a member of the board, of course, with a few extra duties.

[00:08:23] Speaker 03:
Can I ask this?

[00:08:26] Speaker 03:
I don't think I quite appreciated this, but there are two possible statutory arguments you're making.

[00:08:34] Speaker 03:
One is about statutory provisions saying what the director can and can't do.

[00:08:39] Speaker 03:
And then there's statutory provisions saying what the board can and can't do, and at least

[00:08:44] Speaker 03:
The second point is an argument, which I think Judge Teich was asking you about, about when a provision that says a particular component of an agency shall do the following, whether that is general meant to be restrictive and say, and nothing else, even if it would otherwise be implicitly authorized to receive the function.

[00:09:14] Speaker 03:
Um, what I guess I want to try to return to is in the absence of specific case law providing presumptions about the restrictive nature of, of assignments of duties.

[00:09:28] Speaker 03:
I'm not sure why there is something inconsistent in the nature of the function, which I think you were beginning to suggest in describing the executive and the judicial function.

[00:09:38] Speaker 03:
And so to bring this to specific.

[00:09:41] Speaker 03:
question, why is this not like what a district court does in deciding a preliminary injunction and then the merits?

[00:09:49] Speaker 04:
Well, because what the district court does in that situation is entirely a judicial function and they stay within their function.

[00:09:57] Speaker 04:
Here we have an executive discretionary, unreviewable function for institution, which is done by the director and has been always been done by the director's executive delegates.

[00:10:10] Speaker 04:
And then we have a judicial function, which is the follow-up, which is the second stage of the proceeding to conduct and decide these.

[00:10:19] Speaker 04:
And that's entirely a judicial function.

[00:10:21] Speaker 04:
And under the Administrative Procedure Act, one of the primary objectives is to separate- Why isn't the initiation a judicial function?

[00:10:29] Speaker 04:
Because it involves investigation of factors and the complete discretion of the director.

[00:10:38] Speaker 04:
There is a long list of factors, for example, in connection with the jointer that is mentioned in the legislative history, I believe it was by Senator Kyle, as to what the office had told the Senator it would look into when it was trying to decide whether to join a case.

[00:10:57] Speaker 04:
In fact, there are very broad discretion there.

[00:11:00] Speaker 04:
The director can set a limit on the number that are granted.

[00:11:04] Speaker 04:
The director is to promulgate regulations taking into account

[00:11:08] Speaker 04:
the economy and the efficiency of the patent system and many other things.

[00:11:13] Speaker 04:
The directors also to investigate whether the same or similar arguments for prior art has already been before the office.

[00:11:22] Speaker 04:
So these are all the kinds of executive discretionary functions, activities you would expect from the director acting in her executive capacity or her delegate.

[00:11:34] Speaker 02:
Well, district judges have a lot of discretion also.

[00:11:37] Speaker 02:
Of course they do.

[00:11:38] Speaker 02:
Consistent with having discretion.

[00:11:39] Speaker 02:
Of course they do.

[00:11:40] Speaker 04:
But... You keep interrupting.

[00:11:42] Speaker 04:
I'm sorry.

[00:11:43] Speaker 04:
I'm having trouble knowing when you're finished, so I'll be more respectful.

[00:11:49] Speaker 04:
Go ahead.

[00:11:53] Speaker 04:
Yes, they do have a lot of discretion.

[00:11:56] Speaker 04:
And their settings, what they do, is entirely reviewable from the start to the finish, of course.

[00:12:05] Speaker 04:
which is a different aspect between executive discretionary decisions and judicial decisions.

[00:12:12] Speaker 04:
And of course, in this context, especially as promulgated, here we have the kind of limited record.

[00:12:22] Speaker 04:
We don't have a record where the patent owner has been allowed to introduce its own evidence at the institution stage.

[00:12:31] Speaker 04:
So there is a limited record.

[00:12:32] Speaker 04:
There are limited grounds.

[00:12:34] Speaker 04:
that can be raised in the institution phase.

[00:12:38] Speaker 04:
And as I've mentioned, it's entirely unreviewable.

[00:12:41] Speaker 03:
Well, you would have an, ordinarily you would have a limited record in the preliminary injunction stage and a decision about likelihood of success as part of it.

[00:12:52] Speaker 03:
Not perhaps statutorily or otherwise, um, uh, mandatorily limited, but you would ordinarily have a, you know, a preliminary decision on a preliminary

[00:13:03] Speaker 03:
record, and there's a certain amount of discretion in the non-merits-y part of the preliminary injunction decision.

