Government Claims in Arthrex Catch Eye of House Judiciary

As we await the SCOTUS outcome in Arthrex, the Government Accountability Office (GAO) has been tasked with investigating the degree to which the Director might influence individual PTAB outcomes.  In a letter to the GAO from House Judiciary IP Subcommittee Chairman Hank Johnson (D-Ga.) and Ranking Member Darrell Issa (R-Calif.), it was pointed out that the U.S. government has argued in Arthrex  that APJs are inferior officers because they are “subject to significant oversight and control by the Director of the USPTO” who has the ability to “control[] which APJs decide which cases” and “provid[e] policy directives that APJs are obligated to follow.”

The letter (here) expressed a concern that the government has effectively indicated that “PTAB cases may have been decided based on factors outside of the evidentiary record and public legal authority,” which they argued “raises potential due process concerns and would be inconsistent with the intent of Congress in enacting the AIA.” While political appointees are expected to drive overall policy, of course, they are not expected to meddle in individual outcomes. Accordingly, the Subcommittee has tasked the GAO with investigating eight questions designed to explore the Director’s ability to influence individual PTAB decisions, and any instances where the Director has actually influenced the outcome of a decision.

The eight inquiries are as follows:

  1. The mechanisms available to the Director to influence APJ decisions (including institution decisions, final written decisions, and interlocutory decisions) in AIA cases, such as prescribing or changing APJs on a panel, ex parte communications with APJs on a panel, formal review of a decision such as through the Precedential Opinion Panel (POP), personnel actions taken or threatened against APJs, or similar actions.
  2. The policies, written or unwritten, that exist at the USPTO to effectuate each of the above mechanisms, as well as the statutory or other legal authority that forms the basis for each of the above mechanisms.
  3. How APJs understand the role of the Director in the decisions they reach in AIA cases, including APJs’ awareness of the above mechanisms and associated policies and the number of APJs who have been subject to one or more of them. Also, the impact that the exercise of these mechanisms and policies have had on the decision-making of APJs in AIA cases.
  4. Whether any APJs have objected or dissented, or attempted to object or dissent, to the above mechanisms and policies, or the exercise of those mechanisms and policies in specific AIA cases. If so, the results of those objections and the processes that were made available to APJs to object or dissent. Also, how APJs understand the extent to which they may object or dissent.
  5. How often the Director, or a designate thereof, has directly influenced or changed a decision in a specific AIA case (i.e., inter partes review, post-grant review, or covered business method review). Also, the way those decisions were influenced or changed by the Director, and the mechanisms that were used to influence or change those decisions.
  6. Whether specific notice was provided to the parties in those cases indicating that the Director, or designate thereof, was influencing or changing a decision in the case, and the information included in any such notice. Also, whether the decisions themselves document that influence or change, and explain the reasoning or justification for it.
  7. Whether parties in AIA cases where a decision was influenced or changed by the Director or Director-designate have an opportunity to be heard regarding that act, to appeal or seek rehearing of the decision based on an alleged error in that act or its effect on the decision, or seek an independent review of that act or its impact on the decision (e.g., in an Article III court).
  8. Whether stakeholders and the public are aware of the above mechanisms and policies, and the extent to which they have been used to influence or change decisions in AIA cases. What are their opinions of those mechanisms and policies and their use?

While it has been argued that the Director has the authority to tinker with panel assignments for APJs, outside of the Destination Maternity “panel stacking” years ago (as a method to make brute force precedent), I’m not aware of any such instances. That said, when the government advertises the ability of an agency to essentially stack the deck as it pleases, its not surprising that such a position is getting Congressional attention.