Vornado Hits the Midwest: Federal Circuit Jurisdiction in Patent and Antitrust Cases after Holmes V. Vornado*

Article excerpt

I. Introduction

Much controversy has attended the Court of Appeals for the Federal Circuit in its relatively short lifetime. Congress established the court in 1982 by combining the previous Court of Customs and Patent Appeals with the previous Court of Claims,1 intending the Federal Circuit to "receive all patent appeals" in addition to inheriting the dockets of its predecessor courts.2 The Senate Judiciary Committee expected this consolidation of all patent appeals to the Federal Circuit to "increase doctrinal stability in the field of patent law,"3 and identified patent law as presenting a "special need for national uniformity."4 The very idea of a "specialty court" was controversial;5 indeed, proposals to create a court for patent appeals were repeatedly debated and defeated over a period of nearly a century before the creation of the Federal Circuit.6 As is discussed further below, the most vigorous criticism of the Federal Circuit since its creation has come in the last few years, and has largely been in response to both the court's handling of certain antitrust issues and the court's application of its own interpretation of law to issues at the boundary between patent law and other areas of law.7 The Federal Circuit most generally announced this use of its own interpretation of law for boundary issues in Midwest Industries, Inc. v. Karavan Trailers, Inc.8

This Note argues that Midwest is linked in important ways to a recent Supreme Court case involving jurisdiction of the Federal Circuit, Holmes Group, Inc. v. Vornado Air Circulation Systems, Inc.9 Most appeals heard by the Federal Circuit include a patent claim asserted by the plaintiff, but the Federal Circuit has also heard appeals in which the patent issues arose only in a counterclaim.10 In June 2002, the Supreme Court held in Vornado that the Federal Circuit does not have jurisdiction over appeals of cases in which the only patent claim is raised in a counterclaim.11 By restricting the jurisdiction of the Federal Circuit, the Vornado decision promises to lessen the impact of the Federal Circuit's recent expansion, articulated in Midwest, of the areas to which it applies its own interpretation of the law. Furthermore, as discussed below, Vornado arose in part from Midwest and other similar cases, in that these cases helped set up the forum-shopping opportunity that motivated Vornado and they may have also fueled a perception of overreaching by the Federal Circuit.12

The Vornado-Midwest link is instructive in exploring both the form that Federal Circuit jurisdiction should take in the future and the proper treatment by both the Federal Circuit and the regional courts of appeals of cases at the boundary between patent law and other areas of law. The Vornado decision effectively overruled twelve-year Federal Circuit precedent,13 and apparently came as a surprise to much of the patent bar.14 Multiple law review articles and student notes analyzing the decision have appeared.15 Some of these pieces argue that Vornado was incorrectly decided,16 and almost all of them advocate legislation to effectively reverse the decision.17 A committee of the Federal Circuit Bar Association has also proposed a legislative fix.18 In assessing the desirability of such legislation, there are several underlying questions to consider. First of all, was Vornado correctly decided? Furthermore, does the decision represent a rebuke of the Federal Circuit on additional grounds not stated in the opinion-a perceived overreaching of the court in areas outside of patent law, particularly in antitrust law? Is alarm over the Federal Circuit's treatment of antitrust claims justified? Finally, what are the likely implications of the Vornado ruling for patent and antitrust claims? This Note considers these questions. Part II reviews Federal Circuit jurisdiction in the time leading up to Vornado, while Part III considers the Supreme Court's Vornado opinion. I address the Federal Circuit's treatment of antitrust claims in Part IV, and likely implications of the Vornado decision for patent and antitrust claims in Part V. …