[00:00:04] Speaker 02: The first two cases this morning are related, but we noticed that there are different counsels, so we'll leave it to you to decide which specific issues you want to emphasize. [00:00:18] Speaker 02: So the first case we'll hear, the appeal of number 15, 1183, Synopsis Incorporated against Lee, Mr. Lowe. [00:00:33] Speaker 01: Thank you and may it please the court. [00:00:34] Speaker 01: My name is Robert Loeb and I represent Synopsys in this appeal from the district court's dismissal of Synopsys APA action. [00:00:42] Speaker 04: Do you agree that if we hold in the second case that we can consider your claim on the merits with respect to the final decision that the APA case fails because you have an adequate remedy? [00:00:57] Speaker 01: We do concede that on review of the final written decision, [00:01:02] Speaker 01: this court can review the legality and lawfulness of the regulation and the related policy and practice of issuing partial final decisions, that that is an adequate remedy which will preclude APA review. [00:01:16] Speaker 04: Now you're confusing me because I thought that you were clear in the second case that you were only challenging the final decision and not challenging the decision to institute. [00:01:26] Speaker 01: That's correct, Your Honor, that there is an error in the final written decision that this Court can review under Section 319. [00:01:35] Speaker 04: Okay, so let me reframe my question. [00:01:38] Speaker 04: Do you agree that if we entertain your challenge to the final written decision in the second case that you have no APA claim in the first case? [00:01:52] Speaker 01: resolve one half of our APA complaint, our complaint challenges two aspects. [00:01:56] Speaker 01: One, the validity of the regulation of the partial grants. [00:02:00] Speaker 01: Second, the related policy and practice of issuing final written decisions that relate only in part. [00:02:06] Speaker 01: It could be that as you address in your final written decision review, the legality of the policy and practice [00:02:15] Speaker 01: of issuing final written decisions that don't address all claims. [00:02:18] Speaker 04: But you said to me that the second case doesn't involve the decision to institute. [00:02:22] Speaker 04: It only involves the final written decision. [00:02:25] Speaker 04: Correct? [00:02:25] Speaker 04: Correct. [00:02:26] Speaker 04: Okay. [00:02:26] Speaker 04: So is that an adequate remedy with respect to your challenge to the regulation or not? [00:02:34] Speaker 01: It is not as to the regulation, but as to the policy and practice of issuing final written decisions that only pertain to some or not all of the claims. [00:02:44] Speaker 01: It could be that in your decision in that regard, you also say, what's animating them to do this is this regulation, and the regulation is invalid. [00:02:52] Speaker 01: Certainly, that could be in the scope of this court's review. [00:02:55] Speaker 05: So you could at least have raised it in the second case. [00:02:59] Speaker 01: Raised the validity of the regulation? [00:03:00] Speaker 01: Yeah. [00:03:01] Speaker 01: Well, we're clearly raising it in the APA action, and we are arguing there that what's before you is the final written decision, and that the policy they have of only addressing some [00:03:12] Speaker 01: part of the claims in the petition is invalid and contrary to 318A. [00:03:18] Speaker 05: But the question is, you could have raised the validity. [00:03:21] Speaker 05: You can argue the question of validity in the second case. [00:03:24] Speaker 05: Can you not? [00:03:25] Speaker 01: I believe that you can argue it to the extent that it is what's animating the PTAB to only address some and not all of the claims. [00:03:35] Speaker 02: Well, I think we're diverting you from the merits of the issue. [00:03:39] Speaker 02: I think we all appreciate that. [00:03:41] Speaker 02: The particular question of reviewability could have been raised in various ways. [00:03:46] Speaker 02: And I, for one, don't think that we want to require you to make a concession at this stage that hasn't been made. [00:03:56] Speaker 02: We have these separate appeals. [00:03:57] Speaker 02: The cases were filed. [00:03:59] Speaker 02: We need to dispose of them. [00:04:01] Speaker 02: We may very well say that one is mooted or whatever, but let's get to the merits. [00:04:05] Speaker 04: So we think you can and should reach the merits of, certainly at least the... Well, the problem is that the APA statute in 704 says that you can't bring an APA action if you have another adequate remedy. [00:04:18] Speaker 04: So a central issue here is whether you have an adequate remedy in the other case. [00:04:23] Speaker 01: Right. [00:04:25] Speaker 01: And certainly you would be giving substantial relief to us if you hold an on review of the final written decision. [00:04:34] Speaker 01: that the board is acting unlawfully and not addressing all of the claims addressed by the petitioner in the petition. [00:04:45] Speaker 02: In either case, we're going to have to decide whether the remedy is adequate and the merits. [00:04:50] Speaker 02: I really don't want to use up all of your time on this preliminary procedure, which we'll have to decide. [00:04:56] Speaker 01: And we think because the parties have briefed the merits of the underlying validity of the policy and practice and regulation, [00:05:02] Speaker 01: that this court could and should reach the merits whether it's reviewing under the APA or whether it's reviewing on review of final decision because it's before you in any event and it certainly would be efficient to just address the merits. [00:05:15] Speaker 04: I think what we're trying to understand is whether you are challenging the regulation having to do with the institution in the APA action or you're only again challenging the failure to [00:05:31] Speaker 04: address all the claims in the