`
`No. _________
`================================================================
`
`In The
`Supreme Court of the United States
`
`--------------------------------- ---------------------------------
`
`OIL STATES ENERGY SERVICES, LLC,
`
`Petitioner,
`
`v.
`
`GREENE’S ENERGY GROUP, LLC,
`
`Respondent.
`
`--------------------------------- ---------------------------------
`
`On Petition For A Writ Of Certiorari
`To The United States Court Of Appeals
`For The Federal Circuit
`
`--------------------------------- ---------------------------------
`
`PETITION FOR A WRIT OF CERTIORARI
`
`--------------------------------- ---------------------------------
`
`C. ERIK HAWES
`WILLIAM R. PETERSON
`MORGAN, LEWIS & BOCKIUS LLP
`1000 Louisiana Street,
` Suite 4000
`Houston, Texas 77002
`T. 713.890.5000
`F. 713.890.5001
`
`ALLYSON N. HO
` Counsel of Record
`JOHN C. SULLIVAN
`MORGAN, LEWIS &
` BOCKIUS LLP
`1717 Main Street,
` Suite 3200
`Dallas, Texas 75201
`T. 214.466.4000
`F. 214.466.4001
`allyson.ho@morganlewis.com
`
`Counsel for Petitioner
`
`================================================================
`COCKLE LEGAL BRIEFS (800) 225-6964
`WWW.COCKLELEGALBRIEFS.COM
`
`
`
`
`
`i
`
`QUESTIONS PRESENTED
`
`
`1. Whether inter partes review—an adversarial
`
`process used by the Patent and Trademark Office
`(PTO) to analyze the validity of existing patents—
`violates the Constitution by extinguishing private
`property rights through a non-Article III forum with-
`out a jury.
`
`imple-
`2. Whether the amendment process
`
`mented by the PTO in inter partes review conflicts with
`this Court’s decision in Cuozzo Speed Technologies,
`LLC v. Lee, 136 S. Ct. 2131 (2016), and congressional
`direction.
`
`3. Whether the “broadest reasonable interpre-
`
`tation” of patent claims—upheld in Cuozzo for use
`in inter partes review—requires the application of
`traditional claim construction principles, including
`disclaimer by disparagement of prior art and reading
`claims in light of the patent’s specification.
`
`
`
`
`
`
`
`ii
`
`PARTIES TO THE PROCEEDINGS
`AND RULE 29.6 STATEMENT
`
`
`The parties to the proceedings include those listed
`
`on the cover.
`
`Oil States Energy Services, L.L.C., formerly
`
`known as Stinger Wellhead Protection, Inc., is a wholly
`owned subsidiary of Oil States Energy Services Hold-
`ing, Inc., which is a wholly owned subsidiary of Oil
`States International, Inc., a publicly traded company.
`
`
`
`
`
`
`
`iii
`
`TABLE OF CONTENTS
`
`ii
`iii
`v
`1
`1
`1
`
`Page
`QUESTIONS PRESENTED ................................
`i
`PARTIES TO THE PROCEEDINGS AND RULE
`29.6 STATEMENT............................................
`TABLE OF CONTENTS ......................................
`TABLE OF AUTHORITIES .................................
`PETITION FOR A WRIT OF CERTIORARI .......
`OPINIONS AND ORDERS BELOW ....................
`STATEMENT OF JURISDICTION .....................
`CONSTITUTIONAL AND STATUTORY PROVI-
`2
`SIONS INVOLVED...........................................
`2
`STATEMENT .......................................................
