United States v. Arthrex, Inc.

JUSTICE GORSUCH, concurring in part and dissenting in part.¶verify

For most of this Nation’s history, an issued patent was considered a vested property right that could be taken from an individual only through a lawful process before a court. Oil States Energy Services , LLC v. Greene’s Energy Group , LLC , 584 U. S. ___, ___–___ (2018) (GORSUCH, J., dissenting) (slip op., at 8–10). I continue to think this Court’s recent decision in Oil States —upsetting this traditional understanding and allowing officials in the Executive Branch to “cancel” already-issued patents—departed from the Constitution’s separation of powers. But it would be an even greater departure to permit those officials to withdraw a vested property right while accountable to no one within the Executive Branch. Accordingly, I join Parts I and II of the¶verify

Court’s opinion. Respectfully, however, I am unable to join the Court’s severability discussion in Part III.¶verify

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On the merits, I agree with the Court that Article II vests the “executive Power” in the President alone. This admittedly formal rule serves a vital function. If the executive power is exercised poorly, the Constitution’s design at least ensures “[t]he people know whom to blame”—and hold accountable. Morrison v. Olson , 487 U. S. 654, 729 (1988) (Scalia, J., dissenting). As Hamilton explained, the President’s “due dependence on the people and . . . due responsibility” to them are key “ingredients which constitute safety in the republican sense.” The Federalist No. 70, p. 424 (C. Rossiter ed. 1961). Or as Madison put it, “no principle is more clearly laid down in the Constitution than that of responsibility.” 1 Annals of Cong. 462 (1789). Without presidential responsibility there can be no democratic accountability for executive action.¶verify

Of course, the framers recognized that no one alone can discharge all the executive duties of the federal government. They “expected that the President would rely on subordinate officers for assistance.” Seila Law LLC v. Consumer Financial Protection Bureau , 591 U. S. ___, ___ (2020) (ROBERTS, C. J.) (slip op., at 2). But the framers took pains to ensure those subordinates would always remain responsible to the President and thus, ultimately, to the people. Because it is the President’s duty to take care that the laws be faithfully executed, Art. II, §3, the framers sought to ensure he possessed “the power of appointing , overseeing , and controlling those who execute the laws.” 1 Annals of Cong. 463 (Madison) (emphasis added).¶verify

To this end, the Constitution provided for a chain of authority. Several constitutional provisions reflect this structure. See Calabresi & Prakash, The President’s Power To¶verify

Execute the Laws, 104 Yale L. J. 541, 570–599 (1994); Lawson, Appointments and Illegal Adjudication: The American Invents Act Through a Constitutional Lens, 26 Geo. Mason L. Rev. 26, 57–58 (2018). The Appointments Clause, for example, vests the President with the power to appoint “Officers of the United States” with “the Advice and Consent of the Senate,” and to appoint “inferior Officers . . . alone” when Congress authorizes him to do so. Art. II, §2, cl. 2.¶verify

By definition, an ''inferior officer’ . . . has a superior.” Edmond v. United States , 520 U. S. 651, 662 (1997). To be an “inferior” officer, then, one must be both “ subordinate to a[n] officer in the Executive Branch” and “under the direct control of the President” through a “chain of command.” Morrison , 487 U. S., at 720–721 (Scalia, J., dissenting). In this way, the “text and structure of the Appointments Clause” require a “reference to hierarchy.” Calabresi & Lawson, The Unitary Executive, Jurisdiction Stripping, and the Hamdan Opinions: A Textualist Response to Justice Scalia, 107 Colum. L. Rev. 1002, 1018–1020 (2007). Only such an understanding preserves, as Madison described it, the “chain of dependence,” where “the lowest officers, the middle grade, and the highest”—each and every one—“will depend, as they ought, on the President.” 1 Annals of Cong. 499 (Madison). And where the President, in turn, depends “on the community,” so that “[t]he chain of dependence” finally “terminates in the supreme body, namely, in the people.” Ibid.¶verify

I agree with the Court, too, that the statutory regime before us breaks this chain of dependence. In the America Invents Act of 2011 (AIA), Congress authorized the inter partes review (IPR) process, which permits anyone to file a petition asking the Patent and Trademark Office to “cancel” someone else’s patent. 35 U. S. C. §311. Congress assigned the power to decide an IPR proceeding to a specific group of officials—the Patent Trial and Appeal Board (PTAB). Under the AIA’s terms, three members from the PTAB—often, as here, administrative patent judges (APJs)—sit on a panel to decide whether to cancel a patent. §6(c). After the three-member panel issues its decision, a party may seek rehearing from another three-member panel. Ibid. But only a PTAB panel—and no other official within the Executive Branch—may grant rehearing. Ibid. If that fails, a losing party’s only recourse is to seek judicial review in the Court of Appeals for the Federal Circuit, which reviews the PTAB’s factual findings under the deferential substantial evidence standard of review. See §319; Oil States , 584 U. S., at ___ (slip op., at 4).¶verify

