Case: 19-2117 Document: 31 Page: 1 Filed: 01/28/2020
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`NOTE: This order is nonprecedential.
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`United States Court of Appeals
`for the Federal Circuit
`______________________
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`CIENA CORPORATION,
`Appellant
`
`v.
`
`OYSTER OPTICS, LLC,
`Appellee
`
`ANDREI IANCU, Director, U.S. Patent and Trade-
`mark Office,
`Intervenor
`_____________________
`
`2019-2117
`______________________
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`Appeal from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in No. IPR2018-
`00070.
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`______________________
`
`ON MOTION
`______________________
`
`Before MOORE, O’MALLEY, and STOLL, Circuit Judges.
`O’MALLEY, Circuit Judge.
`O R D E R
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`Case: 19-2117 Document: 31 Page: 2 Filed: 01/28/2020
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`CIENA CORPORATION v. OYSTER OPTICS, LLC
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`Ciena Corporation moves to vacate and remand for fur-
`ther proceedings in light of Arthrex, Inc. v. Smith &
`Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019). Oyster Op-
`tics, LLC and the Director of the United States Patent and
`Trademark Office oppose the motion.
` Oyster owns U.S. Patent No. 8,913,898 (“the ’898 pa-
`tent”). In 2016, Oyster filed suit in district court, alleging
`that Ciena infringed several patents, including the ’898 pa-
`tent. Ciena petitioned the Patent Office for inter partes re-
`view of the asserted patents. At Ciena’s request, the
`district court stayed the litigation. In May 2018, the Pa-
`tent Trial and Appeal Board instituted review proceedings
`on the ’898 patent. After conducting proceedings, the
`Board issued a final written decision in May 2019 that con-
`cluded that Ciena had failed to demonstrate by a prepon-
`derance of the evidence that any of the challenged claims
`are unpatentable. Ciena then filed this appeal.
` Ciena argues that under Arthrex, the Board’s decision
`must be vacated and remanded for a new hearing before a
`differently constituted panel because the Board panel that
`issued the decision was not appointed in compliance with
`the Appointments Clause. The trouble with accepting Ci-
`ena’s argument is that, unlike the patent owner in Arthrex,
`Ciena sought out the Board’s adjudication, knew or at least
`should have known of this structural defect, and was con-
`tent to have the assigned Board judges adjudicate its inva-
`lidity challenges until the Board ruled against it. Under
`those circumstances, Ciena has forfeited its Appointments
`Clause challenge. See Customedia Techs., LLC v. Dish Net-
`work Corp., 941 F.3d 1173, 1174 (Fed. Cir. 2019) (explain-
`ing that Appointments Clause challenges are not
`jurisdictional and subject to the rules of forfeiture).
`
`The Supreme Court cases cited by Ciena do not compel
`a different conclusion. Ciena primarily relies on Commod-
`ity Futures Trading Commission v. Schor, 478 U.S. 833
`(1986). In that case, Schor invoked the Commodity
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`Case: 19-2117 Document: 31 Page: 3 Filed: 01/28/2020
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`CIENA CORPORATION v. OYSTER OPTICS, LLC
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`Futures Trading Commission’s reparations jurisdiction by
`filing complaints against his broker, while the broker filed
`a competing lawsuit in federal district court against Schor.
`Schor moved to stay or dismiss the district court action, ar-
`guing that the agency action would fully resolve and adju-
`dicate all the rights of the parties.
` The broker
`subsequently dropped the civil suit and filed a counter-
`claim at the agency. After the agency ruled against Schor,
`Schor argued that the agency’s adjudication of the counter-
`claim violated Article III of the Constitution.
`Under those circumstances, the Court held that “Schor
`indisputably waived any right he may have possessed” to
`having the matter adjudicated in an Article III court. Id.
`at 849. The Court explained that “Schor expressly de-
`manded that [the broker] proceed on its counterclaim in the
`reparations proceeding rather than before the District
`Court.” Id. And like Ciena here, the Court explained that
`Schor “was content to have the entire dispute settled in the
`forum he had selected until the ALJ ruled against him on
`all counts; it was only after the ALJ rendered a decision to
`which he objected that Schor raised any challenge to the
`CFTC’s consideration” of the counterclaim. Id.
