Nos. 19-1434, 19-1452, 19-1458
`In the Supreme Court of the United States
`___________________________
`
`UNITED STATES OF AMERICA,
`
`
`
`Petitioner,
`v.
`ARTHREX, INC., ET AL.,
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`
`Respondents.
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`SMITH & NEPHEW, INC., ET AL.,
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`
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`Petitioners,
`v.
`ARTHREX, INC., ET AL.,
`
`
`Respondents.
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`ARTHREX, INC.,
`
`
`Petitioner,
`v.
`SMITH & NEPHEW, INC., ET AL.,
`
`
`
`Respondents.
`___________________________
`ON WRITS OF CERTIORARI TO THE UNITED STATES
`COURT OF APPEALS FOR THE FEDERAL CIRCUIT
`___________________________
`BRIEF OF AMICUS CURIAE JEREMY C.
`DOERRE IN SUPPORT OF PETITIONER IN
`NO. 19-1458
`___________________________
`Jeremy Cooper Doerre
` Counsel of Record
`Tillman Wright, PLLC
`3440 Toringdon Way, Ste. 310
`Charlotte, NC 28277
`jdoerre@ti-law.com
`(704) 248-4883
`Counsel for Amicus Curiae
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`In the Supreme Court of the United States
`___________________________
`
`UNITED STATES OF AMERICA,
`
`
`
`Petitioner,
`v.
`ARTHREX, INC., ET AL.,
`
`
`Respondents.
`
`
`
`
`
`
`
`SMITH & NEPHEW, INC., ET AL.,
`
`
`
`Petitioners,
`v.
`ARTHREX, INC., ET AL.,
`
`
`Respondents.
`
`
`
`
`
`
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`
`
`ARTHREX, INC.,
`
`
`Petitioner,
`v.
`SMITH & NEPHEW, INC., ET AL.,
`
`
`
`Respondents.
`___________________________
`ON WRITS OF CERTIORARI TO THE UNITED STATES
`COURT OF APPEALS FOR THE FEDERAL CIRCUIT
`___________________________
`BRIEF OF AMICUS CURIAE JEREMY C.
`DOERRE IN SUPPORT OF PETITIONER IN
`NO. 19-1458
`___________________________
`Jeremy Cooper Doerre
` Counsel of Record
`Tillman Wright, PLLC
`3440 Toringdon Way, Ste. 310
`Charlotte, NC 28277
`jdoerre@ti-law.com
`(704) 248-4883
`Counsel for Amicus Curiae
`
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` - i -
`
`TABLE OF CONTENTS
`
`
`TABLE OF CONTENTS .............................................. i
`TABLE OF AUTHORITIES ....................................... ii
`INTEREST OF AMICUS CURIAE ............................ 1
`SUMMARY OF THE ARGUMENT ........................... 2
`ARGUMENT ............................................................... 5
`I. It
`is necessary
`to
`consider whether
`administrative patent judges are directed and
`supervised when exercising authority Congress
`granted to the Board, irrespective of the
`Director’s ability to oversee them when they are
`acting under his authority. .............................. 8
`II. When
`the Board
`is
`exercising
`its
`congressionally granted authority, the Director
`cannot reverse its decision using his panel
`designation power because of due process
`concerns and his statutory obligation to
`perform his duties in a fair manner. ............. 12
`III.When
`the Board
`is
`exercising
`its
`congressionally granted authority, the Director
`cannot reverse its decision by issuing new
`policy guidance that the Board would be
`required to apply because the Director lacks
`retroactive rulemaking authority. ................. 29
`
`
`CONCLUSION .......................................................... 36
`
`
`
`
`
`
` - ii -
`
`TABLE OF AUTHORITIES
`
`
`Cases
`
`American Bus Ass'n v. United States,
`627 F.2d 525 (D.C. Cir. 1980) ........................ 32-33
`
`
`Animal Legal Defense Fund v. Quigg,
`932 F.2d 920 (Fed. Cir. 1991) .......................... 9, 13
`
`
`Board of Regents of State Colleges v. Roth,
`408 U.S. 564 (1972) ............................................. 20
`
`
`Bowen v. Georgetown University Hospital,
`488 U.S. 204 (1988) ................................... 3, 30, 34
`
`
`Brenner v. Manson,
`383 U.S. 519 (1966) ......................................... 2, 15
`
`
`Chevron U.S.A. Inc. v. Natural Resources Defense
`Council, Inc.,
`467 U.S. 837 (1984) .......................... 24, 26, passim
`
`
`Chrysler Corp. v. Brown,
`441 U.S. 281 (1979) ............................................. 34
`
`
`City of Arlington v. Federal Communications
`Commission,
`569 U.S. 290 (2013) ............................................. 25
`
`
`
` - iii -
`
`
`Crowell v. Benson,
`285 U.S. 22, 62 (1932) ......................................... 27
`
`
`Commissioner v. Clark,
`489 U.S. 726, 727 (1989) ..................................... 33
`
`
`D.C. Federation of Civic Ass'ns v. Volpe,
`459 F.2d 1231 (D.C. Cir. 1971), cert. denied, 405
`U.S. 1030 (1972) .................................................. 24
`
`
`Edmond v. United States,
`520 U.S. 651 (1997) ............................................ 4-8
`
`
`Edward J. DeBartolo Corp. v. Florida Gulf Coast
`Building Constr. Trades Council,
`485 U.S. 568 (1988) ............................................. 27
`
`
`Florida Prepaid Postsecondary Ed. Expense Bd. v.
