An increasing number of cases demonstrate the challenges that the Federal Circuit and parties face when dealing with standing questions in appeals from administrative agencies.  These challenges only emphasize the growing need for a change in the Court’s rules of procedure.

Standing in cases from the U.S. Patent and Trademark Office (“PTO”) has become a more significant issue since the Court decided Consumer Watchdog v. Wisconsin Alumni Research Foundation, 753 F.3d 1258 (Fed. Cir. 2014).  In that case, Consumer Watchdog, a non-profit consumer rights organization, challenged a patent owned by the Wisconsin Alumni Research Foundation (“WARF”) in an inter partes reexamination.  WARF prevailed before the PTO and Consumer Watchdog appealed.  However, the Federal Circuit dismissed Consumer Watchdog’s appeal because it lacked standing.  The Federal Circuit clarified that to appeal a decision from an administrative agency to an Article III court, the appellant must have constitutional standing.  Citing Sierra Club v. E.P.A., 292 F.3d 895, 899 (D.C. Cir. 2002), the Federal Circuit emphasized that, “although Article III standing is not necessarily a requirement to appear before an administrative agency, once a party seeks review in a federal court, ‘the constitutional requirement that it have standing kicks in.’” Consumer Watchdog, 753 F.3d at 1261.  The Federal Circuit held that because Consumer Watchdog could not identify any concrete and particularized injury in fact, it lacked standing to appeal to an Article III court.  Id. at 1263.

One issue that has arisen after Consumer Watchdog is when the Federal Circuit or the parties would raise the issue of standing.  One of the more recent examples of a case in which this issue arose is in Personal Audio, LLC, v. Electronic Frontier Foundation, No. 16-1123 (Fed. Cir. 2016).  In that case, Personal Audio appealed the Board’s decision in an inter partes review that Personal Audio’s claims were unpatentable.  After the parties had fully briefed the appeal, and less than two weeks prior to oral argument, the Federal Circuit issued a sua sponte order requiring each party to submit a brief addressing whether the appellee, Electronic Frontier Foundation, had standing under Consumer Watchdog.  While the Court did not delve into the question of standing during oral argument, the parties undoubtedly expended significant resources briefing the issue under the expedited schedule near the end of the appeal.

Personal Audio is not unique in terms of when the question of standing was raised.  In Gandhi v. Bandl-Konrad, No. 14-1087 (Fed. Cir. 2014), the Federal Circuit took a similar approach when it raised the issue of standing for the first time at oral argument.  In that case, the appellant, Gandhi, appealed the Board’s interference decision that Bandl-Konrad’s claims were not shown to be unpatentable.  The real parties in interest were Ford (Gandhi) and Daimler (Bandl-Konrad).  During oral argument, Judge Hughes questioned whether the appellant had Article III standing under Consumer Watchdog.  Notably, neither party had briefed the issue nor had it been developed in the record before the PTO.  A similar situation also occurred in Rambus Inc. v. Micron Technology, No. 2013-1192 (Fed. Cir. 2013) where the issue of standing was first raised by the Federal Circuit during oral argument, and not briefed by either party.

While neither Gandhi nor Rambus resulted in an opinion addressing standing, as shown with the sampling of cases, the current approach for addressing standing in appeals at the Federal Circuit from administrative agencies lacks consistency and leaves the Federal Circuit ill-prepared to evaluate close cases.  In many instances standing is never addressed, or as shown above, the issue is raised towards the end of the appeal after substantive briefing on the merits has taken place.  The result is either hurried briefing by parties or last minute argument by attorneys without a developed record.  Neither situation is ideal.

A primary reason for the inconsistent approach for raising questions concerning standing is that the Federal Circuit is often given little information to assess whether standing problems exist earlier in the appeal.  There is a simple solution.  The D.C. Circuit has dealt with this issue for years.  Indeed, Consumer Watchdog relied heavily on the D.C. Circuit’s jurisprudence, including Sierra Club.  Aside from its body of case law on the subject, the D.C. Circuit has developed its own rules of appellate procedure that require appellants to address standing early in the appeal.  First, D.C. Circuit Rule 15(c)(2) requires that in cases involving review of administrative actions, the appellant include a brief description of its basis for standing in the docketing statement. Additionally, D.C. Circuit Rule 28(a)(7) requires that the appellant’s brief include a specific section setting forth the appellant’s basis for standing in cases involving the review of administrative actions.  Where needed, the rule also provides the opportunity for the appellant to provide evidence establishing standing that is not contained in the administrative record.  The Federal Circuit should consider adopting similar rules.

Adopting similar rules could be very beneficial for the Court and the parties.  First, it would give the Court additional information so that it can satisfy itself that the requirements of Article III are being followed.  Second, it would provide the opportunity to identify potential deficiencies in standing earlier in the appeal.  For example, the Court could have the clerk’s office screen docketing statements for cases with significant standing problems and refer those to a motions panel.  It would also put appellees on notice and facilitate challenges where standing is questionable.  Consistent with current practice, those challenges could be forwarded to the motions panel, or briefed for consideration by the merits panel.  In any event, even if the issue was deferred, the panel would benefit from having the parties discuss the issue of standing prior to argument.  Third, because standing is not required to appear before the PTO, these rules would provide a mechanism for parties to introduce evidence outside of the administrative record when needed to establish standing.  While questions of standing likely will continue to arise, the Court and the parties will be better equipped and prepared to deal with them if such rules are adopted.