Kathleen O'Malley, United States Court of Appeals for the Federal Circuit

Correction: A previous version of this article incorrectly stated that Judge Kimberly Moore was the author of the Ciena order.

Patent owners are the only litigants who can benefit from an appointments clause challenge to PTO administrative judges, a panel for the U.S. Court of Appeals for the Federal Circuit ruled Tuesday.

Petitioners who initiate administrative challenges to patent validity before the Patent Trial and Appeal Board can't then complain on appeal about defects in the board, a panel led by Judge  Kathleen O'Malley wrote.

The decision denies Ciena Corp.'s bid for a new hearing before a different panel of administrative judges. Though nonprecedential, the decision could mean the PTAB will have somewhat fewer cases to contend with on remand than previously expected, if the court's Oct. 31 decision in Arthrex v. Smith & Nephew survives the current en banc calls.

"The trouble with accepting Ciena'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 content to have the assigned board judges adjudicate its invalidity challenges until the board ruled against it," O'Malley wrote Tuesday in Ciena v. Oyster Optics.

Under those circumstances, Ciena forfeited its appointments clause challenge, O'Malley wrote. Judges Kimberly Moore and Kara Stoll concurred.

"The Federal Circuit seems to be taking the position that, 'You chose the path, so you chose the consequences,'" said Ropes & Gray partner Matthew Rizzolo, who's not involved in the case.

Arthrex held that the PTAB's 275 administrative judges are principal officers of the United States who must be appointed by the president and confirmed by the Senate. But rather than render the judges powerless, the court construed the Patent Act to give the PTO director the power to terminate PTAB judges at will. That makes them inferior officers, which means they can continue issuing decisions going forward.

The Federal Circuit has said that Arthrex will apply only to litigants whose cases are not yet final on appeal and who preserved the issue in their opening appellate briefs. That would mean 150 to 200 cases would be eligible for new hearings before different PTAB panels. The Ciena decision figures to shrink that number by roughly 20%.

Arthrex, Smith & Nephew and the PTO have asked the court to reconsider the Arthrex ruling en banc. A few Federal Circuit judges have criticized Arthrex directly or indirectly, but it's far from clear that a majority of the court's 12 judges will vote for reconsideration.

Patent owner Oyster Optics is represented by Wayne Helge of Davidson Berquist Jackson & Gowdey. Oyster Optics was supported by the PTO. "Ciena was sued in district court for infringement of a patent and, instead of pursuing its invalidity allegations there, it chose the board as the forum to hear its invalidity contentions," the agency stated in a brief signed by associate solicitor Molly Silfen.

Ciena was represented by Paul Hastings. The company argued that a litigant who invoked the Commodity Futures Trading Commission's authority didn't forfeit a subsequent Supreme Court challenge to commission appointments, so it shouldn't have to either.

"Nothing in the Supreme Court's jurisprudence forces a party to a Hobson's choice of either forgoing its right to challenge patents asserted against it [at the PTAB] or forfeiting its constitutional challenge to the Board's composition," Paul Hastings partner Igor Timofeyev wrote.