Cascades Projection LLC v. Epson America, Inc.

United States Court of Appeals
for the Federal Circuit
______________________

CASCADES PROJECTION LLC,
Appellant

v.

EPSON AMERICA, INC., SONY CORPORATION,
Appellees
______________________

2017-1517, 2017-1518
______________________

Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in Nos.
IPR2015-01206, IPR2015-01846.
______________________

ON PETITION FOR HEARING EN BANC
______________________

PHILIP P. MANN, Mann Law Group, Seattle, WA, filed
a petition for hearing en banc for appellant. Also repre-
sented by ROBERT GREENSPOON, Flachsbart & Green-
spoon, LLC, Chicago, IL.

DAVID J. BALL, JR., Paul, Weiss, Rifkind, Wharton &
Garrison LLP, Washington, DC, filed a response to the
petition for appellee Epson America, Inc. Also represented
by NICHOLAS P. GROOMBRIDGE, JENNY CHIA CHENG WU,
New York, NY.
2 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

KEVIN P.B. JOHNSON, Quinn Emanuel Urquhart &
Sullivan, LLP, Redwood Shores, CA, filed a response to
the petition for appellee Sony Corporation. Also repre-
sented by ANDREW J. BRAMHALL; MATTHEW A. SMITH,
Turner Boyd LLP, Redwood City, CA.

ANDREW JOHN DHUEY, Berkeley, CA, for amici curiae
Daniel R. Cahoy, Eric R. Claeys, Gregory Dolin, James W.
Ely, Jr., Richard A. Epstein, Matthew P. Harrington,
Ryan Holte, Irina D. Manta, Adam Mossoff, Sean M.
O’Connor, Kristen J. Osenga, Mark Schultz, Peter K. Yu.

FREAR STEPHEN SCHMID, San Francisco, CA, for amici
curiae Security People Inc., Edison Innovators Associa-
tion, Independent Inventors of America, Inventors Net-
work of the Capital Area, Inventors Network of the
Carolinas, Inventors Network of Minnesota, Inventors’
Roundtable, Inventors Society of South Florida, Music
City Inventors, National Innovation Association, San
Diego Inventors Forum, South Coast Inventors, Tampa
Bay Inventors Council, US Inventor, Inc.
______________________

Before PROST, Chief Judge, NEWMAN, LOURIE, DYK,
MOORE, O’MALLEY, REYNA, WALLACH, TARANTO, CHEN,
HUGHES, and STOLL, Circuit Judges.
NEWMAN, Circuit Judge, concurs in the denial of the
petition for initial hearing en banc.
DYK, Circuit Judge, with whom, PROST, Chief Judge,
and HUGHES, Circuit Judge, join, concurs in the denial of
the petition for initial hearing en banc.
O’MALLEY, Circuit Judge, dissents from the denial of
the petition for initial hearing en banc.
REYNA, Circuit Judge, dissents from the denial of the
petition for initial hearing en banc.
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 3

PER CURIAM.
ORDER
Appellant Cascades Projection LLC filed a petition for
hearing en banc. A response to the petition was invited by
the court and filed by appellees Epson America, Inc. and
Sony Corporation. Appellant was also granted leave to file
a reply in support of the petition.
The petition was referred to the circuit judges who are in
regular active service.
Upon consideration thereof,
IT IS ORDERED THAT:
The petition for hearing en banc is denied.

FOR THE COURT

May 11, 2017 /s/ Peter R. Marksteiner
Date Peter R. Marksteiner
Clerk of Court
 United States Court of Appeals
for the Federal Circuit
______________________

CASCADES PROJECTION LLC,
Appellant

v.

EPSON AMERICA, INC., SONY CORPORATION,
Appellees
______________________

2017-1517, 2017-1518
______________________

Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in Nos.
IPR2015-01206, IPR2015-01846.
______________________

NEWMAN, Circuit Judge, concurring in the denial of initial
hearing en banc.
There is no doubt that a patent is a property right,
with the attributes of personal property. This was re-
solved in 35 U.S.C. § 261 (“Subject to the provisions of
this title, patents shall have the attributes of personal
property . . . ”). There is, of course, a public interest in the
innovation incentive of the patent law, see, e.g., Patlex
Corp. v. Mossinghoff, 758 F.2d 594, 604 (Fed. Cir. 1985),
but that does not convert a private right into a public
right. That is not the question presented by the current
debate concerning the America Invents Act.
2 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

Because “the attributes of personal property” enjoyed
by patents are “[s]ubject to the provisions of this title,” the
inquiry focuses on whether patent owners subject to post-
grant procedures are afforded appropriate due process
protections as the Patent Office ensures issued patents do
indeed conform with the provisions of the Patent Act. The
question, then, is whether the statutory scheme created
by the America Invents Act, in which the Office is given
an enlarged opportunity to correct its errors in granting a
patent, with its decision subject to review by the Federal
Circuit, meets the constitutional requirements of due
process in disposition of property.
In view of the uncertainties illustrated in the present
debate, I conclude that the matter should be resolved
after full opportunity for panel consideration, and, as
such, concur in the denial of initial en banc hearing. If
necessary to properly resolve these uncertainties, howev-
er, resolution by the court en banc is appropriate.
 United States Court of Appeals
for the Federal Circuit
______________________

CASCADES PROJECTION LLC,
Appellant

v.

EPSON AMERICA, INC., SONY CORPORATION,
Appellees
______________________

2017-1517, 2017-1518
______________________

Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in Nos.
IPR2015-01206, IPR2015-01846.
______________________

DYK, Circuit Judge with whom PROST, Chief Judge, and
HUGHES, Circuit Judge, join, concurring in the denial of
initial hearing en banc.
We concur in the court’s denial of the petition for ini-
tial hearing en banc. The petition raises the same consti-
tutional challenge to the inter partes review provisions of
the America Invents Act that the court rejected in MCM
Portfolio LLC v. Hewlett-Packard Co., 812 F.3d 1284 (Fed.
Cir. 2015), cert. denied 137 S. Ct. 292 (2016). MCM was
correctly decided, and there is no need to restate MCM’s
reasoning here. We write solely to address three points
raised by today’s dissents.
First, MCM is neither “inconsistent” nor “irreconcila-
ble” with the court’s decision in Patlex Corp. v. Mossing-
2 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

