Inter partes reviews (“IPRs”) are a cheaper and faster alternative to patent litigation, instituted in 2012 by the America Invents Act. IPRs allow parties to challenge the validity of patents in the U.S. Patent and Trademark Office (“USPTO”), rather than in federal courts. Since the inception of IPRs in 2012, there have been 1,291 IPR proceedings instituted in the USPTO (out of over 3,000 petitions). The Federal Circuit has docketed 503 appeals from the USPTO since 2012. Until recently, all decisions by the Patent and Trial Appeal Board (the “Board”) were affirmed in the Federal Circuit, often under the Federal Circuit Rule 36, which allows the Court to affirm a lower decision without any written opinion so long as there was no clear error. The Federal Circuit’s June 16, 2015 decision in Microsoft Corp. v. Proxyconn, Inc. v. Michelle Lee, No. 2014-1542 (Fed Cir. June 16, 2015) marks the first reversal of the Board’s claim constructions in an IPR decision.

In the Microsoft case, Proxyconn originally sued Microsoft for infringement of a patent relating to increasing data transfer speeds over packet switched networks (e.g., the Internet). Microsoft then challenged the validity of the patent in the USPTO, initiating two separate IPR proceedings.3 During these proceedings, the Board denied Proxyconn’s motion to amend the claims, construed the existing claims, and invalidated all but one of them. Proxyconn appealed the Board’s decision to the Federal Circuit...