[00:13:14] Speaker 04:
I'm not arguing that judges and courts don't have discretion.

[00:13:18] Speaker 04:
In those proceedings, however, in preliminary injunctions, I believe it's required that both parties be heard, that both parties are allowed to present their evidence.

[00:13:30] Speaker 04:
That evidence is considered by the court.

[00:13:33] Speaker 04:
We don't have that here at the institution phase.

[00:13:35] Speaker 04:
Here we have a one sided record where the patent owner is precluded from submitting like kind evidence.

[00:13:42] Speaker 04:
And it's given to an executive acting in that capacity to make a discretionary decision, not just on that evidence, but on the basis of an investigation that can be wide ranging.

[00:13:57] Speaker 04:
and involve factors having nothing to do with a particular matter before... I'm sorry, I'm not following this.

[00:14:04] Speaker 02:
The district judge issues a temporary restraining order, non-reviewable, essentially based on one-sided record.

[00:14:14] Speaker 02:
Yes.

[00:14:14] Speaker 02:
So what's the matter with that?

[00:14:17] Speaker 04:
Nothing's the matter with it, but there are other safeguards in that situation where the restraining order can't last very long.

[00:14:25] Speaker 04:
And you have an extremely high threshold.

[00:14:28] Speaker 04:
And even in temporary restraining orders, of course, almost all courts insist that the other side be contacted.

[00:14:35] Speaker 04:
And if they appear, they will be heard.

[00:14:38] Speaker 05:
Let's hear from the other side and we'll save you rebuttal time, Mr. Johnson.

[00:14:46] Speaker 05:
Same as Alan.

[00:14:47] Speaker 05:
Are you, are you here representing the director?

[00:14:52] Speaker 01:
Yes, Your Honor.

[00:14:54] Speaker 01:
Okay.

[00:14:55] Speaker 01:
Thank you, Judge.

[00:14:55] Speaker 01:
May I please the court?

[00:14:57] Speaker 01:
I just want to briefly touch, there are two threshold reasons, independent threshold reasons, why Ethicon's challenge to the director's delegation of the institution decision board is not properly before this court.

[00:15:10] Speaker 01:
And I just want to emphasize the waiver issue, because the agency has important institutional concerns regarding waiver.

[00:15:17] Speaker 01:
Ethicon didn't raise this issue at all before the agency, despite numerous opportunities to do so

[00:15:24] Speaker 01:
throughout the proceedings.

[00:15:26] Speaker 05:
And so under this court's well-established precedent, particularly the case in Ray DBC, the issue is waived.

[00:15:54] Speaker 05:
office in a position of authority and respect and reliability of a court in most cases at least of the post-grant review as to have initially in this one-sided step in which there's a prima facie or whatever case presented to, in theory as I had understood it, one examiner.

[00:16:24] Speaker 05:
who would then cross the threshold through a certain amount of sorting out before it came to the tribunal, which then was established with a good many of the safeguards that we see in the district court.

[00:16:38] Speaker 05:
But that this first threshold step, if taken by the same tribunal that makes the final decision, seems to be extraordinarily, if nothing else, inefficient, because we're just duplicating with the same decision maker

[00:16:54] Speaker 05:
However, with only half the record, because it's not opposed, to take a step.

[00:17:00] Speaker 05:
And aren't we losing one of the fundamental, I'll say selling points, theories as to why it was appropriate and desirable to turn over to an administrative agency what until now only the courts could do?

[00:17:17] Speaker 05:
There would be a threshold so that there wouldn't be a lot of unnecessary

[00:17:23] Speaker 05:
thrashing around, followed by a tribunal of experts who would make the decision.

[00:17:30] Speaker 05:
When you put them all together, it is curious.

[00:17:34] Speaker 05:
We haven't really seen it in this form before.

[00:17:37] Speaker 05:
And I have to tell you, it doesn't match the way I had understood the plan, the purpose of setting up this extraordinarily elaborate jurisdictional jurisprudential structure.

[00:17:53] Speaker 05:
I hadn't meant to make a speech, but if you can put this back in the context, because we don't want to argue about the director's right to delegate.

[00:18:04] Speaker 05:
The question is, who does the director delegate to and in what context?

[00:18:13] Speaker 01:
Sure, Your Honor.

[00:18:14] Speaker 01:
Just to step back with the history of the proceeding, under the prior statute, there was inter-party re-examination.

[00:18:22] Speaker 01:
which and the director in the statute give the director the authority to institute inter-parties re-examination and also the authority to conduct the inter-parties re-examination.

