All I Want for Christmas is an Impartial PTAB

Should Judge David Ruschke be on the Naughty List This Year?


by: Brad Sheafe | December 21, 2017


As the year winds to a close, I thought it would be informative and entertaining to take a quick look at what Patent Trial and Appeal Board (PTAB) Chief (Administrative Patent) Judge David Ruschke has been up to over the last few weeks.

Most recently, he put together a hand-picked expanded panel (not that hand-picking expanded panels is anything new around the PTAB, after all, the cases need to come down a certain way, policy-wise) to decide the issue of whether states are entitled to sovereign immunity from the patent trials overseen by the PTAB under Eleventh Amendment of the U.S. Constitution. Not surprisingly, the majority opinion, written by Judge Ruschke himself, found that they are not entitled.

Why is this not surprising, you ask?

Well, Judge Ruschke is obviously a fan of allowing patent trials to proceed unburdened by legal precedent. After all, he saw no problem, ethical or otherwise, with not only attending, but actively participating in Unified Patents’ (UP) “Corporate IP Strategy Conference” last month in Silicon Valley.

Not familiar with UP? Don’t worry, most people aren’t, but their business model is entirely founded on taking money from clients, largely consisting of companies who regularly infringe patents, and then filing petitions to institute patent trials against anyone who tries to enforce their patent rights against these infringing clients.

As an added benefit, this scheme also avoids any estoppel for the infringing client company. UP promises (cross their heart) that their clients have no say as to whose patents they challenge, and the PTAB, under the leadership of Judge Ruschke, is more than happy to let this charade continue unchallenged as PTAB panels overseeing UP cases have repeatedly and consistently denied patent owners the opportunity to take any discovery on the reality behind UP’s business model. This, of course, has the beneficial effect of allowing UP’s petitions (and the accompanying fees) to continue to flow to the PTAB.

So, we have Judge Ruschke, who heads an administrative tribunal that’s been around for about 5 years, blithely waving away an Amendment to the U.S. Constitution that’s been around a little longer (in fact, 217 years longer, as it was ratified in 1795).

At the same time, Judge Ruschke apparently sees no issue with speaking at a conference sponsored by a group committed to invalidating duly issued property rights through the tribunal he runs and whose highly suspect business model is being shielded from discovery by that same tribunal.

Seems to be questionable behavior for someone commissioned to serve as a neutral arbiter of disputes between adverse parties the outcome of which impacts rights often valued in the millions, if not hundreds of millions of dollars and whose conduct, therefore, should be above reproach. But is it fair to expect Judge Ruschke to ever be truly neutral?

After all, unlike Article III courts, Judge Ruschke’s livelihood depends directly upon cases continuing to be filed before his tribunal. The PTAB, like the rest of the USPTO, is funded by user fees, in this case, the fees paid by petitioners to initiate PTAB-adjudicated patent trials.

So, no trials – no PTAB. No PTAB – no PTAB judges. No PTAB judges – no need for a “chief”. Judge Ruschke is not only personally involved in deciding key issues of constitutional law (which I’m sure he would admit is fairly far afield from his usual purview of questions of anticipation and obviousness), he is also facilitating UP’s continued unfettered access to his tribunal despite clear questions of propriety around their business model while speaking at their conference. And he is financially motivated to do both. That is a string of apparent conflicts of interest that really needs to be addressed.

Again, though, this may not be all Judge Ruschke’s fault. He can’t help it that the sovereign immunity issue landed in his lap, right? And we know that his former director allowed (if not encouraged) the stacking of PTAB panels for “policy” reasons, so panel stacking to reach a desired outcome is just part of the usual practice of business in Judge Ruschke’s professional environment.

The fact that his livelihood depends on funds paid by interested parties before his tribunal is also not his fault, even when those parties, as is the case with UP, exist only because his tribunal exists (although barring discovery on their business model seems odd, particularly in view of his participation in their conference, but maybe they served really good coffee).

Plus, we also know there is no code of ethics for PTAB judges, despite diligent attempts to discover one. And given they have had over five years to write one, apparently those overseeing the PTAB feel they don’t need one, thus Judge Ruschke is free to make his own calls when it comes to his professional ethics.

So maybe we can cut him a break on all of that. But, boy, it really doesn’t look good – and given that the perception of unimpeachable impartiality is critical in his current role, Judge Ruschke may want to spend a little more time considering the importance of how his actions will be perceived.

I suspect Andrei Iancu, as President Trump’s appointee for USPTO Director, is considering it and I also imagine, with the outcome of Oil States currently under discussion, the Supreme Court is considering it as well.



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