Patent Owners Lack Standing to Force USPTO to Issue Rules regarding Discretionary Denials

by Dennis Crouch

US Inventor Inc. v. Vidal, 21-40601 (5th Cir. 2022) (unpublished opinion)

US Inventor along with several patent holders sued the USPTO back in 2021 seeking an injunction against the USPTO Director mandating that she engage and notice-and-comment rulemaking to issue standards for when IPR/PGR discretionary denials are appropriate.  In addition, the case asks that the USPTO’s Standard Operating Procedure relating to discretionary denials be set aside as unlawful.  Judge Gilstrap dismissed the case for lack of standing. US Inventor Inc. v. Hirshfeld, 549 F. Supp. 3d 549 (E.D. Tex. 2021).  On appeal, the Fifth Circuit affirmed — finding that the parties here could not show the type of concrete and particularized injury necessary to serve as the foundation for a “case” or “controversy” under Article III of the U.S. Constitution. US Inventor Inc. v. Vidal, — F.4th —, 2022 WL 4595001 (5th Cir. Sept. 30, 2022).

US Inventor and its co-plaintiffs alleged a future harm of potential IPR proceedings that might have been discretionarily denied.  But the court here found that future projection a “speculative chain of possibilities” insufficient for standing. Quoting Clapper v. Amnesty Int’l USA, 568 U.S. 398 (2013).

[Plaintiffs] contend their injury is like those in Sierra Club v. Marsh; TransUnion; Massachusetts v. EPA; and City of Dania Beach v. FAA. But in all those cases, and unlike that of Plaintiff-Appellants’, the injuries were actual and imminent; they did not require speculation. Given the specific, uncertain series of events required under Plaintiff-Appellants’ theory of harm, we find their injury more closely analogous to the impermissibly speculative theory of injury rejected in Clapper.

US Inventor (internal citations omitted).  US Inventor also sought a ruling that it held “organizational standing” based upon the lobbying organization’s ongoing efforts to counteract the government’s allegedly unlawful actions.  But, the court rejected that theory as insufficient: “redirection of resources toward litigation and legal counseling are insufficient.”

US Inventor and the other appellants were represented by Robert Greenspoon; DOJ attorney Weili Shaw argued for the Patent Office.