CP re-establishes Chevron deference, that’s key to aff solvency. Perm makes the law unambiguous.

The US Supreme Court’s June 28, 2024 decision in Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce overruled the forty-year-old Chevron U.S.A. Inc. v. Natural Resources Defense Council Inc. decision, one of the most-cited cases in US law. This development will have far-reaching impacts, and for intellectual property (IP) law specifically, it could significantly affect how the Court approaches US International Trade Commission (ITC) litigation.

The Chevron doctrine required courts to defer to “permissible” agency interpretations of the statutes those agencies administer, even when a reviewing court read the statute differently. On June 28, the Supreme Court held that reviewing courts need not defer to agency interpretation of law, even when the statute is ambiguous. The holding in the Loper Bright and Relentless decision could have wide-ranging impacts on US IP law.

CHEVRON’S DECADES-LONG SIGNIFICANCE

Chevron established a framework for judicial deference to administrative agency interpretations of statutes. Under the long-standing doctrine, courts were required to determine if the US Congress had directly addressed the specific matter at hand; if it had, that interpretation had to be followed. If the statute was silent or ambiguous, courts would then defer to the agency’s interpretation, so long as it was a permissible construction of the statute.

This framework significantly shaped administrative law, emphasizing the deference owed to agencies in interpreting ambiguous statutes. In practice, the deference gave the executive branch significant influence over how to administer legislation and resulted in changes in interpretations between presidential administrations, even when the underlying statutory text and congressional intent remained unchanged.

THE SUPREME COURT’S DECISION

On June 28, the Supreme Court explicitly overruled Chevron in Loper Bright. An in-depth analysis of the decision can be found in our LawFlash that was published on June 30.

In short, the Court held that the federal judiciary must exercise independent judgment in interpreting statutes and when deciding whether an agency has acted within its statutory authority. While the Court left in place prior judicial rulings that relied on Chevron to enforce preexisting regulations or agency orders, the Court held that, going forward, Article III courts may not defer to an agency’s interpretation of the law.

IMPLICATIONS FOR IP LAW IN THE UNITED STATES

The reversal of Chevron deference will impact US IP law, and it is likely to have the most impact at the ITC. While the reversal will also affect how courts review interpretations of statutes made by IP administrative bodies like the US Patent and Trademark Office (USPTO) and the US Copyright Office, we expect a lesser impact for those agencies.

THE ITC

The ITC hears IP cases pursuant to 19 USC § 1337, which authorizes the ITC to investigate alleged wrongdoing that involves importing an article into the United States that violates patent, trademark, copyright, trade secret, and other unfair competition laws. Drawing on this authority, the ITC has become a popular forum for IP cases given the speed of the cases[1] and the remedies that are difficult to receive in district court: injunctive relief and cease-and-desist orders.

The ITC’s authority has not gone unchallenged. For example, in Suprema v. ITC,[2] the US Court of Appeals for the Federal Circuit considered whether the ITC could ban the importation of articles that do not infringe as imported but would later infringe post-importation. The Federal Circuit concluded that the statutory language was ambiguous, and relying on Chevron, determined that the ITC’s broader interpretation of Section 337 to allow for jurisdiction of post-importation infringement was reasonable.[3]

On June 24, in anticipation of the Supreme Court’s Loper Bright and Relentless decision, Google petitioned the Federal Circuit for an en banc rehearing,[4] asking the Federal Circuit to reconsider “[w]hether the International Trade Commission’s authority under 19 USC § 1337(a)(1)(B)(i) is limited to articles that infringe a patent as imported, or instead extends to cases where infringement can occur only when additional features are added or additional steps are performed after importation.”[5] The Federal Circuit will have to consider this question and any future challenges to the ITC’s interpretation of its authority. This could lead to further limitations on what cases can be brought before and succeed at the ITC.