`REASONS FOR GRANTING THE PETITION .... 10
`
`I. Inter Partes Review Conflicts With This
`Court’s Cases Upholding The Constitu-
`tional Guarantees Of A Jury And An Arti-
`cle III Court For Patent Invalidation ........ 11
`A. This Court’s Precedent Confirms That
`The Seventh Amendment Provides Pa-
`tent Owners With A Right To A Jury
`In Invalidation Proceedings ................ 12
`B. This Court’s Precedent Confirms That
`Patent Owners Have A Right To An Ar-
`ticle III Forum For Invalidation Pro-
`ceedings ............................................... 16
`
`
`
`
`
`
`
`iv
`
`TABLE OF CONTENTS—Continued
`
`Page
` II. The PTO’s Standards For Amending Pa-
`tents Conflict With The Broadest Reason-
`able Interpretation Standard Upheld In
`Cuozzo And The Statutory Scheme ........... 19
` III. The Federal Circuit Is Conflicted In Its
`Application Of Traditional Principles Of
`Claim Construction ................................... 26
` IV. The Constitutionality And Administration
`Of Patent Adjudications Is Unquestiona-
`bly Important And Squarely Presented
`Here ........................................................... 32
` V. Notwithstanding The Federal Circuit’s
`Cursory Treatment, This Case Is An Ap-
`propriate Vehicle To Resolve The Im-
`portant Questions Presented ..................... 35
`CONCLUSION ..................................................... 37
`
`APPENDIX
`United States Court of Appeals, Federal Circuit,
`Judgment, dated May 4, 2016.......................... App. 1
`Patent Trial and Appeal Board, Final Written
`Decision, dated May 1, 2015 ............................ App. 3
`United States Court of Appeals, Federal Circuit,
`Order, dated July 26, 2016 ............................. App. 37
`Relevant Statutory Provisions .......................... App. 39
`
`
`
`
`
`
`v
`
`TABLE OF AUTHORITIES
`
`Page
`
`CASES
`Boulton & Watt v. Bull (1795) 126 Eng. Rep. 651
`(CP) .......................................................................... 16
`Chicago Bd. Options Exch., Inc. v. Int’l Sec.
`Exch., LLC, 677 F.3d 1361 (Fed. Cir. 2012) ............ 28
`CLS Bank Int’l v. Alice Corp. Pty. Ltd., 717 F.3d
`1269 (Fed. Cir. 2013) ............................................... 34
`Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131
`(2016) ............................................................... passim
`Curtis v. Loether, 415 U.S. 189 (1974) ........................ 12
`Darcy v. Allein (1601) 77 Eng. Rep. 1260 (KB) .......... 12
`Ex Parte Wood & Brundage, 22 U.S. 603 (1824) ........ 13
`Feltner v. Columbia Pictures Television, Inc., 523
`U.S. 340 (1998) ........................................................ 13
`Google Inc. v. Jongerius Panoramic Techs., LLC,
`No. IPR 2013-00191, Paper No. 50 (PTAB, Feb.
`13, 2014) .................................................................... 2
`Granfinanciera, S.A. v. Nordberg, 492 U.S. 33
`(1989) ................................................................. 12, 18
`In re CSB-System Int’l, Inc., 832 F.3d 1335 (Fed.
`Cir. 2016) ................................................................. 24
`In re Man Mach. Interface Techs. LLC, 822 F.3d
`1282 (Fed. Cir. 2016) ............................................... 29
`Iron Silver Mining Co. v. Campbell, 135 U.S. 286
`(1890) ....................................................................... 17
`
`
`
`
`
`
`
`vi
`
`TABLE OF AUTHORITIES—Continued
`
`Page
`
`Markman v. Westview Instruments, Inc., 52 F.3d
`967 (Fed. Cir. 1995) ................................................. 12
`Markman v. Westview Instruments, Inc., 517 U.S.
`370 (1996) .......................................... 7, 11, 13, 15, 28
`McCormick Harvesting Mach. Co. v. C. Aultman
`& Co., 169 U.S. 606 (1898) .................................. 2, 17
`MCM Portfolio LLC v. Hewlett-Packard Co., 812
`F.3d 1284 (Fed. Cir. 2015) ................................... 9, 14
`Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292
`(Fed. Cir. 2015) ........................................................ 25
`Murray’s Lessee v. Hoboken Land & Improve-
`ment Co., 59 U.S. 272 (1855) ............................. 16, 19
`N. Pipeline Constr. Co. v. Marathon Pipe Line
`Co., 458 U.S. 50 (1982) ...................................... 16, 19
`NFIB v. Sebelius, 132 S. Ct. 2566 (2012) ................... 19
`Openwave Sys., Inc. v. Apple Inc., 808 F.3d 509
`(Fed. Cir. 2015) ........................................................ 28
`Patlex Corp. v. Mossinghoff, 758 F.2d 594 (Fed.
`Cir. 1985) ................................................................. 17
`PPC Broadband, Inc. v. Corning Optical
`Commc’n RF, LLC, 815 F.3d 747 (Fed. Cir.
