Court Opinion

ID: 4551519
Source: CourtListenerOpinion
Date Created: 2020-07-28 16:00:37.485085+00
Date Added: 2024-06-11T09:24:21.632343
License: Public Domain

Case: 19-1956     Document: 92   Page: 1   Filed: 07/28/2020

        NOTE: This disposition is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

                FALL LINE PATENTS, LLC,
                        Appellant

                            v.

 UNIFIED PATENTS, LLC, FKA UNIFIED PATENTS,
                    INC.,
                   Appellee

     ANDREI IANCU, UNDER SECRETARY OF
   COMMERCE FOR INTELLECTUAL PROPERTY
    AND DIRECTOR OF THE UNITED STATES
      PATENT AND TRADEMARK OFFICE,
                   Intervenor
             ______________________

                        2019-1956
                  ______________________

     Appeal from the United States Patent and Trademark
 Office, Patent Trial and Appeal Board in No. IPR2018-
 00043.
                  ______________________

                  Decided: July 28, 2020
                  ______________________

     MATTHEW JAMES ANTONELLI, Antonelli, Harrington &
 Thompson, LLP, Houston, TX, for appellant. Also repre-
 sented by ZACHARIAH HARRINGTON, LARRY D. THOMPSON,
Case: 19-1956      Document: 92    Page: 2      Filed: 07/28/2020

 2              FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC

 JR.; SARAH RING, Daniels & Tredennick, Houston, TX.

     JAMES R. BARNEY, Finnegan, Henderson, Farabow,
 Garrett & Dunner, LLP, Washington, DC, for appellee.
 Also represented by DANIEL CRAIG COOLEY, Reston, VA;
 JONATHAN R. BOWSER, Buchanan Ingersoll & Rooney PC,
 Alexandria, VA; ASHRAF FAWZY, JONATHAN RUDOLPH
 KOMINEK STROUD, Unified Patents LLC, Washington, DC.

     SARAH E. CRAVEN, Office of the Solicitor, United States
 Patent and Trademark Office, Alexandria, VA, for interve-
 nor. Also represented by THOMAS W. KRAUSE, FRANCES
 LYNCH, FARHEENA YASMEEN RASHEED.
                 ______________________

     Before O’MALLEY, BRYSON, and HUGHES, Circuit Judges.
 O’MALLEY, Circuit Judge.
      “In this Circuit, a later panel is bound by the determi-
 nations of a prior panel, unless relieved of that obligation
 by an en banc order of the court or a decision of the Su-
 preme Court.” Deckers Corp. v. United States, 752 F.3d
949, 959 (Fed. Cir. 2014). Of course, we should not follow
 our precedent blindly. See Ramos v. Louisiana, 140 S. Ct.
1390, 1405 (2020) (“[S]tare decisis has never been treated
 as ‘an inexorable command.’”). “Indeed, we have said that
 it is the province and obligation of the en banc court to re-
 view the current validity of challenged prior decisions.”
 Lighting Ballast Control LLC v. Philips Elecs. N. Am.
 Corp., 744 F.3d 1272, 1298 (Fed. Cir. 2014) (en banc)
 (O’Malley, J., dissenting) (internal quotations marks omit-
 ted). But we do not overturn our decisions lightly, particu-
 larly those that we so recently issued. We recognize that
 “today’s legal issues are often not so different from the
 questions of yesterday and that we are not the first ones to
 try to answer them.” June Med. Servs., LLC v. Russo, 140
S. Ct. 2103, 2134 (2020) (Roberts, C.J., concurring).
Case: 19-1956    Document: 92       Page: 3    Filed: 07/28/2020

 FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC            3

     Appellant Fall Line Patents, LLC (“Fall Line”) asks us
 to ignore the constraints of our precedent with respect to
 two separate issues. It maintains that we have mandamus
 jurisdiction over the Patent Trial and Appeal Board’s (“the
 Board”) real party-in-interest determinations, notwith-
 standing our recent holding in ESIP Series 2, LLC v. Pu-
 zhen Life USA, LLC, 958 F.3d 1378 (Fed. Cir. 2020) that
 § 314(d) precludes appellate review over this institution-
 based requirement. See Appellant Supp. Br. 1–4. And it
 contends that this panel has the authority to modify the
 constitutional fix adopted by this court in Arthrex, Inc. v.
 Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019).
     We do not. Despite Fall Line’s arguments otherwise,
 “a writ of mandamus is not intended to be simply an alter-
 native means of obtaining appellate relief, particularly
 where relief by appeal has been specifically prohibited by
 Congress.” In re Power Integrations, Inc., 899 F.3d 1316,
 1319 (Fed. Cir. 2018). And Fall Line’s challenge to the con-
 stitutional fix adopted by this court in Arthrex invokes the
 same arguments that we rejected in our denial of en banc
 review in that case. See Arthrex, Inc. v. Smith & Nephew,
 Inc., 953 F.3d 760, 763 (Fed. Cir. 2020) (Moore, J., joined
 by O’Malley, Reyna, and Chen, J., concurring in denial of
 rehearing en banc). Accordingly, we decline Fall Line’s in-
 vitation to effect legal whiplash and reject the recent hold-
 ings of this court in ESIP Series 2 and Arthrex. We
 conclude, however, that Fall Line did not waive its right to
 assert an Appointments Clause challenge, and vacate and
 remand for a new panel of APJs to consider the IPR anew.
                       I. BACKGROUND
     While the parties discuss many details regarding Uni-
 fied Patents, LLC’s (“Unified”) revenue structure and the
 timeline leading to the Board’s § 312(a)(2) real parties-in-
 interest determination, there are only a few pertinent facts
 of note.
Case: 19-1956     Document: 92     Page: 4      Filed: 07/28/2020

 4              FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC

      On October 6, 2017, Unified Patents, LLC (“Unified”)
 filed a petition for inter partes review of claims 16–19 and
 21–22 of U.S. Patent No. 9,454,748 (the “’748 patent”). J.A.
 83. At the time of the filing, the ’748 patent was involved
 in a variety of patent matters against certain companies.
 J.A. 88. Unified did not list any of these companies, how-
 ever, as a real party-in-interest. Id. Fall Line thus argued
 that Unified’s real parties-in-interest identification was in-
 sufficient. J.A. 184.
     The Board rejected Fall Line’s initial § 312(a)(2) argu-
 ment in its institution decision. J.A. 200–01. In its insti-
 tution decision, it explained:
     Although Patent Owner argue[d] Petitioner’s busi-
     ness model and public statements could make Pe-
     titioner’s members real parties-in-interest, Patent
     Owner d[id] not provide any evidence indicating
     that any of those members are real parties-in-in-
     terest in this proceeding.
 J.A. 201. Without anything more, the Board said Fall
 Line’s allegations fell flat. The Board concluded, moreover,
 that the fact that Unified failed to “submit Voluntary In-
 terrogatory Responses in the instant case” was insufficient
 to demonstrate that Unified’s real party-in-interest desig-
 nation was inaccurate. Id.
     After institution, Fall Line sought authorization to file
 a motion for discovery regarding Unified’s real party-in-in-
 terest designation. J.A. 17. It asked, however, to wait for
 a district court ruling before filing the motion. Id. The
 Board instructed Fall Line to re-seek authorization when
 it was prepared to file the motion, but Fall Line never made
 a second request for authorization. Id. Nor did it raise a
 § 312(a)(2) challenge in its patent owner response. Id. Fall
 Line’s real party-in-interest objections were not brought
 back to the Board’s attention until a few days before the
 hearing, when the parties submitted their oral hearing
 demonstratives and related objections. Id. Then, during
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 FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC             5

