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December 19, 2017

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Hey Kevin,

I would say that the Knight case isn’t dispositive on the issue of “waiver” of sovereign immunity, as it relates to the separate filing of an IPR which is a different forum from that of federal district court. Here’s the key statement of relevant holding in Knight:

“We thus hold that when a state files suit in federal court to enforce its claims to certain patents, the state shall be considered to have consented to have litigated in the same forum all compulsory counterclaims.”

Note the phrase (“in the same forum”). An IPR is not the “same forum,” therefore there is no “waiver.” The argument by PTAB that the accused infringer would be barred from filing the IPR if they don’t do so within a year of the filing the infringement action is specious-the accused infringer can still assert invalidity in the court infringement proceeding. But given PTAB’s penchant for playing “fast and loose” with the case law, I’m not surprised that they have ruled (incorrectly in my view) that “waiver” has occurred.

As far as the concurring view by APJ Bisk that there's waiver from having obtained the patent at the USPTO, that view is absurd on its face-even the Knight case says that.

Good for the Board. The CAFC has no jurisdiction to review institution denials, so the previous crop of sovereign immunity decisions at the PTAB have evaded judicial review. By instituting this petition in the teeth of an assertion of sovereign immunity, the PTAB sets up a straightforward presentation of the issue to the CAFC, so that we can get some legal clarity on this so-far murky issue.

The PTAB expanded panel here was properly following what it considered the most relevant immunity waiver decision* of its supervisory appellate court for defensive IPR situations in which where the party asserting immunity has sued in Federal Court on the same patent [i.e., the patent owner is the plaintiff]. But that does not affect state or tribal IPR immunity in other situations, and of course presumably this PTAB decision will be appealed.
*Regents of Univ. of New Mexico v. Knight, 321 F.3d 1111 (Fed. Cir. 2003),

There's no way to reconcile the Federal Circuit caselaw (which will soon be affirmed by the Supreme Court) holding that IPRs do not offend the Seventh Amendment or Article III with the University's argument that it is even entitled to immunity in an administrative IPR proceeding.

Stated another way, if a state University is entitled to raise rights under the Eleventh Amendment, then all patent owners are entitled to raise the right to a jury trial under the Seventh Amendment. Why is it that the Eleventh applies but the Seventh does not?

I think Greg may be giving the members of the PTAB too much credit, although he is careful not to say one way or the other.

Certainly, the decision sets up the question of sovereign immunity squarely for review by a court not of the marsupial variety. And by doing so in a case involving a state rather than a tribe as patentee, there is no question that, but for waiver, sovereign immunity exists. No doubt the members of board were aware of that.

But I think that at least some of the PTAB decision-renderers (I hesitate to use the term "judges", because that lends to confusion with judges of the Article III variety) rendered this decision not in order to set the table for the Federal Circuit and SCOTUS (assuming the latter doesn't dismantle IPR/PGR proceedings later this term), but because they really think that no patent should be beyond their grasp.

Atari Man,

I tend to agree with you.

Greg's statement of "so that we can get some legal clarity on this so-far murky issue." begs the question as to WHY (and WHO) has made this murky.

It only appears murky because those who do not like the application of a very well established legal position WANT it to be "murky."

That's called dust-kicking. I "get" that it is a legal tactic. I also "get" that is should NOT be respected. Sovereign Immunity law remains clear - it just remains to be applied.

"I think that at least some of the PTAB... rendered this decision... because they really think that no patent should be beyond their grasp."

I am inclined to agree. I certainly did not mean to suggest that the PTAB *wants* CAFC review of their decision. I expect that they would rather that *their* precedent (not the CAFC's) would stand as the last word on this point.

I merely mean to say that we have not even had the *chance* for the CAFC to weigh in yet, because their has not been a decision over which the CAFC could exercise jurisdiction. It is a good thing that we are finally getting a chance for real, proper, Art. III review on this point.

"Greg may be giving the members of the PTAB too much credit, although he is careful not to say one way or the other."

The reason I do not say one way or the other is that I am indifferent in this case. I do not have a dog in *this* fight. I just want a clear, binding precedent to control the issue, so that we all know what the *law* is on this point.

"because their has not been..."

Er, "because there has not been..."

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