In a unanimous ruling, the U.S. Supreme Court in Peter v. NantKwest, case number 18-801, struck down the U.S. Patent and Trademark Office’s (USPTO) recent and often-criticized effort to recoup its legal fees – even in cases it loses – because it violates the so-called American Rule, which says U.S. litigants must typically pay for their own lawyers.

The Patent Act creates two mutually exclusive pathways to challenge an adverse decision by the USPTO. The first permits judicial review by direct appeal to the United States Court of Appeals for the Federal Circuit. There is “no opportunity for the applicant to offer new evidence” in a §141 proceeding, and the Federal Circuit “must review the PTO’s decision on the same administrative record that was before the [agency].”
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