 the oral hearing, Fall Line argued that the Board should
 consider its § 312(a)(2) challenge. Id.
     In its final written decision, the Board concluded that
 Fall Line’s real party-in-interest challenge was untimely,
 and that, even if it were to consider Fall Line’s belated ar-
 gument, the evidence was insufficient to support such a
 challenge. J.A. 17–25. Accordingly, the Board rejected Fall
 Line’s § 312(a)(2) challenge, proceeded to address the mer-
 its of Unified’s § 103 ground, and concluded that Unified
 had proven, by a preponderance of the evidence, that
 claims 16–19 and 21–22 of the ’748 patent are unpatenta-
 ble. J.A. 75.
     Fall Line appealed. In its opening brief, Fall Line ar-
 gues that it did not waive its § 312(a)(2) challenge and that
 Unified failed to properly identify the real parties-in-inter-
 est. Appellant Opening Br. 9–16. It also contends that the
 panel should vacate and dismiss the Board’s final written
 decision because the current structure of the Board violates
 the Appointments Clause, and, because it asserts that the
 severance remedy imposed in Arthrex is inadequate, a re-
 mand to a new panel of APJs would not fix the constitu-
 tional violation. Id. at 17–18.
     After the parties completed briefing, we held in ESIP
 Series 2, LLC v. Puzhen Life USA, LLC that § 314(d) pre-
 cludes review of the Board’s real party-in-interest determi-
 nations. 958 F.3d at 1386. In light of this holding, we
 ordered that the parties submit supplemental briefing on
 the issue.
                        II. DISCUSSION
      A. Fall Line’s Real Party-in-Interest Challenge
     Section 312(a) of Title 35 specifies that a petition “may
 be considered only if” it includes, inter alia, an “identifica-
 tion” of “all real parties in interest.” 35 U.S.C. § 312(a)(2).
 In ESIP Series 2, we explained that preclusion of judicial
 review under § 314(d) extends to a Board decision
Case: 19-1956     Document: 92     Page: 6      Filed: 07/28/2020

 6              FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC

 concerning the “‘real parties in interest’ requirement of
 § 312(a)(2).” 958 F.3d at 1386. In light of the Supreme
 Court’s decision in Thryv, Inc. v. Click-to-Call Techs., LP,
 140 S. Ct. 1367 (2020), we held that § 314(d) precludes our
 review of the real party-in-interest determination. ESIP
 Series 2, 958 F.3d at 1386 (quoting Thryv, 140 S. Ct. at
 1373–74).
      Fall Line “acknowledges that this [c]ourt . . . should
 rule that it lacks normal appellate jurisdiction over the RPI
 issue” in light of Thryv, Appellant Supp. Br. 1, but never-
 theless insists that we may review the Board’s decision un-
 der our “mandamus jurisdiction.” Id. Relying on the
 Supreme Court’s stipulation that Cuozzo does not “categor-
 ically preclude review,” Fall Line contends that mandamus
 is authorized and necessary when the Board engages in
 “shenanigans.” Appellant Supp. Br. 2–3 (quoting Cuozzo,
136 S. Ct. at 2141). According to Fall Line, in this case,
 such “shenanigans” constitute the Board’s § 312(a)(2) de-
 termination. Appellant Supp. Br. 3.
     Fall Line misrepresents the Cuozzo Court’s qualifica-
 tion and misunderstands the role of mandamus. In Cuozzo,
 the Supreme Court explained that its interpretation of
 § 314(d) applies where the grounds for challenging the
 Board’s decision “consist of questions that are closely tied
 to the application and interpretation of statutes related to
 [the Board]’s decision to initiate inter partes review.”
 Cuozzo, 136 S. Ct. at 2141. It emphasized that its holding
 did not decide “the precise effect of § 314(d) on appeals that
 implicate constitutional questions, that depend on other
 less closely related statutes, or that present other ques-
 tions of interpretation that reach, in terms of scope and im-
 pact, well beyond ‘this section.’” Id. And to provide an
 example of the type of review that was not “categorically
 precluded” by its holding, the Court explained:
     [W]e do not categorically preclude review of a final
     decision where a petition fails to give “sufficient
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 FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC              7

