A recent case between two medical device companies raised the question of the constitutionality of the method in which Patent Trial and Appeal Board (PTAB) judges are appointed. PTAB judges are administrative patent judges who examine patents whose validity is questioned and hear appeals from patentees whose patent applications have been rejected. More specifically, PTAB judges hear appeals from adverse examiner decisions in patent applications and reexamination proceedings, conduct America Invents Act (AIA) trial proceedings, and hear interference proceedings. The PTAB is an administrative court run by the USPTO and was created by Congress as part of the AIA.
The case at issue was appealed to the U.S. Supreme Court after the lower court held that the method of appointment of PTAB judges, by the Secretary of Commerce, was unconstitutional as a violation of the Appointments Clause of the United States Constitution. Found in Article II, Section 2, Clause 2 of the United States Constitution, the Appointments Clause states:
“… and [the President] shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.”
The issue in question is whether PTAB judges are considered “principal officers” that require nomination by the President and confirmation by the U.S. Senate. An alternative interpretation is that PTAB judges are “inferior officers,” who have less authority and can be appointed and supervised by a department head. Currently, PTAB judges are appointed by the Secretary of Commerce and have certain job protections from unrestricted removal from their posts. While the Federal Circuit agreed that the appointment of PTAB judges does violate the Constitution, the Federal Circuit stated that the method of appointment could be cured by removing these job protections in order to render the judges inferior officers. The case was argued in early March and the ruling is expected by the end of June.