Supreme Court: Patent Trial and Appeal Board’s Time-Bar Determination Is Unreviewable

April 20, 2020

On April 20, 2020, in the case of Thryv, Inc. v. Click-to-Call Technologies, LP, the U.S. Supreme Court determined that a court of appeals cannot review the Patent Trial and Appeal Board (PTAB) decision that an inter partes review (IPR) petition was not time-barred under 35 U.S.C. § 315(b). The Supreme Court’s decision, which reverses a prior en banc decision by the Federal Circuit Court of Appeals, eliminates an avenue of appeal that many patent owners previously used to challenge invalidity rulings from the PTAB.

The case originated from an IPR petition filed by Thryv in 2013, challenging the validity of a patent owned by Click-to-Call. Under 35 U.S.C. § 314, the PTAB has the discretion to institute IPR of a challenged patent, and the PTAB’s decision “whether to institute an inter partes review under this section shall be final and nonappealable.” Prior to institution, Click-to-Call argued that Thryv’s petition was time-barred under 35 U.S.C. § 315(b), which states that “an inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.”

In 2001, Thryv’s predecessor was sued for infringement of the challenged patent, a case that eventually was voluntarily dismissed without prejudice. The PTAB rejected Click-to-Call’s time-bar argument and instituted IPR after it determined that a voluntary dismissal without prejudice does not trigger the time-bar provision of § 315(b). Following the IPR proceeding, the PTAB issued a final written decision, reiterating its rejection of Click-to-Call’s § 315(b) argument and finding the challenged claims to be invalid. Click-to-Call appealed this decision to the Federal Circuit on the grounds that Thryv’s petition was time-barred under § 315(b), and the Federal Circuit, in an en banc decision, ultimately reversed the PTAB and found that “time-bar determinations under § 315(b) are appealable,” notwithstanding § 314(d). Thryv then appealed this decision to the Supreme Court, posing the question whether the § 314(d) bar on judicial review of the PTAB decision to institute IPR precluded Click-to-Call’s appeal.

In a 7-2 decision, the Supreme Court held that § 314(d) did in fact preclude judicial review of the PTAB’s application of the § 315(b) time bar. Citing its precedent in Cuozzo Speed Technologies, LLC v. Lee, the Supreme Court evaluated “whether a challenge based on § 315(b) ranks as an appeal of the agency’s decision to institute an inter partes review,” which § 314(d) renders nonappealable. The Supreme Court determined that the § 315(b) “time limitation is integral to, indeed a condition on, institution” because it expressly sets forth a condition upon which an IPR may not be instituted, and nothing more.

The Supreme Court also determined that the purpose and design of the statute strongly reinforced its conclusion, because the statute’s goal was to provide an efficient mechanism for a party to challenge “bad patents,” and permitting appeals under § 315(b) that challenged the timeliness of a petition “would operate to save bad patent claims.” Indeed, Click-to-Call’s original appeal was based solely on § 315(b). The Supreme Court also determined that other features of the statute confirmed that Congress meant to prioritize patentability over the § 315(b) timeliness requirement, including the fact that a time-barred petitioner can still join a previously instituted IPR, and that the PTAB can issue a final written decision even after the petitioner has withdrawn from the proceeding. Accordingly, the Supreme Court rejected Click-to-Call’s “narrower reading” of § 314(d), vacated the judgement of the Federal Circuit, and ordered the dismissal of the appeal for lack of appellate jurisdiction.

It is not uncommon for patent owners who are defending a patent at the PTAB to challenge the timeliness of the petition under § 315(b), particularly where a party related to the petitioner was sued long before the petition was filed. The Supreme Court’s decision in Thryv means that patent owners with a colorable claim under § 315(b) should all the more vigorously develop that position before the PTAB, as there will be no second chances