final decision? [00:05:34] Speaker 01: We are challenging both, really, in the APA complaint. [00:05:37] Speaker 01: We are arguing that they have no authority to issue the partial grants of the partial institutions on the petition, and that there's the related error that they have the policy and practice of then only issuing final written decisions as to some but not all of the claims in the petition. [00:05:56] Speaker 01: So you're right that it addresses half of what we, but does not address all. [00:06:01] Speaker 01: So what this court should do, we think, is address the error on the final decision under 319, on review of the final decision, and then go ahead and also address under the APA, and you could do so here today, the validity of the regulation, because the two are fundamentally flawed for the same reason. [00:06:19] Speaker 04: The validity of the regulation about institution. [00:06:22] Speaker 01: It's a regulation regarding institution, but it's not a review under Section 314D of any determination [00:06:30] Speaker 01: of the board regarding institution. [00:06:34] Speaker 01: Like in the Supreme Court McNary case, there there was a statute which limited review of the determination. [00:06:40] Speaker 01: In the words of the Supreme Court, the government argued there that it was clear and unambiguous. [00:06:43] Speaker 01: You could not review the determination there of whether you were a special agricultural worker except for under the very limited review provided by Congress. [00:06:52] Speaker 01: The Supreme Court said that's fine, but you have review under the APA to [00:06:56] Speaker 01: challenges, as the case here, to the legality of the regulation and the policies, including the validity of the regulation here. [00:07:04] Speaker 04: So what about Pregis? [00:07:05] Speaker 04: Because in Pregis we said that an APA action was barred even though you couldn't get relief in the infringement action, right? [00:07:21] Speaker 01: While this Court pointed out there were multiple other avenues Congress had provided for challenging [00:07:26] Speaker 01: the validity of the patent, and that those were adequate remedies which precluded the APA action. [00:07:33] Speaker 01: So here the question is, where can this regulation be challenged? [00:07:35] Speaker 01: Can it be challenged on the APA, or can it be also resolved under the final written decision? [00:07:41] Speaker 01: Let me return to the merits of the regulation and practice. [00:07:45] Speaker 04: I don't think that's a full answer to Preaches, because it seems to me that Preaches says that the whole structure of the statute suggested that these [00:07:55] Speaker 04: challenges should be brought before the PTO rather than an APA action or an infringement action rather than an APA action. [00:08:06] Speaker 04: So it seems to me that's a difficult case for you. [00:08:09] Speaker 01: Well, in there you were challenging the particular validity of a patent. [00:08:15] Speaker 01: Here in the APA challenge, we're arguing the validity and lawfulness of this regulation writ large as it applies to the whole patent world. [00:08:25] Speaker 01: And that is in your wheelhouse of your general APA authority to address the lawfulness of government authority. [00:08:35] Speaker 02: Please proceed with the merits. [00:08:36] Speaker 02: We're going to have to decide the question in one case or the other. [00:08:40] Speaker 01: So under 318A, it says that CAB shall issue a final written decision with respect to the patentability of any claim challenged by the petitioner. [00:08:55] Speaker 01: The regulation and the policy and practice of the PTAB and the board here of having partial grants and partial final decisions cannot be squared with the plain language of 318A. [00:09:08] Speaker 01: This court's Beersbach versus Kraft decision explains that there's no merit to the argument that the word, including the word any, provides some ambiguity that gives the court or the board some authority to interpret any to mean anything but all and every. [00:09:25] Speaker 01: Also if you look at the prior statute which the AIA replaced, section 313, there Congress had provided authority in the re-examination to focus on a particular question. [00:09:38] Speaker 04: Yeah, but 318 says if an inter-party's review is instituted and not dismissed, then the PTO shall address every challenged claim. [00:09:48] Speaker 04: Why doesn't that preamble to 318A clearly mean that [00:09:55] Speaker 04: It's dealing only with claims as to which a decision has been made to institute review. [00:10:03] Speaker 01: The reading of that, the proper reading of that is that if review is instituted, it's an all or nothing proposition. [00:10:11] Speaker 01: Either you're instituting it to the petition or you're not. [00:10:14] Speaker 01: So it's thumbs up or thumbs down. [00:10:16] Speaker 04: I don't think you're really answering my question. [00:10:18] Speaker 04: Why doesn't that preamble, the 18A, [00:10:22] Speaker 04: pretty clearly say that it's dealing with claims as to which review has been instituted. [00:10:29] Speaker 01: It is saying if review is instituted, there's some legal consequences. [00:10:33] Speaker 01: And the consequences is that the board then needs to issue a final written decision that addresses any claim challenged by the petitioner. [00:10:41] Speaker 01: So it doesn't say that when you're granting, you're only granting a certain claims and that the final written decision only needs to address those claims. [00:10:48] Speaker 01: It says once you've decided, there's an on and off switch, once you've decided that you're going to grant the institution, as they did in the 376 patent, which you'll hear about in a moment, there is a legal consequence of that decision at the Institute. [00:11:01] Speaker 01: And 318A says, in mandatory terms, you shall issue a final decision with respect to any claim challenged by the