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Courtland Merrill is a trial attorney at Anthony Ostlund Baer & Louwagie P.A.
Courtland Merrill is a trial attorney at Anthony Ostlund Baer & Louwagie P.A.

Patent Jury Trials: Do Administrative Proceedings at the U.S. Patent Office Undermine Patent Owners’ Right to a Jury?

Legal partner blogs are sponsored by companies that have information and opinions to share with the legal community. They do not represent the views of Minnesota Lawyer. Blogs are accepted on a variety of topics and are subject to approval by Minnesota Lawyer management. To contribute contact Mark Berriman at 612-584-1539.

The U.S. Supreme Court has said that patent infringement cases must be tried to a jury.[1]  A patent owner’s Seventh Amendment right to a jury is a powerful tool against infringers.

Case in point: A jury awarded VirnetX $302 million against Apple in September, finding FaceTime infringes two patents.  This was the third jury verdict in favor of the online security firm against Apple in the companies’ long-running dispute.  Juries in patent cases also gained strength this June when the U.S. Supreme Court lowered the requirements needed to show willful infringement to give juries a greater role in deciding whether infringement was willful.[2]

Despite constitutional support, efforts to unseat patent juries persist.  The greatest current challenge to a patent owner’s right to a jury may be administrative proceedings before the Patent Trial and Appeal Board (PTAB), part of the U.S. Patent Office.  Created by the 2011 America Invents Act, the Patent Trial and Appeal Board was intended to strengthen the patent system by giving patent holders and challengers a quick and inexpensive way to resolve disputes as an alternative to the courts.

The PTAB allows a petitioner to challenge an issued patent under a standard lower than that required by a federal district court in an action for infringement.  Courts assume that a patent is valid until a challenger provides “clear and convincing” evidence to the contrary. The PTAB requires only that challengers show that it’s more likely than not (i.e., a “preponderance of the evidence”) that a patent should not have been issued.

Following enactment, accused infringers have flocked to the PTAB as a way to overturn patents that courts and juries would find infringed. By June 2015 the PTAB invalidated at least some claims of 86 percent of the patents it reviewed, and 72 percent of all claims in which review had been instituted.  The PTAB received the nickname “patent death squads.”

A recent petition to the U.S. Supreme Court challenged whether the PTAB’s reviews violate the U.S. Constitution. The petition for certiorari filed by flash memory patent owner MCM Portfolio LLC urged the U.S. Supreme Court to take on its case against Hewlett­Packard Co. so the high court could rule on whether the PTAB’s reviews violate the Seventh Amendment to the Constitution. The Supreme Court, however, in October 2016 declined take up the issue.

For now, the “new normal” for patent owners taking legal action against infringers is to be ready to face litigation on two fronts—once in a federal district court and a second concurrently in administrative litigation before the PTAB.

 

Bio

Courtland Merrill is a trial attorney at Anthony Ostlund Baer & Louwagie P.A.   His practice focuses exclusively on business and intellectual property disputes.  Merrill has tried to verdict patent and various other intellectual property disputes.  In 2014, Merrill won a $1.85 million jury verdict for his client in a patent infringement case in which the jury found that the defendant’s infringement was also willful.  In September 2016, Merrill won a $637,000 verdict for his client, the owner of patents used to test computer chips, after the jury found infringement was willful.

[1] Markman v. Westview Instruments, Inc. 517 U.S. 370 (1996.)

[2] Halo Electronics, Inc. v. Pulse Electronics, Inc., No. 14-1513, June 13, 2016.

 

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