# Amicus Curiae Brief — Oil States Energy Servs., LLC v. Greene's Energy Grp., LLC, 138 S. Ct. 350 (2017) (No. 16-712) > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0724%3A58 ## Record - **Collection:** Supreme Court brief - **Document type:** Amicus Curiae Brief - **Published:** January 1, 2017 ## Text No. 16-712 3n The FILED AUG 29 2017 ERK Supreme Court of the United States ¢ OIL STATES ENERGY SERVICES, LLv, Petitioner, Vv. GREENE’S ENERGY GROUP, LLC, et al., Respondents. + On Writ Of Certiorari To The United States Court Of For The Federal Circuit ° AMICUS CURIAE BRIEF OF SECURITY PEOPLE, INC. IN SUPPORT OF PETITIONER + FREAR STEPHEN SCHMID Counsel of Record 177 Post Street, Suite 550 San Francisco, CA 94108 Tel: (415) 788-5957 frearschmid@aol.com Counsel for Amicus Curiae i TABLE OF CONTENTS Page INTEREST OF AMICUS CURIAE .............c00c00008 1 SUMMARY OF ARGUMENT ..................-..sceseeeeees 4 I. II. Il. IPR Violates Separation Of Powers By Un- constitutional Impingement On Power Re- served To The Judiciary By Article II1........ IPR Results In Deprivation Of The Right To Pi FR ainckcnccearcvsbidsornceenisesesiayensntadeasacnvs The Article III Violation Unfairly Empowers Infringers By Applying Different Burdens Of Proof, Presumptions, And Standards Of Patent Interpretation Used In IPR Trials .... TT sist cctenesicicesisntesrenseisntniaeninintamesvenaninets I. IT. Patentees Are Entitled To Rely On Long- Standing Supreme Court Precedent That Has Always Treated Patents As Property And Hence Patent Invalidation As Subject Solely To The Judicial Power Under Article Adjudications Of Validity Involves Seventh Amendment-Protected Private Rights, Thus, The Right To A Jury Tria] Is A Fundamen- tal Part Of The Article [II Fact-Finding Pro- ~~ i TABLE OF CONTENTS — Continued Page III. In The Name Of Efficiency, IPR Unfairly Tilts The Scales In Favor Of Infringers By Applying Different Burdens Of Proof, Pre- sumptions, And Standards Of Patent Interpre- tation In Contradiction Of The Constitutional! Mandate To Promote Inventions................. 18 CNET sc sncscestictvonecepnsvcsecusuvedobesisosiciakinicunniies 19 ill TABLE OF AUTHORITIES Page CASES B&B Hardware, Inc. v. Hargis Indus., Inc., 135 Be I viccnbesaySedapuievdovapperadesnmiucurcseccisesss 9,10 Crowell v. Benson, 285 U.S. 22 (1932) ..........cccseecseeeees 16 Granfinanciera, S.A. v. Nordberg, 492 U.S. 33 ges agri an ra oaths aul aan pewlieaacanaay 4,17 Hawes v. Gage, 11 F. Cas. 867 (C.C.N.D.NLY. NU sis ckekn eet tag-teceaoncs aguuc garecseeaemmnpharmadomaesouincon 12 Horne v. Dep’t of Agriculture, 576 U.S. ___ (20195).......... 8 In re Lockwood, 50 F.3d 966 (Fed. Cir. 1995).............14 In re Mankin, 823 F.2d 1296 (9th Cir. 1987).............. 12 In re Tech. Licensing Corp., 423 F.3d 1286 (Fed. SR I sa a ee rns eed oe eee nena el 5,14 James v. Campbell, 104 U.S. 356 (1882).......000. 8 Joy Techs., Inc. v. Manbeck, 959 F.2d 226 (Fed. Cir. 1992)... a aaananeebbisnpeieies ..@, 10, 16,17 Marbury v. Madison, 5 U.S. 137 (1803)... eee 7 Markman v. Westview Instruments, Inc.,517 U.S. a ae a eee McCormick Harvesting Co. v. Aultman, 169 U.S. Rete alae waren AN ERG PER 4,7,8, 9,15 MCM Portfolio v. Hewlett-Packard Co., 2015 US. EE aia cnciteen where the USPTO is the judge. inter partes reviews jack the very thing that al- lowed ex parte reexamination to pass muster: a legal fiction that the USPTO is restarting the examination process by patent examiners to correct a governmental mistake. The USPTO conducts a court-like trial be- tween adversaries including taking of and weighing testimony of witnesses. !n sum, it acts as an Article Ii court, but without a jury to weigh the multitude of fac- tual issues presented and without the protections en- joyed by Article III courts (e.g., life tenure, protection ® The PTO cannot initiate an IPR. Under 35 U.S.C. § 311(a), only a “persun who is not the patent owner” may file a petition for IPR, and the PTO is not a “person” under the statute. Under 37 C.FR. § 41.101, the “person who is not the patent owner” is re- ferred to as the “petitioner,” which is defined in 37 CLF_R. § 42.2 as “the party filing a petition requesting that a trial be instituted.” The regulations define “party” as “at least the petitioner and the patent owner” and do not make any reference to the PTO. 37 C.F.R. § 42.2. 