petitioner. [00:11:10] Speaker 01: And we know from other language in that very statute, if you look at 312 and 314, it's defining [00:11:16] Speaker 01: claims challenged in terms of the petition. [00:11:18] Speaker 01: It defines what goes into the petition as claims challenged. [00:11:22] Speaker 01: In 314, it says you examine the claims challenged in the petition to see if there's at least one claim that may have merit. [00:11:28] Speaker 01: And then what you do is you then institute review. [00:11:31] Speaker 01: And 318 is very clear that when you do institute review, there shall be a mandatory requirement on the board to issue a decision, a final decision, [00:11:45] Speaker 01: as to any claim challenged by the petitioner. [00:11:49] Speaker 01: The government and the mentor try to rewrite that provision, but the plain language here controls. [00:11:54] Speaker 01: Moreover, that plain language is fully consistent with congressional intent. [00:11:58] Speaker 01: The intent here was to try to displace district court litigation. [00:12:01] Speaker 01: And when you pick and choose which claim and have partial grants and partial decisions, you're completely undermining the effort of Congress to achieve to displace that litigation. [00:12:12] Speaker 01: Instead, you have dual track litigation [00:12:14] Speaker 01: and board proceedings at the same time. [00:12:17] Speaker 01: The key is that 315, which provides a stop-all and precludes the district court litigation, is hooked to there being a final written decision. [00:12:26] Speaker 01: So therefore, the final written decision is written in a very broad term. [00:12:28] Speaker 01: You need to address any claim challenged by the petitioner. [00:12:32] Speaker 01: And then there will be a stop-all as to all those claims in the petition. [00:12:36] Speaker 01: And that will fulfill the goal of Congress as to preclude the dual track [00:12:42] Speaker 01: litigation and board review, and reserve the rest of my time for rebuttal. [00:12:48] Speaker 02: Well, we've used up a good deal of your time with procedural matters, so please proceed. [00:12:52] Speaker 02: We'll restore your time. [00:12:53] Speaker 01: All right. [00:12:55] Speaker 01: So the key is that the grant of the petition then means that as to any claim challenged by the petitioner is now before the board, and we're going to have a stop-all add to those claims. [00:13:06] Speaker 01: And once you have a stop-all of those claims, that is precluding the district court litigation. [00:13:10] Speaker 01: When you have the world envisioned by a mentor and by the government, you have partial grants, you have some claims which are being granted, some are denied, and you have the district court litigation is not going to be stayed. [00:13:21] Speaker 01: You're going to have burdens on the parties to proceed in both venues. [00:13:24] Speaker 01: So our position and our reading of Section 318A as to barring these partial grants and partial decisions is not only fully consistent with the language of the statute, but is also [00:13:37] Speaker 01: the reading of it, which is most consistent with the intent and purpose of Congress. [00:13:41] Speaker 01: The whole purpose here was to displace district court litigation. [00:13:48] Speaker 02: Does everyone agree that on their theory of the case that only some claims need to be reviewed, that the district court can then go back and litigate the remaining claims as if there had been no proceeding in the office? [00:14:06] Speaker 01: So the government's position, as we understand it, is if there is a partial grant as they do under the regulation and then a decision which only addresses that partial grant, there is no estoppel. [00:14:17] Speaker 01: to the remaining claims. [00:14:19] Speaker 04: Well, you agree with that, right? [00:14:20] Speaker 04: Everybody agrees that there's no estoppel to claims that weren't the subject of a final decision. [00:14:26] Speaker 01: That's correct, Your Honor. [00:14:28] Speaker 01: The point, the question is, do all the claims, any claims handled by the decisioner. [00:14:33] Speaker 01: Your answer to Judge Newman's question is, yes, they can litigate the other claims in district court. [00:14:38] Speaker 01: Yes. [00:14:38] Speaker 01: The board's position, I think that's the clear law that for 315 to take effect, it needs to be in the final written decision. [00:14:45] Speaker 05: That's consistently the government's [00:14:47] Speaker 01: So the question is what goes in the final written decision? [00:14:51] Speaker 02: The question to me really is is it consistent with the statute and the purpose of the statute which is I think everyone also agrees to replace district court determination of validity by the expertise of the office and not to only determine half of the claims in terms of validity. [00:15:15] Speaker 01: I couldn't have said it better, Judge Newman, that by deciding only some of the claims and having a stop will only apply to some of the claims of petition, you're inherently going to have the district court litigation continue, and you're going to have this dual track before the district court and before the board, which is what Congress clearly did not want. [00:15:35] Speaker 05: Wasn't it the clear intent of Congress to, in some instances, [00:15:39] Speaker 05: allow the board to not determine what might be meritorious claims. [00:15:46] Speaker 01: Right, but then you'll have in one form, those claims could then proceed in the district court. [00:15:50] Speaker 01: What you won't have is this dual track. [00:15:52] Speaker 01: It gives them under section 314 of discretion as to whether to grant or deny. [00:15:57] Speaker 01: But then there's a legal consequence. [00:15:59] Speaker 01: When they do find there's one claim of sufficient merit and they decide to institute, there is a legal consequence that the number 318 [00:16:08] Speaker 01: they need to address. [00:16:10] Speaker 