`2016) .............................................................. 4, 27, 29
`SafeTCare Mfg., Inc. v. Tele-Made, Inc., 497 F.3d
`1262 (Fed. Cir. 2007) ............................................... 28
`SciMed Life Sys., Inc. v. Advanced Cardiovascu-
`lar Sys., Inc., 242 F.3d 1337 (Fed. Cir. 2001) .......... 27
`Stern v. Marshall, 564 U.S. 462 (2011) ..... 16, 17, 18, 19
`
`
`
`
`
`vii
`
`TABLE OF AUTHORITIES—Continued
`
`Page
`
`Tegal Corp. v. Tokyo Electron Am., Inc., 257 F.3d
`1331 (Fed. Cir. 2001) ............................................... 13
`Thorner v. Sony Comput. Entm’t Am. LLC, 669
`F.3d 1362 (Fed. Cir. 2012) ....................................... 27
`United States v. Am. Bell Tel. Co., 128 U.S. 315
`(1888) ................................................................. 14, 19
`
`
`CONSTITUTIONAL PROVISIONS
`U.S. CONST. amend. VII ....................................... passim
`U.S. CONST. art. III .............................................. passim
`
`STATUTES AND REGULATIONS
`28 U.S.C. § 1254 ............................................................ 1
`Act of Dec. 12, 1980, Pub. L. No. 96-517, 94 Stat.
`3015 (1980) .............................................................. 17
`Administrative Procedure Act, Pub. L. No. 79-
`404, 60 Stat. 237 (1946)
` 5 U.S.C. § 554 ............................................................. 3
` 5 U.S.C. § 556 ....................................................... 3, 22
` 5 U.S.C. § 706 ..................................................... 21, 22
`Leahy-Smith America Invents Act, Pub. L. No.
`112-29, 125 Stat. 284 (2011)
` 35 U.S.C. § 311 ....................................................... 2, 3
`
`
`
`
`
`
`
`viii
`
`TABLE OF AUTHORITIES—Continued
`
`Page
` 35 U.S.C. § 316 ................................................... 20, 23
` 35 U.S.C. § 318 ........................................................... 2
`37 C.F.R. § 42.6 ....................................................... 8, 23
`37 C.F.R. § 42.24 ..................................................... 8, 23
`37 C.F.R. § 42.100 ......................................................... 3
`37 C.F.R. § 42.121 ............................................. 8, 21, 22
`Amendments to the Rules of Practice for Trials
`Before the Patent Trial and Appeal Board, 80
`Fed. Reg. 28,561 (May 19, 2015) ......................... 8, 23
`
`
`OTHER AUTHORITIES
`1 Patent Office Litigation § 4:70 ................................ 24
`2 JOSEPH STORY, COMMENTARIES ON EQUITY JU-
`RISPRUDENCE (Melville M. Bigelow ed., Little,
`Brown, & Co., 13th ed. 1886) .................................. 17
`H.R. REP. NO. 112-98 (2011) ......................................... 3
`Richard Baker, America Invents Act Cost the US
`Economy over $1 Trillion, PATENTLYO (June
`8, 2015), http://patentlyo.com/patent/2015/06/
`america-invents-trillion.html ................................. 33
`Oren Bracha, Owning Ideas: A History of Anglo-
`American Intellectual Property (June 2005)
`(unpublished Ph.D. thesis, Harvard Law
`School), https://law.utexas.edu/faculty/obracha/
`dissertation/pdf/chapter1.pdf ................................. 12
`
`
`
`
`
`
`
`
`ix
`
`TABLE OF AUTHORITIES—Continued
`
`Page
`
`Tony Dutra, Rader Regrets CLS Bank Impasse,
`Comments on Latest Patent Reform Bill,
`Bloomberg BNA (Oct. 28, 2013), http://www.
`bna.com/rader-regrets-cls-n1717987 9684 ............. 33
`patents,
`General
`information
`concerning
`USPTO (Oct. 2015), https://www.uspto.gov/
`patents-getting-started/general-information-
`concerning-patents .................................................. 14
`Mark A. Lemley, Why Do Juries Decide If Pa-
`tents Are Valid?, 99 VA. L. REV. 1673 (2013) .......... 13
`Philip P. Mann, When the going gets tough . . .
