Opinions — Thursday, March 19, 2026

The Federal Circuit denied Volkswagen Group of America, Inc.'s petition for mandamus seeking to vacate the Acting Director's discretionary denial of inter partes review of a Longhorn Automotive Group LLC patent. Volkswagen argued that Congress violated the nondelegation doctrine by granting the Director unbounded discretion to deny institution of IPR proceedings, a constitutional challenge that would normally permit review despite § 314(d)'s bar on appeals of institution decisions.

The court held that the Director's discretion to deny institution constitutes executive rather than legislative power, analogizing it to prosecutorial discretion under Heckler v. Chaney. Distinguishing the Fifth Circuit's decision in Jarkesy v. SEC, which found an unconstitutional delegation where the SEC chose which defendants received jury trials, the court emphasized that the Director merely decides whether the USPTO will conduct post-grant review—a "second look" at an earlier administrative patent grant—rather than determining what procedures apply. The court further noted that non-institution decisions have no legal effect on underlying patent rights, leaving the challenger's obligations unchanged and reinforcing the executive nature of the Director's choice whether to initiate agency proceedings.

The Federal Circuit affirmed the International Trade Commission's determination that Apple violated Section 337 of the Tariff Act by importing Apple Watch models with blood oxygen sensing functionality that infringed U.S. Patent Nos. 10,912,502 and 10,945,648, owned by Masimo Corporation and Cercacor Laboratories, Inc. The court upheld the Commission's limited exclusion order barring importation of the infringing watches. Apple challenged both prongs of the domestic industry requirement under 19 U.S.C. § 1337(a)(2), arguing that Masimo failed to identify an actual article practicing the asserted claims at the time of filing and that the Commission relied on a "hypothetical" device. The court rejected Apple's contention that the Commission must identify the exact article specified in the complaint to satisfy the technical prong, holding instead that the regulation at 19 C.F.R. § 210.12(a)(9)(ix) requires only identification of "a representative involved domestic article" in the complaint, with the actual articles determined through the evidentiary record. The Commission found that multiple Masimo prototype devices—including the RevA, RevD, and RevE sensors—practiced the asserted claims and existed at the complaint filing date based on testimony regarding pre-filing oxygen saturation testing.

The decision clarifies that complainants in Section 337 investigations need not rigidly adhere to the precise domestic industry article identified in their complaint, provided substantial evidence supports that physical articles practicing the asserted claims existed at filing. This holding gives complainants flexibility during ITC investigations to develop their domestic industry showing through discovery and hearing testimony, rather than requiring complete specification at the pleading stage. The court's interpretation of 19 C.F.R. § 210.12(a)(9)(ix) as requiring only a "representative" article in the complaint, with the final determination based on the evidentiary record developed under APA procedures, resolves tension between early case pleading requirements and the realities of proving technical prong satisfaction through iterative product development. For respondents, the decision underscores the difficulty of defeating domestic industry claims based on specification deficiencies in the complaint alone, shifting the battleground to factual disputes about what physical articles actually existed and functioned at the critical date.