01: I have a final written decision which addresses the patentability of any claim challenged by the petitioner. [00:16:18] Speaker 04: But Congress gave the PTO the rule-making authority here to decide the procedures for instituting review, and the regulation in question specifically says they can institute review as to some or all, correct? [00:16:33] Speaker 04: Correct, Your Honor. [00:16:35] Speaker 04: There's no question about what the regulation says. [00:16:38] Speaker 01: And our argument is not in interpreting the regulation, but as to the validity of that regulation and its consistency with the scheme enacted by Congress and specifically... Where does Congress say you have to institute review as to all of the claims? [00:16:53] Speaker 01: Well, in 314 it says you look to the petition and you look to whether there's merit to at least one claim and then it says... Where does the statute say you have to institute review as to all of the claims? [00:17:08] Speaker 01: 318 says that once you institute, you need to issue a final decision. [00:17:12] Speaker 04: So there's no provision in the statute that says you have to institute as to all claims. [00:17:16] Speaker 01: Well, it doesn't say that in those terms, but if you read 314 and 318 together as you must, the natural reading of that together in a clear plain language is... Well, that's what it detracts from your plain language claims, since there isn't any plain language saying you have to institute as to all the claims, right? [00:17:32] Speaker 01: It says once you institute, you need to issue a final written decision with respect to any claim challenged by the petitioner. [00:17:38] Speaker 01: We think that's very clear. [00:17:39] Speaker 01: That means once you institute, you don't have discretion to address only some of those claims and to issue a partial decision. [00:17:46] Speaker 01: So you have to have an institution as to all of them. [00:17:48] Speaker 01: And you need to issue, at minimum, you need a final written decision which addresses any patent claim challenged by the petitioner. [00:17:54] Speaker 01: That is the plain language of the statute which controls here. [00:17:58] Speaker 01: Even if there would be ambiguity of looking at 314 on its own, [00:18:01] Speaker 01: That ambiguity is obscured when looking in context of how that same language is used in 312, in 314, and significantly, the legal consequences of a grant of institution in 318. [00:18:14] Speaker 05: You can agree that what you're saying flies directly in the face of the legislative history of the AIA, right? [00:18:20] Speaker 01: I do not agree with that. [00:18:22] Speaker 01: Legislative history is clear. [00:18:24] Speaker 01: As Judge Newman said, the point was to displace district court litigation. [00:18:31] Speaker 01: And by having this split the atom approach, you're not displacing the litigation. [00:18:35] Speaker 01: So it's completely consistent with the intent of Congress to displace district court litigation. [00:18:39] Speaker 01: But also part of that legislative history is the old statute. [00:18:43] Speaker 01: If you look at the old version of Section 313, Congress granted in the re-examination the power to focus on one question and said, and you can have a written decision which only addresses that one particular question. [00:18:55] Speaker 01: They rejected that in the AIA and said, no, you have an institution as to the petition. [00:19:00] Speaker 01: You look as to whether one claim has merit or not. [00:19:03] Speaker 01: Then you grant the petition. [00:19:04] Speaker 01: And then 318 unvigorously says, once you grant the petition, there is a legal consequence there that you need to address any patent claim challenged by the petitioner. [00:19:15] Speaker 01: So both the expressed statements in the reports of Congress and the legislative history, they're replacing [00:19:22] Speaker 01: a statute and wiping it out, which would have granted them this authority, and saying instead, no, in your final decision, you don't just address particular claims or particular questions, you address any patent claim challenged by the petitioner. [00:19:35] Speaker 04: Even though there's no district court litigation pending at all? [00:19:39] Speaker 04: Whether or not there is. [00:19:43] Speaker 04: So what's the purpose of Congress to require institution as to all claims if there's no district court litigation? [00:19:48] Speaker 01: Is that once you get a decision in the final decision and all the claims are addressed in the final written decision, then there's going to be a stopple under section 315, which will preclude litigation or relitigation about those in the district court. [00:20:03] Speaker 01: If you don't have that, then the claims they didn't institute on are now either can continue in the district court or in the future can be subject to claims because there is no a stopple. [00:20:13] Speaker 01: The point was to have resolution as to the patent and as to the petition, as to those claims that are subject to review in the PTAB, that if there's institution, we get finality as to those claims under section 315. [00:20:24] Speaker 01: 315 is really the driver of the congressional purpose here, is to get estoppel to any patent claim challenged by the petitioner. [00:20:33] Speaker 01: So if you go thumbs up, we're going to institute. [00:20:36] Speaker 01: That means you need to address any claim challenged by the petitioner. [00:20:40] Speaker 01: And there's going to be estoppelage to those claims, which will fulfill the congressional purpose and the efficiencies afforded by the AIA. [00:20:46] Speaker 01: Otherwise, you're back in the mire of having dual-track litigation, or you'll litigate for the PTAB, and then you'll then litigate in the district court. [00:20:55] Speaker 02: Let's hear from the other side, and we'll save you a little time. [00:20:58] Speaker 02: Thank you. [00:21:03] Speaker 02: Ms. [00:21:03] Speaker 02: Patterson. [00:21:06] Speaker 00: May it please the court, Melissa Patterson for the Patent and Trademark Office. [00:21:10] Speaker 00: I'd like to focus on the actual complaint filed in the APA action in district court here. [00:21:17] Speaker 04: And we think if you look at that... Well, the actual complaint does seem to challenge this regulation and asks to have it invalidated. [00:21:24] Speaker 04: And I think synopsis position is somewhat confusing, but they seem to be suggesting that at least in the APA action, their challenge in the regulation in so far as it permits the PTO [00:21:37] Speaker 04: the Institute review only with respect to some of the claims covered in the petition. [00:21:43] Speaker 04: And that's not an issue which is involved in the second case. [00:21:48] Speaker 00: Your Honor, separate and apart from any of the specific grievances with the institution decision in ICR 2012.2, this complaint doesn't give them standing. [00:22:03] Speaker 00: Now, I want to point out the actual complaint filed was focused on the regulation [00:22:07] Speaker 00: but only insofar as it affected synopsis in this particular institution decision. [00:22:13] Speaker 00: And if you look at JA 36, they could not have been clearer that the final agency action they were relying on to get into court under the APA is, at paragraph 24, the board's issuance of a final written decision in IPR 2012-42 on February 19th. [00:22:32] Speaker 00: That's the final agency action. [00:22:34] Speaker 00: And in their reply brief, [00:22:36] Speaker 00: In this court, I think they're very candid that the only injury they have is that institution decision. [00:22:43] Speaker 00: And what they plan to do is to go and get a different institution decision. [00:22:48] Speaker 00: And that sort of complaint, the actual complaint here, where you're upset by a particular institution decision and you want to get a different one, that runs straight into 314-D's final and non-appealable bar. [00:23:02] Speaker 00: What they're trying to do is appeal by a different route [00:23:05] Speaker 00: that institution decision. [00:23:07] Speaker 02: Well, given the benefit of that perhaps they felt they needed to file some sort of protective appeal or take a protective path because of the novelty of everything that we're looking at with the America Invents Act. [00:23:21] Speaker 02: So I don't think it's a matter of motivation particularly. [00:23:25] Speaker 02: We have this case that's decided on the merits. [00:23:30] Speaker 00: Your Honor, I think on this case, this APA case, you don't [00:23:36] Speaker 00: You don't look at those merits on this complaint because this is a, this is a, this is an end run around 314 bar, 314 D's bar on institution decision. [00:23:47] Speaker 02: All right. [00:23:47] Speaker 02: It could be, it could very well be that this particular issue needs to be decided in the other appeal, which would moot this area. [00:23:59] Speaker 02: And perhaps, perhaps it's improper. [00:24:02] Speaker 02: I think. [00:24:03] Speaker 02: Let's discuss the merits rather than the propriety. [00:24:06] Speaker 02: We will have to decide it, but again, let's not exhaust our time here. [00:24:11] Speaker 00: Your Honor, the merits were not briefed in this case. [00:24:15] Speaker 02: They were briefed... I'm talking of the merits of the particular APA issue. [00:24:19] Speaker 02: That is the regulation, the validity of the regulation. [00:24:22] Speaker 00: Yes, Your Honor. [00:24:23] Speaker 00: In their opening brief in this case, synopsis did not brief the merits. [00:24:26] Speaker 00: Their only [00:24:28] Speaker 00: Pitch was, we get to have an APA challenge. [00:24:31] Speaker 00: They did brief it in the case that's up next. [00:24:33] Speaker 00: And so I'm going to defer to my colleague from the PTO to discuss it. [00:24:37] Speaker 04: The sole issue here is the procedure. [00:24:39] Speaker 00: Yes. [00:24:39] Speaker 00: The sole issue in this case is whether they can brief. [00:24:42] Speaker 02: Well, then that's what I meant by the merits, the procedural merits of this task, of reviewing what the director has adopted in terms of the [00:24:55] Speaker 02: opportunity of the office and the right of the office not to decide all of the claims. [00:25:03] Speaker 00: Your Honor, those sorts of merits are what we don't think this court can reach by an APA challenge. [00:25:09] Speaker 00: And I want to point out if someone who's been through an IPR can take their dissatisfaction with an institution... Well, they're challenging whether the regulation accords with a statute. [00:25:19] Speaker 02: You're saying that that can never be challenged under the APA? [00:25:22] Speaker 00: No, Your Honor, we're saying they cannot challenge it because their only injury here is a particular institution decision. [00:25:28] Speaker 00: We are not saying, and I think it's a mischaracterization that NAFTSIS makes, that no one could ever challenge this regulation. [00:25:36] Speaker 00: What we are saying is that you have to have an injury. [00:25:38] Speaker 00: You have to be trying to get something that is not a different institution decision. [00:25:44] Speaker 00: Now, if somebody brings that complaint under the APA, we're not saying that there's some sort of [00:25:50] Speaker 00: broad bar on judicial review of this regulation at the test of any party at any time. [00:25:56] Speaker 00: But what we're saying is that your injury has to be something other than a particular institution. [00:26:02] Speaker 04: Who would have an injury which would allow them to bring an APA action? [00:26:06] Speaker 00: Well, I don't want to speculate on a potential complaint. [00:26:10] Speaker 04: Well, my understanding of your theory is there isn't anybody who would do that. [00:26:15] Speaker 04: In order to have standing, they have to have a case pending before [00:26:19] Speaker 04: the