`Rule 36!, IP LITIGATION BLOG (Jan. 14, 2016),
`http://www.iplitigationblog.com/2016/01/articles/
`uncategorized/when-the-going-gets-tough-rule-
`36/ ...................................................................... 29, 36
`MANUAL OF PATENT EXAMINING PROCEDURE
`(M.P.E.P.) § 2258(G) (9th ed., 2015) .................... 3, 24
`Peter J. Pitts, ‘Patent Death Squads’ vs. Innova-
`tion, WALL ST. J. (June 10, 2015), http://www.
`wsj.com/articles/patent-death-squads-vs-
`innovation-1433978591 ........................................... 34
`PTAB Statistics, USPTO (Mar. 31, 2016), https://
`www.uspto.gov/sites/default/files/documents/
`2016-3-31%20-PTAB.pdf ......................................... 33
`Jason Rantanen, Data on Federal Circuit Ap-
`peals and Decisions, PATENTLYO, (June 2,
`2016), http://patentlyo.com/patent/2016/06/
`circuit-appeals-decisions.html ................................ 36
`
`
`
`
`
`x
`
`TABLE OF AUTHORITIES—Continued
`
`Page
`
`Brad M. Scheller, PTAB Grants Fourth Motion
`to Amend in an IPR Proceeding, THE NATIONAL
`LAW REVIEW (June 17, 2015), http://www.
`natlawreview.com/article/ptab-grants-fourth-
`motion-to-amend-ipr-proceeding ............................ 23
`The Seventh Annual Judicial Conference of the
`Court of Appeals for the Federal Circuit, 128
`F.R.D. 409 (May 24, 1989) ....................................... 36
`
`
`
`
`
`1
`
`PETITION FOR A WRIT OF CERTIORARI
`Petitioner Oil States Energy Services respectfully
`
`submits this petition for a writ of certiorari to review
`the judgment of the U.S. Court of Appeals for the Fed-
`eral Circuit.
`
`--------------------------------- ---------------------------------
`
`OPINIONS AND ORDERS BELOW
`The order denying panel rehearing and rehearing
`
`en banc (App., infra 37-38) is unreported. The panel
`order disposing of the case without opinion (App., infra
`1-2) is unreported and available at 639 F. App’x 639
`(Fed. Cir. May 4, 2016). The opinion and order of the
`Patent Trial and Appeal Board (App., infra 3-36) is un-
`reported and available at 2015 WL 2089371 (PTAB
`May 1, 2015).
`
`--------------------------------- ---------------------------------
`
`STATEMENT OF JURISDICTION
`The court of appeals entered its order denying re-
`
`hearing on July 26, 2016. An application to extend the
`time to file a petition for a writ of certiorari was
`granted on October 14, 2016, making the petition due
`on or before November 23, 2016. The jurisdiction of
`this Court is invoked under 28 U.S.C. § 1254(1).
`
`--------------------------------- ---------------------------------
`
`
`
`
`
`
`
`
`
`2
`
`CONSTITUTIONAL AND
`STATUTORY PROVISIONS INVOLVED
`The Seventh Amendment of the United States
`
`Constitution provides:
`
`In Suits at common law, where the value
`
`in controversy shall exceed twenty dollars, the
`right of trial by jury shall be preserved, and
`no fact tried by a jury, shall be otherwise re-
`examined in any Court of the United States,
`than according to the rules of the common law.
`
`35 U.S.C. §§ 311-316 are attached in the Appendix
`
`(App., infra 39-48).
`
`--------------------------------- ---------------------------------
`
`STATEMENT
`Patents create property rights, protected by the
`
`Constitution. Once a patent is granted, it “is not sub-
`ject to be revoked or canceled by the president, or any
`other officer of the Government” because “[i]t has be-
`come the property of the patentee, and as such is enti-
`tled to the same legal protection as other property.”
`McCormick Harvesting Mach. Co. v. C. Aultman & Co.,
`169 U.S. 606, 608-09 (1898).
`
`In 2011, Congress passed the America Invents Act
`
`to combat what it perceived as inefficiencies in patent
`litigation. The Act allows the PTO’s Patent Trial and
`Appeal Board (the Board) to review existing patents
`and extinguish those rights in an adversarial process.
`See 35 U.S.C. §§ 311(a) & 318(a); Google Inc. v. Jongerius
`
`
`
`
`
`
`3
`
`Panoramic Techs., LLC, No. IPR 2013-00191, Paper No.