Under this statutory arrangement, APJs are executive officers accountable to no one else in the Executive Branch. A panel of bureaucrats wields unreviewable power to take vested property rights. This design may hold its advantages for some. Often enough, the Director of the Patent and Trademark Office and the President may be happy to wash their hands of these decisions. But by breaking the chain of dependence, the statutory scheme denies individuals the right to be subjected only to lawful exercises of executive power that can ultimately be controlled by a President accountable to “the supreme body, namely, . . . the people.”¶verify

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The real question here concerns what to do about it. In Part III of its opinion, the Court invokes severability doctrine. Ante , at 19–22. It “sever[s]” Congress’s statutory direction that PTAB decisions may not be reviewed by the Director of the Patent Office—in that way reconnecting APJs to the chain of command and subjecting their decisions to a superior who is, in turn, ultimately accountable to the President. See ibid.¶verify

I don’t question that we might proceed this way in some cases. Faced with an application of a statute that violates the Constitution, a court might look to the text of the law in question to determine what Congress has said should happen in that event. Sometimes Congress includes “fallback” provisions of just this sort, and sometimes those provisions tell us to disregard this or that provision if its statutory scheme is later found to offend the Constitution. See, e.g. , Bowsher v. Synar , 478 U. S. 714, 718–719 (1986); see also Walsh, Partial Unconstitutionality, 85 N. Y. U. L. Rev. 738, 780–781 (2010).¶verify

The problem here is that Congress has said nothing of the sort. And here it is the combination of separate statutory provisions that conspire to create a constitutional violation. Through some provisions, Congress has authorized executive officers to cancel patents. §§6(b)(4), 318(a). Through others, it has made their exercise of that power unreviewable within the Executive Branch. See §§6(c), 318(b). It’s the combination of these provisions—the exercise of executive power and unreviewability—that violates the Constitution’s separation of powers.¶verify

Nor is there only one possible way out of the problem. First, one could choose as the Court does and make PTAB decisions subject to review by the Director, who is answerable to the President through a chain of dependence. See Duffy, Are Administrative Patent Judges Unconstitutional? 77 Geo. Wash. L. Rev. 904, 911 (2009). Separately, one could specify that PTAB panel members should be appointed by the President and confirmed by the Senate and render their decisions directly reviewable by the President. See Lawson, 26 Geo. Mason L. Rev., at 57. Separately still, one could reassign the power to cancel patents to the Judiciary where it resided for nearly two centuries. See Oil States , 584 U. S., at ___–___ (GORSUCH, J., dissenting) (slip op., at 8–10). Without some direction from Congress, this problem cannot be resolved as a matter of statutory interpretation. All that remains is a policy choice.¶verify

In circumstances like these, I believe traditional remedial principles should be our guide. Early American courts did not presume a power to “sever” and excise portions of statutes in response to constitutional violations. Instead, when the application of a statute violated the Constitution, courts simply declined to enforce the statute in the case or controversy at hand. See Seila Law , 591 U. S., at ___ (THOMAS, J., dissenting in part) (slip op., at 15); see also Walsh, N. Y. U. L. Rev., at 769. I would follow that course today by identifying the constitutional violation, explaining our reasoning, and “setting aside” the PTAB decision in this case. See Novartis AG v. Torrent Pharmaceuticals Ltd. , 853 F. 3d 1316, 1323–1324 (CA Fed. 2017) (holding that the standard in 5 U. S. C. §706 governs judicial review of PTAB decisions).¶verify

The Court declines to follow this traditional path. Instead, it imagines that, if Congress had known its statutory scheme was unconstitutional, it would have preferred to make the policy choice the Court makes for it today. Faced with an unconstitutional combination of statutory instructions—providing for the exercise of executive power and its unreviewability—the Court chooses to act as if the provision limiting the Director’s ability to review IPR decisions doesn’t exist. Having done that, the Court gifts the Director a new power that he never before enjoyed, a power Congress expressly withheld from him and gave to someone else—the power to cancel patents through the IPR process. Effectively, the Court subtracts statutory powers from one set of executive officials and adds them to another.¶verify

