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VirnetX, Inc. v. Cisco Systems, Inc.

No Rehearing for Opinion Applying Arthrex to Inter Partes Reexamination

VirnetX, Inc. v. Cisco Systems, Inc., __ F.3d __, 2020 WL 2462797 (Fed. Cir. May 13, 2020) (Moore, O’MALLEY, Chen) (PTAB) (3 of 5 stars)

Fed Cir denies petitions for panel rehearing. The opinion explains the panel’s rationale for holding that, per Arthrex, APJs are not constitutionally appointed officers as to their duties reviewing appeals from IPRx proceedings. Discussing Freytag, 501 U.S. 868 (1991), the opinion reasons that Appointments Clause challenges consider “all of that appointee’s duties,” not only those at issue in the case. Op. at 3. “Thus, if these APJs are unconstitutionally appointed officers because of their inter partes review duties in light of Arthrex, it would appear that under Freytag vacatur would be appropriate for all agency actions rendered by those APJs regardless of the specific type of review proceeding on appeal.” Id. at 3–4. That the Director has significant control over the IPRx process before cases reach the Board does not require a different outcome, and the opinion notes that the Director lacks review authority or supervision over the APJs’ final decisions. Nor does the role of petitions in IPRx change the outcome.

KEYWORDS: REHEARING (NO); INTER PARTES REEXAMINATION; APPOINTMENTS CLAUSE; CONSTITUTIONAL LAW