A couple of years ago, in Amerigen Pharmaceuticals Ltd. v. UCB Pharma GmbH, 913 F.3d 1076, 1082 (Fed. Cir. 2019), the Federal Circuit acknowledged its jurisdiction to decide appeals of the Board’s final written decisions in AIA trials, but explained that an appellant (AIA Trial petitioner) must demonstrate it has standing. Quoting from the Supreme Court’s decision in Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016), the court explained the appellant must demonstrate, among other things, that it has “suffered an injury in fact.” Amerigen, 913 F.3d at 1082–83. The court more recently explained that the appellant who claims injury by the Board’s decision “need not face a specific threat of infringement litigation by the patentee” but can establish injury by “show[ing] that it has engaged in, is engaging in, or will likely engage in activity that would give rise to a possible infringement suit.” Adidas AG v. Nike, Inc., 963 F.3d 1355, 1357 (Fed. Cir. 2020) (cleaned up).That’s a flexible qualification, one the court’s critics reflexively complain is lacking in other patent law doctrines. But a trio of recent cases shows that flexibility begets unpredictability.
Substantial Risk of Future Infringement Is an Injury Sufficient for Standing
In General Electric Co. v. Raytheon Technologies Corp., 983 F.3d 1334 (Fed. Cir. 2020), GE appealed the Board’s decision that concluded Raytheon’s aircraft-engine patent was not unpatentable. Raytheon moved to dismiss GE’s appeal for lack of standing. After all, Raytheon wasn’t the instigator; it hadn’t even alleged GE was infringing. Instead, GE petitioned the Board to institute inter partes review, ostensibly to obtain a freedom to practice relative to the petitioned patents. But GE failed to persuade the Board to cancel the patents and, thus, appealed.
To demonstrate its standing on appeal, GE alleged that it had conceived an aircraft engine design that Raytheon would likely complain falls within the scope of the reviewed patents. GE also alleged it had spent $10–12 million, during the Board proceedings, to continue to develop and refine that design. GE further alleged that its design was one it was preferring to offer to its customers for the next-generation commercial jetliners. More concretely, GE submitted this design (and no alternative design) in the preliminary stage of a bidding process for an Airbus aircraft program. GE alleged Raytheon would accuse this design of infringing the reviewed patents. For purposes of assessing appellate standing, the court accepts as true the appellant’s representation of such material facts. See James v. J2 Cloud Servs., LLC, 887 F.3d 1368, 1372 (Fed. Cir. 2018). According to the court, GE alleged sufficient facts to establish that it is “engaging in activity that creates a substantial risk of future infringement.” As a result, GE had standing to appeal the Board’s decision.
Non-zero Risk of Future Infringement Is Not an Injury Sufficient for Standing
In ABS Global, Inc. v. Cytonome/ST, LLC, 984 F.3d 1017 (Fed. Cir. 2021), ABS appealed the Board’s decision that Cytonome’s patent was not unpatentable. But in contrast to Raytheon, in the above case, Cytonome filed a district court complaint alleging ABS was infringing claims of many patents, including some claims in one that ABS successfully petitioned the Board to review. The Board’s eventual decision canceled some but not all claims of the challenged patent. Shortly after the Board’s decision, the district court issued a summary judgment that ABS’s accused products did not infringe any of the asserted and reviewed patent’s claims. A year later, the court entered a final judgment of no infringement. Post-trial motions remain pending, but Cytonome “has elected not to pursue an appeal of the district court’s finding of non-infringement as to the reviewed patent and hereby disclaims such an appeal.” Id. at 1018–19. Intervening the summary and final judgments is ABS’s appeal of the Board’s decision.
Cytonome maintained on appeal that ABS cannot demonstrate “injury in fact” sufficient to support standing because ABS is not engaged in activity that would place it at substantial risk of infringement of the reviewed patent. ABS countered that mootness, not standing, offered the relevant doctrinal framework to assess the propriety of its appeal. Continuing, ABS argued that its appeal wasn’t moot because certain claims survived the Board’s review and Cytonome could assert those claims against future ABS products. But Cytonome demonstrated, according to the court, that its challenged conduct (patent assertion) is not reasonably expected to recur, and that ABS had not demonstrated that it is engaged in or has sufficiently concrete plans to engage in activities not covered by Cytonome’s disavowal.