While the Court has in relatively recent years proclaimed the power to proceed in this fashion, it has never paused to explain how this “severance doctrine” comports with traditional judicial remedial principles. See Barr v . American Assn. of Political Consultants , Inc. , 591 U. S. ___, ___ (2020) (GORSUCH, J., concurring in judgment in part and dissenting in part) (slip op., at 5). Or with the fact that the judicial power is limited to resolving discrete cases and controversies. Murphy v. National Collegiate Athletic Assn. , 584¶verify

U. S. ___, ___–___ (2018) (THOMAS, J., concurring) (slip op., at 2–3). Or with the framers’ explicit rejection of allowing this Court to serve as a council of revision free to amend legislation. See Mitchell, The Writ-of-Erasure Fallacy, 104 Va. L. Rev. 933, 954–960 (2018). Let alone with our constant admonitions that policy choices belong to Congress, not this Court. E.g. , Pereida v. Wilkinson , 592 U. S. ___, ___ (2021) (slip op., at 16). And certainly none of the early cases the Court cites today proceeded as it does. See ante , at 19, 22.¶verify

Nor does the Court pause to consider whether venturing further down this remedial path today risks undermining the very separation of powers its merits decision purports to vindicate. While the Court’s merits analysis ensures that executive power properly resides in the Executive Branch, its severability analysis seemingly confers legislative power to the Judiciary—endowing us with the authority to make a raw policy choice between competing lawful options. No doubt, if Congress is dissatisfied with the choice the Court makes on its behalf today, it can always reenter the field and revise our judgment. But doesn’t that just underscore the legislative nature of the Court’s judgment? And doesn’t deciding for ourselves which policy course to pursue today allow Congress to disclaim responsibility for our legislative handiwork much as the President might the PTAB’s executive decisions under the current statutory structure?¶verify

Instead of confronting these questions, the Court has justified modern “severance” doctrine on assumptions and presumptions about what Congress would have chosen to do, had it known that its statutory scheme was unconstitutional. See, e.g. , Seila Law , 591 U. S., at ___ (slip op., at 32) (“We will presume that Congress did not intend the validity of the statute in question to depend on the validity of the constitutionally offensive provision” (internal quotation marks omitted)). But any claim about “congressional intent” divorced from enacted statutory text is an appeal to mysticism. Short of summoning ghosts and spirits, how are we to know what those in a past Congress might think about a question they never expressed any view on—and may have never foreseen?¶verify

Let’s be honest, too. These legislative séances usually wind up producing only the results intended by those conducting the performance: “When you are told to decide, not on the basis of what the legislature said, but on the basis of what it meant , . . . your best shot at figuring out what the legislature meant is to ask yourself what a wise and intelligent person should have meant; and that will surely bring you to the conclusion that the law means what you think it ought to mean.” Scalia, Common Law Courts in a Civil-Law System, in A Matter of Interpretation: Federal Courts and the Law 18 (A. Gutmann ed. 1997); see also United States v. Public Util. Comm’n of Cal. , 345 U. S 295, 319 (1953) (Jackson, J., concurring) (describing that process as “not interpretation of a statute but creation of a statute”). The crystal ball ends up being more of a mirror.¶verify

Our case illustrates the problem. The Court apparently believes that Congress would have wanted us to render PTAB decisions reviewable by the Director. This regime is consistent with the ''standard federal model'' for agency adjudication. Walker & Wasserman, The New World of Agency Adjudication, 107 Cal. L. Rev. 141, 143–144 (2019). It’s easy enough to see why a group of staid judges selecting among policy choices for itself might prefer a “standard” model. But if there is anything we know for certain about the AIA, it is that Congress rejected this familiar approach when it came to PTAB proceedings. Multiple amici contend that Congress did so specifically to ensure APJs enjoy “independence” from superior executive officers and thus possess more “impartiality.” Brief for Fair Inventing Fund as Amicus Curiae 20–21 (quoting legislative history that Congress desired a ''fairer'' and ''more objective'' process); see also, e.g. , Brief for New Civil Liberties Alliance as Amicus¶verify

Curiae 6 (Congress sought “to preserve the independence of those conducting inter partes review”); Brief for US Inventor Inc. as Amicus Curiae 22 (“[I]t is plainly evident that Congress would not have enacted an APJ patentability trial system that was more political than the one they did enact”); Brief for Cato Institute et al. as Amici Curiae 20 (It was a “conscious congressional decision to provide individuals with the power to adjudicate (and often destroy) vested patent rights with some level of independence”). All of which suggests that the majority’s severability analysis defies, rather than implements, legislative intent. At the least, it is surely plausible that, if faced with a choice between giving the power to cancel patents to political officials or returning it to courts where it historically resided, a Congress so concerned with independent decisionmaking might have chosen the latter option.¶verify

