(Chicago, Ill. and Atlanta, Ga. – Sept. 3, 2020) Is the US Court of Appeals for the Federal Circuit (CAFC) relevant anymore? Is it right that ten massive technology companies should be holding hostage more than 100,000 other commercial corporations at the patent bar? What effect is the ongoing divergence in patent decisions at the CAFC and the US Supreme Court having on the US innovation community?
US companies and their counsel have witnessed a breakdown of predictability in the US patent system in the last decade, including with “confused” and often “contradictory” rulings from the CAFC and the US Supreme Court, argued AddyHart P.C.’s Meredith Addy and other presenters on the panel “The Future of the CAFC: Is the Court Still Relevant?” at IPWatchdog’s CON2020, the annual patent conference for inside and outside counsel.
Other participants in the dialogue included The Hon. Paul R. Michel, former Chief Judge of the CAFC, and IPWatchdog’s founder Gene Quinn.
Addy, co-founder and a partner at AddyHart P.C., noted in particular how the CAFC tends to give certain topics superficial review, including 35 U.S.C. § 101. Addy observed that while appeals from the PTAB are reviewed by the CAFC using the high standard of substantial evidence, in many cases there is little to no evidence on which to base the Court’s decisions.
Addy’s argument was seconded by J. Michel, who shares her view that it is improper for the CAFC ignore legal determinations, such as in obviousness, by relying solely on the high standard to review factual findings. Addy and Michel also highlighted the daunting cost of patent litigation as factor affecting patentees’ ability to assert their patent rights.
Michel offered his perspective that patent rights have been eroded by the rulings in the last decade, including on eligibility; injunctions; and high rates of instituting inter partes reviews, in turn leading to high rates of invalidity rulings at the Patent Trial and Appeal Board of the USPTO. Together, he noted, this has led to the US’s falling in international rankingson IP, and falling from number one to number 16 in terms of public investment in research and development.
Earlier in the day, J. Michel had noted, “Our [patent] system has become rather unstable because the law keeps changing and is unpredictable, unreliable, unscientific and uneconomic. The courts seem to be completely oblivious to this.” He added, “There are 100,000 commercial corporations in America today, and § 101 reform is being blocked by about 10. Everybody else needs to speak up.”
Michel and Addy agreed that prevailing instability in patent law and rulings must be addressed by statute, and that individuals and companies can spur legislative change by becoming involved in the legislative process and advocating for reform at the local level.
Addy also noted that while the background of judges at the CAFC is diverse, and while there is benefit to having judges who have practiced as patent attorneys, a technical background ought not be necessary to be appointed. Rather, she argued, it is important that its judges take more time to understand the underlying technologies in the cases before the Court.