Supreme Court Issues Decision in United States v. Arthrex, Inc.

In the long-awaited decision in United States v. Arthrex, Inc., the U.S. Supreme Court confirmed that the Patent Trial and Appeal Board is unconstitutionally structured, but held that the correct remedy is more limited than the one the U.S. Court of Appeals for the Federal Circuit had granted. Instead of a new hearing before a new panel of the Board, raising an Appointments Clause objection on appeal will only result in a remand to the Director of the Patent and Trademark Office, to allow him or her to decide whether to reconsider the Board’s decision in an Inter Partes Review (IPR) or similar proceeding.

The Supreme Court’s decision was splintered, but a majority agreed on both the constitutional holding and the remedy.

The court’s decision leaves a number of issues unresolved, however, and may require the Federal Circuit to change its approach in some respects. In particular, the Federal Circuit has been firm in denying any relief in any IPR that was decided by the Board at any time after the Federal Circuit’s panel decision in Arthrex. The court’s decision may allow litigants to argue that this temporal limitation is incorrect.

The court’s decision will also require the PTO to create a new procedure for the Director to review IPR decisions. Depending on the timing and other requirements the PTO adopts, this new step could materially affect the timeline of a typical IPR.

For a more in-depth analysis of the Arthrex decision and its implications, please see Goodwin’s client alert on the Arthrex opinion prepared by Goodwin’s Supreme Court and IPR experts, William Jay, David Zimmer, Daryl Wiesen, and Linnea Cipriano.