My point here isn’t that I profess any certainty about what Congress would have chosen; it’s that I confess none. Asking what a past Congress would have done if confronted with a contingency it never addressed calls for raw speculation. Speculation that, under traditional principles of judicial remedies, statutory interpretation, and the separation of powers, a court of law has no authority to undertake.¶verify

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If each new case this Court entertains about the AIA highlights more and more problems with the statute, for me the largest of them all is the wrong turn we took in Oil States . There, the Court upheld the power of the Executive Branch to strip vested property rights in patents despite a long history in this country allowing only courts that authority. See 584 U. S., at ___–___ (GORSUCH, J., dissenting) (slip op., at 8–10). In the course of rejecting a separationof-powers challenge to this novel redistribution of historic authority, the Court acknowledged the possibility that permitting politically motivated executive officials to “cancel” patents might yet raise due process concerns. Id. , at ___ (slip op., at 17). But the Court refused to consider those concerns in Oil States because, it said, no one had “raised a due process challenge.” Ibid.¶verify

It was my view at the time that the separation of powers—and its guarantee that cases involving the revocation of vested property rights must be decided by Article III courts—is itself part of the process that is due under our Constitution. See Chapman & McConnell, Due Process as Separation of Powers, 121 Yale L. J. 1672, 1801–1804 (2012). Any suggestion that the neutrality and independence the framers guaranteed for courts could be replicated within the Executive Branch was never more than wishful thinking. The Court’s decision in Oil States allowing executive officials to assume an historic judicial function was always destined to invite familiar due process problemslike decisions “favor[ing] those with political clout, the powerful and the popular.” Thryv , Inc. v. Click-To-Call Technologies , LP , 590 U. S. ___, ___ (2020) (GORSUCH, J., dissenting) (slip op., at 20). After all, “[p]owerful interests are capable of amassing armies of lobbyists and lawyers to influence (and even capture) politically accountable bureaucracies.” Oil States , 584 U. S., at ___ (same) (slip op., at 3).¶verify

Already in the AIA’s short tenure these problems have started coming home to roost—even with supposedly “independent” APJs. The briefs before us highlight example after example. I leave the interested reader to explore others. See, e.g. , Brief for TiVo Corporation as Amicus Curiae 6–13; Brief for 39 Aggrieved Inventors as Amici Curiae 14–23; Brief for Joshua J. Malone as Amicus Curiae 9–11. Here just consider the tale of a patent attorney at one of the world’s largest technology companies who left the company to become an APJ. See Brief for US Inventor Inc. as Amicus Curiae 12. This private advocate-turned-APJ presided over dozens of IPRs brought by his former company. Ibid. In those proceedings, the company prevailed in its efforts to cancel patents damaging to its private economic interests 96% of the time. Ibid. After six years of work, the APJ decided he had done enough, resigned, and (yes) returned to the company. Ibid. Without a hint of irony, that company has filed an amicus brief in this case to inform us, as a self-described “frequent user of the IPR process,” about “the benefits of the system.” Brief for Apple Inc. as Amicus Curiae 3. Nor is that the only large technology company to have its attorneys rotate in and out of the PTO to similar effect. See Brief for B. E. Technology, LLC, as Amicus Curiae 17 (discussing a Google attorney). Oil States virtually assured results like these.¶verify

That’s not the end of the constitutional problems flowing from Oil States either. The Director has asserted “plenary authority” to personally select which APJs will decide an IPR proceeding. Brief for United States 5–6. Thus, any APJs whose rulings displease the party currently in power could soon find themselves with little to do. The PTAB has even “claimed the power through inter partes review to overrule final judicial judgments affirming patent rights.” Thryv , 590 U. S., at ___ (GORSUCH, J., dissenting) (slip op., at 20). And this menu of constitutional problems is surely just illustrative, not exhaustive.¶verify

Today’s decision at least avoids the very worst of what Oil States could have become—investing the power to revoke an individual’s property rights in some unaccountable fourth branch controlled by powerful companies seeking a competitive advantage. Alignments between the moneyed and the permanent bureaucracy to advance the narrow interests of the elite are as old as bureaucracy itself. Our decision today represents a very small step back in the right direction by ensuring that the people at least know who’s responsible for supervising this process—the elected President and his designees.¶verify

Still, I harbor no illusions that today’s decision will resolve all the problems. Even if our judgment demands some degree of democratic accountability in the IPR process, it does not begin to fix the revolving door or any of the other due process problems Oil States ignored. No doubt, challenges involving those aspects of the IPR process will come. When they do, I hope this Court will come to recognize what was evident for so much of our history—that the process due someone with a vested property right in a patent is a proceeding before a neutral and independent judge.¶verify