Interlocutory Is Interlocutory – Patent Reform Can’t Reform That.

At the recent Senate Judiciary hearing, the Coalition for Patent Fairness offered remarks supporting the “Patent Reform Act of 2007” through the testimony of the General Counsel of Palm.  Specifically, they “support interlocutory appeal to the [CAFC] from Markman rulings.”

Palm’s General Counsel (who is not listed on the USPTO Roster of attorneys) related a case history, which may or may not reflect a need for interlocutory appeals of Markman rulings.  A disputed claim term was construed, “favorably to Palm,” and the company was granted summary judgment.  That “claim construction was reversed” by the Federal Circuit, and remanded.  The “second Markman hearing” as to the claim term was decided “again to Palm’s advantage” and was “sustained on the second appeal” to the CAFC.   How is that any different, in timing, costs or outcome, than the contemplated interlocutory appeal of a Markman ruling?

Palm’s example, and the proposed interlocutory appeal, involve two appeals.  The cost the time from filing a complaint to final judgment, and the tasks necessary to reach that point, seem to be the same in the Palm example and if there were interlocutory, Markman appeals.  The difference is that, there would be two appeals in every patent case.  The Palm example involved two appeals only because the first Markman ruling was dispositive, presumably of non-infringement.  In other words, dispositive Markman rulings get appealed now, and promptly; the proposed reform would add non-dispositive Markman claim construction rulings to the appeal docket.

The threshold question is whether an interlocutory ruling is worth much.  An interlocutory order “is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.”  FRCvP 54(b).  At a ‘first’ Markman hearing, the judge MAY construe the then-disputed claim terms, or only some of terms may then be construed.  The construction MAY be tentative, and expressly, the Judge’s order may state it is subject to revision later.  So, is that appealable?  What if there are subsequent Markman rulings, are each one appealable?  Will it be necessary to wait until after all the infringement contentions, and all of the validity challenges are flesh-out before the Court is ready to interpret the claims – knowing that an interlocutory appeal will follow?  Let that be decided by the reformers, and their lobbyists, and the reform coalitions or consorts.

With that ‘first’ Markman ruling made and appealed, the matter will be remanded.  If error was found, the a ‘second’ Markman will be needed (perhaps a 2nd interlocutory appeal, too?).  Central to evaluating the worth of these interlocutory appeals is the jurisprudence on interlocutory orders.  Only notions of stare decisis or the law of the case suggest that an interlocutory ruling will remain unchanged.  All that has to happen is more prior art to be presented, or perhaps supplemental expert reports, or a change in the law governing claim construction, and any interlocutory order might be changed based on ‘changed circumstances.”

Interlocutory appeals of Markman rulings may sound like a fix, but claim constructions that are dispositive get appealed now.  If claim construction is not dispositive, then does it make sense to stop the litigation of the dispositive issues, while the CAFC reviews the non-dispositive claim construction issues?  Even if they reject what the district court has done, on remand, a second, non-dispositive claim construction ruling will be the result.  How many mini-trials does it take to make one whole?