PTO in which claims are being challenged and anybody who has a case pending before the PTO has to litigate in the PTO and not in the district court. [00:26:31] Speaker 04: So it doesn't seem to me that you're leaving room for anybody to challenge the regulation. [00:26:35] Speaker 04: That's not necessarily wrong, but it seems to me that's the logic of your position. [00:26:41] Speaker 00: I don't think our position goes that far, Your Honor. [00:26:44] Speaker 00: Well, then who could challenge? [00:26:45] Speaker 00: Well, I want to point out, synopsis says that this rule actually injures patent owners writ large because the estoppel effects are not as fully effective as they're supposed to be. [00:26:54] Speaker 00: If that's true and some patent owners group says, hey, we're getting hit with suits later writ large, this regulation, the mere existence of this regulation on the books, it's hurting us. [00:27:06] Speaker 00: And they can make the kind of concrete, non-speculative showing that Article 3 requires... I don't understand what you're talking about. [00:27:12] Speaker 04: That somebody... Everybody agrees there's no estoppel for claims that aren't addressed by the PTO. [00:27:17] Speaker 00: And I think that's synopsis of complaint. [00:27:19] Speaker 00: We do agree that. [00:27:20] Speaker 00: But they say... And they agree with that, too. [00:27:22] Speaker 00: But they agree that that is the status quo. [00:27:25] Speaker 00: They disagree that it should be the status quo. [00:27:27] Speaker 00: Even though they're the petitioner here, I take it that their broader claim to standing that they made on appeal, they didn't make it in their complaint, that they made on appeal, is that [00:27:35] Speaker 00: This rule hurts us even when we're on the other end of these petitions, when we're the patent owner. [00:27:40] Speaker 00: And so if that's true, if somehow patent owners writ large are being hurt by this regulation, separate and apart from any institution decision, they may well be able to bring an APA claim. [00:27:51] Speaker 00: Our only point here is you don't get to take your dissatisfaction with an institution decision, re-plead your complaint as, well, I'm not dissatisfied with the merits, I'm dissatisfied with the underlying policy. [00:28:04] Speaker 00: Agency decisions strive to be consistent. [00:28:06] Speaker 00: Their decisions in any particular case are almost certainly going to be undergirded by a policy, if not an actual regulation. [00:28:14] Speaker 00: If people unhappy with their decisions can artfully plead claims, say, well, my injury is this institution decision. [00:28:23] Speaker 00: I'm attacking the policy underlying that institution decision. [00:28:27] Speaker 00: I get APA review. [00:28:28] Speaker 00: We are going to have the kind of bifurcated district court route [00:28:32] Speaker 00: versus federal circuit route, and as we all know, the IAA gave exclusive jurisdiction to this court to review final written decisions. [00:28:44] Speaker 00: If there are no further questions? [00:28:47] Speaker 02: Okay, then we'll hear from Mr. Long. [00:29:01] Speaker 03: I have pleased the court, Robert Long representing Mentor Graphics Corporation. [00:29:07] Speaker 03: Mentor Graphics is principally concerned that this APA action not be used as a backdoor method to challenge the board's completed Interpartes review. [00:29:22] Speaker 03: Synopsis waited until after the Interpartes review was over to [00:29:28] Speaker 03: commence this challenge in the district court, we think it's clear that the decision to institute or not institute inter partes review can't be reviewed by any court. [00:29:43] Speaker 03: The final written decision in an inter partes review can only be reviewed by this court. [00:29:50] Speaker 03: So the district court can't possibly give synopsis the relief that it set out to get, which was to reopen this particular [00:29:59] Speaker 03: inter partes review. [00:30:00] Speaker 02: But the issue here is not whether one or more claim had been at least tentatively deemed to be invalid. [00:30:09] Speaker 02: The issue here is a question of the relationship between the statute and the regulation. [00:30:15] Speaker 02: Is it not? [00:30:16] Speaker 03: Well, so on the merits, I want to get to the merits very quickly, but I do think there's a standing question. [00:30:25] Speaker 03: One synopsis is I think it's now said is okay, we admit. [00:30:28] Speaker 03: We can't get the district court to order the board to institute review on additional claims. [00:30:35] Speaker 02: I think they do have to establish... So let's say that it was crystal clear from the statute and the regulation that the statute says you must consider every claim once you... Let me turn to the merits, Your Honor, but... Nonetheless, we have a regulation which says, no, you don't have to. [00:30:53] Speaker 02: We're busy. [00:30:54] Speaker 02: And you're saying that that can't be judicially reviewed under the APA? [00:31:01] Speaker 03: We think the statute authorizes this regulation. [00:31:05] Speaker 03: Section 314A, that's the section of the statute about institution, doesn't say anything about the board has to institute on all claims in the petition or none. [00:31:15] Speaker 03: It just says if at least one comes up to the threshold then that's the [00:31:21] Speaker 03: the precondition the board may not institute. [00:31:24] Speaker 02: Well, I didn't want to press you into conceding that it can be reviewed. [00:31:30] Speaker 02: This is the first question, is it not? [00:31:32] Speaker 02: Assuming that a facially erroneous regulation is adopted in connection with the decision to institute, I thought I heard you say in your opening remarks that that cannot be reviewed. [00:31:47] Speaker 03: Oh, no. [00:31:48] Speaker 03: We think there can be review of the regulation. [00:31:51] Speaker 03: It simply has to be a challenge to the regulation that