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`It is true that the Court nonetheless addressed
`whether that Executive Branch tribunal’s handling of
`those claims violated Article III. However, that was be-
`cause “[w]hen these Article III limitations are at issue, no-
`tions of consent and waiver cannot be dispositive because
`the limitations serve institutional interests that the parties
`cannot be expected to protect.” Id. at 851. Schor is of no
`help to Ciena here because Ciena is not raising an Article
`III violation such that we would have an independent
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`CIENA CORPORATION v. OYSTER OPTICS, LLC
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`obligation to safeguard the role of the Judicial Branch
`against incursions by the Political Branches. Id. at 850.1
` Nor does Freytag v. Commissioner, 501 U.S. 868 (1991)
`obligate us to take up Ciena’s challenge. In Freytag, the
`petitioners sought review in the United States Tax Court
`and consented to having a special trial judge preside over
`their case. On appeal, the Fifth Circuit held that the peti-
`tioners had waived any constitutional challenge to the ap-
`pointment of the special trial judge by their consent and by
`failing to raise the challenge at the Tax Court. Id. at 872.
`The Supreme Court did not disturb that conclusion, but
`nonetheless decided to take up the Appointments Clause
`challenge because it had included “Appointments Clause
`objections to judicial officers” in the category of cases to
`which it had previously exercised its discretion to consider
`even if not preserved below, id. at 878, and concluded that
`“this is one of those rare cases in which we should exercise
`our discretion to hear petitioners’ challenge to the consti-
`tutional authority of the Special Trial Judge,” id. at 879.
`
`A balancing of the factors identified in Freytag—“the
`disruption to sound appellate process” and the judiciary’s
`interest in remediating an Appointments Clause defect,
`id.—warrants a different conclusion here. The Court has
`generally noted that “the consequences of a litigant . . . re-
`maining silent about [its] objection and belatedly raising
`the error only if the case does not conclude in [its] favor . .
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`1 Contrary to Ciena’s suggestions, these cases do not
`stand for the proposition that courts are obligated to con-
`sider all structural challenges. At most, they stand for the
`proposition that courts have discretion to consider other-
`wise forfeited structural claims. See Plaut v. Spendthrift
`Farm, Inc., 514 U.S. 211, 231 (1995) (explaining that “the
`proposition that legal defenses based upon doctrines cen-
`tral to the court’s structural independence can never be
`waived simply does not accord with our cases.”).
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`CIENA CORPORATION v. OYSTER OPTICS, LLC
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`. can be . . . severe.” Stern v. Marshall, 564 U.S. 462, 482
`(2011) (internal quotation marks and citations omitted).
`That concern is particularly acute here because Ciena had
`a perfectly good alternative forum in which it could have
`pursued its invalidity arguments. Cf. Kuretski v. Commis-
`sioner, 755 F.3d 929, 937 (D.C. Cir. 2014) (considering chal-
`lenge in part because party had no alternative forum).
`This case is also meaningfully distinguishable from Frey-
`tag because Arthrex has already decided the issue raised
`here and remedied the structural defect.2 For these rea-
`sons, this is not one of those rare situations in which we
`should exercise our discretion to excuse a forfeiture.
`Accordingly,
`IT IS ORDERED THAT:
`(1) Ciena’s motion to vacate and remand is denied.
`(2) The opening brief is due within 30 days.
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` FOR THE COURT
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` January 28, 2020 /s/ Peter R. Marksteiner
` Date
` Peter R. Marksteiner
` Clerk of Court
`
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`s29
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`2 Unlike Freytag, this challenge also does not directly
`implicate questions concerning Article III or the exercise of
`judicial power. See Freytag, 501 U.S. at 888 (taking up an
`Appointments Clause challenge that implicated whether
`“Courts of Law” in the Appointments Clause is limited to
`Article III courts); Kuretski, 755 F.3d at 939–40 (taking up
`an Appointments Clause challenge questioning whether an
`exercise of judicial power was made under Article III).
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