     notice” such that there is a due process problem
     with the entire proceeding, nor does our interpre-
     tation enable the agency to act outside its statutory
     limits by, for example, canceling a patent claim for
     “indefiniteness under § 112” in inter partes review.
Id. at 2141–42. Thus, institution decisions that implicate
 constitutional or jurisdictional violations are not “categori-
 cally precluded” from judicial review under § 314(d). The
 Cuozzo Court did not hold, however, that this court may
 exercise its mandamus powers to review “an ordinary dis-
 pute about the application of” an institution-related stat-
 ute. Id. While we once relied on this precise language in
 Cuozzo to conclude that statutory prerequisites to the Di-
 rector’s authority to institute an IPR were not related to
 institution within the meaning of § 314(d), the Supreme
 Court disagreed with that conclusion in Thryv.
      It is true that, in the context of concluding that § 314(d)
 bars appellate review of the Board’s § 315(b) determina-
 tion, the Thryv Court said it did “not decide whether man-
 damus would be available in an extraordinary case.”
 Thryv, 140 S. Ct. at 1374 n.6. But as Justice Gorsuch rec-
 ognized, we have addressed that question and concluded
 that mandamus is not available to address decisions that
 are barred from appellate review under § 314(d). Id. at
 1389 (Gorsuch, J., dissenting) (“[T]he Court today will not
 say whether mandamus is available where the § 314(d) bar
 applies, and the Federal Circuit has cast doubt on that pos-
 sibility.”). Specifically, we recently held that statutory pro-
 hibitions of appellate review “cannot be sidestepped simply
 by styling the request for review as a petition for manda-
 mus.” In re Power Integrations, Inc., 899 F.3d at 1319 (col-
 lecting cases). Where an appellant’s claim is nothing more
 than a challenge to the Board’s conclusion that the infor-
 mation presented in the petition warranted review, there
 is “no ‘clear and indisputable’ right to challenge [the] non-
 institution decision directly in this court, including by way
 of mandamus.” In re Dominion Dealer Solutions, LLC, 749
Case: 19-1956      Document: 92    Page: 8      Filed: 07/28/2020

 8              FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC

 F.3d 1379, 1381 (Fed. Cir. 2014). See also GTNX, Inc. v.
 INTTRA, Inc., 789 F.3d 1309, 1312 (Fed. Cir. 2015). So,
 while the Supreme Court side-stepped the issue in Thryv,
 we have not.
     In its mandamus request, Fall Line simply rehashes
 the procedural timeline of its § 312(a)(2) challenge and the
 evidence in support of its claim. Appellant Supp. Br. 3.
 These are the types of arguments that appellants regularly
 raised in their § 312(a)(2) appeals, prior to the Supreme
 Court’s holding in Thryv and our decision in ESIP Series 2.
 See, e.g., Worlds Inc. v. Bungie, Inc., 903 F.3d 1237 (Fed.
 Cir. 2018). Moreover, as evident from the Board’s decision
 and the record, this appeal involves no issues extraneous
 to the Board’s § 312(a)(2) determination. Accordingly, we
 reject Fall Line’s contention that the present appeal justi-
 fies mandamus review. “For this court to entertain such
 claims in response to a petition for mandamus would con-
 vert the mandamus procedure into a transparent means of
 avoiding the statutory prohibition on appellate review of
 agency institution decisions.” In re Power Integrations,
 Inc., 899 F.3d at 1321. 1
                B. Fall Line’s Arthrex Challenge
     Fall Line separately argues that the Board’s final writ-
 ten decision is erroneous because, at the time of the Board’s
 final written decision, the structure of the Board violated

     1   The fact that the Board’s real party-in-interest de-
 terminations are not reviewable makes it particularly im-
 portant that the Board conduct a critical assessment of a
 party’s assertions regarding the real party-in-interest is-
 sue. Such a critical assessment is especially warranted in
 a case in which a petitioner’s entire business model is to
 challenge patents on behalf of others. See Applications in
 Internet Time, LLC v. RPX Corp., 897 F.3d 1336, 1352 (Fed.
 Cir. 2018).
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 FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC            9

 the Appointments Clause. Of course, we already addressed
 this issue in Arthrex, Inc. v. Smith & Nephew, Inc., 941
F.3d 1320 (Fed. Cir. 2019). There, we held that the Board’s
 Administrative Patent Judges (“APJs”) were principal of-
 ficers, appointed in violation of the Appointments Clause.
 Arthrex, 941 F.3d at 1335. Because the Secretary of Com-
 merce and the Director did not have unfettered authority
 to remove APJs, we determined that there was insufficient
 executive control over APJs. To remedy this constitutional
 violation, we severed the problematic removal restrictions
 regarding APJs and concluded that impacted cases 2 must
 be vacated and remanded for rehearing before a new panel
 of APJs. Id. at 1355–40. Fall Line agrees that the APJs
 were unconstitutionally appointed, but disagrees with the
 severance we adopted to cure that constitutional defect.
 Appellant Opening Br. 17–18. Fall Line argues that the
 Arthrex severance is inadequate because (1) it does not pro-
 vide for reviewability of final agency decisions; and (2) the
 severance was inconsistent with Congress’ intent. Id. Be-
 cause “no properly appointed Board panel exists,” Fall Line
 contends that we must vacate and dismiss the Board’s writ-
 ten decision. Id. at 18.
     We will not. As a panel, we are bound by our holding
 in Arthrex that severance is “an appropriate cure for an Ap-
 pointments Clause infirmity” and that Congress “would
 have preferred a Board whose members are removable at
 will rather than no Board at all.” 753 F.3d at 1337–38.
 That Fall Line disagrees with the sufficiency of the consti-
 tutional fix is of no moment.

     2   That is, an Arthrex-based remand is available in
 cases in which the final decision was rendered by a panel
 of APJs who were not constitutionally appointed and where
 the parties presented an Appointments Clause challenge
 on appeal. Arthrex, 941 F.3d at 1340.
Case: 19-1956     Document: 92    Page: 10      Filed: 07/28/2020

 10             FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC

     Having rejected Fall Line’s attempt to reargue the is-
 sues we addressed in Arthrex, however, we nevertheless
 find that it is entitled to a remand. Like the patent owner
 in Arthrex, Fall Line raised an Appointments Clause chal-
 lenge in its opening brief before us. Arthrex, 941 F.3d at
 1340. We have held that such litigants are entitled to an
 Arthrex-based remand. 3 See, e.g., Polaris Innovations Ltd.
 v. Kingston Tech. Co., 792 Fed. Appx. 819 (Fed. Cir. 2020);
 Bedgear, LLC v. Fredman Bros. Furniture Co., Inc., 783
Fed. Appx. 1029 (Fed. Cir. 2019). Accordingly, because Fall
 Line’s Appointments Clause challenge was timely and the
 Board’s final written decision was issued before our Ar-
 threx decision, the Board’s decision in No. IPR2018-00043
 is vacated and the case is remanded to the Board for pro-
 ceedings consistent with this court’s decision in Arthrex.

      3   Unified separately argues that Fall Line waived its
 right to an Arthrex-based remand because the appellant re-
 jected Unified’s offer for a “consented remand” prior to its
 appeal. Unified Supp. Br. 5 (citing J.A. 5012). Unified in-
 sists that Fall Line cannot “reverse course and seek a re-
 mand at this late stage in the case.” Unified Supp. Br. 6.
 The record reveals, however, that Fall Line did not waive
 an Arthrex-based remand. Rather, Fall Line explained
 that, at the time of Unified’s offer, such a remand did not
 “make[] sense.” J.A. 5012. During this period of negotia-
 tion, Fall Line still believed that this court had appellate
 jurisdiction to review the Board’s § 312(a)(2) determina-
 tion. Id. (“[T]he RPI issue if decided in our favor would
 moot the need for a remand altogether—if we were re-
 manded, we would ultimately have to come back up again
 on the RPI issue.”). Thus, we conclude that Fall Line has
 not waived its Appointments Clause challenge and is enti-
 tled to a new IPR proceeding before a constitutionally ap-
 pointed panel.
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 FALL LINE PATENTS, LLC   v. UNIFIED PATENTS, LLC           11

                      III. CONCLUSION
    For these reasons, the Board’s final written decision is
 vacated and remanded.
                 VACATED AND REMANDED
                             COSTS
     No costs.