Court Dismisses Suit Claiming PTAB’s Structure was Unconstitutional

An order issued Monday in the Western District of Tennessee dismissed a challenge to the Patent Trial and Appeal Board’s (PTAB) structure. The original complaint, filed by Martin David Hyole and B.E. Technology, LLC alleged that the agency violated the right to due process under the Fifth Amendment.

In 2012, the filings recounted, B.E. Technology brought patent infringement suits against reputable technology companies including Google, Facebook, Microsoft, and Samsung. PTAB, an administrative court handling patent law matters, ruled against BE. Technology in each case and invalidated their patents, claiming they were “either ‘anticipated by’ and/or ‘obvious,’ in light of prior art.” Attempted appeals by B.E. Technology led to the Federal Circuit affirming PTAB’s reasoning.

Following this, the opinion explains that “starting in or around late 2017, various news outlets, blogs, and other websites began to publish scandalous revelations about the USPTO’s inner machinations, which raised serious questions about the constitutionality of IPR proceedings before the PTAB.” Specifically, concern raised around the compensation structure that allegedly provided incentive to administrative procedure judges to rarely issue dissenting opinions.

The initial complaint was filed in August 2021 and contended that their suit left “no room for debate as to the unconstitutionality of those proceedings,” referencing the course of their 2012 complaints. The defendants, who the plaintiffs claimed were “either individually responsible for, involved in, or otherwise complicit in the actions that resulted in the violation,” moved to dismiss the complaint in November of 2021.

The defendant’s motion to dismiss was granted by the court, which explained that the plaintiffs failed to state a plausible cause of action under Bivens, a case that governs suits against federal officials. The opinion found that Bivens has not been extended to any new context for the past 30 years. as the Supreme Court discouraged expanding the Bivens remedy. The defendants had argued that the complaint should be dismissed due to the plaintiffs’ seeking of “an improper extension of Bivens to this context,” which the court agreed with.

The defendants also moved to dismiss the complaint for lack of standing, for lack of personal jurisdiction, because the claims are time-barred, and on the basis that all defendants had either absolute immunity or qualified immunity. However, since the Court determined that the plaintiffs had failed to state a Bivens claim, these arguments were ruled as moot.

The defendant’s motion to dismiss was granted by the Court on Monday. The plaintiffs were represented by Pollock Cohen.