United States v. Arthrex, Inc. (19-1434)

argument 19-1434

United States v. Arthrex, Inc.

Supreme Court of the United States 1h 29m 8 speakers 8 chapters transcribed 7 days ago official recording ↗

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What are the PTO Director’s supervisory powers to control administrative patent judges?

John G. Roberts 0:00

We will hear argument this morning in case 1914-34, United States v. Arthrex, Inc., and the consolidated cases. Mr. Stewart?

Unknown 0:11

Mr. Chief Justice, and may it please the court, in Edmond v. United States, this court held that Coast Guard Court of Criminal Appeals judges were inferior officers. The court based that conclusion on the combined supervisory powers of the Coast Guard Judge Advocate General and the Court of Appeals for the Armed Forces. Here are the mechanisms by which the PTO's director can supervise. administrative patent judges substantially exceed the combined powers of the supervising officials in Edmond. The Judge Advocate General was authorized to promulgate rules of procedure for the Court of Criminal Appeals, and he could remove individuals from their judicial assignments without cause. The PTO Director can exercise those same two powers, but he has other important tools of control as well.

Unknown 0:53

The director can promulgate binding guidance concerning substantive patent law. He can designate particular Board opinions as precedential, thus making those opinions binding on future panels. He can also decide whether any particular review will be instituted and which judges will sit on the panel, and he can de-institute a review even after it has been commenced. ARTHREX focuses primarily on the purported absence of any mechanism by which the Director can review a panel's final written decision. But the Board can grant rehearing of any such decision, and the Director is a member of the Board and is authorized to decide which members will sit on any panel. The Director thus can convene a new panel that consists of himself and two other members of his choosing to decide whether any final written decision will be reheard.

Unknown 1:38

The director's power over re-hearings is not plenary, since he must exercise it jointly with two other board members. But in Edmond, the review authority of the Court of Appeals for the Armed Forces was not plenary either, since that court could not reassess the factual findings of the Court of Criminal Appeals. Taken together, the director's supervisory powers are fully sufficient to render administrative patent judges inferior officers.

John G. Roberts 2:05

Mr. Stewart, that was a long list of things that the director can do. But, of course, the one thing that he can't do is just change the decision of the APJ. And the rest of those things, deciding whether to rehear, you know, stacking in a non-pejorative way, the panels, rehearing guidance on hypothetical facts, they all seem to be more or less ways of They were twisting the arms of the APJs. And so it is sort of directly opposite to what the appointments clause was designed to do, which is transparency and make it clear who's responsible. Here, you know, the director can pressure the APJ, but at the end of the day he can say, well, that's not my fault. That's what he wanted. Why isn't that true?

Unknown 2:59

I think I'd say two things in response to that. The first are the supervisory mechanisms that we've identified are transparent. If the director issues binding guidance that says here's how the patent laws apply to particular fact patterns, that will be done in the director's own name and the director will have responsibility for it.

John G. Roberts 3:17

Yeah, but the APJ is the one who's going to decide whether that so-called hypothetical applies in this particular case. And if he comes out with a different result, that's the executive decision, not the director's rule about hypotheticals.

Unknown 3:34

Even if you focus on the mechanisms that are available after a final written decision is issued, the board panel's decision will be the decision of the executive agency only if it is not reheard. And as I said in my opening, the director's power over rehearings is not plenary, but it is substantial.

John G. Roberts 3:53

Thank you, counsel. Justice Thomas?

Clarence Thomas 3:56

Thank you, Mr. Chief Justice. Mr. Stewart, you said it's not plenary, but it's substantial. How would we discern what is substantial?

Unknown 4:07

Well, I think what the court said in Edmond was that the mark of an inferior officer is that the inferior has a superior and is supervised at some level by executive branch officials who are appointed by the president and confirmed by the Senate.