`College Savings Bank,
`527 U.S. 627 (1999) ............................................. 19
`
`
`Freytag v. Commissioner,
`501 U.S. 868 (1991) ........................................ 11-12
`
`
`Grace v. Barr,
`no. 19-5013 (D.C. Cir. July 17, 2020) .................... 9
`
`
`In re Alappat,
`33 F.3d 1526 (Fed. Cir. 1994) ........ 14-18, 21-22, 24
`
`
`
`
`
` - iv -
`
`
`In re Murchison,
`349 U.S. 133 (1955) ............................................. 24
`
`
`In re Wiechert,
`370 F.2d 927 (C.C.P.A. 1967) .............................. 14
`
`
`Lincoln v. Vigil,
`508 U.S. 182 (1993) ............................................. 32
`
`
`McCormick Harvesting Machine Co. v. Aultman,
`169 U. S. 606 (1898) ............................................ 19
`
`
`Morgan v. United States,
`298 U.S. 468 (1936) ........................................ 20-21
`
`
`Morgan v. United States,
`304 U.S. 1 (1938) ................................................. 21-22
`
`Moore v. United States,
`40 App.D.C. 591 (D.C. Cir. 1913) ........................ 14
`
`
`Nidec Motor Corp. v. Zhongshan Broad Ocean Motor
`Co.,
`868 F.3d 1013 (Fed. Cir. 2017) ........................ 8, 18
`
`
`Solid Waste Agency of Northern Cook County v.
`United States Army Corps of Engineers,
`531 U.S. 159 (2001) ............................................. 27
`
`
`
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`
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` - v -
`
`
`U.S. v. Picciotto,
`875 F.2d 345 (D.C. Cir. 1989) ....................... 32, 35
`
`
`Utica Packing Co. v. Block,
`781 F.2d 71 (6th Cir. 1986) ............................ 23-24
`
`
`
`Constitutional Provisions
`
`U.S. Const., Art. II, § 2, Cl. 2 ...................................... 5
`
`U.S. Const., Amendment 5 ....................................... 19
`
`
`Statutes and Regulations
`
` 5
`
` 5
`
` 5
`
` 5
`
` U.S.C. § 551(4) .............................................. 4, 33-35
`
` U.S.C. § 553(b) .............................................. 3, 31-32
`
` U.S.C. § 553(c) ........................................................ 32
`
` U.S.C. § 553(d) ....................................................... 32
`
`
`26 U.S.C. § 7443A .................................................... 11
`
`
`
`
` - vi -
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`
`35 U.S.C. § 3 ................................................................ 8
`
`35 U.S.C. § 3(a)(2)(A) ................... 3, 25, 26, 28, passim
`
`35 U.S.C. § 6 ............................................ 3, 9-10, 12-13
`
`35 U.S.C. § 6(b) ..................................................... 9, 12
`
`35 U.S.C. § 6(c) .................................... 10, 13-16, 24-25
`
`35 U.S.C. § 102 .......................................................... 19
`
`35 U.S.C. § 131 .......................................................... 19
`
`35 U.S.C. § 314 ............................................................ 9
`
`35 U.S.C. § 324 .......................................................... 10
`
`37 CFR § 42.4 ............................................................ 10
`
`37 CFR § 42.108 ........................................................ 10
`
`37 CFR § 42.208 ........................................................ 10
`
`Act of March 2, 1861, 12 Stat. 246 ........................... 14
`
`
`
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` - vii -
`
`
`Act of March 2, 1927, ch. 273, § 3, 44 Stat. 1335 ..... 14
`
`American Inventors Protection Act of 1999, Pub. L.
