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Ciena Corp. v. Oyster Optics, LLC

United States Court of Appeals for the Federal Circuit

January 28, 2020, Nonprecedential Order Issued; May 5, 20201, Precedential Order Issued

2019-2117

Opinion

ON MOTION

O'Malley, Circuit Judge.

ORDER

Ciena Corporation ("Ciena") moves to vacate and remand for further proceedings in light of Arthrex, Inc. v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019). Oyster Optics, LLC ("Oyster") and the Director of the United States Patent and Trademark Office oppose the motion. For the reasons explained here, the motion is DENIED.

Oyster owns U.S. Patent No. 8,913,898 ("the '898 patent"). In 2016, Oyster filed suit in district court, alleging that Ciena infringed several patents, including the '898 patent. Ciena petitioned the Patent Trial and Appeal Board ("Board") for inter partes review of the asserted patents. At Ciena's request, the district court [*2]  stayed the litigation. In May 2018, the Board instituted review proceedings on the '898 patent. After conducting proceedings, the Board issued a final written decision in May 2019, concluding that Ciena had failed to demonstrate by a preponderance of the evidence that any of the challenged claims were unpatentable. Ciena then filed this appeal.

Ciena argues that, under Arthrex, the Board's decision must be vacated and remanded for a new hearing before a differently constituted panel because the members of the Board panel that issued the decision were not appointed in compliance with the Appointments Clause. The problem with Ciena's request is that, unlike the patent owner in Arthrex, Ciena requested that the Board adjudicate its petition. It, thus, affirmatively sought a ruling from the Board members, regardless of how they were appointed. Ciena was content to have the assigned Board judges adjudicate its invalidity challenges until the Board ruled against it. Under those circumstances, we find that Ciena has forfeited its Appointments Clause challenge.

The Supreme Court cases cited by Ciena do not compel a different conclusion. Ciena primarily relies on Commodity Futures Trading Commission v. Schor, 478 U.S. 833, 106 S. Ct. 3245, 92 L. Ed. 2d 675 (1986). In that case, Schor invoked the Commodity Futures Trading Commission's ("CFTC's") [*3]  reparations jurisdiction by filing complaints against his broker, while the broker filed a competing lawsuit in federal district court against Schor. Schor moved to stay or dismiss the district court action, arguing that the agency action would fully resolve and adjudicate all the rights of the parties. The broker subsequently dropped the civil suit and filed a counterclaim at the agency. After the agency ruled against Schor, Schor argued that the agency's adjudication of the counterclaim violated Article III of the Constitution.

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2020 U.S. App. LEXIS 14252 *

CIENA CORPORATION, Appellant v. OYSTER OPTICS, LLC, Appellee, ANDREI IANCU, UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL PROPERTY AND DIRECTOR OF THE UNITED STATES PATENT AND TRADEMARK OFFICE, Intervenor

Subsequent History: Request granted Ciena Corp. v. Oyster Optics, LLC, 2020 U.S. App. LEXIS 14318 (Fed. Cir., May 5, 2020)

Prior History:  [*1] Appeal from the United States Patent and Trademark Office, Patent Trial and Appeal Board in No. IPR2018-00070.

Ciena Corp. v. Oyster Optics, LLC, 2019 Pat. App. LEXIS 12488 (P.T.A.B., May 9, 2019)

CORE TERMS

district court, patent, separation of powers, appointment, counterclaim, adjudicate, challenges, forfeiture, tax court, implicated, cases

Civil Procedure, Venue, Motions to Transfer, Choice of Forum, Constitutional Law, Separation of Powers, Appeals, Reviewability of Lower Court Decisions, Preservation for Review