Federal Circuit: "Consumer Rights" Organization Lacks Standing

In what can only be characterized as excellent news for the biotech industry, the Federal Circuit yesterday dismissed Consumer Watchdog's appeal from a USPTO decision in an inter partes reexam upholding claims to human embryonic stem cell cultures.  

The Court found that Consumer Watchdog "has not established an injury in fact to confer Article III standing."  

Consumer Watchdog does not allege that it is engaged in any activity that could form the basis for an infringement claim.  It does not allege that it intends to engage in such activity.  Nor does it allege that it is an actual or prospective licensee, or that it has any other connection to the '913 patent or the claimed subject matter.  Instead Consumer Watchdog relies on the Board's denial of Consumer Watchdog's  requested administrative action -- namely, the Board's refusal to cancel claims 1-4 of the '913 patent.  That denial, however, is insufficient to confer standing.

This makes perfect sense, right up to that last bit.  See, there's no "standing" requirement at the USPTO.  So anybody can bring a request for inter partes reexamination of an eligible patent, assuming they have the fee in hand and can meet the "substantial likelihood of success" standard for review. And the statute specifically authorizes appeals from Board decisions in inter partes reexam, but doesn't say anything about standing.

The Court acknowledges as much, but is unpersuaded.

Nor is it enough that the inter partes reexamination statute allows a third party requester to appeal decisions favorable to patentability.  35 U.S.C. 315(b).  A statutory grant of a procedural right, e.g., right to appeal, does not eliminate the requirements of Article III.  See Lexmark Int'l, Inc. v. Static Control Components Inc., 134 S.Ct. 1377, 1386 (2014).  To be clear, a statutory grant of a procedural right may relax the requirements of immediacy and redressability, and eliminate any prudential limitations, ...which distinguishes the present inquiry from that governing a declaratory judgment action.  But the statutory grant of a procedural right does not eliminate the requirement that Consumer Watchdog have a particularized, concrete stake in the outcome of the reexamination.  Summers [v. Earth Island Inst.], 555 U.S. [488] at 496 [(2009)] ("[D]eprivation of a procedural right without some concrete interest that is affected by the deprivation -- a procedural right in vacuo -- is insufficient to create Article III standing.")

So this decision creates a strange procedural anomaly - anybody can bring an inter partes reexam, but not everybody who is dissatisfied with the result will have standing to appeal, despite the clear language of the statute.