Inter Partes Review Proceedings (IPRs) Do Not Violate Article III of the Constitution per U.S. Supreme CourtApril 24, 2018

The U.S. Supreme held in a 7-2 decision (Justice Gorsuch and Chief Justice Roberts dissenting), Oil States Energy Servs. V. Greene’s Energy Group, LLC, that the Inter Partes Review proceedings, commonly referred to as IPRs, do not violate Article III or the Seventh Amendment.

The Court was deciding two primary constitutional challenges: (1) whether IPRs violate Article III of the constitution by assigning a task intended for U.S. District Courts to an administrative agency (i.e., the Patent Office); and (2) whether IPRs violate the Seventh Amendment by having a matter tried outside of the U.S. Courts.  

The majority held that the grant of a patent falls within the public-rights doctrine.  Public and private rights are distinguished historically in legal precedent. The Court held that patents and “[i]nter partes review fall[] squarely within the public-rights doctrine.”  Elaborating on this, the Court noted that the decision to grant a patent is a matter involving public rights as it is a public franchise and provides the patentee the right to exclude the public from making, using, selling, and offering for sale the patented invention.  The Court also noted that granting patents is one of the constitutional rights carried out by the executive and legislative branches. This too is indicative of the public-rights doctrine as the granting of patents is a matter that occurs between the government and others. Quoting the Court’s earlier decision in In re Cuozzo, the majority reiterated that IPRs are “a second look at an earlier administrative” action, i.e., grant of a patent.  The only difference between IPR and examination is that the former occurs after issuance. The Court held that this is a distinction without a difference.

The public-rights doctrine provides Congress with “wide latitude to assign adjudication of public rights to entities other than Article III courts.”  Thus, by holding that patents and the IPR proceedings fall within the public rights doctrine, Congress has the authority to assign review, amendment, and cancellation of patents to the USPTO without violating Article III of the Constitution.  Moreover, the Court also held that since Congress can properly assign adjudication of patent validity to the USPTO, the Seventh Amendment is not violated.

Justice Gorsuch wrote a dissent, joined by Chief Justice Roberts.  The focus of the dissent is on the importance of independent judicial review of cases and controversies, which is laid out in Article III of the Constitution, and protecting the judiciary from “intrusions by the other branches.” The dissent provides a detailed historical review of Courts and the importance of independent judicial review over controversies between parties, contending that controversies between parties are to be considered by Article III courts.

The Court’s full opinion can be accessed here. A more detailed discussion of this case is provided in a subsequent article available here.

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