Supreme Court Upholds Quick Patent Cancellation Process in Speedometer Case

The U.S. Supreme Court on Monday ruled against Cuozzo Speed Technologies Corp. in its challenge to a federal agency’s procedures for canceling patents in a case involving a vehicle speedometer that tells drivers when they are speeding.

The justices’ 8-0 decision backed a 2015 appeals court ruling that upheld the U.S. Patent and Trademark Office’s invalidation of New Jersey-based Cuozzo’s speedometer patent.

The legal question was whether a federal agency’s procedures have made it too easy to successfully cancel patents. In an opinion by Justice Stephen Breyer, the court backed the process.

Cuozzo’s speedometer patent was invalidated in a U.S. Patent and Trademark Office review procedure after being challenged by GPS device maker Garmin Ltd. in 2012.

Companies that are frequent targets of patent suits, including Apple Inc. and Google Inc., have taken advantage of the patent office procedure, known as inter partes review (IPR), in unexpectedly high numbers since it was put in place in 2012. These reviews allow anyone to challenge the validity of a patent far more cheaply and quickly than in a U.S. federal court.

Cuozzo was supported by several industry groups and companies, which urged the justices to take the case.

One friend-of-the-court brief filed in the case on behalf of 3M Co., Caterpillar Inc., Eli Lilly and Co. and Qualcomm Inc. said the patent office reviews and litigation in district court needed to be streamlined for the “proper functioning of the patent system as a whole.”

The cancellation of Cuozzo’s patent came in the first-ever petition for an IPR. Garmin’s action was in response to a lawsuit filed by Cuozzo in federal court in 2012. Garmin is no longer involved in the case.

(Reporting by Lawrence Hurley; Editing by Will Dunham)