United States v. Arthrex, Inc.
1. Are administrative patent judges principal officers who must be appointed by the President with the advice and consent of the Senate, or inferior officers who may be appointed by a department head?
2. If they are principal officers, can they be rendered inferior officers by severing the portion of the Patent Act restricting their removal?
- Malcolm L. Stewart, for Petitioner the United States
- Mark A. Perry, for Respondents Smith & Nephew, Inc., et al.
- Jeffrey A. Lamken, for Respondents Arthrex, Inc.
The Patent Trial and Appeal Board consists of a Director, a Deputy Director, a Commissioner for Patents, a Commissioner for Trademarks, and approximately 250 administrative patent judges. Under 35 U.S.C. § 6(a), the Secretary of Commerce, in consultation with the Director of the U.S. Patent and Trademark Office (USPTO), appoints Administrative Patent Judges (APJs) to the Board. Among other responsibilities, APJs decide questions of patentability in inter partes review, a “hybrid proceeding” with “adjudicatory characteristics similar to court proceedings.”
Arthrex owns a patent that was subject to inter partes review, and a three-judge panel consisting of three APJs issued a final written decision finding the claims unpatentable. Arthrex appealed to the U.S. Circuit Court for the Federal Circuit, claiming that the appointment of APJs violates the Appointments Clause of the U.S. Constitution. The Federal Circuit agreed, finding that the statute as currently constructed makes APJs principal officers, who must be appointed by the President with the advice and consent of the Senate. The Federal Circuit stated that as a remedy it would sever the provision that restricts removal of APJs. It reasoned that by doing so, it rendered APJs inferior officers and eliminated the constitutional appointment problem.
On the merits of the inferior officer question in United States v. Arthrex, Inc., there are two subsidiary questions: are Administrative Patent Judges (APJs)—whose status is at issue—inferior officers, and by what test will that be determined? Because the second question should be answered first, I focus on that issue.
Malcolm Stewart for the United States and Mark Perry for the private party argued in favor of inferior officer status for APJs, relying on the Court’s decision in Edmond v. United States. That opinion cited to a number of facts that led the Edmond Court to conclude that Coast Guard Judges were inferior officers. At least three Justices seemed troubled by the open-ended nature of that approach as applied to APJs:
JUSTICE SOTOMAYOR (of Stewart): For my colleagues — and there are some who don’t like amorphous concepts or ones that don’t have a yardstick by which to measure — what is the advantage of us keeping the Edmond test?
JUSTICE THOMAS (of Perry): What would be your test for whether someone is an inferior officer? It seems to be almost a totality of the circumstances.
JUSTICE ALITO (of Perry): In your brief you tick off all the ways in which there is control over these APJs. So I’m going to go through these, go through your list and eliminate them one by one, and you tell me when to stop, when we get to the point where we’ve crossed the line and there’s no longer sufficient control [for the person to still be an inferior officer].
Below, I provide an answer that addresses the running theme in these three questions.United States v. Arthrex, Inc. on Oyez: https://www.oyez.org/cases/2020/19-1434