`50, at 4 (PTAB, Feb. 13, 2014). This is known as inter
`partes review. 37 C.F.R. § 42.100(a); H.R. REP. NO.
`112-98, pt. 1, at 46-47 (2011). Inter partes review com-
`mences when a party—often an alleged patent in-
`fringer—asks the Board to reconsider the PTO’s
`issuance of an existing patent and invalidate it on the
`ground that it was anticipated by prior art or obvious.
`35 U.S.C. § 311(b).
`
`Historically, though, suits to invalidate patents
`
`would have been tried before a jury in a court of law.
`The Constitution thus provides patent owners with a
`right to a jury and an Article III forum. Inter partes
`review violates these rights.
`
` Without ruling on the constitutionality of inter
`partes review, this Court recently affirmed that such
`review may consider patent claims under their “broad-
`est reasonable construction.” Cuozzo, 136 S. Ct. at
`2136. The PTO’s treatment of potential amendments
`to patents in inter partes review directly conflicts with
`that standard. As the patent office itself has noted, the
`broadest reasonable interpretation standard only
`makes sense when a patent holder (or potential patent
`holder) has the ability to engage in the back-and-forth
`process for amending the patent. See MANUAL OF PA-
`TENT EXAMINING PROCEDURE (M.P.E.P.) § 2258(G) (9th
`ed., 2015). Yet in inter partes review, there is no prac-
`tical ability to amend and no ability to rebut argu-
`ments offered sua sponte by the Board. Even if patent
`owners have no right to an Article III forum, they must
`receive a fair opportunity to be heard. See 5 U.S.C.
`§§ 554 & 556.
`
`
`
`
`
`4
`
`The Cuozzo standard also requires clarification.
`
`Currently, it is unclear if traditional principles of claim
`construction—disparagement of prior art and reading
`claims in light of the specification—apply under a pa-
`tent’s broadest reasonable interpretation. And the
`Federal Circuit has acknowledged the conundrum of
`using a standard in inter partes review that was devel-
`oped for use in the very different context of a patent
`application. See PPC Broadband, Inc. v. Corning Opti-
`cal Commc’n RF, LLC, 815 F.3d 747, 752 (Fed. Cir.
`2016). After Cuozzo, proper application of claim con-
`struction standards—vital in the context of extremely
`valuable patents—requires guidance from this Court,
`and this question presents an issue of importance war-
`ranting this Court’s attention.
`
`1. During hydraulic fracturing (“fracking”) pro-
`
`cedures, fluid is pumped into oil and gas wells to stim-
`ulate or increase production. See App. 5. The fluid,
`which can be abrasive and corrosive, is often pumped
`into the well at pressures up to 15,000 pounds per
`square inch. JA67, 1:18-23, 791. The wellheads that
`sit on top of oil and gas wells are not designed to with-
`stand continuous exposure to fracking fluids, and if left
`unprotected the wellheads can be severely damaged.
`Ibid. Murray Dallas, an employee of Stinger Wellhead
`Protection, Inc. (now a subsidiary of Oil States), twice
`attempted to solve this problem. See id. at 57-73, 247-
`78.
`
`2. The first attempted solution was disclosed in
`
`Canadian Patent Application No. 2,195,118 (the ’118
`
`
`
`
`
`5
`
`Application).1 This solution relied on using hydraulic
`pressure first to push a “mandrel” (essentially, a pro-
`tective tube) into the wellhead and then to push the
`mandrel down onto the casing, forming a seal between
`the bottom end of the mandrel and the top end of the
`casing—pipe that is already cemented in place to form
`the well. JA287, 3:8-24. Fracking fluid could then be
`pumped through the mandrel and into the casing with-
`out contacting the wellhead equipment.
`
`Unfortunately, using hydraulic pressure failed to
`
`form a sufficient seal with the casing. Id. at 897. Dal-
`las explained: “[I]t was a failure. It wouldn’t seal,
`wouldn’t create a seal for us.” Id. at 991. Dallas deter-
`mined that the ’118 design was “useless” and “just
`scrapped the whole idea.” Id. at 961.
`
`3. Dallas’s second solution came in Patent No.
`
`6,179,053 (the ’053 Patent), the patent at issue here.
`The new design “utilize[d] * * * mechanical lock-
`downs.” JA992. Instead of pushing down on the man-
`drel with constant hydraulic pressure, the new design
`used a mechanical lockdown to “lock” the mandrel in
`place after it had been inserted. Id. at 57, Abstract; id.
