This reexamination appeal raises a fundamental question—is a final adjudication, after trial and decision in the district court, and appeal and final judgment in the Federal Circuit, truly final? Or is it an inconsequential detour along the administrative path to a contrary result? Although final decisions of courts of last resort are preclusive within the courts, is the administrative agency excused? Here the Patent and Trademark Office did not mention the prior adjudication of the same issue, although that issue was finally decided in thecourtsin2001.1 The PTO’s reexamination decision is now before us on appeal, the same issue that we finally adjudicated eleven years ago.
Thus the curious, as well as unconstitutional, situation whereby this court’s final decision has devolved into an uncertain gesture, stripped of value in commerce as well as in law. The panel majority, unperturbed, simply defers to the agency’s new result as if this history does not exist. I respectfully dissent.
In this case the rules of res judicata and issue preclusion are involved, for this reexamination was requested by Power- screen, the defendant in the prior district court ruling, the appellant in the prior Federal Circuit appeal, and the petitioner for certiorari. Powerscreen could not have relitigated the question of obviousness in any court. See San Remo Hotel, L.P. v. City & Cnty. of S.F., 545 U.S. 323, 336 n.16 (2005) (“Under res judicata, a final judgment on the merits of an the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action. Under collateral estoppel, once a court has decided an issue of fact or law necessary to its judgment, that decision may preclude relitigation of the issue in a suit on a different cause of action involving a party to the first case.”). There is no assertion here of the “extraordinary circumstances” contemplated by Fed. R. Civ. P. 60(b), a rule that reflects the courts’ inherent power to reopen their own judgments in the interest of justice. See Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847 (1988) (...)
Seven years later Powerscreen requested reexamination on the ground of obviousness, citing the same references and additional references, placing strongest reliance on the same references that had been cited in the litigation. However, when an issue has been litigated and judgment entered in a court of last resort, “[t]he underlying rationale of the doctrine of issue preclusion is that a party who has litigated an issue and lost should be bound by that decision and cannot demand that the issue be decided over again.” In re Freeman, 30 F.3d 1459, 1465 (Fed. Cir. 1994) (in a reexamination completed after litigation, the PTO gave preclusive effect to the district court’s ruling on claim scope, although the Board stated that it the Board stated that it did not agree with the district court). These fundamentals of judicial authority and administrative obligation are not subject to the vagaries of shifts in the burden or standard of proof in non-judicial forums, as the panel majority proposes. Although this aspect was weighed in In re Swanson, 540 F.3d 1368 (Fed. Cir. 2008), a lower stan- dard of proof in an administrative agency cannot override the finality of judicial adjudication. The burden of proof assigned to administrative bodies is a matter of policy and procedure, not a change in substantive law. Administrative burdens do not override the Judicial Power of dispositive judgment.
One interesting question is how the non-estoppel here might play out in the reversed situation under the terms of the AIA?
Or does this case hinge solely on the difference between preponderance and clear and convincing?