`No. 106–113 ......................................................... 13
`
`
`
`Other Authorities
`
`44 PTCJ 43 (BNA 1992) .......................................... 17
`
`Attorney General’s Manual on the Administrative
`Procedure Act (1947) ................................. 4, 34-35
`
`
`Frederico, Evolution of Patent Office Appeals,
`22 J.P.O.S. 838-920 (1940) ...................................... 14
`
`John M. Golden, PTO Panel Stacking: Unblessed by
`the Federal Circuit and Likely Unlawful, 104 Iowa
`L. Rev. 2447, 2469 (2019) .................... 21-22, 25-26
`
`
`Oral argument in Nidec Motor Corp. v. Zhongshan
`Broad Ocean Motor Co., 868 F.3d 1013 (Fed. Cir.
`2017) (appeal no. 2016-2321, argued June 8, 2017),
`available at http://oralarguments.cafc.uscourts
`.gov/default.aspx?fl=2016-2321.mp3) ....... 9-10, 14
`
`
`Transcript of Oral Argument, Oil States Energy
`Services, LLC v. Greene's Energy Group, LLC, 138
`S. Ct. 1365 (2018) (no. 16-712, argued Nov. 27,
`
`
`
`
`
` - viii -
`
`2017), available at https://www.supremecourt.gov/
`oral_arguments/argument_transcripts/2017/16-
`712_879d.pdf ................................................... 18-20
`
`
`Vishnubhakat,
`Saurabh
`Patent
`Disguised
`Policymaking, 76 Wash. & Lee L. Rev. 1667, 1719
`(2019) ................................................................... 21
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`INTEREST OF AMICUS CURIAE1
`Amicus Curiae Jeremy C. Doerre is a registered
`patent attorney who practices before the United
`States Patent and Trademark Office, the Office’s
`Patent Trial and Appeal Board, and the United States
`Court of Appeals for the Federal Circuit. Amicus has
`no stake in any party or in the outcome of this case.
`Amicus’ only interest in this case is in the law.
`
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`- 1 -
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`
`
`1 No counsel for a party authored this brief in whole or in
`part, and no party or counsel for a party made a monetary
`contribution
`intended to
`fund the preparation or
`submission of this brief. No person or entity other than
`amicus curiae or amicus curiae’s counsel made such a
`monetary contribution to the preparation or submission of
`this brief. Counsel for each party filed a statement of
`blanket consent to the filing of amicus briefs.
`
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`- 2 -
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`SUMMARY OF THE ARGUMENT
`
`This Court has indicated with respect to the
`previous head of the Office that “[a]s a member of the
`Board and the official responsible for selecting the
`membership of its panels, … the [head of the Office]
`may be appropriately considered as bound by Board
`determinations.” Brenner v. Manson, 383 U.S. 519,
`523 n.6 (1966).
`In the face of this indication, the government
`urges that administrative patent judges are inferior
`officers based on the purported ability of the Director
`to “convene a panel of his own choosing to determine
`whether any individual decision should be reheard,
`either in whole or in part, with no limits on the scope
`of that rehearing,” and “issue relevant policy guidance
`that the Board would be required to apply in … all []
`pending cases.” Brief for the United States at 37, 38.
`The government even suggests that the Director “can
`prevent [a] … decision from taking effect even in an
`individual case by using his authority to issue binding
`policy guidance, in concert with his power to convene
`a [review] [p]anel to decide whether to rehear the
`decision.” Id. at 38.
`Amicus submits this brief to urge that, when the
`Board
`is exercising
`its congressionally granted
`authority, the Director cannot reverse its decision
`using his panel designation power because of due
`process concerns and his statutory obligation under 35
`
`
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`- 3 -
`
`
`U.S.C. § 3(a)(2)(A) to perform his duties in a fair
`manner.
