Chief Judge Lynn Refuses To Maintain Stay of Patent Case Pending Supreme Court’s Oil States Decision

On November 13, 2017, Chief Judge Lynn entered an Order (available here) in Leak Surveys v. Flir Systems. In 2013, Leak filed suit asserting infringement of one patent. Thereafter, the PTAB instituted an IPR as to the patent, and the Court stayed the litigation pending the results of the IPR. In 2015, the PTAB invalidated all of the asserted claims, and, in 2017, the Federal Circuit affirmed the PTAB’s decision. The Supreme Court refused to grant certiorari to review the Federal Circuit’s decision.

Despite presently having no claims to assert (since they had all been invalidated), Leak sought to continue the stay until after the Supreme Court issues its decision in Oil States (wherein the Supreme Court will determine whether IPRs are constitutional). According to Leak, a finding that IPRs are unconstitutional would “void all previous IPR decisions such that they would no longer have any preclusive effect.” Chief Judge Lynn refused to maintain the stay, and instead dismissed the case with prejudice:

Plaintiff overstates the potential effect of Oil States. Even if the Supreme Court holds that IPRs are unconstitutional, it may choose not to apply the new rule retroactively. [FN1: The Supreme Court considers three factors to determine whether a decision announcing a new rule should apply retroactively. See Chevron Oil Co. v. Huson, 404 U.S. 97 (1971). The factors are: (1) whether the holding in question “decid[ed] an issue of first impression whose resolution was not clearly foreshadowed” by earlier cases, (2) “whether retrospective operation will further or retard [the] operation” of the holding in question, and (3) whether retroactive application “could produce substantial inequitable results” in individual cases. Id. at 106-07.] Even if the Supreme Court applies the new rule retroactively, it would seemingly only apply to cases still pending on direct review of the PTAB decision. [FN2: In contrast to civil cases, criminal cases that are final on direct appeal may be subject to collateral review if the new rule is (1) substantive or (2) is a watershed rule that implicates the “fundamental fairness and accuracy of the criminal proceeding.” Whorton v. Bockting, 549 U.S. 406, 407 (2007) (quoting Saffle v. Parks, 494 U.S. 484, 495 (1990)).] See Harper v. Virginia Dep’t of Taxation, 509 U.S. 86, 86 (1993). Accordingly, the outcome of Oil States is unlikely to affect the PTAB’s judgment here, where Plaintiff has exhausted all appeals.

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