`at 70, 7:6-32.
`
`The ’053 Patent criticized the earlier design’s reli-
`
`ance on hydraulic pressure: “[A] hydraulic lockdown
`mechanism is considered less secure than a mechani-
`cal lockdown mechanism” because it “is dependent on
`
`
`1 The same disclosure is found in U.S. Patent No. 5,819,851.
`
`
`
`
`
`
`
`6
`
`maintenance of the hydraulic fluid pressure in the set-
`ting tool.” Id. at 68, 3:2-9. “Since fluid pressure may
`be lost for a variety of reasons, persons in the industry
`are generally less inclined to endorse or accept a hy-
`draulic lockdown mechanism.” Ibid. The ’053 Patent
`explained the “need for a lockdown mechanism for se-
`curing a mandrel * * * in an operative position * * *
`which provides a broader range of adjustment while
`ensuring a secure mechanical lockdown for maximum
`security.” Id. at 68, 3:42-46.
`
`The redesign brought another significant ad-
`
`vantage as well. Because the design did not rely on the
`same hydraulic pressure both to insert the mandrel
`and to hold it in place, the device used to insert the
`mandrel (the “setting tool”) could be removed after the
`mandrel was locked in its operating position. Id. at 70,
`7:6-32. The shorter height was both more convenient
`for well operators and safer for workers. See id. at 67-
`68, 2:62-3:2; id. at 626 ¶ 10.
`
`The ’053 Patent criticized the height required by
`
`the non-removable setting tool of the previous design.
`Because “the setting tool is not removable from the
`mandrel during a well treatment,” the device disclosed
`in the ’118 Application “has a high profile.” Id. at 67-
`68, 2:63-3:2. “A well tool with a high profile is not con-
`venient because access to equipment mounted thereto,
`such as a high pressure valve, is impeded by the height
`of the valve above ground.” Ibid.
`
`4. In 2012, Oil States filed an infringement suit
`
`against Greene’s Energy Group in the Eastern District
`
`
`
`
`
`7
`
`of Texas. During the course of the litigation, the dis-
`trict court, applying the “ordinary meaning” standard
`and traditional principles of claim construction, con-
`strued the ’053 Patent to be distinct from the ’118 Ap-
`plication. See JA509 (construing the term “second
`lockdown mechanism” to “lock the mandrel in the op-
`erative position without hydraulic pressure”). Follow-
`ing the Markman order, and almost one year into the
`litigation as the case was nearing the close of discovery,
`Greene’s petitioned for inter partes review. Id. at 306.
`
`5. The Board granted review and construed the
`
`claims of the ’053 Patent under the “broadest reasona-
`ble interpretation” standard, holding that the ’053 Pa-
`tent was anticipated by the ’118 Application. That
`decision was predicated on the construction of two
`claim terms. First, the Board held that the “second
`lockdown mechanism” was broad enough to cover a de-
`vice that (a) relies only on hydraulic pressure to lock
`the mandrel in position; and (b) was integrally incor-
`porated with the setting tool. App. 12-18. Second, the
`Board held, contrary to positions taken by both sides’
`technical experts, that “locking” did not require main-
`taining the mandrel in position while operating the
`tool. Id. at 18-19. The Board concluded that the ’053
`Patent’s claims were fairly encompassed by the earlier
`’118 Application. Id. at 29.
`
`6. Oil States moved to amend the ’053 Patent to
`
`explicitly align the claims with the specification’s con-
`sistent description of a lockdown mechanism that was
`both mechanical and separate from the setting tool.
`JA764-81.
`
`
`
`
`
`8
`
` When inter partes reviews were first instituted,
`the PTO limited motions to amend to 15 pages—
`with double-spacing and 14-point font. 37 C.F.R.
