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United States v. Arthrex

Supreme Court of the United States · 2021 · Constitutional Law

Constitutional LawAppointments ClauseSeparation of PowersAdministrative LawPatent LawAppointments Clauseinferior officersprincipal officers

Facts

Congress provided that Administrative Patent Judges on the Patent Trial and Appeal Board would be appointed by the Secretary of Commerce as inferior officers. APJs conduct inter partes review and can issue final decisions on patentability that bind the Executive Branch in those proceedings. Although the PTO Director has broad administrative and policy oversight over APJs, the statute provided that only the PTAB may grant rehearings, and no principal officer in the Executive Branch could directly review and reverse an APJ's final decision in inter partes review. The Director was required to issue and publish certificates canceling or confirming claims as dictated by the APJs' final decision.

Issue

Whether Administrative Patent Judges, appointed by the Secretary of Commerce as inferior officers, may constitutionally exercise unreviewable authority to issue final decisions on behalf of the Executive Branch in inter partes review. If not, what remedy is appropriate?

Rule

Under Edmond, inferior officers must be directed and supervised at some level by a principal officer appointed by the President with Senate confirmation. In the context of executive adjudication, an officer who can issue a final decision binding the Executive Branch must be subject to review by such a principal officer. Statutory restrictions that prevent the PTO Director from reviewing final PTAB decisions are unenforceable to that extent.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Congress creates the Renewable Equipment Review Board within the Department of Energy. Board judges are appointed by the Secretary of Energy and may issue final orders canceling or confirming federal clean-energy licenses, but the statute says only the Board may grant rehearing and the Secretary must implement the Board's final order.

Is this arrangement most likely constitutional under Article II?

Explanation. The majority held that in executive adjudication, officers appointed as inferior officers cannot render a final decision binding the Executive Branch unless a principal officer has discretion to review that decision. A ministerial duty to carry out the tribunal's result does not count as meaningful supervision, and later judicial review does not substitute for executive review. The constitutional defect is the insulation of final adjudicatory decisions from review by a principal officer, not the mere use of adjudicators appointed by a department head. (Derived from United States v. Arthrex (n.d.).)