Cytonome’s voluntary cessation of patent assertion governs, according to the court, the mootness inquiry: “Cytonome’s disavowal of its right to appeal the district court’s noninfringement judgment mooted ABS’s appeal.” Id. at 1020–21. According to the court, ABS’s evidence of “injury in fact” was essentially “a nonzero risk of future litigation,” which “[w]ithout more,  is clearly insufficient to establish injury in fact to defeat mootness, even considering” the parties’ adversarial litigation history. Id. at 1025.
Fortune-telling the Standing Between Substantial and Non-zero Risks of Future Infringement
In Apple Inc. v. Qualcomm Inc., Appeals 2020-1561, -1652 (Fed. Cir. Apr. 7, 2021), the Federal Circuit dismissed Apple’s appeals of Board decisions that refused to cancel Qualcomm’s patents based on Apple’s inter partes review petitions. Like Cytonome, in the above case, Qualcomm filed a district court complaint alleging Apple was infringing two of its patents. In response, Apple successfully petitioned the Board to review both patents, but ultimately failed to persuade the Board to cancel the patents. Meanwhile, Apple and Qualcomm settled their dispute, and successfully moved to dismiss Qualcomm’s district court action with prejudice. Yet Apple maintained its appeals of the Board’s decisions. Apple, Slip Op. at 2–3.
Apple unsuccessfully alleged three distinct injuries as bases for its standing. First, Apple argued that its ongoing license-payment obligations on thousands of Qualcomm patents placed it in the same position as the licensee in MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 120 (2007), which sought to challenge the validity of one patent. But, said the court, “Apple has not alleged that the validity of the [two reviewed patents] will affect its contract rights (i.e., its ongoing royalty obligations)” on all of the other licensed patents. Apple, Slip Op. at 7. Next, Apple argued that it might be sued for infringing the patents in 2025 (or 2027) when the license expires. To the court, that “possibility of suit is too speculative to confer standing” despite Qualcomm’s history of asserting patents against Apple after certain agreements had expired. Id. at 8. Finally, Apple argued that the Board’s decision estops Apple from challenging the validity of the same claims in a future suit. But the court has repeatedly rejected that purported injury as a basis for standing and, thus, said hardly more here. Id. at 11 (citing General Elec. Co. v. United Techs. Corp., 928 F.3d 1349, 1355 (Fed. Cir. 2019)). The court thus dismissed Apple’s appeal due to its lack of a standing-sufficient injury. To add insult to injury, perhaps, the court awarded costs in the appeal to Qualcomm.
Of these three cases, it’s ironic, perhaps, that the one where the Federal Circuit found sufficient appellate standing was the one where the appellant hadn’t even been sued for patent infringement. Further, despite the court’s earlier Adidas pronouncement—that an injury sufficient for standing may exist where the appellant “will likely engage in activity that would give rise to a possible infringement suit”—the Apple court said that the potential for suit there is “too speculative to confer standing,” adding “[w]e are not fortune-tellers.” Id. at 9–10. But perhaps the court’s flexible inquiry offers only ephemeral hope.
In Adidas, “Nike ha[d] refused to grant Adidas a covenant not to sue, confirming that Adidas’ risk of infringement is concrete and substantial.” Adidas, 963 F.3d at 1357. That fact coupled to Nike’s litigious history with its direct competitor, Adidas, led the court to conclude that Adidas had standing to appeal the Board’s decisions refusing to cancel Nike’s patents. So, despite offering the flexible inquiry, the injury Adidas suffered, like the injury GE suffered, was sufficiently concrete, and the injuries ABS and Apple suffered apparently were not. And concreteness is ultimately what the Supreme Court requires: “To establish injury in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally protected interest’ that is ‘concrete and particularized’ and ‘actual or imminent, not conjectural or hypothetical.’” Spokeo, 136 S. Ct. at 1548 (citation omitted).