Supreme Court Upholds Patent Agency's Rules

Read AARP's Amicus Brief (PDF)


Background

In 2011 Congress enacted the Leahy-Smith America Invents Act (AIA) which established a patent agency procedure called “inter partes review” (IPR).  The IPR process, a new adjudicative proceeding, allows third parties to challenge weak patents and patent owners to strengthen their patent portfolio. The IPR process is intended to improve the patent system by creating an expedited, less expensive alternative to litigation. IPR also offers a faster path to legal certainty in the biosimilar development cycle which can decrease health costs.

Cuozzo Speed Technologies LLC (Cuozzo) was the first company to have its patent invalidated in an IPR review. The Board invalidated Cuozzo's patent on a speedometer that alerts drivers to the speed limit, finding that Garmin International Inc., who challenged Cuozzo’s patent, had shown that Cuozzo’s patent was invalid as obvious. Garmin and Cuozzo later settled, but Cuozzo continued to challenge the IPR claim construction standard in court. In a split ruling, the Federal Circuit upheld the IPR decision, holding that that the US Patent and Trademark Office has used the broadest reasonable interpretation claim construction standard for more than a century, and nothing in the AIA indicated that Congress intended for that to change. The Supreme Court agreed, holding that the patent claim construction standard used by the Patent Office is a reasonable exercise of the agency’s rulemaking authority.  While the facts of this case concern a patent on a speedometer, the decision reached will determine the standard of review in the IPR process for all patents including drug and biologic patents.

AARP’s brief, filed by AARP Foundation Litigation attorneys, noted that Congress designed the Leahy-Smith America Invents Act to overturn patents that should have never been issued in the first place.  The brief discusses how improperly issued patents can increase prescription drug costs and argues that the current IPR system is working as intended, and patents that should have never been issued are being invalidated.  


What’s at Stake

Low-quality patents have a direct impact on the cost of pharmaceutical drugs, to the detriment of older individuals and the public, generally. Prescription drug medications alone cost many individuals thousands of dollars annually. Drug costs also affect employers, private insurers, and taxpayer-funded programs like Medicare and Medicaid.


Case Status

Cuozzo Speed Technologies, LLC v. Lee was decided by the U.S. Supreme Court.