Today, in Teva Pharmaceuticals v. Sandoz, Inc., the U.S. Supreme Court granted the petition seeking review of the Federal Circuit’s de novo standard of review of a district court’s claim construction ruling. Teva phrased the question presented as follows:
Rule 52(a) of the Federal Rules of Civil Procedure provides that in matters tried to a district court, the court’s “[f]indings of fact … must not be set aside unless clearly erroneous.”
The question presented is as follows:
Whether a district court’s factual finding in support of its construction of a patent claim term may be reviewed de novo, as the Federal Circuit requires (and as the panel explicitly did in this case), or only for clear error, as Rule 52(a) requires.
The question presented mirrors Judge O’Malley’s dissent in the Federal Circuit’s recent divided en banc decision in Lighting Ballast v. Philips Electronics, which upheld the Cybor de novo standard of review of a district court’s claim construction ruling (see our Feb. 21, 2014 post summarizing that decision).
Recall that, in Lighting Ballast, Judge Newman’s majority decision considered three proposed standards of review:
(1) clear error review that defers to the district court’s claim construction ruling,
(2) clearly erroneous review of facts that defers to factual findings underlying the district court’s claim construction ruling, and
(3) Cybor plenary (or de novo) review that does not defer to the district court’s claim construction ruling.
The majority concluded that, under principles of stare decisis, there was insufficient reason to depart from the Cybor standard of review.
Judge Lourie concurred, noting that “whatever rubrice is used to describe the standard” does not matter, because the appellate court will defer to the district court’s claim construction decision as a practical matter in instances where “there are truly factual issues involved in claim construction.”
Judge O’Malley dissented because, among other things, Rule 52(a) requires deference on appeal to the district court’s findings of facts — “findings of fact … must not be set aside unless clearly erroneous.” Judge O’Malley–a former district court judge–also sought more deference to avoid undermining district court decisions.
The Supreme Court’s decision to review the standard of review of claim construction is not surprising given the en banc split at the Federal Circuit on this issue — the closest patent issues from the single patent appeal court come to a split among regional circuits that typically warrants Supreme Court review.
Some in the patent bar support the current Cybor de novo standard of review because, among other things, it will provide more uniformity in decisions dealing with what typically is the most important ruling in a patent case — what does the patent cover. Others, however, prefer a more deferential standard so that cases may be resolved sooner in the litigation process, rather than the district court providing an advisory decision as a waypoint to inevitable Federal Circuit review.
Those supporting a more deferential review of the district court’s claim construction ruling may hope that a legal generalist’s view from the Supreme Court may not be inclined to carve-out an exception for patent cases to the general Rule 52(a) standard of review. Recall that, in Dickinson v. Zurko, the Supreme Court set aside a long-standing Federal Circuit standard of review of Patent Office factual findings because it conflicted with the more deferential standard required under the general Administrative Procedures Act (APA).
You can find filings for this Supreme Court case at SCOTUSblog.