Court revives Apple, Google’s challenge to US patent examination practices

Apple Inc, Google LLC, Cisco Systems Inc and others may sue the US Patent and Trademark Office to challenge a rule that reduced the number of patent validity proceedings before the USPTO, a US appeals court said on Monday.

A U.S. federal appeals court overturned a California federal court’s decision to dismiss the companies’ lawsuit, saying the agency may not have gone through the required public notice and comment rulemaking process.

The PTO declined to comment on the decision.

Google spokesman José Castañeda said the company appreciates the ruling and looks forward to hearing its case in a lower court. A Cisco spokesman said the ruling reaffirms that the PTO’s patent review procedures are “an important tool in preserving a balanced patent system, protecting innovation, and ensuring the quality of patents in the United States.”

Representatives for the other plaintiffs did not immediately respond to requests for comment.

The PTO’s Patent Trial and Appeal Board is popular with large technology companies, which are often the target of patent litigation and use the board’s “inter partes review” process to challenge patents they are accused of. The companies told the appeals court that an internal rule that gave agency judges more discretion to deny inter partes review applications “dramatically limited access” to the process.

Apple, Google, Cisco, Intel Corp and Edwards Lifesciences Corp challenged the PTO in California federal court in 2020 over the rule. They argued that it undermined the role of inter partes review in “protecting a strong patent system” and violated federal law.

Companies including Tesla, Honda, Comcast and Dell filed in the federal district in support of the plaintiffs.

A California court dismissed the case in 2021, citing U.S. Supreme Court rulings that the Patent Trial and Appeal Board’s decisions regarding inter partes review applications are not subject to appeal.

The Federal Circuit also rejected the companies’ arguments that the rule was arbitrary and violated US patent law. But the three-judge panel said the PTO may have been required to have a public notice and comment period before issuing the rule, and could be challenged on that claim.

The case is Apple Inc v. Vidal, US Court of Appeals for the Federal Circuit, No. 22-1249.

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