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Supreme Court Upholds Constitutionality of IPR, Directs PTAB to Assess All Challenged Claims

WASHINGTON, D.C., April 24, 2018 –The U.S. Supreme Court announced decisions today, April 24, 2018, in the much-anticipated patent related cases Oil States Energy Services, LLC v. Greene's Energy Group, LLC and SAS Institute Inc. v. Iancu, Director, United States Patent and Trademark Office. Baker Botts Intellectual Property lawyers release an analysis of the Court’s opinions and discuss what impact the outcomes have on patent prosecution, IPRs, Federal Circuit appeals and District Court litigations.

The Court determined in Oil States that inter partes review (IPR) is constitutional and does not violate the US Constitution's Seventh Amendment. In SAS, the Court reversed a Federal Circuit judgment by confirming today that the Patent Trial and Appeal Board (PTAB) must assess all, not some, challenged claims in an inter partes review.

Eliot Williams (Palo Alto)

“This pair of decisions cements the PTAB as an important forum in the patent litigation landscape. In Oil States, the Court, for the second time in two years, emphasizes the importance of the PTAB’s work in protecting the “public’s paramount interest in seeing that patent monopiles are kept within their legitimate scope.” In SAS, the Court expands the potential impact of the PTAB on litigation by requiring the Board to address in its final written decision every claim challenged in the petitioner’s initial filing. This will eliminate the PTAB’s current practice of “partial” institution decisions, which has led to some inefficient piecemeal validity litigation in both the PTAB and the district courts.”

Sarah Guske (San Francisco)

“While Oil States has dominated the headlines leading up to the opinions that the Court issued today, the Court’s opinion in SAS Institute Inc. v. Iancu is likely to have greater impact on PTAB and district court strategies. Under SAS, the PTAB must now decide the validity of all challenged claims if it has agreed to institute review of any claim. With declining institution rates and open questions regarding the scope of the estoppel effect of PTAB final written decisions, the outcome of SAS may factor in to petitioners’ strategies in selecting claims to challenge at the PTAB.”

Michael Hawes (Houston)

“Reserving the due process issue is more important for particular procedures employed in IPRs than for IPRs as a whole. For example, during argument, the Court’s questions suggested that procedures such as adding judges to a panel to change a decision might not survive due process scrutiny. However, there was no suggestion that the entire IPR structure would violate the due process clause. This Court’s reservation of a due process ruling makes clear that the Court retains the ability to find specific parts of the IPR process unconstitutional for lack of due process in future cases.”

With over 180 IP lawyers and patent professionals, holding over 220 technical degrees, Baker Botts has an incredibly deep bench of practitioners with a wealth of experience in patent litigation, patent prosecution and post-grant proceedings. Baker Botts’ IP practice also authors the PTAB Trials Blog, which provides a unique perspective on news, trends and analysis of PTAB proceedings as they evolve, including IPRs, CBMRs, and post-grant reviews (PGRs), and the wide-ranging impact the proceedings have on the patent litigation landscape.

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