hoff, 758 F.2d 594 (Fed. Cir. 1985). Slip op. 2 (Reyna, J.,
dissenting). In Patlex, the court upheld the constitutional-
ity of ex parte reexaminations conducted by the PTO. In
doing so, the court expressly affirmed the power of an
Article I tribunal to adjudicate, in the first instance, the
validity of an issued patent. See Patlex, 758 F.2d at 604.
MCM faithfully followed the reasoning of Patlex to reach
the same conclusion with respect to inter partes review.
Second, Patlex and MCM did not differ in their inter-
pretation of McCormick Harvesting Machine Co. v. Ault-
man, 169 U.S. 606 (1898). On its face, the decision in
McCormick rested on the lack of statutory authority: “Our
conclusion upon the whole case is that, upon the issue of
the original patent, the patent office had no power to
revoke, cancel, or annul it. It had lost jurisdiction over it,
and did not regain such jurisdiction by the application for
a reissue.” Id. at 612.
Both Patlex and MCM distinguished McCormick as
resting on a lack of statutory authority, statutory authori-
ty which was later conferred by a series of statutes culmi-
nating in ex parte reexamination and, later, inter partes
review. As explained by the court in Patlex:
We do not read McCormick Harvesting as forbid-
ding Congress to authorize reexamination to cor-
rect governmental mistakes, even against the will
of the patent owner. A defectively examined and
therefore erroneously granted patent must yield
to the reasonable Congressional purpose of facili-
tating the correction of governmental mistakes.
This Congressional purpose is presumptively cor-
rect, and we find that it carries no insult to the
Seventh Amendment and Article III.
758 F.2d at 604. MCM adopted this exact reasoning in
upholding the constitutionality of inter partes review. See
MCM, 812 F.3d at 1291 (quoting Patlex 758 F.2d at 604).
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 3

Third, contrary to the dissents, there is no incon-
sistency in concluding that patent rights constitute prop-
erty and that the source of that property right is a public
right conferred by federal statute. See Slip op. 2
(O’Malley, J., dissenting); Slip op. 19–23 (Reyna, J. dis-
senting). The Supreme Court has repeatedly recognized
that patent rights are public rights flowing from congres-
sional legislation. In a decision pre-dating McCormick, the
Court observed that:
The [patent] monopoly did not exist at common
law, and the rights, therefore, which may be exer-
cised under it cannot be regulated by the rules of
the common law. It is created by the act of Con-
gress; and no rights can be acquired in it unless
authorized by statute, and in the manner the
statute prescribes.
Gayler v. Wilder, 51 U.S. (10 How.) 477, 494 (1850). The
recognition of patent rights as grounded in statutory law
remains to this day. See Sears, Roebuck & Co. v. Stiffel
Co., 376 U.S. 225, 229 n.5 (1964) (“Patent rights exist only
by virtue of statute.”).
The Supreme Court has also repeatedly made clear
that such public rights may be adjudicated in the first
instance by an administrative agency. For example, most
recently in Stern v. Marshall, 564 U.S. 462, 491 (2011),
the Court concluded that the public rights doctrine ex-
tends to “cases in which the claim at issue derives from a
federal regulatory scheme, or in which resolution of the
claim by an expert government agency is deemed essen-
tial to a limited regulatory objective within the agency’s
authority.” 1 There is no dispute that the issue of patent

1 See also Granfinanciera, S.A. v. Nordberg, 492
U.S. 33, 54 (1989); Commodity Futures Trading Comm’n
v. Schor, 478 U.S. 833, 856 (1986); Thomas v. Union
4 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

validity “derives from a federal regulatory scheme” and is
“integrally related to particular federal government
action.” Stern, 492 U.S. at 490–91.

Carbide Agric. Prods. Co., 473 U.S. 568, 584 (1985);
Northern Pipeline Constr. Co. v. Marathon Pipe Line Co.,
458 U.S. 50, 69–70 (1982); Crowell v. Benson, 285 U.S. 22,
50 (1932); Murray’s Lessee v. Hoboken Land & Improve-
ment Co., 59 U.S. (18 How.) 272, 284 (1855).
 United States Court of Appeals
for the Federal Circuit
______________________

CASCADES PROJECTION LLC,
Appellant

v.

EPSON AMERICA, INC., SONY CORPORATION,
Appellees
______________________

2017-1517, 2017-1518
______________________

Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in Nos.
IPR2015-01206, IPR2015-01846.
______________________

O’MALLEY, Circuit Judge, dissenting from the denial of
initial hearing en banc.
In MCM Portfolio LLC v. Hewlett-Packard Co., 812
F.3d 1284 (Fed. Cir. 2015), a panel of this court stated
that “patent rights are public rights.” Id. at 1293. We did
so in the context of rejecting a constitutional challenge to
inter partes review (“IPR”), a new post-grant proceeding
created by the Leahy-Smith America Invents Act, Pub. L.
No. 112-29, 125 Stat. 284 (2011) (“the AIA”). In an IPR
proceeding, third parties can challenge the validity of
issued patent rights before the Patent Trial and Appeal
Board of the United States Patent and Trademark Office
(“PTO”) without plenary Article III trial court review of
the decision. The Supreme Court has explained that
2 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

“public rights” may be assigned to a non-Article III forum
for resolution without violating the Constitution, but that
core private rights are only subject to adjudication in
Article III courts. Stern v. Marshall, 564 U.S. 462, 484-86
(2011). By characterizing a patent as a public right,
therefore, the panel in MCM was able to conclude that
patent validity is “susceptible to review by an administra-
tive agency”—in other words, that IPR proceedings do not
violate the Constitution. 812 F.3d at 1293.
Cascades Projection LLC petitions this court to re-
solve whether a patent right is a public right en banc. For
the reasons Judge Reyna outlines in Parts I and II.A of
his thoughtful dissent, I believe it is far from certain that
MCM’s underlying premise—that patent rights are public
rights—is correct. Because that issue is both sufficiently
debatable and exceptionally important, I dissent from the
court’s refusal to consider it en banc in the first instance.
The Supreme Court has acknowledged that “[p]atents
. . . have long been considered a species of property.” Fla.
Prepaid Postsecondary Educ. Expense Bd. v. Coll. Sav.
Bank, 527 U.S. 627, 642 (1999) (Patents “are surely
included within the ‘property’ of which no person may be
deprived by a State without due process of law.”). In the
takings context, the Supreme Court has recognized that
“the rights of a party under a patent are his private
property” which “cannot be taken for public use without
just compensation.” Brown v. Duchesne, 60 U.S. 183, 197
(1857). Recently, the Court reaffirmed that a patent
“confers upon the patentee an exclusive property in the
patented invention which cannot be appropriated or used
by the government itself, without just compensation, any
more than it can appropriate or use without compensation
land which has been patented to a private purchaser.”
Horne v. Dep’t of Agric., 135 S. Ct. 2419, 2427 (2015)
(quoting James v. Campbell, 104 U.S. 356, 358 (1882)).
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 3

The Supreme Court has stated that “[t]he only au-
thority competent to set a patent aside, or to annul it, or
to correct it for any reason whatever, is vested in the
courts of the United States, and not in the department
which issued the patent.” McCormick Harvesting Mach.
Co. v. Aultman, 169 U.S. 606, 609 (1898). As Judge
Reyna points out, McCormick may suggest that the PTO
does not have the authority to invalidate issued patents
through IPR proceedings and that Article III adjudication
is required. See also Michael I. Rothwell, After MCM, A
Second Look: Article I Invalidation of Issued Patents for
Intellectual Property Still Likely Unconstitutional After
Stern v. Marshall, 18 N.C.J.L. & Tech. On. 1, 18 (2017).
Because MCM might be at odds with long-standing Su-
preme Court precedent, I believe we should take this
opportunity to reconsider our decision. 1

1 Two Supreme Court Justices recently expressed
an interest in the public versus private rights distinction
in the trademark context. B&B Hardware, Inc. v. Hargis
Indus., Inc., 135 S. Ct. 1293, 1316-17 (2015) (Thomas, J.,
dissenting). Justice Thomas, joined by Justice Scalia,
stated that “[t]rademark registration under the Lanham
Act has the characteristics of a quasi-private right” and
that, because registration is a “statutory government
entitlement, no one disputes that the [Trademark Trial
and Appeal Board] may constitutionally adjudicate a
registration claim.” Id. at 1317. But the “right to adopt
and exclusively use a trademark appears to be a private
property right that ‘has been long recognized by the
common law and the chancery courts of England and of
this country.’” Id. at 1317 (quoting Trade-Mark Cases,
100 U.S. 82, 92 (1879)). Given this historical framework,
Justice Thomas stated that “it appears that the trade-
mark infringement suit at issue in this case might be of a
type that must be decided by ‘Article III judges in Article
4 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

For these reasons, I dissent from the court’s refusal to
consider en banc whether a patent right is a public right.
Expressing no definitive opinion on the merits, it seems to
me that this case raises exceptionally important questions
of constitutional law and separation of powers principles
that warrant our careful consideration. Indeed, the
Supreme Court has warned that allowing Congress to
confer judicial authority outside Article III “compro-
mise[s] the integrity of the system of separated powers
and the role of the Judiciary in that system.” Stern, 564
U.S. at 503. Because these issues are complex and could
have far reaching consequences, they deserve the atten-
tion of the full court. I respectfully dissent.

III courts.’” Id. (quoting Stern, 564 U.S. at 484). Accord-
ingly, at least some members of the Court have expressed
an interest in the interplay between the public versus
private rights distinction and administrative agency
authority. Because the issue presents itself here in the
patent context, we should address it head on.
 United States Court of Appeals
for the Federal Circuit
______________________

CASCADES PROJECTION LLC,
Appellant

v.

EPSON AMERICA, INC., SONY CORPORATION,
Appellees
______________________

2017-1517, 2017-1518
______________________

Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in Nos.
IPR2015-01206, IPR2015-01846.
______________________

REYNA, Circuit Judge, dissenting from denial of initial
hearing en banc.
Cascades petitions this court to address en banc the
exceptionally important question of whether the United
States Constitution prohibits the Patent Trial and Appeal
Board from canceling patents through its inter partes
review process. I would grant Cascades’ petition and
respectfully dissent from today’s order to the contrary.
The state of current law compels en banc review.
First, undisturbed Supreme Court precedent addresses
the question at hand: “The only authority competent to
set a patent aside, or to annul it, or to correct it for any
reason whatever, is vested in the courts of the United
2 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

States, and not in the department which issued the pa-
tent.” McCormick Harvesting Mach. Co. v. C. Aultman &
Co., 169 U.S. 606, 609 (1898) (citation omitted).
Second, two inconsistent and irreconcilable Federal
Circuit precedential opinions, which purport to distin-
guish McCormick, hold that the United States Patent and
Trademark Office retains power to revoke, cancel, or
annul any original patent it issues. McCormick was
decided over a century ago. By contrast, the two Federal
Circuit decisions and the America Invents Act, which gave
birth to inter partes review, are much more recent.
Third, the separation of powers weighs in the balance.
The core of this dispute involves substantial questions of
property rights, Article III, and the Seventh Amendment.
Thus, while this matter involves a significant question of
federal patent law, its reach is beyond patent law. Specif-
ically, we should consider the constraints Article III
imposes on the adjudication of patent rights by an admin-
istrative authority. We should not ignore these important
questions that lie at our doorstep.
To understand the relationship between patents, per-
tinent stakeholders, and these questions, we must first
look at the circumstances that existed when the Patent
Clause was made part of the Constitution. Hence, we
start at the founding of our nation.
I. THE PATENT CLAUSE
The Constitution empowers Congress “[t]o promote
the Progress of Science and useful Arts, by securing for
limited Times to Authors and Inventors the exclusive
Right to their respective Writings and Discoveries.” U.S.
CONST. art. I, § 8, cl. 8. The Patent Clause is unique in
several aspects. It grants Congress authority in such
particularized detail to render the clause an imperative:
to secure an exclusive right. And of the many clauses in
Section 8, this is the only one to specify not only the ends
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 3

(promotion of the progress of science and the useful arts)
but the means (issuance of patents).
A. Patent Clause Debate
The simplicity of the language of the Patent Clause
has obscured the underlying debate over time. There is
no doubt that the link between patents and the promotion
of “the Progress of Science and useful Arts” has proven
prescient. Yet, consider that the Patent Clause came into
being only after attempts to promote the progress of
science and useful arts by the establishment of a national
university failed. See Dotan Oliar, Making Sense of the
Intellectual Property Clause: Promotion of Progress as a
Limitation on Congress’s Intellectual Property Power, 94
GEO. L.J. 1771, 1792–94 (2006) (summarizing James
Madison’s rejected proposal for a national university).
While the draft text calling for a constitutional establish-
ment of a national university was relegated to the debate
dustbin, the phrase “[t]o promote the Progress of Science
and useful Arts” was, much to Thomas Jefferson’s cha-
grin, rescued from the cutting room floor and combined
with “by securing for limited Times to Authors and Inven-
tors the exclusive Right to their respective Writings and
Discoveries” to create the Patent Clause. See id. at 1776,
1804–05 (summarizing Jefferson’s opposition to the
Patent Clause).
Indeed, what little debate there was on the Patent
Clause was intense, substantive, and almost entirely
focused on uncertainties about the creation of an exclusive
right and its links to the establishment of a private mo-
nopoly. Madison was correct when he wrote that the
utility of patents “will scarcely be questioned.” THE
FEDERALIST No. 43, at 338 (James Madison) (John C.
Hamilton ed., J. B. Lippincott & Co. 1804). Though the
Framers generally disfavored monopolies, Madison ar-
gued that monopolies for “literary works and ingenious
discoveries” are “too valuable” to be “wholly renounced.”
4 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

14 THE PAPERS OF THOMAS JEFFERSON (Julian P. Boyd ed.,
1956) (Oct. 17, 1788 letter from Madison to Jefferson). He
believed that “[t]he right to useful inventions seems . . . to
belong to the inventors” because patents foster the public
good. THE FEDERALIST No. 43, at 338 (James Madison).
On the other side of the debate, Benjamin Franklin
staunchly opposed monopolies, writing that “as we enjoy
great advantages from the inventions of others, we should
be glad of an opportunity to serve others by any invention
of ours; and this we should do freely and generously.”
BENJAMIN FRANKLIN, 1 THE COMPLETE WORKS OF
BENJAMIN FRANKLIN 223–24 (John Bigelow ed. 1887). Of
course, not everyone would be so free and generous with
their inventions without an opportunity to profit through
a limited monopoly. Recognizing a tradeoff was re-
quired—promotion of free thought and creativity for the
public, and a secured right for the inventor—the Framers
unanimously voted to adopt the Patent Clause. In doing
so, the Framers calmed the uncertainty about monopolies
in clear, simple words: the Constitution granted Congress
authority to create for a limited time a personal right of
exclusivity. In my view, Congress was more than empow-
ered to act—the American people spoke and told Congress
to act in a specific and particularized way.
B. The Patent As A Private Property Right
At the time the Constitution went into effect, the pa-
tent was considered more than a public good and in brief
time became a recognized property right. In eighteenth
century America, patents were considered “privileges.”
Adam Mossoff, Who Cares What Thomas Jefferson
Thought About Patents? Reevaluating the Patent “Privi-
lege” in Historical Context, 92 CORNELL L. REV. 953, 990
(2007) (“Mossoff”). At that time, “privileges” were “civil
rights in property afforded expansive and liberal protec-
tion under the law.” Id. This civil property right, which
the Constitution instructs Congress to “secur[e],” stands
in stark contrast to the “grant” of patents in England.
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 5

McKeever v. United States, 14 Ct. Cl. 396, 421 (1878)
(“Congress are not empowered to grant to inventors a
favor, but to secure to them a right.”); Mossoff at 991
(“Throughout the nineteenth century, courts reaffirmed
their view of patents as civil rights on par with contract
and property rights similarly identified as privileges.”).
That patents are property is now “beyond reasonable
debate.” Patlex Corp. v. Mossinghoff, 758 F.2d 594, 599
(Fed. Cir. 1985); see Fla. Prepaid Postsecondary Educ.
Expense Bd. v. Coll. Sav. Bank, 527 U.S. 627, 642 (1999)
(“Patents . . . have long been considered a species of
property.”) (citation omitted); Ex parte Wood, 22 U.S. (9
Wheat.) 603, 608 (1824) (“The inventor has, during this
period [of patent monopoly], a property in his inventions;
a property which is often of very great value, and of which
the law intended to give him the absolute enjoyment and
possession.”); Robert Bosch LLC v. Pylon Mfg. Corp., 659
F.3d 1142, 1149 (Fed. Cir. 2011) (courts may not “entirely
ignore the fundamental nature of patents as property
rights granting the owner the right to exclude”); 35 U.S.C.
§ 261 (“[P]atents shall have the attributes of personal
property.”).
The Supreme Court has long held the view that pa-
tents are private rights worthy of protection. See Grant
v. Raymond, 31 U.S. (6 Pet.) 218, 222 (1832) (constitu-
tional imperative to secure the “progress of useful arts”
led the Supreme Court to endorse reissued patents before
Congress ever provided statutory authority to do so).
Patent rights vest such that subsequent repeals of a
patent statute cannot impact an issued patent. McClurg
v. Kingsland, 42 U.S. (1 How.) 202, 206 (1843). And the
Supreme Court has warned this court to remember “the
settled expectations of the inventing community.” Festo
Corp. v. Shoketsu Kinzoku Kogyo Kabuyshiki Co., 535
U.S. 722, 739 (2002). Grant, McClurg, and Festo all show
how patent rights cannot be separated from any other
type of property right. For as we have said previously,
6 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

“[p]atent law is not an island separated from the main
body of American jurisprudence.” Knorr-Bremse Systeme
Fuer Nutzfahrzeuge GmbH v. Dana Corp., 383 F.3d 1337,
1351 (Fed. Cir. 2004) (en banc).
Amici lend support. They point out that “[s]ince the
Antebellum Era in the early nineteenth century, the
Supreme Court and Circuit Courts repeatedly and con-
sistently defined patents as constitutionally protected
private rights—specifically, as private property rights.” 13
Law Professors’ Amicus Curiae Brief at 2 (emphasis in
original). As private property, patents are protected by
the Fifth Amendment against uncompensated govern-
ment takings. See Horne v. Dep’t of Agriculture, 135 S.
Ct. 2419, 2427 (2015) (personal property, including pa-
tents, is not “any less protected against physical appro-
priation than real property”); James v. Campbell, 104
U.S. 356, 358 (1882) (“[A patent] confers upon the patent-
ee an exclusive property in the patented invention which
cannot be appropriated or used by the government itself,
without just compensation, any more than it can appro-
priate or use without compensation land which has been
patented to a private purchaser . . . .”); 28 U.S.C.
§ 1498(a) (granting the United States Court of Federal
Claims jurisdiction to adjudicate patent infringement
suits against the federal government under a takings
theory). 1 And patents are protected against violations of
due process pursuant to the Fourteenth Amendment. Fla.
Prepaid, 527 U.S. at 642 (“[Patents] are surely included
within the ‘property’ of which no person may be deprived
by a State without due process of law.”).

1 For more detail, see Adam Mossoff, Patents as
Constitutional Private Property: The Historical Protection
of Patents under the Takings Clause, 87 B.U. L. REV. 689,
700–11 (2007).
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 7

The exclusive nature of the property right vested in
patents has long been analogized to patents for land. 2
The Supreme Court has stated that a patent for an inven-
tion “is as much property as a patent for land,” and its
rights “rest[] on the same foundation and [are] surround-
ed and protected by the same sanctions.” Consol. Fruit
Jar Co. v. Wright, 94 U.S. 92, 96 (1876); Moore v. Robbins,
96 U.S. (6 Otto) 530, 532 (1877). Once a land patent is
issued, private disputes involving the patent do not
trigger the public rights exception to Article III review.
See Moore, 96 U.S. (6 Otto) at 532 (once a patent issues,
“[i]f fraud, mistake, error, or wrong has been done, the
courts of justice present the only remedy”); cf. Atlas
Roofing Co. v. Occupational Safety & Health Review
Comm’n, 430 U.S. 442, 458 (1977) (“Our prior cases
support administrative factfinding in only those situa-
tions involving ‘public rights,’ e.g., where the Government
is involved in its sovereign capacity under an otherwise
valid statute creating enforceable public rights. Wholly
private tort, contract, and property cases, as well as a
vast range of other cases as well are not at all implicat-
ed.”). As with land patents, early American third parties
could challenge an invention patent’s validity only in
courts of equity. See Mowry v. Whitney, 81 U.S. (14 Wall.)
434, 440 (1871). The same was true in England at the
time. See Mark A. Lemley, Why Do Juries Decide If
Patents Are Valid?, 99 VA. L. REV. 1673, 1684 (2013) (“[I]n
England in the eighteenth century, only chancery courts
had the power to revoke a patent upon request of a pri-
vate citizen.”).

2 A land patent is “[a]n instrument by which the
government conveys a grant of public land to a private
person.” Land Patent, BLACK’S LAW DICTIONARY (10th ed.
2014).
8 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

II. CASE LAW
A. Murray’s Lessee and McCormick
Two Supreme Court decisions inform the nature of
the patent as a property right and the implications for
Article III adjudication. The first decision concerned
United States customs agents who embezzled government
funds. Murray’s Lessee v. Hoboken Land & Improvement
Co., 59 U.S. (18 How.) 272 (1855). To recover the funds,
the Treasury Department issued a distress warrant 3
against the agents. In response to the government’s
attempt to recover the funds through a non-judicial pro-
cess, the agents asserted a violation of Article III and the
Fifth Amendment. Id. at 275. As a general rule, the
Court wrote, Congress may not “withdraw from judicial
cognizance any matter which, from its nature, is the
subject of a suit at the common law, or in equity, or admi-
ralty.” Id. at 284. But the Court explained an exception:
At the same time there are matters, involving
public rights, which may be presented in such
form that the judicial power is capable of acting
on them, and which are susceptible of judicial de-
termination, but which congress may or may not
bring within the cognizance of the courts of the
United States, as it may deem proper.
Id. The Supreme Court held that the distress warrant did
not violate the Constitution because the matter fell within
the category of public rights. See id. at 283–84. “The
point of Murray's Lessee,” according to a later Court
decision, “was simply that Congress may set the terms of
adjudicating a suit when the suit could not otherwise
proceed at all.” Stern v. Marshall, 564 U.S. 462, 489

3 A distress warrant authorizes a court officer to
seize property as payment for money owed. Distress
Warrant, BLACK’S LAW DICTIONARY (10th ed. 2014).
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 9

(2011). Subsequent discussion of Murray’s Lessee has
been critical at times, but it nonetheless remains binding
on this court. See, e.g., Wellness Int’l Network, Ltd.
v. Sharif, 135 S. Ct. 1932, 1966–67 (2015) (Thomas, J.,
dissenting) (compiling various interpretations of Murray’s
Lessee).
Unlike Murray’s Lessee, the Supreme Court’s 1898 de-
cision in McCormick specifically addressed patents. In
McCormick, a patent owner applied to the patent office for
a reissue that added several new claims to the existing
claims. 169 U.S. at 607. While reviewing the reissue
application, the examiner determined that several origi-
nal claims were invalid. Id. Then, the patent owner
abandoned his reissue application and received his origi-
nal patent back from the examiner. Id. at 607–08. The
Supreme Court granted certiorari on whether the original
patent included the claims the reissue examiner had
determined to be invalid. Id. It held that the examiner
had no power to cancel previously issued claims:
It has been settled by repeated decisions of this
court that when a patent has received the signa-
ture of the secretary of the interior, countersigned
by the commissioner of patents, and has had af-
fixed to it the seal of the patent office, it has
passed beyond the control and jurisdiction of that
office, and is not subject to be revoked or canceled
by the president, or any other officer of the gov-
ernment. It has become the property of the pa-
tentee, and as such is entitled to the same legal
protection as other property.
The only authority competent to set a patent
aside, or to annul it, or to correct it for any reason
whatever, is vested in the courts of the United
States, and not in the department which issued
the patent.
10 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

Id. at 608–09 (citations omitted). The Court further
stated that:
the reasons given for the rejection of [the added]
claims might apply equally to the same claims
contained in the original patent, but with respect
to such claims [the examiner] was functus officio.
His opinion thereon was but his personal opinion,
and, however persuasive it might be, did not oust
the jurisdiction of any court to which the owner
might apply for an adjudication of his rights, and,
as the examiner had no authority to affect the
claims of the original patent, no appeal was neces-
sary from his decision. . . . [T]o attempt to cancel
a patent upon an application for reissue when the
first patent is considered invalid by the examiner
would be to deprive the applicant of his property
without due process of law, and would be in fact
an invasion of the judicial branch of the govern-
ment by the executive.
Id. at 611–12. The Court wrote in conclusion that “upon
the issue of the original patent, the patent office had no
power to revoke, cancel, or annul it. It had lost jurisdic-
tion over it, and did not regain such jurisdiction by the
application for a reissue.” Id. at 612. Thus, the patent
owner’s original claims remained valid and enforceable
unless invalidated by an Article III court.
The cases McCormick cites in holding that an execu-
tive agency may not cancel issued patents concern the
separation of powers and similar constitutional issues.
For example, in United States v. Stone, 69 U.S. (2 Wall.)
525 (1864), the Secretary of the Interior “decided that
[certain land] patents had been issued without legal
authority, and he declared them void and revoked.” Id. at
528 (emphasis in original). In finding the Secretary’s
revocation to be unconstitutional, the Court held that “[a]
patent is the highest evidence of title, and is conclusive as
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 11

against the Government, and all claiming under junior
patents or titles, until it is set aside or annulled by some
judicial tribunal.” Id. at 535 (emphasis added).
Patents are sometimes issued unadvisedly or by
mistake, where the officer has no authority in law
to grant them, or where another party has a high-
er equity and should have received the patent. In
such cases courts of law will pronounce them void.
The patent is but evidence of a grant, and the of-
ficer who issues it acts ministerially and not judi-
cially. If he issues a patent for land reserved from
sale by law, such patent is void for want of author-
ity. But one officer of the land office is not compe-
tent to cancel or annul the act of his predecessor.
That is a judicial act, and requires the judgment of
a court.
Id. (emphasis added).
The McCormick Court also cited Moore v. Robbins, 96
U.S. (6 Otto) 530 (1877). In Moore, the Secretary of the
Interior reversed a previous grant of a land patent. Id. at
531. While the Court “conced[ed]” that the Land Depart-
ment may decide land disputes in the first instance, “it is
equally clear that when a patent has been awarded to one
of the contestants, and has been issued, delivered, and
accepted, all right to control the title or to decide on the
right to the title has passed from the land-office.” Id. at
532. “Not only has it passed from the land-office, but it
has passed from the Executive Department of the govern-
ment.” Id. (emphasis added).
[A]ny private owner of land who has conveyed it to
another can, of his own volition, recall, cancel, or
annul the instrument which he has made and de-
livered. If fraud, mistake, error, or wrong has
been done, the courts of justice present the only
remedy. These courts are as open to the United
States to sue for the cancellation of the deed or re-
12 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

conveyance of the land as to individuals; and if the
government is the party injured, this is the proper
course.
Id. at 533 (emphasis added). The Court noted that the
existence of the Land Department’s power to annul issued
patents was “utterly inconsistent with the universal
principle on which the right of private property is found-
ed.” Id. at 534; see also Mich. Land & Lumber Co. v. Rust,
168 U.S. 589, 595 (1897) (holding that the Land Depart-
ment may correct mistakes in an earlier survey only
“prior to the issue of a patent”); Shepley v. Cowan, 91 U.S.
(1 Otto) 330, 340 (1875) (“If [Land Department officers]
err in the construction of the law applicable to any case,
or if fraud is practi[c]ed upon them, or they themselves
are chargeable with fraudulent practices, their rulings
may be reviewed and annulled by the courts when a
controversy arises between private parties founded upon
their decisions.”). 4
B. Patlex and MCM
McCormick is the law of the land. Yet, this court has
twice considered McCormick and twice declined to follow
it for two distinct but conflicting reasons. In my view,
that two of our precedential opinions address McCormick
in such irreconcilable terms alone warrants an en banc
review.
In 1985, a three-judge Federal Circuit panel held that
Congress’s 1980 reexamination statute did not violate

4 This, of course, portends difficulties for agencies
other than the United States Patent and Trademark
Office (“PTO”), such as the United States International
Trade Commission (“ITC”), which does not administer or
grant patents yet often acts to annul them. See, e.g.,
Lannom Mfg. Co. v. ITC, 799 F.2d 1572, 1574 (Fed. Cir.
1986) (ITC finding of patent invalidity).
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 13

Article III. Patlex, 758 F.2d at 605. The appellant in
Patlex argued that his Article III “rights were part of the
bundle of property rights that accompanied the grant of
his patents, and thus that the retroactive scope of reex-
amination worked a prohibited deprivation.” Id. at 603.
The panel disagreed. It wrote that the Supreme Court’s
decision in McCormick established “on constitutional
grounds that an applicant for a reissue patent need not
acquiesce in any finding of invalidity or unpatentability
by the reissue examiner[ and] affirmed that an issued
patent could not be set aside other than by an Article III
court.” Id. at 604. Nevertheless, the Patlex panel distin-
guished McCormick based on congressional intent to
provide authority for reexaminations while retaining
reissue proceedings. Id.
The purpose of reissuance of patents is to enable
correction of errors made by the inventor, at the
initiative of the inventor. The reexamination
statute’s purpose is to correct errors made by the
government, to remedy defective governmental
(not private) action, and if need be to remove pa-
tents that should never have been granted. We do
not read McCormick [] as forbidding Congress to
authorize reexamination to correct governmental
mistakes, even against the will of the patent own-
er. A defectively examined and therefore errone-
ously granted patent must yield to the reasonable
Congressional purpose of facilitating the correc-
tion of governmental mistakes. This Congres-
sional purpose is presumptively correct, and we
find that it carries no insult to the Seventh
Amendment and Article III.
Id. The losing party in Patlex did not petition the Su-
preme Court for a writ of certiorari.
Three decades later, a three-judge panel held that in-
ter partes review (“IPR”) proceedings do not violate Arti-
14 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

cle III. MCM Portfolio LLC v. Hewlett-Packard Co., 812
F.3d 1284, 1292 (Fed. Cir. 2015). The panel “s[aw] no
basis to distinguish the reexamination proceeding in
Patlex from inter partes review,” because “Congress
viewed inter partes review as ‘amend[ing] ex parte and
inter partes reexamination.’” Id. at 1291 (quoting H.R.
Rep. No. 112-98, 2011 U.S.C.C.A.N. 67, 75, at 45).
Beyond approving (and extending) Patlex, the MCM
panel made two significant legal conclusions. First, it
stated that McCormick was decided on statutory, rather
than constitutional, grounds. See id. at 1289 (characteriz-
ing McCormick’s holding as depending on the lack of
“statutory authorization”). According to the MCM panel,
McCormick “did not address Article III and certainly did
not forbid Congress from granting the PTO the authority
to correct or cancel an issued patent.” Id.
Second, the MCM panel explicitly found for the first
time that “patent rights are public rights.” Id. at 1293.
As a basis for its finding, the panel noted that “[t]he
patent right ‘derives from an extensive federal regulatory
scheme’ and is created by federal law.” Id. at 1290 (quot-
ing Stern, 564 U.S. at 490). In addition, “Congress creat-
ed the PTO, ‘an executive agency with specific authority
and expertise’ in the patent law.” Id. (quoting Kappos v.
Hyatt, 132 S. Ct. 1690, 1696 (2012)). According to MCM,
because there is “no suggestion that Congress lacked the
authority to delegate to the PTO the power to issue pa-
tents, . . . [i]t would be odd indeed if Congress could not
authorize the PTO to reconsider its own decisions.” Id. at
1291. 5
Like Patlex, the panel decision in MCM was never
subject to en banc review. Instead of petitioning for
rehearing en banc, the losing party in MCM petitioned the

5 See supra note 4.
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 15

Supreme Court for a writ of certiorari. That petition was
denied. See 137 S. Ct. 292 (2016). Thus, we have not yet
considered as a full court Article III’s constraints on the
Patent Trial and Appeal Board’s (“Board”) power to cancel
originally issued patents. 6
C. Cascades
In 2015, Epson America, Inc. (“Epson”) and Sony
Corp. (“Sony”) separately petitioned for IPR of U.S. Patent
No. 7,688,347 (“’347 patent”). The Board instituted both
proceedings. Cascades Projection LLC (“Cascades”)
argued in the Sony proceeding that Article III prohibited
the Board from canceling patents. The Board issued
Final Written Decisions finding certain claims of the ’347
patent to be unpatentable. In the Sony Final Written
Decision, the Board correctly acknowledged that it “lacks
authority to rule on the constitutional questions.” Sony
Corp. v. Cascades Projection LLC, No. IPR2015-01846,
Dkt. No. 32, at 34–35 (P.T.A.B. Jan. 11, 2017). 7
Cascades appeals only the issue of whether Article III
prohibits the Board from canceling patent claims. It

6 Though the Supreme Court denied the petition for
writ of certiorari in MCM, it asked for the PTO’s views on
this issue (and two others) in Oil States Energy Services
v. Greene’s Energy Group, No. 16-712. In Oil States, the
patent owner did not raise an Article III challenge before
the Board. The patent owner argued before the Federal
Circuit that IPR proceedings violate Article III, but MCM
was decided during the Oil States appeal. A Federal
Circuit panel summarily affirmed Oil States using its
Rule 36 affirmance procedure. See Oil States Energy
Servs., LLC v. Greene’s Energy Grp., LLC, 639 F. App’x
639 (Fed. Cir. 2016).
7 It appears Cascades did not raise a constitutional
argument in the Epson IPR.
16 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

recognizes that it cannot prevail on appeal if MCM re-
mains good law. Because a three-judge panel cannot
overrule a precedential opinion, Cascades seeks initial
rehearing en banc. We have jurisdiction under 28 U.S.C.
§ 1295(a)(4)(A) to address the constitutional issues.
III. EN BANC ACTION IS NECESSARY
The Federal Circuit internal operating procedures
provide for taking en banc action upon: (a) necessity of
securing or maintaining uniformity of decisions;
(b) involvement of a question of exceptional importance;
and (c) necessity of overruling a prior holding of our court.
Fed. Cir. Internal Operating Procedure #13(2); Fed. R.
App. P. 35(a); Sony Elecs., Inc. v. United States, 382 F.3d
1337, 1339 (Fed. Cir. 2004) (per curiam). Any one of these
reasons is sufficient to justify en banc action. At least the
first two are satisfied here.
A. Panel Decisions Not Uniform
Our panel decisions holding that McCormick does not
prohibit patent claim cancellation by non-Article III
forums are not uniform. To the contrary, Patlex and
MCM diverge on the approach taken to avoid the plain
language of McCormick.
Patlex and MCM are unequivocal. Patlex stated that
McCormick’s holding was “establish[ed] on constitutional
grounds.” 758 F.2d at 604. Moreover, the Patlex panel
wrote that McCormick “affirmed that an issued patent
could not be set aside other than by an Article III court.”
Id. Contrary to Patlex, the MCM panel characterized
McCormick as a statutory case. It framed the unlawful
patent invalidation in McCormick as “[w]ithout statutory
authorization.” MCM, 812 F.3d at 1289. And it wrote
that McCormick “did not address Article III and certainly
did not forbid Congress from granting the PTO the au-
thority to correct or cancel an issued patent.” Id.
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 17

What Patlex and MCM hold in common is a conclusion
that reexaminations and IPRs, respectively, do not violate
Article III. They both distinguish binding Supreme Court
precedent, but they do so in distinct and incompatible
ways. As a court of appeals, we have no discretion to
distinguish Supreme Court precedent solely to avoid its
holdings. At minimum, if we determine in two separate
actions that a Supreme Court holding does not apply, our
rationale must be uniform. Because it is not, and because
the divergent rationales in Patlex and MCM are outcome-
determinative, we should have granted Cascades’ petition.
B. An Exceptionally Important Question
There are two primary reasons why Cascades’ petition
is exceptionally important. First, the issue before us
invokes the separation of powers—a fundamental consti-
tutional safeguard. Second, it is incumbent upon us to
address the private-versus-public right distinction as it
relates to patents. 8 Both of these issues require us to
review the IPR process in the context of the constitutional
role of Article III courts.
1. Separation Of Powers
Congressional delegation of judicial power to non-
Article III entities compromises Article III’s “purpose in
the system of checks and balances” and “the integrity of
judicial decisionmaking.” Stern, 564 U.S. at 484. James
Madison considered the “separat[ion of] the Legislative,
Executive, and Judicial powers” to be a principle “more
sacred than any other.” 1 Annals of Cong. 581 (1789).
Since the earliest years of our nation, the Supreme Court
has agreed. See Marbury v. Madison, 5 U.S. (1 Cranch)

8 Moreover, if patents are private rights, the
Board’s cancellation of original patent claims should
cease. Obviously, a decision on these issues could impli-
cate areas of law beyond patents.
18 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

137, 177 (1803) (“It is emphatically the province and duty
of the judicial department to say what the law is.”); N.
Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U.S.
50, 60 (1982) (plurality opinion) (“[O]ur Constitution
unambiguously enunciates a fundamental principle—that
the ‘judicial Power of the United States’ must be reposed
in an independent Judiciary. It commands that the
independence of the Judiciary be jealously guarded, and it
provides clear institutional protections for that independ-
ence.”). The judicial power of Article III is not to be
shared with other branches of government. United States
v. Nixon, 418 U.S. 683, 704 (1974); see also Stern, 564 U.S.
at 483 (the judiciary must be “truly distinct from both the
legislature and the executive”) (quotation marks and
citation omitted).
Ever since the Supreme Court declared that the judi-
ciary is the only branch of government empowered “to say
what the law is,” Marbury, 5 U.S. (1 Cranch) at 177,
Article III courts have witnessed Congress transfer more
and more of their authority to other tribunals. Madison
warned that “the Legislature would inevitably seek to
draw greater power into its ‘impetuous vortex.’” Wellness,
135 S. Ct. at 1960 (Roberts, C.J., dissenting) (quoting THE
FEDERALIST No. 48, p. 309 (James Madison) (C. Rossiter
ed. 1961) (1788)); id. (“[S]teady erosion of Article III
authority, no less than a brazen usurpation, violates the
constitutional separation of powers.”); see also Buckley
v. Valeo, 424 U.S. 1, 129 (1976).
While Congress has established federal courts under
Article III, it also has established several tribunals out-
side of Article III. Without a doubt, these able and hard-
working administrative law judges allow the judiciary to
keep up with its massive docket. But I find the trend of
efficiency-over-constitutionality to be troubling and in
need of a clear limiting principle. See Crowell v. Benson,
285 U.S. 22, 56–67 (1932) (“The recognition of the utility
and convenience of administrative agencies for the inves-
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 19

tigation and finding of facts within their proper province,
and the support of their authorized action, does not re-
quire the conclusion that there is no limitation of their
use . . . .”). These tribunals lack the protections of Article
III courts, in particular, the Seventh Amendment’s guar-
antee of a jury. We should be always wary of pawning
Article III for the immediate relief of efficiency.
2. Patents As Private Rights
A fundamental rule of our system of government is
that judicial power belongs in the judiciary, as defined by
Article III. See Marbury, 5 U.S. (1 Cranch) at 177; N.
Pipeline, 458 U.S. at 60 (plurality opinion); Nixon, 418
U.S. at 704; Stern, 564 U.S. at 483. That rule, however, is
not absolute. The Supreme Court has recognized three
exceptions: (1) territorial courts; (2) courts-martial; and
(3) adjudication of public rights. See N. Pipeline, 458 U.S.
at 71; Stern, 564 U.S. at 505 (Scalia, J., concurring). The
first two exceptions are not at issue in this case.
In 1765, William Blackstone contrasted the three “ab-
solute” rights of life, liberty, and property to public rights,
which belonged to “the whole community, considered as a
community, in its social aggregate capacity.” Wellness,
135 S. Ct. at 1965 (Thomas, J., dissenting) (quoting
WILLIAM BLACKSTONE, 1 COMMENTARIES *119 and 4
COMMENTARIES *5). Early examples of public rights
included transportation rights and general regulatory
compliance. Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1551
(2016) (Thomas, J., concurring) (citation omitted). Nor-
mally only the government could vindicate a public right;
private individuals could sue for violations of public rights
only in rare cases upon showing extraordinary harm. Id.
The Supreme Court first invoked the public rights
doctrine in Murray’s Lessee. There, the Court held that
Congress may not “withdraw from judicial cognizance any
matter which, from its nature, is the subject of a suit at
the common law, or in equity, or admiralty.” 59 U.S. at
20 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

284. But the Court provided an exception for public
rights:
At the same time there are matters, involving
public rights, which may be presented in such
form that the judicial power is capable of acting
on them, and which are susceptible of judicial de-
termination, but which congress may or may not
bring within the cognizance of the courts of the
United States, as it may deem proper.
Id. Only later did the Supreme Court explain the consti-
tutional justification for the public rights exception:
sovereign immunity.
[Claims against the United States] may arise in
many ways and may be for money, lands, or other
things. They all admit of legislative or executive
determination, and yet from their nature are sus-
ceptible of determination by courts; but no court
can have cognizance of them except as Congress
makes specific provision therefor. Nor do claim-
ants have any right to sue on them unless Con-
gress consents; and Congress may attach to its
consent such conditions as it deems proper, even
to requiring that the suits be brought in a legisla-
tive court specially created to consider them.
Ex parte Bakelight Corp., 279 U.S. 438, 452 (1929).
Three years after Bakelight, the Supreme Court de-
cided Crowell v. Benson, 285 U.S. 22 (1932). Drawing on
historic practice and the benefits of efficiency, the Court
found that certain agency factfinding in admiralty cases,
even if preclusive, did not violate Article III. Id. at 51–54.
The Court emphasized the statute’s “limited application”
to legislative facts only; an Article III judge was required
to review jurisdictional facts. Id. at 53. As the Court
warned, “Congress cannot reach beyond the constitutional
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 21

limits which are inherent in the admiralty and maritime
jurisdiction.” Id. at 55. It went on:
The recognition of the utility and convenience of
administrative agencies for the investigation and
finding of facts within their proper province, and
the support of their authorized action, does not
require the conclusion that there is no limitation
of their use, and that the Congress could com-
pletely oust the courts of all determinations of fact
by vesting the authority to make them with finali-
ty in its own instrumentalities or in the executive
department. That would be to sap the judicial
power as it exists under the federal Constitution,
and to establish a government of a bureaucratic
character alien to our system, wherever funda-
mental rights depend, as not infrequently they do
depend, upon the facts, and finality as to facts be-
comes in effect finality in law.
Id. at 56–57. Finally, Crowell held that “the judicial
power of the United States necessarily extends to the
independent determination of all questions, both of fact
and law, necessary to the performance of th[e] supreme
function” of enforcing constitutional rights. Id. at 60.
In 1982, the Supreme Court decided Northern Pipe-
line, holding that bankruptcy courts (as then constituted)
violated Article III. 458 U.S. at 87. A plurality of the
Court announced “two principles that aid us in determin-
ing the extent to which Congress may constitutionally
vest traditionally judicial functions in non-Art[icle] III
officers.” Id. at 80. “First, it is clear that when Congress
creates a substantive federal right, it possesses substan-
tial discretion to prescribe the manner in which that right
may be adjudicated—including the assignment to an
adjunct of some functions historically performed by judg-
es.” Id. “Second, the functions of the adjunct [deci-
sionmaker] must be limited in such a way that ‘the
22 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

essential attributes’ of judicial power are retained in the
Art[icle] III court.” Id. at 81. When constitutional rights
are at stake, the Court explained, “substantial inroads
into functions that have traditionally been performed by
the Judiciary cannot be characterized merely as inci-
dental extensions of Congress’ power to define rights that
it has created.” Id. at 84. Because the Bankruptcy Re-
form Act of 1978 “impermissibly removed most, if not all,
of ‘the essential attributes of the judicial power’” from
Article III courts, it was unconstitutional. Id. at 87.
The Supreme Court further noted that a fundamental
reason to exclude public rights from Article III is “the
traditional principle of sovereign immunity, which recog-
nizes that the Government may attach conditions to its
consent to be sued.” Id. at 67. In other words, “‘public
rights’ are those matters involving disputes between an
entity and the federal government to which sovereign
immunity applies, such that Congress need not have
permitted the lawsuit in the first place.” Michael P.
Goodman, Taking Back Takings Claims: Why Congress
Giving Just Compensation Jurisdiction To The Court Of
Federal Claims Is Unconstitutional, 60 VILL. L. REV. 83,
100 (2015). In my view, veterans benefits cases, Social
Security cases, and claims against the United States in
the Court of Federal Claims all involve a waiver of sover-
eign immunity and, in one form or the other, generally
involve a private party asserting claims against the
government. But query whether patents fit this category.
No one sues the government to invalidate a third party’s
patent, for the patent is property of the patent owner.
The Supreme Court has acknowledged that its “dis-
cussion of the public rights exception . . . has not been
entirely consistent, and the [public rights] exception has
been the subject of some debate.” Stern, 564 U.S. at 488.
But the Court in recent years has given us some guide-
posts. The public rights exception is not limited to actions
where the government is a party, Stern, 564 U.S. at 490,
CASCADES PROJECTION LLC v. EPSON AMERICA, INC. 23

despite the objection of at least one justice, id. at 503
(Scalia, J., concurring) (“I adhere to my view, however,
that—our contrary precedents notwithstanding—a matter
of public rights must at minimum arise between the
government and others . . . .”) (quotation marks, altera-
tion, and citation omitted). The exception is limited,
however, “to cases in which the claim at issue derives
from a federal regulatory scheme, or in which resolution
of the claim by an expert government agency is deemed
essential to a limited regulatory objective within the
agency’s authority.” Id. at 490 (majority opinion). Put
another way, “what makes a right ‘public’ rather than
private is that the right is integrally related to particular
federal government action.” Id. at 490–91. Despite this
recent guidance from Stern, “the contours of the ‘public
rights’ doctrine have been the source of much confusion
and controversy.” Wellness, 125 S. Ct. at 1964–65 (Thom-
as, J., dissenting). The confusion continues. Lending to
the confusion is the apparent conviction of some that the
patent is a child, born and nurtured, of a federal regulato-
ry scheme. I believe that the patent derives, its charac-
teristics indelibly secured, from a greater parent, the
United States Constitution.
It is essential, therefore, to clarify the line between
public and private rights. Under current Supreme Court
precedent, that line remains hazy, in particular in connec-
tion with patent rights. Yet, as the administrative state
expands and non-Article III tribunals adjudicate more
disputes under the cover of the public rights doctrine,
there must be vigilance in protecting Article III jurisdic-
tion. Each new tribunal outside of Article III should be
greeted with skepticism. Rigorously defending Article
III’s protections is among our most important duties, for
24 CASCADES PROJECTION LLC v. EPSON AMERICA, INC.

there exists no other voice to guard against legislative and
executive excess. 9
IV. CONCLUSION
By its inaction today, the court ignores the plain lan-
guage of binding Supreme Court precedent. It ignores
whether to continue to allow a 2-year-old panel decision to
supplant a 120-year-old Supreme Court holding, and it
overlooks an irreconcilable divide in our panel decisions.
The relationship between patent statutes and constitu-
tional provisions is an exceptionally important issue this
court, in particular, should address.
The Board’s cancellation of patents through inter
partes review may be the type of agency activity that
“sap[s] the judicial power as it exists under the federal
Constitution” and “establish[es] a government of a bu-
reaucratic character alien to our system.” Crowell, 285
U.S. at 57. Or, it may not. It is a question we should
address.
I respectfully dissent.

9 I note that a recent Board decision interpreted the
Eleventh Amendment of the United States Constitution.
See Covidien LP v. Univ. of Fla. Research Found. Inc., No.
IPR2016-01274, Paper 19 (Order Dismissing Petitions for
Inter Partes Review Based on Sovereign Immunity)
(P.T.A.B. Jan. 25, 2017).