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Tribal Immunity Does Not Apply to IPR Proceedings

The US Court of Appeals for the Federal Circuit affirmed a Patent Trial and Appeal Board (PTAB) finding that tribal immunity does not apply to inter partes review (IPR) proceedings. Saint Regis Mohawk Tribe v. Mylan Pharmaceuticals, Inc., et al., Case Nos. 18-1638, -1639, -1640, -1641, -1642, -1643 (Fed. Cir. July 20, 2018) (Moore, J).

The appeal stems from a multi-front dispute between Allergan and various generic drug manufacturers regarding patents related to Allergan’s Restasis product, a treatment for alleviating the symptoms of chronic dry eye. In 2015, Allergan sued the generic drug manufactures in the Eastern District of Texas, alleging infringement of its Restasis patents based on their filings of abbreviated new drug applications. In 2016, Mylan petitioned for IPR of Restasis patents, and the other generic drug manufacturers subsequently filed similar petitions. The PTAB instituted IPR and scheduled a consolidated oral hearing for September 2017.

Less than one week before the oral hearing, Allergan transferred certain patents relating to its Restasis product to the Saint Regis Mohawk Tribe. Allergan moved to withdraw, and the Tribe moved to terminate the IPR proceedings, asserting tribal sovereign immunity. In February 2018, the PTAB denied both motions. The Tribe and Allergan appealed.

On appeal, the Tribe argued that tribal immunity applies to IPR proceedings under the Supreme Court of the United States’ 2002 decision in Fed. Maritime Comm’n v. S.C. State Ports Auth. (FMC). In FMC, the Supreme Court considered whether state sovereign immunity precluded the Federal Maritime Commission from “adjudicating a private party’s complaint that a state-run port ha[d] violated the Shipping Act of 1984.” In answering the question, the Supreme Court asked whether Commission adjudications “are the type of proceedings from which the Framers would have thought the States possessed immunity when they agreed to enter the Union.” In finding that sovereign immunity applied, the Supreme Court recognized the distinction between adjudicative proceedings brought against a state by a private party, where sovereign immunity applies, and agency-initiated enforcement proceedings, where sovereign immunity does not apply.

In the case at hand, the Tribe argued that tribal immunity applies in IPR proceedings under FMC because an IPR is a contested adjudicatory proceeding between private parties in which the petitioner, not the US Patent and Trademark Office, defines the contours of the proceeding. The generic drug manufacturers disagreed, arguing that IPR proceedings are more like traditional agency actions because the PTAB is not adjudicating claims between parties, but instead is reconsidering a grant of a government franchise.

The Federal Circuit rejected the Tribe’s argument, finding that tribal immunity does not apply to IPR proceedings. The Court noted that IPR proceedings are neither clearly a judicial proceeding instituted by a private party nor clearly an enforcement action brought by the federal government. However, the Court found that IPR proceedings are more akin to an agency proceeding for the following reasons:

  • The government has broad discretion in deciding whether to institute an IPR proceeding.

  • The government may choose to continue an IPR proceeding once instituted even if the petitioner chooses not to participate.

  • IPR procedures are different than the Federal Rules of Civil Procedure.

  • Congress did not contemplate that tribal immunity would apply to IPR proceedings.

Given these findings, the Court affirmed the PTAB’s decision that tribal immunity does not apply.

Practice Note: The Federal Circuit’s decision is limited to tribal immunity. The Court recognized that there are many parallels between sovereign immunity and tribal immunity, but left for another day the question of whether there is any reason to treat state sovereign immunity differently. 

© 2020 McDermott Will & Emery


About this Author

Amol Parikh, McDermott Will Emery, Chicago, patent lawyer, Intellectual Property Litigation Attorney

Amol Parikh is an associate in the law firm of McDermott Will & Emery LLP and is based in the Firm's Chicago office.  He focuses his practice on IP litigation, counseling and prosecution. Amol has been recognized as a 2011 Illinois Rising Star in Intellectual Property by Law & Politics.  Rising Stars are lawyers under the age of 40 that have been in practice for 10 years or less.  No more than 2.5 percent of the lawyers in Illinois are named as Rising Stars.

Amol has...