`Amicus further submits this brief to urge that,
`when the Board is exercising its congressionally
`granted authority, the Director cannot reverse its
`decision by issuing new policy guidance that the
`Board would be required to apply because the Director
`lacks retroactive rulemaking authority.
`In this regard, this Court has made clear that “a
`statutory grant of legislative rulemaking authority
`will not, as a general matter, be understood to
`encompass the power to promulgate retroactive rules
`unless that power is conveyed by Congress in express
`terms.” Bowen v. Georgetown University Hospital, 488
`U.S. 204, 208 (1988).
`Given that the Board exercises independent
`authority granted by Congress, see 35 U.S.C. § 6, any
`attempt by the Director to circumscribe this
`congressionally granted authority by binding the
`Board to guidance must involve use of legislative
`rulemaking authority.
`This conclusion is reinforced by the fact that any
`attempt by “the Director … to issue relevant policy
`guidance that the Board would be required to apply in
`… all … pending cases,” Brief for the United States at
`38, would not qualify as an “interpretative rule[]” or
`“general statement[] of policy” under the statutory
`exceptions to 5 U.S.C. § 553(b), and instead would
`require notice and comment procedures. Specifically,
`any attempt by “the Director … to issue relevant
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`- 4 -
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`policy guidance that the Board would be required to
`apply in … all … pending cases,” Brief for the United
`States at 38, would not qualify under
`the
`interpretative rule exception as a “statement of …
`future effect,” 5 U.S.C. § 551(4), and would not qualify
`under the statement of policy exception as a
`“statement[]
`issued …
`to advise
`the public
`prospectively.” Attorney General’s Manual on the
`Administrative Procedure Act (1947) at 30 n.3.
`Amicus urges that, given this Court’s reference
`in Edmond v. United States, 520 U.S. 651 (1997) to the
`“power to reverse decisions,” and indication that
`“[w]hat is significant is that the judges of the
`[tribunal] have no power to render a final decision on
`behalf of the United States unless permitted to do so
`by other Executive officers,” the inability of the
`Director to reverse decisions, even under the creative
`schemes proposed by the government, weighs in favor
`of principal officer status for administrative patent
`judges. Id. at 664-665.
`
`
`
`
`
`
`
`
`
`
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`- 5 -
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`ARGUMENT
`
`The present case presents the question of
`“[w]hether, for purposes of the Appointments Clause,
`U.S. Const. Art. II, § 2, Cl. 2, administrative patent
`judges of the U.S. Patent and Trademark Office are
`principal officers who must be appointed by the
`President with the Senate’s advice and consent, or
`‘inferior Officers’ whose appointment Congress has
`permissibly vested
`in a department head.”
`Memorandum for the United States submitted July
`22, 2020 in nos. 19-1452 and 19-1458.
`In Edmond v. United States, 520 U.S. 651 (1997),
`this Court observed that “the term ‘inferior officer’
`connotes a relationship with some higher ranking
`officer or officers below the President,” and indicated
`that “[w]hether one is an ‘inferior’ officer depends on
`whether he has a superior.” Id. at 662. In this regard,
`“[i]t is not enough that other officers may be identified
`who formally maintain a higher rank, or possess
`responsibilities of a greater magnitude.” Id. at 662-
`663. Instead, “‘inferior officers’ are officers whose
`work is directed and supervised at some level by
`others who were appointed by Presidential
`nomination with the advice and consent of the
`Senate.” Id. at 663.
`Thus, while it is clear that both the Secretary of
`Commerce and the Director “maintain a higher rank,
`[and] possess responsibilities of a greater magnitude”
`as compared to administrative patent judges, it is less
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`- 6 -
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`clear whether either qualifies as a “superior” so as to
`render administrative patent judges inferior officers.
`Edmond, 520 U.S. at 662-663.
`One factor that this Court highlighted in
`Edmond in evaluating whether members of a tribunal
`qualify as inferior officers for Appointments Clause
`purposes is whether another executive officer has
`“power to reverse decisions” of the tribunal. Id. at 664.
