Standing or Guesswork? A Speculative Risk of Patent Cancellation is Insufficient for Standing

US INVENTOR, INC. v. UNITED STATES PATENT AND TRADEMARK OFFICE

Before Lourie, Reyna, and Stark. Appeal from the United States District Court for the District of Columbia.

Summary: Appellants who alleged a speculative risk of patent cancellation failed to establish standing to challenge denial of a USPTO rulemaking petition.

US Inventor, Inc. and National Small Business United (collectively, “appellants”) jointly filed a petition for rulemaking to establish criteria for limiting the discretionary authority of the USPTO to institute IPR and PGR proceedings.  The proposed rule allowed a patent owner to prevent institution of an IPR or PGR if, for example, the patent owner qualified as a small business and actually reduced the challenged claims to practice.  The USPTO denied appellants’ petition.  Appellants filed a complaint against the USPTO, alleging that the USPTO’s denial of their petition violated the Administrative Procedure Act and the America Invents Act.  The district court dismissed the appellants’ complaint due to a lack of organizational and associational standing.  Appellants appealed to the Federal Circuit.

On Appeal, appellants asserted that the district court erred in dismissing their complaint for lack of associational standing.  Appellants argued that, due to the USPTO’s denial of their petition, their members suffered the injury of the risk of cancellation of a patent in the event of institution of an IPR or PGR.  The Federal Circuit held that appellants lacked associational standing because they failed to show that at least one of their members would have had standing to sue.  Specifically, because an extended chain of future events would have to occur before a member would be harmed, the purported risk of cancellation was “speculative” rather than “actual or immediate.”  The Federal Circuit therefore affirmed the district court’s dismissal for lack of standing.

Editor: Sean Murray