[00:18:32] Speaker 01:
And under the prior scheme, the director delegated both of those to the examiner, typically to the same examiner.

[00:18:38] Speaker 01:
When the America Invenst Act came along, Congress purposely delegated, purposely specified that the board would conduct inter-parties re-examination in order to streamline the proceedings.

[00:18:51] Speaker 01:
Because what was happening under the prior regime was that an examiner would make a decision and then it would be appealed to the board.

[00:18:57] Speaker 01:
And it was taking too long and consuming too many resources as the legislative history shows.

[00:19:02] Speaker 01:
And so Congress purposely chose to have the merits determination made by the board.

[00:19:07] Speaker 05:
But this wasn't a casual choice.

[00:19:11] Speaker 05:
This was a powerful upheaval of the structure of patent decisions because

[00:19:19] Speaker 05:
80% of the litigated patents were being tossed out by the courts.

[00:19:24] Speaker 05:
It looked as if there was some kind of disrepair within the office.

[00:19:31] Speaker 05:
And to build this two-layered system to provide the reliability and the authority of the nation depends on its innovation.

[00:19:41] Speaker 05:
And here it looked as if it might be collapsing.

[00:19:45] Speaker 01:
Well, your honor, Congress did raise the standard at the threshold step so that it went from the director determining whether there was a substantial new question of patentability to the question of whether there's a reasonable likelihood of success.

[00:20:00] Speaker 01:
And that threshold, that higher threshold was purposely chosen to protect patent holders and to make sure that invalid challenges weren't going forward.

[00:20:13] Speaker 01:
But I just would like to turn to the delegation issue quickly just to point out that Ethicon agrees in its reply brief at page 19 that the director can delegate the institution decision to secretarial appointees.

[00:20:27] Speaker 01:
So the only question remaining on the merits of this case is whether the director can delegate to the board, which is the specialized body within the agency that specializes in claim construction,

[00:20:39] Speaker 03:
And I think it's sort of two parts to the argument.

[00:20:43] Speaker 03:
Can it delegate to the board and can it delegate to the same panel that's going to decide the merits?

[00:20:48] Speaker 03:
Which I think they have a stronger and a weaker argument.

[00:20:52] Speaker 03:
I'm not evaluating the merits.

[00:20:53] Speaker 03:
I mean, it's scope of argument.

[00:20:54] Speaker 01:
Of course.

[00:20:55] Speaker 01:
Respectfully, Your Honor, there is a lot of hand wringing about the fact that the same panel decides both issues, but Eficon clearly states in its reply brief at page eight that it would not have been sufficient.

[00:21:07] Speaker 01:
if the merits decision had merely been assigned to a different panel.

[00:21:12] Speaker 01:
So I think it's clear that their legal argument.

[00:21:14] Speaker 03:
But that's in the nature of stronger and weaker arguments.

[00:21:18] Speaker 03:
You don't say, I'm perfectly happy with the weaker one.

[00:21:23] Speaker 03:
It would actually like to win on both arguments.

[00:21:28] Speaker 03:
Or actually, the stronger one would make the second one unnecessary.

[00:21:31] Speaker 01:
Well, Your Honor, if their argument is merely that it should have been assigned to a different panel.

[00:21:35] Speaker 01:
It's not merely.

[00:21:35] Speaker 01:
It's both.

[00:21:36] Speaker 03:
Sorry.

[00:21:37] Speaker 03:
I'm just, I'm just trying to clarify.

[00:21:39] Speaker 03:
I mean, they do have a point about, about the initiation decision, um, maybe not supposed to be, um, in the same hands as the final written decision, um, merits decision, but they also have another point that the structural separation within the PTO should be even stronger than that.

[00:22:01] Speaker 03:
And board members simply should not be part of stage one.

[00:22:07] Speaker 01:
Well, Your Honor, they said that assigning it to a different panel wouldn't cure their legal challenge.

[00:22:15] Speaker 01:
And so I don't think that they're raising a straight argument about the same panel being assigned to both.

[00:22:21] Speaker 01:
And I think it points out the waiver issue here, because they clearly could have raised to the board before the merits determination that it should have been assigned to a different panel.

[00:22:30] Speaker 01:
They could have petitioned the chief administrative judge who could have done that.

[00:22:35] Speaker 03:
Can I double check one thing that was, I think, raised by Mr. Johnson?

[00:22:41] Speaker 03:
Am I right that it's not the statute, but only regulation that restricts what the patent owner can put in the preliminary response?

[00:22:51] Speaker 01:
Your Honor, there's a statutory provision that governs the preliminary response.