does not involve seeking review of a particular decision to institute or not institute IPR. [00:32:04] Speaker 03: That's the problem here. [00:32:07] Speaker 03: And the plaintiff would have to show an injury that can be redressed. [00:32:12] Speaker 03: So for example, if there were an organization that files many petitions for intrapartes review, they could show a likely [00:32:21] Speaker 05: imminent injury because they file so many that some are likely, you know, to be granted... The government forgot to publish it in the Code of Federal Regulations, and as a result of the reg is facially invalid. [00:32:33] Speaker 05: They can challenge that under the APA. [00:32:36] Speaker 03: Well, yes, Your Honor, but they still have to show standing. [00:32:39] Speaker 03: They have to show an injury caused by the unlawful regulation that would be redressed. [00:32:44] Speaker 03: And I'm suggesting to Judge Dyke there could be such a party. [00:32:48] Speaker 03: I don't think this regulation is [00:32:51] Speaker 03: insulated from review by this court. [00:32:54] Speaker 03: What we're urging is not to let synopsis, which came up with the society. [00:32:58] Speaker 02: I realize that the patent office position is that it is insulated, so you don't join with that. [00:33:05] Speaker 02: Is that correct? [00:33:06] Speaker 03: Well, I'm not sure that's exactly the patent office position, but our position is that [00:33:12] Speaker 03: There is a clear review on... There's two separate questions here. [00:33:18] Speaker 04: The initiation decision and the final decision. [00:33:20] Speaker 04: With respect to the second case, they agree they're only challenging the final decision. [00:33:24] Speaker 04: We'll get to that and we'll see. [00:33:26] Speaker 04: But in the APA case, there's this other aspect of it. [00:33:30] Speaker 04: They say they're challenging the regulation insofar as it allows an institution with respect to fewer than all of the clients. [00:33:39] Speaker 04: That is not an issue which can be litigated in the second case. [00:33:44] Speaker 04: So is that issue properly litigated in APA action? [00:33:51] Speaker 03: No, not by synopsis because what they're trying to do here is they're trying to attack a particular decision not to institute. [00:33:59] Speaker 04: By somebody else? [00:34:01] Speaker 03: But we think it could be challenged by somebody else. [00:34:03] Speaker 03: For example, this [00:34:05] Speaker 03: group I was hypothesizing that files a significant number of petitions for inter partes review and could say, look, we can demonstrate to the court that it is likely and imminent within the next several months or so that we're going to have one that's going to be granted only in part because we do a volume business. [00:34:26] Speaker 03: And I think that in that situation, they would not be challenging a particular [00:34:32] Speaker 03: decision to institute or not. [00:34:34] Speaker 04: But they say they're in that position. [00:34:35] Speaker 04: They say they are also a patentee and that they have cases like this before the PTO. [00:34:42] Speaker 03: Well, I think if you look at the PTO's brief on this, they cited, hey, I mean, first of all, standing has to be judged on the allegations of the complainant or motion to dismiss. [00:34:53] Speaker 03: They didn't allege any of this. [00:34:55] Speaker 03: But these eight actions, six of them, they're the patent owner. [00:34:59] Speaker 03: So they benefit if the review is narrower rather than broader. [00:35:03] Speaker 04: The PTO just told us that a patent owner could challenge the regulation. [00:35:08] Speaker 04: You're saying the patent owner can't challenge the regulation. [00:35:11] Speaker 03: Well, I was saying someone who was challenging a lot of other people's patents would be the most logical challenger. [00:35:18] Speaker 03: I mean, I don't know if this organization exists, a public interest group that wants to clean up patents and so is filing [00:35:25] Speaker 03: a number of petitions for inter partes review because they think these are bad patents and they need to be cancelled. [00:35:35] Speaker 03: So that's, their claims that they have raised in their briefs don't count for standing, you know, for the reasons the PTO has explained. [00:35:48] Speaker 02: Okay. [00:35:50] Speaker 02: Thank you, Mr. Long. [00:35:52] Speaker 02: All right, Mr. Lowe, you have your rebuttal time. [00:35:57] Speaker 01: Thank you, Your Honor. [00:35:58] Speaker 01: Let me just address the question of our standing, which was raised, of course, to appeal. [00:36:05] Speaker 01: But as to our standing, we in our complaint made clear that we have an injury from the 38376 IPR proceeding. [00:36:13] Speaker 01: The government points to the Supreme Court Lyons case, where there was a chokehold. [00:36:16] Speaker 01: It was over. [00:36:17] Speaker 01: And can you now seek perspective and declaratory relief? [00:36:21] Speaker 01: And the Supreme Court said no. [00:36:22] Speaker 01: In contrast, here we have an ongoing case. [00:36:24] Speaker 01: The chokehold continues. [00:36:27] Speaker 01: of their decision to have a partial grant and a partial decision here is having ongoing effect in the 376 case. [00:36:34] Speaker 01: When they did on appeal challenge our standing for the first time, we pointed out that we're a player on this in multiple cases, including at least six cases at Patent Owner. [00:36:45] Speaker 01: And this regulation and this policy also affects the Patent Owner. [00:36:48] Speaker 01: It deprives the Patent Owner from getting a stopple effect as to the weak claim. [00:36:53] Speaker 01: So when a petition, there are weak claims. [00:36:54] Speaker 01: What should happen is there should be a decision in the final rent decision, and the patent owner should get a stopple effect over the sweet claims. [00:37:01] Speaker 01: Instead, under the government's position, the patent owner