Supreme Court Uncertain On Claim Construction Standard

The Supreme Court’s new term got off to a hot start in the patent field with Teva Pharmaceuticals v. Sandoz. At oral argument on October 15, 2014, the justices wrestled with themselves and each other over how to weigh competing interests and rules in a case that could, depending on the outcome, change patent litigation dramatically by changing how courts look at claim construction. (Transcript here; SCOTUSblog’s helpful recap here).

Teva has asked the high court to reverse the Federal Circuit’s current practice of treating issues of claim construction—what does the claim language that defines a patented invention mean?—as purely a question of law. Under that regime, the Federal Circuit takes a fresh look at every decision on claim construction made by a trial court without any deference to the lower court. And the Federal Circuit has taken that opportunity to reverse trial judge’s claim constructions as a matter of course, many times leaving patent litigants unsure whether it means much that they won (or lost) at the trial level.

The other option, proposed by Teva (supported on this point by the Government), is for the appellate court to defer to the factual findings of the trial judge, while reviewing his or her conclusions of law without deference. This shift would be a big change in current practice, but also bring patent law in line with other areas of civil litigation, in which facts found by a trial court can only be set aside for clear error.

On the one hand, many justices seemed unconvinced by Teva’s argument that the Federal Circuit could easily sift fact from law in reviewing a claim construction ruling. On the other, the Supreme Court has shown a strong dislike for special rules for patent cases that do not apply in any other area of the law or any other federal appellate court. Whether the justices will risk an earthquake among the patent bar to bring patent litigation in line with the rest of civil litigation, stamp approval on the existing practice of non–deferential review, or find some third path remains very much an open question to be decided by the written opinion of the Supreme Court in the coming months.