Earlier today the United States Court of Appeals for the Federal Circuit issued an Order staying further proceedings at the PTAB relating to the RESTASIS patents now owned by the Saint Regis Mohawk Tribe. The stay will remain in place until at least one day after the oral argument scheduled for June 2018. The Court will consider whether the stay shall remain in effect or be lifted based on the merits of the case.
The dispute between the Saint Regis Mohawk Tribe and Mylan Pharmaceuticals arose when Allergan transferred the RESTASIS patents to the Tribe so a claim of sovereign immunity could be raised, which would divest the Patent Trial and Appeal Board (PTAB) of jurisdiction. The Tribe filed a motion to dismiss the various inter partes review (IPR) proceedings instituted against the RESTASIS patents by the PTAB at the request of Mylan. In a controversial and questionable decision the PTAB panel assigned to the case refused to recognize the Mohawk claim of sovereign immunity. It has since been learned through Freedom of Information Act (FOIA) requests that the three Administrative Patent Judges (APJs) assigned to the case engaged in off-the-record deliberations with supervising APJs, which on its face seems to clearly violate the Administrative Procedures Act (APA).
After losing the motion to dismiss, attorneys for the Mohawk Tribe filed an immediate appeal with the Federal Circuit, and also sought a stay from the PTAB. The PTAB denied the stay and was within a matter of days moving to hold a final hearing on April 3, 2018, which now will not happen.
In the Per Curiam decision from the Federal Circuit the Court explained that the PTAB has lost jurisdiction by virtue of the appeal. The brief, non-precedential Order substantively reads:
Appellants’ motion for a stay is granted until the day after oral argument in June 2018. At this juncture, it appears that the appeals divested the Board of jurisdiction over the aspects of the case on appeal, see Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58 (1982); Princz v. Fed. Republic of Ger., 998 F.2d 1 (D.C. Cir. 1993) (appeal from denial of motion to dismiss on grounds of sovereign immunity divests district court of jurisdiction over entire case); Apostol v. Gallion, 870 F.2d 1335 (7th Cir. 1989); accord In re Graves, 69 F.3d 1147, 1149 (Fed. Cir. 1995), and that exclusive jurisdiction to resolve the threshold issue of whether these proceedings must be terminated vests in this court, and that the Board may not proceed until granted leave by this court. The stay shall remain in effect until the day after oral argument in the appeals in June 2018. The court will address whether the stay shall remain in effect or whether it will be lifted at that time based on further consideration of the merits of the appeals.
For now, the Mohawk Tribe has prevailed, scoring an important victory. Given the politicization of this case, and the fact that the PTAB has traditionally bent to political pressure, it is virtually certain the PTAB would have invalidated all the claims of the RESTASIS patents in order to send a not too subtle message of disapproval.
Given the high stakes and unique legal question presented it seems virtually certain the Judges of the Federal Circuit were aware of the Mohawk sovereign immunity issue as it weaved its way through the Patent Office and even prior to reaching the Court. If that is in fact true, a stay could well signal that there is some serious question about the refusal to recognize claims of sovereign immunity at the PTAB. While it can be unwise to read too much into an Order to stay proceedings, all things being equal this is a big win in a legal fight that seems destined for consideration by the Supreme Court eventually.
Perhaps by the date of the Federal Circuit oral arguments in June 2018 the Patent Office will have completely responded to the now long overdue FOIA requests pending that might shed a clearer light on who actually decided the issues in the RESTASIS IPRs, and why so many supervising APJs were allowed to participate in deliberations without it ever being made known to the parties, known to the public, or placed on the record as required by 37 CFR 1.2.