[00:22:54] Speaker 03:
But it doesn't say no evidence.

[00:22:56] Speaker 01:
Right.

[00:22:57] Speaker 01:
And to be clear, the regulation that he points to, which is 37 CFR, section 42.107C,

[00:23:05] Speaker 01:
It allows the person responding to present evidence, just not, quote, new testimony evidence.

[00:23:13] Speaker 01:
And it specifically says, except as authorized by the board.

[00:23:18] Speaker 01:
So here, again, this is another situation in which Ethicon could have asked the board to present new testimony evidence if it thought it was necessary at the institution phase in order to have a fair proceeding.

[00:23:29] Speaker 01:
And they never gave the agency an opportunity to consider that argument.

[00:23:34] Speaker 05:
But to get back to the... We've exhausted your five minutes.

[00:23:39] Speaker 05:
Thank you.

[00:23:39] Speaker 05:
Anything else that you must ask on behalf of the director?

[00:23:43] Speaker 05:
Okay.

[00:23:44] Speaker 05:
Thank you.

[00:23:44] Speaker 05:
Thank you.

[00:23:45] Speaker 05:
Thank you, Ms.

[00:23:45] Speaker 05:
Allen.

[00:23:49] Speaker 00:
Ms.

[00:23:49] Speaker 00:
Jaley.

[00:23:50] Speaker 00:
Thank you, Your Honors.

[00:23:52] Speaker 00:
I was actually going to turn to the obviousness question, but that wasn't raised in Mr. Johnson.

[00:23:58] Speaker 00:
So I guess I'd ask the panel if they have any questions on obviousness.

[00:24:02] Speaker 00:
I'd be happy to ask them, or if you have

[00:24:04] Speaker 00:
Quite more questions on the statutory authority.

[00:24:07] Speaker 00:
I can answer those or I can defer the time back to the government's counsel.

[00:24:18] Speaker 05:
Okay.

[00:24:18] Speaker 05:
Thank you.

[00:24:21] Speaker 05:
Mr. Johnson, you have the last word.

[00:24:27] Speaker 04:
Thank you.

[00:24:29] Speaker 04:
I'd like to refer back to your question.

[00:24:34] Speaker 05:
With 16 o'clock.

[00:24:37] Speaker 04:
Okay.

[00:24:37] Speaker 04:
I'd like to refer back to your question about a prohibition on the board's right to institute.

[00:24:45] Speaker 04:
The sections of the statute I referred to, section six, which references chapter 31 and chapter 31, which in both situations, both the references, references that the board must conduct itself pursuant to the chapter.

[00:25:02] Speaker 04:
to chapter 31 and section six, limit, cabin the authority of the board.

[00:25:10] Speaker 04:
The jurisdiction is limited.

[00:25:11] Speaker 04:
There's no jurisdiction given to the board to go beyond that.

[00:25:15] Speaker 02:
Yeah, but what case says that if a sub-part of the agency has certain responsibilities, other responsibilities can't be delegated to them?

[00:25:26] Speaker 04:
Well, the director has no authority with respect to- No, you're not answering my question.

[00:25:30] Speaker 02:
What case says-

[00:25:32] Speaker 02:
that if a part of an agency is assigned certain functions by statute, that other functions cannot be delegated to it.

[00:25:40] Speaker 04:
Well, there are several things under the Administrative Procedure Act, Section 554D.

[00:25:46] Speaker 04:
What case?

[00:25:50] Speaker 04:
Well, I think that the cases that underlie that would be Kelly versus Goldberg, which is cited at footnote 24 in the Withrow decision,

[00:26:02] Speaker 04:
where they discuss, in particular, limitations on any employee of an agency making a decision that reviews, in essence, the propriety of its own earlier decision.

[00:26:17] Speaker 04:
And Kelly versus Goldberg, I think, preceded... That's not the same point.

[00:26:22] Speaker 02:
Different point.

[00:26:24] Speaker 04:
Perhaps I didn't understand your question.

[00:26:26] Speaker 02:
What case says that if a subpart of the agency is assigned certain statutory functions,

[00:26:32] Speaker 02:
that it's impermissible to delegate other functions to that sub-part of the agency?

[00:26:38] Speaker 04:
Well, I think that with respect to administrative law judges whose independence is recognized under the federal statutes as, for example, 5 USC 3105, which precludes assignment of duties to administrative law judges that are inconsistent with their responsibilities as judges.

[00:26:59] Speaker 04:
That's a special statutory provision.

[00:27:01] Speaker 04:
Yes, it is.

