Litigation Trends 2024

70 | Weil, Gotshal & Manges LLP LITIGATION TRENDS 2024 | 71 T O C E M P A N T I I P C A P R O W C C O N T A C T I N T A P P P A T C C L S E C Chevron Deference in the Crosshairs at the Supreme Court – Will it Survive and in What Form? The Supreme Court’s decision in the case of Chevron v. NRDC, 467 U.S. 837 (1984), has governed judicial review of federal agency decisions for nearly 40 years. Under the Court’s standard of review, coined Chevron Deference, courts defer to a federal agency’s reasonable interpretation of a statute where congress has not directly and unambiguously spoken on the issue. In practice, this has given federal agencies, including the ITC and USPTO in certain circumstances, wide discretion to interpret and implement rules and regulatory schemes. The Supreme Court has “long recognized that considerable weight should be accorded to an executive department’s construction of a statutory scheme it is entrusted to administer.” Chevron, 467 U.S. at 844. Now, after 40 years, two cases again present the Court with the question of what weight to give and level of deference is owed to agency decision making: Loper Bright Enterprises v. Raimondo, Case No. 21-5166 and Relentless v. U.S. Dept. of Commerce, Case No. 22-1219. These cases, originating from a National Marine Fisheries Service requirement that vessels pay for inspectors to ensure compliance with fisheries regulations, may prove the mechanism by which the Court overrules Chevron and curtails or ends 40 years of agency deference. Chevron at the ITC Among the federal agencies potentially affected by changes to the deference standard is the International Trade Commission (“ITC”). The ITC conducts unfair import investigations under Section 337 of the Tariff Act of 1930, which prohibits the importation of products that infringe U.S. patent rights, issuing exclusion orders directing U.S. Customs to stop imports as its primary remedy. The Federal Circuit has applied Chevron Deference to the ITC’s statutory interpretations, in a consequential manner. For example, in Suprema v. ITC, No. 12-1170 (Fed. Cir. 2015) (en banc), the Federal Circuit upheld an ITC interpretation of Section 337 that goods used “after importation … by the importer to directly infringe at the inducement of the goods’ seller” were barred from importation. Id. at 4. The ITC’s interpretation effectively allows it to provide relief under Section 337 for induced infringement – a critical ruling to protect patent owner’s rights. The Federal Circuit explicitly invoked Chevron Deference in Suprema, reasoning that “because Section 337 does not answer the question before us, the Commission’s interpretation of Section 337 is entitled to Chevron deference.” Id. Thus, the courts have reviewed the ITC’s authority in certain contexts with broad discretion – a paradigm that may be flipped if Chevron is overruled. Chevron at the USPTO Another federal agency potentially impacted by changes to the deference standard is the United States Patent and Trademark Office (“USPTO”). The Federal Circuit and the Supreme Court have applied Chevron Deference to the USPTO’s statutory and regulatory interpretations for the Patent Trial and Patent Litigation Anish Desai Co-Head New York anish.desai@weil.com Edward Reines Co-Head Silicon Valley edward.reines@weil.com P A T

RkJQdWJsaXNoZXIy MTE2NjA5Mw==