`In particular, this Court indicated that “[w]hat is
`significant is that the judges of the [tribunal] have no
`power to render a final decision on behalf of the
`United States unless permitted to do so by other
`Executive officers.” Id. at 665.
`The government urges that administrative
`patent judges’ “work is [sufficiently] directed and
`supervised” by the Director so as to render
`administrative patent judges inferior officers. Id. at
`663.
`
`Notably, the government is not suggesting that
`administrative patent judges can be told to make a
`particular decision, and indeed counsel for the
`Director has acknowledged before the Federal Circuit
`that they cannot.2
`
`
`2 In particular, during oral argument discussing the
`Director’s practice of sometimes expanding Board panels to
`beyond three members, counsel for the Director indicated
`that “[i]f judges could be told to make a particular decision,
`there would be no need to expand a panel in the first place,”
`thus acknowledging that members of the Board in fact
`
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`- 7 -
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`Instead, recognizing the significance of the
`“power to reverse decisions,” Edmond, 520 U.S. at
`664, the government urges that “the Director can …
`convene a panel of his own choosing to determine
`whether any individual decision should be reheard,
`either in whole or in part, with no limits on the scope
`of that rehearing,” and that “the Director could
`require
`that Board opinions addressing any
`unresolved legal or policy issues should be circulated
`internally before they were issued, enabling him to
`issue relevant policy guidance that the Board would
`be required to apply in those and all other pending
`cases.” Brief for the United States at 37, 38. The
`government even suggests that the Director “can
`prevent [a] … decision from taking effect even in an
`individual case by using his authority to issue binding
`policy guidance, in concert with his power to convene
`a [review] [p]anel to decide whether to rehear the
`decision.” Id. at 38.
`Amicus submits this brief to urge that the
`Director’s ability to control or reverse decisions of the
`Board is more constrained than the government
`appears to suggest.
`
`
`cannot “be told to make a particular decision.” Oral
`argument at 25:27 in Nidec Motor Corp. v. Zhongshan
`Broad Ocean Motor Co., 868 F.3d 1013 (Fed. Cir. 2017)
`(appeal no. 2016-2321, argued June 8, 2017), available at
`http://oralarguments.cafc.uscourts.gov/default.aspx?fl=20
`16-2321.mp3).
`
`
`
`
`I.
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`- 8 -
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`to consider whether
`is necessary
`It
`administrative patent judges are directed
`and supervised when exercising authority
`Congress granted to the Board, irrespective
`of the Director’s ability to oversee them
`when they are acting under his authority.
`
`As noted above, the government urges that
`administrative patent judges’ “work is [sufficiently]
`directed and supervised” by the Director so as to
`render administrative patent judges inferior officers,
`Edmond, 520 U.S. at 663, and points to various ways
`that the Director can purportedly oversee the Board,
`and the administrative patent judges thereon.
`However, the government does not disambiguate
`between
`the Director’s
`ability
`to
`oversee
`administrative patent judges when they are acting
`under authority he has delegated to them, and the
`Director’s ability to oversee administrative patent
`judges when they are acting under independent
`authority that Congress chose to grant to the Board,
`rather than the Director.
`A. In this regard, while “IN GENERAL … [t]he
`powers and duties of the United States Patent and
`Trademark Office shall be vested in … [the] Director,”
`35 U.S.C. § 3, Congress chose to specifically grant the
`
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`- 9 -
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`
`Patent Trial and Appeal Board authority independent
`of the Director.3
`Specifically, 35 U.S.C. § 6 grants the Board
`authority to “review adverse decisions of examiners
`upon applications for patents,” “review appeals of
`reexaminations,” “conduct derivation proceedings,”
`and “conduct inter partes reviews and post-grant
`reviews.” 35 U.S.C. § 6(b). Notably, this grant of
`authority is not to the Office generally, or to the
`Director, instead, it is specifically to “[t]he Patent
`Trial and Appeal Board,” 35 U.S.C. § 6(b), and thus
`“the Board’s authority … rests on an independent
`grant.” Animal Legal Defense Fund v. Quigg, 932 F.2d
`920, 928-929 (Fed. Cir. 1991).
`B. However, not all tasks performed by the
`Board, and the administrative patent judges on the
`Board, are performed under authority granted by
`Congress to the Board. This is because the Director
`has chosen to delegate some tasks to the Board.
