The U.S. Supreme Court will consider whether to declare unconstitutional a system that technology companies, including Apple Inc. and Google Inc., have used to invalidate hundreds of patents and head off litigation. In fact, so many patents have been invalidated that it’s been called a "death squad," a term coined by Randall Rader, the former chief judge of the Federal Circuit, which oversees all patent disputes in the country. The patent office has since altered its rules, giving patent owners a better shot at surviving the challenges.

In an argument at the intersection of intellectual property and the separation of powers, the justices today will consider a challenge to a congressionally-created board that critics have dubbed a “death squad” because of its tendency to toss out patents.

The Patent Trial and Appeal Board has invalidated more than 2,000 patents since it began work in 2012. Apple says it alone has used the board to successfully attack almost 200 patents, many held by entities interested only in filing lawsuits and extracting royalties. Congress set up the board, known as PTAB, in 2011 as a faster and cheaper alternative to litigation.

But some smaller inventors see a chance to undercut the board, saying it’s become an anticompetitive tool for large companies.

Jim Carmichael, a former PTAB judge and now managing director of Carmichael IP stated that the case "has the potential to shut down the PTAB, if only for a moment until Congress can do something to get it back on course. For many inventors and patent owners, that’s a very exciting prospect."

At issue is whether more than 250 PTAB judges are serving in violation of the Constitution. The federal appeals court that handles most patent disputes said the judges have important enough powers that they need to be appointed directly by the president.

Should the Supreme Court agree, it could go as far as barring the board from continuing to review and invalidate patents. The justices could also issue a more limited ruling that would strip the judges of their job protections but leave the board’s powers intact.

Either way, a decision against the board could mean that hundreds of cases would have to be reconsidered.

Constitutional Fight

The U.S. Court of Appeals for the Federal Circuit said the judges are "principal officers," a constitutional category that requires presidential appointment and Senate confirmation. The court said it reached that conclusion in part because patent judges’ decisions, typically issued by three-person panels, aren’t subject to review by a presidentially appointed official at the agency.

Technology Companies

Apple, the single biggest user of the review boards, filed a brief backing Arthrex. The iPhone maker said it relies "on Congress’s promise of a fair and efficient forum to challenge what often prove to be woefully weak patents that should not have issued in the first instance."

Other companies backing PTAB include Intel Corp. and an alliance whose members include Alphabet Inc.’s Google, Cisco Systems Inc., Microsoft Corp., Oracle Corp. and Samsung Electronics Co.

PTAB already survived one challenge at the Supreme Court. In 2018, justices found the panel wasn’t unconstitutionally wielding powers that belong to the courts.

The court is scheduled to rule by late June. For more, read the full Bloomberg report.