The Saint Regis Mohawk Tribe has confirmed it will appeal the Patent Trial and Appeal Board’s (PTAB) decision denying the tribe’s motion to terminate the series of inter partes reviews filed by a group of generics manufacturers against patents that the tribe took ownership of last year. The move sets the stage for the Court of Appeals for the Federal Circuit to eventually weigh in on what has become one of the highest profile patent stories of recent years. Here’s the full text of the tribe’s statement which was issued late yesterday afternoon:
The Saint Regis Mohawk Tribal Council strongly disagrees with the decision of the U.S. Patent Trial and Appeal Board (PTAB) that tribal sovereign immunity does not apply to inter partes review (IPR) proceedings, a ruling that contradicts other PTAB panels’ decisions from last year holding state sovereigns do enjoy such immunity, as well as longstanding Circuit Court and Supreme Court precedents holding that sovereign immunity does apply to these exact types of proceedings. By ignoring these precedents, this administrative Panel places sovereign governments on the same footing as private corporations. Today, the Saint Regis Mohawk Tribe filed its Notice of Appeal of the PTAB decision and looks forward to the decision being vacated by an Article III tribunal.
The PTAB’s decision, which was issued last Friday, has attracted plenty of coverage as the board came down heavily against the use of tribal sovereign immunity as a defence against IPR.
The wide scope of the decision and the application of tribal law has attracted criticism from some quarters. In a post on the Written Description blog Professor Greg Ablavsky, an expert in federal Indian law at Stanford University, took aim at how the PTAB had applied some of the relevant case law and described the decision as “highly unpersuasive”.
In a lengthy twitter thread New York University associate professor Jacob Sherkow also weighed in on the decision opining that the Board could have crafted a narrow decision specific to the tribe’s agreement with Allergan, but went much further. “This just seems like such a painfully wrong-headed, self-aggrandising decision that never needed to be made,” he wrote in conclusion. “Wrong on the law and wrong as a matter of principle.”
Others were far kinder to the PTAB’s ruling, with Ropes & Gray’s Scott McKeown defending its breadth. “The Board understands this decision will be appealed so better to tee up the broader question than decide on some narrow factual issue,” he told IAM. “This is a dispute that will keep popping up until the Federal Circuit settles it and each deal will be factually different.”
The issue of tribal sovereign immunity and IPRs was thrust into the spotlight last September when the St Regis Mohawks struck a deal with Allergan through which the tribe took ownership of six patents previously owned by the pharmaceutical company in an attempt to shield them from IPRs filed by Mylan and other generic rivals Teva and Akorn. In return, the St Regis received an upfront payment of $13.75 million and another $15 million annually for licensing the grants back to Allergan.
The use of sovereign immunity, which was pioneered by several state universities, has proved highly controversial. In a first sign that the PTAB was looking to limit its application, the board ruled late last year in a case involving the University of Minnesota that immunity could not be used as an IPR shield if the patent owner has asserted its IP in court.
Given the millions of dollars at stake, it was almost inevitable that the St Regis would appeal last Friday’s decision. And presumably, should the Federal Circuit also rule against its use of sovereign immunity, we could expect a cert petition to the Supreme Court. This story still has some way to go; but as things stand the sovereign immunity workaround, that some had hoped would prove a boon to patent owners, looks to be closed off unless there is a court reversal – something that is likely not happen until sometime in the future. And, who knows, by then it may not even be an issue at all.