`In particular, Congress granted the Director the
`authority to “determine whether to institute an inter
`partes review,” 35 U.S.C. § 314, or “post-grant
`
`
`3 Congress’ choice to grant the Board authority
`independent of the Director is in accord with “Congress’
`‘use [of] the phrase ‘in general,’ [which] suggest[s] that
`[some powers] might, depending on the circumstances,” not
`be vested in the Director. Grace v. Barr, no. 19-5013, slip
`op. at 39 (D.C. Cir. July 17, 2020) (analyzing “use [of] the
`phrase ‘in general’” in a different context.)
`
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`- 10 -
`
`
`review,” 35 U.S.C. § 324, but the Director has chosen
`to delegate that task to the Board. See 37 CFR § 42.4
`(“The Board institutes the trial on behalf of the
`Director.”).
`In this situation, the Board is indeed acting “on
`behalf of the Director” under his authority, 37 CFR §
`42.4, in sharp contrast to situations where the Board
`is acting under its own congressionally granted
`authority pursuant to 35 U.S.C. § 6.
`C. This distinction matters because in situations
`where
`the Board
`is acting under
`its own
`congressionally granted authority pursuant to 35
`U.S.C. § 6, the constraints specified in 35 U.S.C. § 6(c)
`operate to limit the Director’s ability to oversee the
`Board.4 This distinction also matters because in
`situations where the Board is acting under its own
`congressionally granted authority, the Director
`cannot simply bind the Board by placing constraints
`on the exercise of authority he delegates to the Board.
`
`
`4 Other constraints may still operate to limit the Director’s
`oversight ability even when the Board is acting under the
`Director’s authority. For example, the Director appears to
`have bound himself to the requirement that “[i]nter partes
`review shall not be
`instituted
`for a ground of
`unpatentability unless the Board decides that…“ 37 CFR §
`42.108; see also 37 CFR § 42.208 (“Post-grant review shall
`not be instituted for a ground of unpatentability unless the
`Board decides that…”).
`
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`- 11 -
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`turn matter because,
`in
`effects
`These
`analogously to this Court’s reasoning in Freytag v.
`Commissioner, 501 U.S. 868 (1991), if administrative
`patent judges are principal officers for purposes of
`duties under 35 U.S.C. § 6, they are principal officers
`within the meaning of the Appointments Clause
`regardless of the Director’s ability to oversee their
`performance of other duties the Director has
`delegated to them.
`an
`confronted
`this Court
`In Freytag,
`Appointments Clause challenge for special trial
`judges assignable by the Chief Judge of the United
`States Tax Court to various proceedings under 26
`U.S.C. § 7443A. The government “concede[d] that, in
`cases governed by subsections (b)(1), (2), and (3),
`special trial judges act as inferior officers who exercise
`independent authority,” but urged that this was
`irrelevant to the petitioner, whose case was under
`subsection (b)(4). Freytag, 501 U.S. at 882.
`This Court made clear that “[s]pecial trial judges
`are not inferior officers for purposes of some of their
`duties under § 7443A, but mere employees with
`respect to other responsibilities,” and that “[t]he fact
`that an inferior officer on occasion performs duties
`that may be performed by an employee not subject to
`the Appointments Clause does not transform his
`status under the Constitution.” Id. This Court
`concluded that “[i]f a special trial judge is an inferior
`officer for purposes of subsections (b)(1), (2), and (3),
`he is an inferior officer within the meaning of the
`
`
`
`- 12 -
`
`
`Appointments Clause, and he must be properly
`appointed.” Id.
`that an
`fact
`“[t]he
`Here, analogously,
`[administrative patent judge] on occasion performs
`duties [under the Director’s authority] that may be
`performed by an [inferior officer] … does not
`transform his status under the Constitution.” Freytag,
`501 U.S. at 882. Thus, analogously to Freytag, “[i]f
`a[n] [administrative patent] judge is a[] [principal]
`officer for purposes of [one or more duties under 35
`U.S.C. § 6(b)], he is a[] [principal] officer within the
`meaning of the Appointments Clause, and he must be
`properly appointed.” Freytag, 501 U.S. at 882.