`§§ 42.24(a)(1)(v) & 42.6(a)(2). The motion was re-
`quired to contain a verbatim recitation of each pro-
`posed amended claim, constructions of new claim
`terms (to the extent necessary to show distinction over
`the prior art), written description support for all claims
`in the patent (not just new ones), and substantive ar-
`guments establishing that the proposed amended
`claims were patentable over the known universe of
`prior art, including proving, as necessary, nonobvious-
`ness through potentially complex secondary consider-
`ations. See 37 C.F.R. § 42.121(b)(1). Because of the
`amendment rules in place at the time, Oil States pro-
`vided a chart to the Board that identified where each
`claim element was disclosed.2
`
`The Board denied the motion to amend because,
`
`according to the Board, Oil States had not “demon-
`strated” or sufficiently “explained” where and how
`each and every new claim element was disclosed in the
`original patent specification. App. 32-34. There was
`no suggestion by Greene’s that such “demonstration”
`or “explanation” was either required or lacking—the
`requirement was developed solely by the PTO. In
`reaching its conclusion, the Board refused to consider
`the evidence in the chart offered by Oil States.
`
`
`
`2 The PTO has since amended the rules to extend the page
`limit from 15 to 25 pages. Amendments to the Rules of Practice
`for Trials Before the Patent Trial and Appeal Board, 80 Fed. Reg.
`28,561, 28,562 (May 19, 2015).
`
`
`
`
`
`9
`
`The Board also concluded that Oil States failed to
`
`provide “express” construction of two claim terms—one
`of which was defined in the claim itself and discussed
`at length by Oil States’ technical expert, and the other
`of which involved simply adding the word “assembly”
`to the claim’s preamble, a cosmetic change that had no
`bearing on the patentability of the claims. Id. at 35.
`
`7. Oil States appealed the Board’s determination
`
`to the Federal Circuit, arguing that the Board erred in
`construing the claims at issue. First, Oil States argued
`that the Board ignored the patent’s discussion of the
`shortcomings of the prior art tool and its explanation—
`clear in the specification of the patent—that the ’053
`Patent did not suffer from these drawbacks. Brief of
`Patent Owner-Appellant at 18-33, Oil States Energy
`Servs., LLC v. Greene’s Energy Grp., LLC, (No. 2015-
`1855), 639 F. App’x 639 (Fed. Cir. 2016) (mem.). A
`patent’s “disparagement of the prior art” ordinarily
`plays an important role in claim construction when the
`Federal Circuit is reviewing a determination on patent
`claims. Second, Oil States argued that the Board erred
`in rejecting the evidence that the ’118 Application
`failed to enable the ’053 Patent. Id. at 35-43.
`
`Oil States also argued that inter partes review was
`
`contrary to Article III and the Seventh Amendment of
`the Constitution, id. at 52-56, but the Federal Circuit’s
`decision in MCM Portfolio LLC v. Hewlett-Packard Co.,
`812 F.3d 1284 (Fed. Cir. 2015), was handed down before
`the close of briefing and foreclosed that argument. Oil
`
`
`
`
`
`
`10
`
`States also noted—pre-Cuozzo—that the virtual una-
`vailability of amendments in the inter partes review
`process counseled against use of the “broadest reason-
`able interpretation” standard. Brief of Patent Owner-
`Appellant at 18 n.2.3
`
`Following oral argument, a panel of the Federal
`
`Circuit affirmed without opinion under that court’s
`Rule 36. App. 1-2. The court of appeals then denied
`panel rehearing and rehearing en banc. Id. at 37-38.
`
`--------------------------------- ---------------------------------
`
`REASONS FOR GRANTING THE PETITION
`Inter partes review violates the Constitution.
`
`Suits to invalidate patents must be tried before a jury
`in an Article III forum, not in an agency proceeding.
`
`But even if inter partes review were constitutional,
`
`its application by the Board violates both this Court’s
`and Congress’s directives concerning the rights of pa-
`tent holders to protect their property rights through
`the amendment process. The Board has recognized
`that the amendment process is critical to the applica-
`tion of a broadest reasonable interpretation standard,
`yet patent-holder amendments in inter partes review
`are effectively unavailable. The Board’s implementa-
`tion of inter partes review in this way is contrary to
`congressional intent and cannot be reconciled with the
`broadest reasonable interpretation standard, either.
`
`
`
`3 The government intervened on appeal to defend the consti-
`tutionality of inter partes review and its application in this case.
`
`
`
`
`
`11
`
`Finally, the Board’s application of the broadest
`
`reasonable interpretation standard has created intol-
`erable confusion in the Federal Circuit. Different pan-
`els have reached different conclusions about how this
`standard interacts with traditional principles of claim
`construction. As a result, a patent holder’s rights de-
`pend on the panel drawn rather than the patent
`drafted.
