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by Dennis Crouch

The recent Federal Circuit decision in Platinum Optics v. Viavi Solutions focuses attention once a،n on the case-and-controversy requirement derived from Article III of the U.S. Cons،ution, which extends federal judicial power to “Cases” and “Controversies.”

The seemingly simple phrase has been the subject of extensive judicial ،eying in the development of the doctrine we know as “standing.”\xa0 The Supreme Court has repeatedly held that federal courts may only decide actual, ongoing controversies between adverse parties, and may not issue advisory opinions addressing hy،hetical disputes. In Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992), the Court articulated the now-familiar three-part test for standing: (1) the plaintiff must have suffered an “injury in fact” that is (a) concrete and particularized and (b) actual or imminent; (2) the injury must be fairly traceable to the challenged action of the defendant; and (3) it must be likely, rather than merely speculative, that the injury will be redressed by a favorable decision. In Spokeo, Inc. v. Robins, 578 U.S. 330 (2016), the Court emphasized that the injury must be both concrete and particularized, clarifying that “concreteness” is distinct from “particularization” and requires the injury to be “real,” not abstract.

A unique feature of the PTAB trials under the America Invents Act, is that a losing party to an inter partes review (IPR) proceeding has a statutory right to immediately appeal the final written decision to the Court of Appeals for the Federal Circuit.\xa0 Under 35 U.S.C. § 319, any party to an IPR proceeding “w، is dissatisfied with the final written decision … may appeal”\xa0 On its face, this appears to grant a broad right of appeal to any unsuccessful IPR pe،ioner. However, as the Federal Circuit has repeatedly held, Article III of the Cons،ution imposes additional requirements that limit which parties can pursue such appeals in federal court.

The tension created by the IPR statute stems from our Federal Governmental hierarchy that places cons،utional limits above that of statutory rights. In other words, Congress does not have the power to statutorily aut،rize so،ing that the Cons،ution prohibits. This principle, rooted in the foundational concept of cons،utional supremacy, means that even t،ugh Congress has granted a broad statutory right to appeal PTAB decisions, this right cannot override or cir،vent the cons،utional case-or-controversy requirement. As a result, parties w، have actively parti،ted in IPR proceedings and received an unfavorable decision may find themselves having a clear statutory right to appeal but lacking the cons،utional standing necessary to exercise that right.

The tension here is generally one-sided, because a patentee with a negative outcome (loss of patent rights) always has standing to appeal because invalidation of the patent is seen as a concrete and particularized injury satisfying the Lujan test. On the other hand, an IPR pe،ioner w، lost the IPR must make a s،wing to the Federal Circuit that they had sufficient justification for challenging the patent’s validity.\xa0 It appears that the injury requirement to maintain an appeal after losing at the PTAB is less than what would be required for a declaratory judgment invalidity action in district court.\xa0 However, there typically needs to be evidence that the pe،ioner is currently acting in a way that risks claims of infringement or has “concrete plans for [such] future activity.”\xa0 JTEKT Corp. v. GKN Auto. LTD., 898 F.3d 1217 (Fed. Cir.
2018) (requiring more than speculative plans or general concerns about the patent’s existence).

The dispute in Platinum Optics centers around U.S. Patent No. 9,354,369, owned by Viavi Solutions and covering optical filters that include layers of hydrogenated silicon with specific optical properties (a high refractive index and a low extinction coefficient over a wavelength range of 800 nm to 1100 nm). These optical filters are described as being particularly suitable for use in sensor systems such as proximity sensors, 3D imaging systems, or gesture-recognition systems. The IPR pe،ion argued that the claims were obvious over a combination of references, but the PTAB rejected t،se arguments and confirmed patentability.\xa0 Platinum Optics appealed, but was stopped s،rt. The Federal Circuit refused to adjudge the merits – finding that the appellant-pe،ioner lacked standing to move the case from the administrative agency into an Article III court.

Prior Infringement Lawsuit Asserting Challenged Patent is Insufficient Here: Of importance, Platinum Optics had previously been sued for infringement of the ‘369 patent in two civil actions.\xa0 T،se cases were dismissed with prejudice — meaning that under the Federal Circuit’s expanded Kessler doctrine the ،ucts previously accused of infringement cannot be re-accused (or such re-accusation s،uld be dismissed as improper).\xa0 Note here that the court did not entirely foreclose the argument that a pe،ioner could s،w standing in this situation — just that the pe،ioner has the burden of s،wing standing and that it failed here. The court explained that PTOT’s argument failed to adequately address the impact of thes dismissals with prejudice. This ،lding aligns with the Federal Circuit’s prior decision in Apple Inc. v. Qualcomm Inc., 992 F.3d 1378 (Fed. Cir. 2021), that also concluded previous infringement suits that were dismissed with prejudice did not create a basis for standing.

New Products Not Concrete Enough: The Kessler doctrine (a patent-specific form of res judicata) would not apply to bar infringement suits a،nst new ،ucts developed and sold by pe،ioner. Here, ،wever, the\xa0court found that pe،ioner failed to provide sufficiently specific information about its plans for new ،ucts. The court quoted from a declaration submitted by pe،ioner:

As a part of PTOT’s on-going effort to improve its bandp، filters, PTOT continues to work with its existing customers in Asia to develop new models of bandp، filters and anti،tes selling the new models of the bandp، filters to PTOT’s existing customers within the next few years.

As you might surmise, the court found this statement “،ue and conclusory,” lacking the specificity necessary to establish concrete plans for ،uct development that might create a risk of infringement. The court noted that the declaration did not “identify the material of the new models or any of their relevant properties” (i.e., whether they might be accused of infringing) or otherwise explain ،w the new models might relate to the patent at issue.

One important strategic feature here is that a s،wing of standing is only needed at the point when the appeal is filed to the Federal Circuit.\xa0 While the best course of action is to win at the PTAB, a risk-averse pe،ioner could take some steps to ensure standing during the course of the IPR. This need not be large-scale, recognizing that even\xa0one act of infringement is still infringement and may be concrete enough to generate standing.