`Thus, in evaluating whether administrative
`patent judges qualify as principal officers, it is
`necessary to consider whether they are directed and
`supervised when
`exercising
`the
`independent
`authority Congress granted to the Board under 35
`U.S.C. § 6, irrespective of the Director’s ability to
`oversee them when they are acting under his
`authority to perform tasks he has delegated to them.
`
`its
`is exercising
`the Board
`II. When
`congressionally granted authority, the
`Director cannot reverse its decision using
`his panel designation power because of due
`process concerns and his
`statutory
`obligation to perform his duties in a fair
`manner.
`
`
`
`
`
`
`- 13 -
`
`A. As noted above, when the Board is acting
`under its own congressionally granted authority
`pursuant to 35 U.S.C. § 6, rather than performing
`tasks under the Director’s authority, the constraints
`specified in 35 U.S.C. § 6(c) operate to limit the
`Director’s ability to oversee the Board.
`In particular, 35 U.S.C. § 6(c) mandates that
`“[e]ach appeal, derivation proceeding, post-grant
`review, and inter partes review shall be heard by at
`least 3 members of the … Board,” and that “[o]nly the
`… Board may grant rehearings.” 35 U.S.C. § 6(c).
`Although the Director is a member of the Board,
`the requirement that “proceeding[s]… be heard by at
`least 3 members of the … Board” prevents any single
`member of the Board, even the Director, from
`unilaterally dictating the outcome of a Board
`proceeding. 35 U.S.C. § 6(c); see also Animal Legal
`Defense Fund, 932 F.2d at 929 n.10 (noting with
`respect to the previous head of the Office5 that “[w]hile
`the Commissioner may sit on the Board, in that
`capacity he serves as any other member.”)6
`
`
`5 The American Inventors Protection Act of 1999, Pub. L.
`No. 106–113 changed the management structure of the
`Office and placed a Director at its head rather than a
`Commissioner.
`6 This is in accord with historical practice, as even a
`century ago members of the Board’s predecessor, a Board
`of Examiners-in-chief, were not “subject to the official
`direction of the [head of the Office]” with respect to “the
`
`
`
`
`
`- 14 -
`
`Further, the express limitation that “[o]nly the …
`Board may grant rehearings” precludes the Director
`from unilaterally rehearing, reviewing, or reversing a
`decision of the Board. 35 U.S.C. § 6(c).7
`
`
`free exercise of their judgments in the matters submitted
`for their … determination.” In re Alappat, 33 F.3d 1526,
`1534 n.9 (Fed. Cir. 1994) (en banc) (quoting Moore v.
`United States, 40 App.D.C. 591, 596 (D.C. Cir. 1913)).
`Indeed, counsel for the Director has acknowledged that
`administrative patent judges cannot be told to make a
`particular decision. See n.2, supra.
`7 The inability of the Director to unilaterally rehear,
`review, or reverse a decision of the Board is notable, and
`presents a clear contrast with an earlier “system of two
`appeals within the office, one from the examiner to a board
`of three examiners-in-chief, and another appeal from this
`board to the Commissioner of Patents.” In re Wiechert, 370
`F.2d 927, 950-951 (C.C.P.A. 1967); see also Act of March 2,
`1861, 12 Stat. 246. In 1927, Congress eliminated the ability
`of the then head of the Office, the Commissioner, to review
`Board of Examiners-in-chief decisions by replacing “’the
`two appeals, to the Board of Examiners-in-chief and from
`the latter to the Commissioner, … [with] a single appeal,
`this single appeal being to a Board of Appeals.’” Wiechert,
`370 F.2d at 952 (quoting Frederico, Evolution of Patent
`Office Appeals, 22 J.P.O.S. 838-920 (1940)); see also Act of
`March 2, 1927, ch. 273, § 3, 44 Stat. 1335. Although the
`Board of Appeals included the Commissioner, the Act of
`1927 required “that each appeal shall be heard by at least
`three members of the Board of Appeals,” and made clear
`
`
`
`
`
`- 15 -
`
`Indeed, this Court has noted with respect to the
`previous head of the Office that “[a]s a member of the
`Board and the official responsible for selecting the
`membership of its panels, … the [head of the Office]
`may be appropriately considered as bound by Board
`determinations.” Brenner v. Manson, 383 U.S. 519,
`523 n.6 (1966).
