SCOTUS Grants USPTO Director Discretion to Review Decisions by PTAB

In United States v. Arthrex, 594 U.S.  ­­­­­­­­­­­­­­­(2021), the Supreme Court of the United States amended the powers of the USPTO Director to include review of final decisions made by APJs. Arthrex Inc. contended that Smith & Nephew, Inc. and ArthroCare Corp. infringed its patent, which led to the filing of an IPR by Smith & Nephew to challenge the patent as invalid. After the PTAB held the patent to be invalid, Arthrex appealed to the Federal Circuit and argued that under the Appointments Clause, Administrative Patent Judges (APJs) that preside over cases at the PTAB are unconstitutionally appointed principal officers acting on behalf of the President, and thus the PTAB decision could not stand. The Federal Circuit agreed and removed the tenure protections of APJs as a remedy. However, the parties, unsatisfied, petitioned for and obtained consideration by the Supreme Court. Upon review, the Supreme Court considered the authority of the USPTO Director and the APJs and found that the Director, although required under the constitution to have a final say on the part of the Executive Branch of government in APJ decisions, did not have such authority where APJs rendered final decisions in IPR proceedings.  According to the Supreme Court, the critical question was not whether APJs were principal officers, but rather whether or not the responsibilities of APJs were consistent with their method of appointment. Ultimately, the Court determined that the decision-making process was unconstitutional as the responsibilities of APJs fell outside those of officers appointed in the manner APJs are appointed, without advice and consent of the Senate.  To remedy this, the Court assigned the Director of the USPTO to have authority to review decisions of APJs.

A link to the decision is here: