Automated Merch. Sys., Inc. v. Lee, No. 14-1728 (Fed. Cir. 2015)
Annotate this CaseAMS sued Crane for infringement of four patents. In 2011, Crane requested an inter partes reexamination of each patent under 35 U.S.C. 311–318. Finding that Crane raised substantial new questions of patentability, the PTO initiated four inter partes reexaminations. While they were underway, AMS and Crane settled their suit. The court issued a consent judgment stating that “[t]he parties stipulate that [the patents] are valid,” that “[a]ll claims . . . are dismissed with prejudice,” and that “[t]his judgment is final.” AMS argued that the reexaminations must stop because, under 35 U.S.C. 317(b), the judgment was a “final decision . . . entered against a party in a civil action . . . that the party has not sustained its burden of proving the invalidity of any patent claim in suit.” The PTO denied AMS’s petition. The district court reasoned that the consent judgment, though final, was not a decision that Crane failed to prove invalidity of the patents, but only that the parties stipulated to validity. The Federal Circuit affirmed, holding that the PTO’s refusal to terminate pending reexaminations is not subject to judicial review because it is not a “final agency action” under the APA, 5 U.S.C. 704.
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