Supreme Court Review of Patent Cases: What Will Follow eBay, Medimmune, and KSR?
Steinberg, Donald, Chavous, David, The Journal of High Technology Law
Since its inception, the United States Court of Appeals for the Federal Circuit ("Federal Circuit") has had an evolving relationship with the United States Supreme Court. Congress established the Federal Circuit pursuant to the Federal Courts Improvement Act of 1982, in part, to eliminate inconsistent decisions rendered in patent-related cases. (1) In many ways, this was in response to Congress's expressed displeasure with the state of patent law and enforcement in the United States as of 1982. (2) It was under those circumstances that the Federal Circuit came into being, and assumed its role as the overseer of the patent system.
Of course, the Federal Circuit has not replaced the Supreme Court as ultimate arbiter on issues of patent law. Nevertheless, the Federal Circuit operated with little oversight from the Supreme Court on patent-related matters for the majority of its history. In its first twelve years, the Supreme Court granted certiorari to only six decisions relating to patent cases. (3) Unsurprisingly, the lack of Supreme Court oversight leads commentators to look to the Federal Circuit as the nation's top patent court--implying that it is the only court that matters on issues of patent law. (4)
The situation, however, may be changing. The Supreme Court has granted certiorari on an increasing number of patent cases. (5) In many of these cases, the Court primarily granted certiorari to deal with perceived splits among different panels, or judges, in the Federal Circuit. (6) In this role, the Court acted to resolve conflicts within Federal Circuit case law.
Currently pending before the Supreme Court is the question of whether the Federal Circuit's jurisprudence regarding patent exhaustion conflicts with Supreme Court jurisprudence. (7) In Quanta Computer, the petitioners contend that the Federal Circuit undermined the principle that an authorized sale of a patented article or an article embodying essential features of a patented invention exhausts the patentee's patent rights relating to that article. (8)
While the outcome in Quanta Computer remains to be seen, the Supreme Court recently identified divergences between its jurisprudence and the Federal Circuit's application of its jurisprudence. (9) Most recently, the Supreme Court articulated its concern in a unanimous decision rejecting the Federal Circuit's "rigid a proach" to applying the teaching-suggestion-motivation test in KSR. (10) The Court held the Federal Circuit's application of the test to be "inconsistent with [section] 103 and this Court's precedents." (11) In fording the claimed invention obvious, the Court observed that rigid, preventive rules, such as the Federal Circuit's application of the "teaching-suggestion-motivation test," which prevents the use of common sense, were neither necessary, nor consistent with the Court's case law. (12) Nevertheless, the "teaching-suggestion-motivation test" was not completely rejected in KSR. (13) The Court merely rejected the Federal Circuit's application of the test. (14) It noted that the "teaching-suggestion-motivation test" had diverged from precedent, and applied in a manner inconsistent with the public's desire to prevent the withdrawal of knowledge from the prior art into a patent's monopoly. (15) Lower courts, therefore, could not continue to apply the test as it had been applied in KSR and other cases.
Before KSR, the Court reversed the Federal Circuit regarding the standing requirement for a patent licensee to bring declaratory judgment proceedings in District Court. (16) The Court found that the reasoning of the Federal Circuit diverged from its precedent and the common interpretation of the Declaratory Judgment Act in other courts. (17) The majority was particularly concerned with the apparent willingness of the Federal Circuit to distinguish its precedent to reach a certain conclusion, particularly noting that, even if its precedent could be distinguished, the Federal Circuit's test still contradicted the Federal Circuit's own precedent. …