16 against salary reduction and involvement of the polit- ical process, and Senate confirmation in appoint- ments). The USPTO is not a party, but serves as judge. For example, the trial includes initia) scheduling or- ders, mandatory notices, initial disclosures modeled after Fed. R. Civ. P. 26(a)(1), depositions, additional dis- covery as the USPTO determines is otherwise neces- sary “in the interest of justice,” cross-examination, compelled testimony and document production, oral argument, as well as objections, motions in imine, mo- tions to exclude arguably inadmissible evidence, and oral argument. After the parties have finished the en- tire adversarial process, the USPTO’s Judicial Panel issues a decision, which may cancel the patent. In sum, inter partes review is virtually identical to what would happen if the party challenging the valid- ity of the patents chose to bring an action in an Article I[I court instead with one key difference — no right to a jury trial. The Federal Circuit in Joy (in dispensing with a right to a jury trial) stated that a private right involves the liability of one individual to another, which contrasts with cases that “arise between the Government and persons subject to its authority in connection with the performance of the constitutional functions of the executive or legislative departments.” Joy, 959 F.2d at 229 (internal quotation marks omit- ted) (citing Crowell v. Benson, 285 U.S. 22, 50 (1932)). Inter partes review is the epitome of a private dispute, and was designed by Congress to lack the features of reexamination which made reexamination a proceed- ing just between the Government and a person. In an 17 IPR trial, the USPTO assumes that the adversaries (the petitioner and patentee) will bring the best prior art and does not conduct any examination as part of the proceedings. Its decision is based entircly on the adversaries’ arguments and evidence. This stands in stark contrast to ex parte reexaminations, which were the only USPTO proceedings considered in Patlex and Joy. This is alse why patentees’ jury trial rights are be- ing abridged in a way not present in Patlex or Joy. The Seventh Amendment protects the right to a jury trial on issues of patent validity that may arise in a suit for patent infringement. Patlex, 758 F.2d at 603 (citing Swofford v. B & W, Inc., 336 F.2d 406 (5th Cir. 1964), cert. denied, 379 U.S. 962 (1965)). “Congress may de- vise novel causes of action involving public rights free from the strictures of the Seventh Amendment if it as- signs their adjudication to tribunals without statutory authority to employ juries as factfinders. But it lacks the power to strip parties contesting matters of private right of their constitutional right to a trial by jury.” Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 51-52 (1989) (emphasis added). Stated another way, the pub- lic rights exception cannot apply where a right has a long line of common-law jury-trial forebears. Jd. at 52. “The Constitution nowhere grants Congress such puis- sant authority.” Jd. Instead, the claim must “originate in a newly fashioned regulatory scheme.” /d. 18 Thus, not only does inter partes review violate Sep- aration of Powers principles, it also violates the patent- ees’ inseparably intertwined right to a jury trial under the Seventh Amendment. Ill. In The Name Of Efficiency, IPR Unfairly Tilts The Scales In Favor Of Infringers By Applying Different Burdens Of Proof, Pre- sumptions, And Standards Of Patent Interpre- tation In Contradiction Of The Constitutional Mandate To Promote Inventions Patentees wrongly face significant lessened pro- tections in the IPR process in the rules concerning bur- den of proof and claim interpretation, in contravention to long-established procedures in Article III courts. The undeniable effect of the different rules applied in the USPTO inter partes review is to put a patentee at a distinct disadvantage and greatly increase the odds that patents will be invalidated. The validity or inva- lidity cannot rationally depend on whether the matter is heard in U.S. District Court or in the Patent Office; however, due to different standards of proofs, presump- tions and rule of patent construction, such unfair, une- qual application of the law and unfair results are pre-ordaincd. This is in direct contradiction with the constitutional mandate Article 1, Section 8 “to pro- mote” inventions. IPR has created an expensive disin- centive to invent. [t has created a new form of forum shopping, whereby an infringer can opt out of Article 11f courts and seek protection in the Executive Branch. 19 Congress enacted the IPR process for the ostensi- ble efficiency of trying issues of validity before a panel of administrative judges instead of Article III courts. Even if IPR were actually more “efficient,” “[i)t goes without saying that the fact that a given law or proce- dure is efficient, convenient, and useful in facilitating functions of government, standing alone, will not save it if it is contrary to the Constitution.” Stern v. Mar. shall, 131 S. Ct. 2594, 2619 (2011) (quotation marks omitted). “We cannot compromise the integrity of the system of separated powers and the role of the Judici- ary in that system, even with respect to challenges that may seem innocuous at first blush.” Jd. at 2620. . CONCLUSION For the foregoing reasons, the writ of certiorari should be granted. Respectfully submitted, FREAR STEPHEN SCHMID Counsel of Record 177 Post Street, Suite 550 San Francisco, CA 94108 Tel: (415) 788-5957 frearschmid@aol.com Counsel for Amicus Curiae August 29, 2017 --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0724%3A58. Public record. Not legal advice.