suffers as well because they do not get that a stopple effect. [00:37:08] Speaker 01: So we have ongoing injury in 376. [00:37:11] Speaker 02: Why would a patent owner want to be stopped? [00:37:14] Speaker 02: Isn't it the potential infringer who's looking for a stopple? [00:37:19] Speaker 01: Well, it's on both sides of [00:37:22] Speaker 01: The patent owner wants also to preclude district court litigation challenging the ability of the patent. [00:37:28] Speaker 02: If the claims are sustained, but if they're not, that ends it, right? [00:37:33] Speaker 01: That is correct, Your Honor. [00:37:35] Speaker 01: But if there's no grant as to those weak claims as what the Board is doing now, then they don't go to final decision and there's no estoppel. [00:37:44] Speaker 01: The patent owner benefits from having those [00:37:47] Speaker 01: codified in the final written decision, so they're estoppel to any district court litigation challenging the patent on those grounds. [00:37:55] Speaker 01: As to the argument that we didn't challenge the regulation and policy in our complaint, I don't think that can withstand even the slightest bit of scrutiny. [00:38:01] Speaker 01: In our 12-page complaint, on every single page, we are challenging the validity of the regulation and the validity of the policy and practice [00:38:09] Speaker 01: of having partial written decisions. [00:38:12] Speaker 04: The fact that we have... It is true that the complaint in terms of standing only alleges injury resulting from the PTO case, which is the second case before us today, right? [00:38:23] Speaker 01: That is what we focus on for injury in that case. [00:38:26] Speaker 01: If the government had challenged our standing, we could have then submitted a declaration or other things talking about the other cases where we're also injured. [00:38:34] Speaker 04: Why shouldn't your standing be judged by the face of the complaint? [00:38:37] Speaker 01: Well, ordinarily, the party, when standing is put into play, does get to make a factual showing regarding its injury. [00:38:45] Speaker 01: Here, we have pointed to court documents showing that we're a frequent player in this field on both the challenging patents and as patent owner. [00:38:55] Speaker 01: And we have, in the 3776 case, an ongoing injury, which is likely redressable from getting a positive ruling. [00:39:05] Speaker 01: as with the cases when we're patent holder. [00:39:08] Speaker 05: Paragraph 11 of your complaint says jurisdiction is appropriate under the APA in Section 31 because there is no other adequate remedy. [00:39:17] Speaker 01: Right. [00:39:17] Speaker 01: And if there is, as Judge Dyke started, if this court can reach these issues in the final written decision, we would concede that's an adequate remedy which would displace the APA review. [00:39:30] Speaker 01: Of course, the PTO has taken the position that you can't reach those issues. [00:39:33] Speaker 01: in which case APA review would be completely appropriate. [00:39:38] Speaker 01: So the two cases, you have a unique opportunity here to explicate whether there is judicial review of this regulation and policy and practice and whether it's before the APA for this court and the APA or is before this court upon final written decision. [00:39:54] Speaker 01: But what can't be the case. [00:39:55] Speaker 05: So whether there's an adequate remedy is dependent on which way we roll. [00:40:00] Speaker 01: Is that what you're saying? [00:40:02] Speaker 01: In part, Your Honor, absolutely. [00:40:03] Speaker 01: That if you find that in the course of deciding the final written decision, that the policy and practice of issuing final written decisions in part is inconsistent with 318A, that takes that out of our complaint, and you have an adequate remedy as to that. [00:40:18] Speaker 01: And if this court goes further and says, and what's animating is this invalid regulation, and that needs to be struck down as well, that would be an adequate remedy which would preclude [00:40:28] Speaker 01: the first part of our APA complaint too. [00:40:30] Speaker 01: So yes, the jurisdiction under the APA depends in part about what you hold in the next case here as well. [00:40:40] Speaker 04: But you're not challenging the institution decision and the regulation dealing with institution in the second case, right? [00:40:48] Speaker 01: We are not, Your Honor. [00:40:49] Speaker 01: I'm just pointing out that in your decision there, you could find that what's animating the error there is this invalid regulation and speak to it there. [00:40:57] Speaker 01: I mean, we could go beyond what you argue. [00:41:01] Speaker 01: It's not beyond what we argue. [00:41:03] Speaker 01: Looking at the scheme... Well, you say that you're only challenging the final written decision. [00:41:08] Speaker 01: Of course, this court only has authority to review the final written decision. [00:41:11] Speaker 01: So it's sort of chicken or the egg, if we're sure. [00:41:14] Speaker 01: The question is, what can you say in review of that final written decision? [00:41:17] Speaker 01: You can say, that final written decision is an error because you're required to speak to any claim challenged by the petitioner. [00:41:23] Speaker 01: You can also say, and why does the PTO think they have this authority? [00:41:27] Speaker 01: Why does the board think they have this authority? [00:41:29] Speaker 01: Well, they're relying on their regulation. [00:41:31] Speaker 01: That regulation is in conflict with 318A. [00:41:33] Speaker 01: I think you would have authority to say that on review of the final written decision. [00:41:37] Speaker 01: And all these arguments are before you between the two sets of cases. [00:41:41] Speaker 01: And I think Judge Newman has it right that there's a pragmatic imperative here to answer these questions once and for all. [00:41:49] Speaker 02: in your adjudication of these two matters together.