[00:27:03] Speaker 02:
And it recognizes the fact that when you talk to... So are you agreeing that in general the fact that part of the agency has specific functions by statute doesn't preclude delegation of other functions?

[00:27:14] Speaker 02:
I believe that if the delegation... You keep interrupting.

[00:27:16] Speaker 02:
Excuse me.

[00:27:17] Speaker 02:
It does not bar the assignment of other functions.

[00:27:20] Speaker 04:
I believe that where the statutory scheme makes it clear that the official or employee to whom

[00:27:28] Speaker 04:
the responsibility would be delegated is not authorized to discharge that function, that that delegation would be improper.

[00:27:35] Speaker 04:
The example we give in our brief is it would be improper for the director to delegate to the commissioner of trademarks the examination of patent applications.

[00:27:46] Speaker 02:
Just to be clear, what we're talking about here, your argument is entirely based on the statute, right?

[00:27:54] Speaker 02:
If the statute

[00:27:56] Speaker 02:
had set up the scheme that exists now.

[00:27:58] Speaker 02:
There'd be nothing, no constitutional question raised by doing that, right?

[00:28:02] Speaker 04:
Well, there are constitutional concerns that are raised and the canon of constitutional avoidance should be used in interpreting the statute.

[00:28:10] Speaker 02:
If the statute had provided exactly for the way things are done now, would that statute be unconstitutional?

[00:28:23] Speaker 02:
May I ask, when you say that, that the statute would include... Said that the board was responsible for initiating and for making the final adjudication.

[00:28:34] Speaker 04:
And the same panel?

[00:28:35] Speaker 04:
Same panel.

[00:28:37] Speaker 04:
Yes, I think that would raise some... Would it be unconstitutional?

[00:28:41] Speaker 04:
Why?

[00:28:42] Speaker 04:
Because I think that there is a concern given the structure that we're in the hypothetical about having the same decision makers

[00:28:51] Speaker 04:
be involved in the first phase on limited record, making up a decision, and then in essence reviewing the propriety of that decision in the later final merits decision.

[00:29:03] Speaker 04:
I don't know that it would be unconstitutional, but I believe that the cases are concerned about the risk, an undue risk of concern, that the decision makers may not meet the fair and unbiased requirements of the due process clause.

[00:29:21] Speaker 05:
To elaborate on that question and answer, because I think I made clear that I'm trying to think through the legislative intent.

[00:29:33] Speaker 05:
If this isn't a constitutional issue, nonetheless, it's appropriate to look at the statutory process.

[00:29:42] Speaker 04:
We don't believe that this case needs to be decided on constitutional grounds.

[00:29:49] Speaker 04:
We do believe.

[00:29:50] Speaker 04:
that all the normal canons of statutory construction and the legislative history, those canons, of course, include the canon of constitutional avoidance.

[00:30:02] Speaker 04:
But we don't believe that this court needs to address a constitutional question because the statute is quite clear.

[00:30:10] Speaker 04:
The statutory framework is quite clear and the intent of Congress is quite clear in how they set this up with the executive discretionary

[00:30:18] Speaker 04:
an unreviewable decision coming first from the director.

[00:30:22] Speaker 04:
And uniformly through the house committee report and through the statute, institution is clearly to be done by the director.

[00:30:31] Speaker 04:
It's then to be shifted.

[00:30:32] Speaker 04:
The government itself has argued to this court that at that point after institution, the statutory responsibility for conducting and deciding shifts to the board.

[00:30:45] Speaker 04:
And that's all the court need

[00:30:48] Speaker 04:
decide is that that is indeed what the statute has in mind.

[00:30:53] Speaker 04:
And I would suggest it's completely consistent with decisions like the Crozzo decision and others that you have already made, recognizing that this is a two-stage proceeding.

[00:31:03] Speaker 04:
Recognizing the difference between the kinds of decisions that are made and why the institution decision is not appealable on its merits.

[00:31:14] Speaker 04:
I think it's completely consistent

[00:31:17] Speaker 04:
with what the court has decided thus far.

[00:31:20] Speaker 05:
Any more questions?

[00:31:22] Speaker 05:
Any more questions for Mr. Johnson?

[00:31:24] Speaker 05:
Thank you, Mr. Johnson.

[00:31:25] Speaker 05:
And thank you.

[00:31:26] Speaker 05:
The case is taken under submission.

[00:31:28] Speaker 05:
That concludes the argued cases for this morning.

[00:31:31] Speaker 04:
All rise.

[00:31:37] Speaker 04:
The honorable court is adjourned until tomorrow morning at 10 o'clock AM.