`
`The Court should grant the petition and either de-
`
`clare inter partes review unconstitutional or else re-
`solve the confusion in its administration.
`
`
`I.
`
`Inter Partes Review Conflicts With This
`Court’s Cases Upholding The Constitu-
`tional Guarantees Of A Jury And An Arti-
`cle III Court For Patent Invalidation.
`This Court has long held that patent “infringe-
`
`ment cases today must be tried to a jury, as their pre-
`decessors were more than two centuries ago.”
`Markman v. Westview Instruments, Inc., 517 U.S. 370,
`377 (1996) (emphasis added). At a minimum, the Con-
`stitution requires that an Article III judge adjudicate
`all cases in law and in equity arising under federal law.
`U.S. CONST. art. III. Contrary to this Court’s precedent,
`the Board’s inter partes review proceeding provides
`neither the jury nor the Article III forum guaranteed
`by the Constitution.
`
`
`
`
`
`
`
`12
`
`A. This Court’s Precedent Confirms That
`The Seventh Amendment Provides Pa-
`tent Owners With A Right To A Jury In
`Invalidation Proceedings.
`The Seventh Amendment ensures a jury trial “[i]n
`
`Suits at common law.” U.S. CONST., amend. VII. The
`“thrust of the Amendment was to preserve the right to
`jury trial as it existed in 1791.” Curtis v. Loether, 415
`U.S. 189, 193 (1974). Beyond that, this Court has held
`that the Seventh Amendment “also applies to actions
`brought to enforce statutory rights that are analogous
`to common-law causes of action ordinarily decided in
`English law courts in the late 18th century, as opposed
`to those customarily heard by courts of equity or admi-
`ralty.” Granfinanciera, S.A. v. Nordberg, 492 U.S. 33,
`42 (1989).
`
`In 1791, “[a]n action for patent infringement is one
`
`that would have been heard in the law courts of old
`England.” Markman v. Westview Instruments, Inc., 52
`F.3d 967, 992-93 (Fed. Cir. 1995). And it had been that
`way for 200 years before that, too. See Darcy v. Allein
`(1601) 77 Eng. Rep. 1260 (KB); see also Oren Bracha,
`Owning Ideas: A History of Anglo-American Intellec-
`tual Property 33 (June 2005) (unpublished Ph.D. thesis,
`Harvard Law School), https://law.utexas.edu/faculty/
`obracha/dissertation/pdf/chapter1.pdf (noting that, in
`Darcy, “none of the parties disputed that the common
`law court had jurisdiction to decide the validity of the
`patent”). The only other way for a patent to be revoked
`at that time would have been a writ scire facias—
`essentially a show-cause order as to why the patent
`
`
`
`
`
`13
`
`should not be revoked—that could be filed in the Chan-
`cery courts. And even in those instances, any disputed
`facts were tried to a jury in the common law courts.
`See, e.g., Ex Parte Wood & Brundage, 22 U.S. 603, 614-
`15 (1824) (“[I]t is ORDERED * * * that the said Judge
`do award a process, in the nature of a scire facias, to
`the patentees, to show cause why the said patent
`should not be repealed * * * and that if the issue be an
`issue of fact, the trial thereof be by a jury.”).4
`
`As this Court has held in the copyright context—
`
`indistinguishable from patents in this regard—“the
`common law and statutes in England and this country
`granted copyright owners causes of action for infringe-
`ment [and those suits were] tried in courts of law, and
`thus before juries.” Feltner v. Columbia Pictures Tele-
`vision, Inc., 523 U.S. 340, 348-49 (1998). It is thus clear
`that patent infringement cases—including invalidity
`defenses where damages are sought—are the province
`of the jury. See Markman, 517 U.S. at 377; Tegal Corp.
`v. Tokyo Electron Am., Inc., 257 F.3d 1331, 1340 (Fed.
`Cir. 2001).
`
`Disregarding this long line of precedent, inter
`
`partes review takes a patent infringement claim out of
`the jury’s hands and entrusts it to bureaucrats. In sup-
`port of this regime, the PTO has argued that “patents
`
`4 While the dividing line between law and equity can be dif-
`
`ficult to draw and has spawned debate over whether a jury should
`be required in every case, see Mark A. Lemley, Why Do Juries De-
`cide If Patents Are Valid?, 99 VA. L. REV. 1673, 1674-77, 1710-19
`(2013), the issue here is that the optio
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