`In the face of this prior indication by this Court,
`the government urges that “the Director can …
`convene a panel of his own choosing to determine
`whether any individual decision should be reheard,
`either in whole or in part, with no limits on the scope
`of that rehearing.” Brief for the United States at 37;
`see also Id. at 32 (“Any proceeding in which an
`administrative patent judge participates may be
`reheard de novo by another panel whose members the
`Director also picks—a panel that typically includes
`the Director himself and two other Executive
`officials.”)
`The government appears to be referencing a new
`review mechanism that the current Director recently
`
`
`that “[t]he Board of Appeals shall have sole power to grant
`rehearings.” Act of March 2, 1927, ch. 273, § 3, 44 Stat.
`1335, 1336. As noted above, these limitations persist to
`today, see 35 U.S.C. § 6(c), and make clear that the
`Director, just like the Commissioner before him, “cannot
`personally grant a rehearing, notwithstanding the general
`authority that he has over the operation of the PTO.” In re
`Alappat, 33 F.3d 1526, 1534 (Fed. Cir. 1994) (en banc).
`
`
`
`- 16 -
`
`
`created: Precedential Opinion Panel review. See Id. at
`31-32 (“the Director has established a Precedential
`Opinion Panel, which consists of Board members he
`chooses (typically including the Director himself), and
`which can determine whether to rehear and reverse
`any Board decision.”)
`Notably, though, the Director is the only member
`of the Board nominated by the President and
`confirmed by the Senate, and thus 35 U.S.C. § 6(c)’s
`mandate that “[e]ach … [Board proceeding] shall be
`heard by at least 3 members of the … Board” means
`that simple rehearing by the Board cannot possibly
`constitute principal officer review.
`The only way that such an ability to “convene a
`panel of [the Director’s] own choosing to determine
`whether any individual decision should be reheard”
`could qualify as principal officer review is if the
`Director were to use his panel designation power to
`produce a desired result.
`There is some history of heads of the Office
`utilizing panel designation power in this way. The en
`banc Federal Circuit was confronted with such a
`situation in Alappat, where after “a three-member
`panel … reversed the Examiner's … rejection[,] …
`[t]he Examiner [] requested reconsideration … [and]
`requested that such reconsideration be carried out by
`an expanded panel.” In re Alappat, 33 F.3d 1526, 1531
`(Fed. Cir. 1994) (en banc) “An expanded eight-member
`panel, acting as the Board, granted both of the
`Examiner's requests,” and “the five new members of
`
`
`
`- 17 -
`
`
`the expanded panel issued the majority decision … in
`which they affirmed the Examiner's … rejection, thus
`ruling contrary to the decision of the original three-
`member panel.” Id.
`Importantly, there was no dispute in Alappat
`that panel designation power was being utilized by
`the head of the Office to “reconstitut[e] the Board in
`order to produce a result more to his liking.” Id. at
`1577-1578 (Plager, J., concurring). See, e.g., Id. at
`1576 (Mayer, J., dissenting) (“That the Commissioner
`‘stacked’ the board is abundantly clear. After the
`original panel rendered a decision favorable to
`Alappat, the Commissioner designated an expanded
`panel … [where] the outcome was assured[,] … and
`the original panel filed an emphatic dissent.”)
`Nor was this simply an isolated case. In 1992, for
`example, thirty-three members of a predecessor Board
`signed a letter addressed to the head of the Office
`expressing concern over “an increasing number of
`instances in which the composition of panels of the
`Board … has been manipulated in a manner which
`interferes with the decisional independence of the
`Board.” 44 PTCJ 43 (BNA 1992). The Office responded
`by indicating that the head of the Office may “ask any
`three [members] for a draft opinion,” and may, if he
`“believes… that the opinion would establish incorrect
`policy,” and “is of the opinion that one or more other
`members of the Board share his view, … designate a
`panel including himself and those other members.” 44
`PTCJ 43 (BNA 1992).
`
`
`
`
`
`- 18 -
`
`This practice has continued to be employed on
`occasion, although infrequently, and members of the
`Federal Circuit have expressed “concern[] about the
`PTO's practice of expanding administrative panels to
`decide requests for rehearing in order to ‘secure and
`maintain uniformity of the Board's decisions.’” Nidec
`Motor Corp. v. Zhongshan Broad Ocean Motor Co.,
`86
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