UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`MYLAN PHARMACEUTICALS INC., TEVA PHARMACEUTICALS USA,
`INC., and AKORN INC.,1
`Petitioners
`v.
`
`ALLERGAN, INC.,
`Patent Owner
`
`
`
`
`
`
`
`
`
`
`
`
`
`Case IPR2016-01127 (8,685,930 B2)
`Case IPR2016-01128 (8,629,111 B2)
`Case IPR2016-01129 (8,642,556 B2)
`Case IPR2016-01130 (8,633,162 B2)
`Case IPR2016-01131 (8,648,048 B2)
`Case IPR2016-01132 (9,248,191 B2)
`
`
`BRIEF OF THE ASSOCIATION FOR ACCESSIBLE MEDICINES AS
`AMICUS CURIAE IN SUPPORT OF PETITIONERS
`
`William M. Jay
`Jaime A. Santos
`Goodwin Procter LLP
`901 New York Ave.,
`N.W.
`Washington, DC 20001
`Tel: 202-346-4000
`
`
`Cynthia Lambert Hardman
`Registration No. 53,179
`Goodwin Procter LLP
`The New York Times
`Building
`620 Eighth Avenue
`New York, NY 10018-1405
`chardman@goodwinlaw.com
`Tel: 212-813-8800
`
`
`
`Jeffrey K. Francer
`Rachel L. Sher
`Association for
`Accessible Medicines
`601 New Jersey Ave.,
`N.W., Suite 850
`Washington, DC 20001
`Tel: 202-249-7100
`
`
`
`1 Cases IPR2017-00576 and IPR2017-00594, IPR2017-00578 and IPR2017-00596,
`IPR2017-00579 and IPR2017-00598, IPR2017-00583 and IPR2017- 00599,
`IPR2017-00585 and IPR2017-00600, and IPR2017-00586 and IPR2017-00601
`have respectively been joined with the captioned proceedings.
`
`
`
`
`

`

`
`
`I.
`
`II.
`
`TABLE OF CONTENTS
`
`Page
`
`INTEREST OF AMICUS CURIAE ........................................................1
`
`INTRODUCTION ...................................................................................2
`
`III. ARGUMENT ...........................................................................................3
`
`A.
`
`Tribal Immunity Does Not Block The Board From
`Considering The Validity Of An Issued Patent. ...........................3
`
`2.
`
`1.
`
`IPRs Are Administrative Proceedings Instituted By A
`Federal Agency, Not Judicial Disputes Between
`Private Parties. ....................................................................3
`Instituted IPRs Are In Rem Proceedings, And The
`Transfer Of The Subject Patents To A Tribe Does Not
`Defeat In Rem Jurisdiction. .................................................6
`Tribal Immunity Does Not Block The Board From
`Completing Instituted IPRs When A Patent Owner
`Transfers Its Patents To Avoid An Adverse Decision. .............. 11
`
`B.
`
`IV. CONCLUSION ..................................................................................... 15
`
`
`
`
`
`
`i
`
`

`

`
`
`TABLE OF AUTHORITIES
`
`Cases Page(s)
`Allergan, Inc. v. Teva Pharm. USA, Inc.,
`No. 15-cv-1455-WCB, 2017 WL 4619790 (E.D. Tex. Oct.16, 2017) ............... 15
`
`Anderson & Middleton Lumber Co. v. Quinault Indian Nation,
`929 P.2d 379 (Wash. 1996) .................................................................................. 7
`
`Cass Cnty. Joint Water Res. Dist. v. 1.43 Acres of Land,
`643 N.W.2d 685 (N.D. 2002) ........................................................................... 8, 9
`
`Cloverleaf Standardbred Owners Ass’n, Inc. v. Nat’l Bank of Wash.,
`699 F.2d 1274 (D.C. Cir. 1983) .......................................................................... 12
`
`Consumer Watchdog v. Wis. Alumni Research Found.,
`753 F.3d 1258 (Fed. Cir. 2014) ............................................................................ 4
`
`Cnty. of Yakima v. Confederated Tribes & Bands of the Yakima Indian Nation,
`502 U.S. 251 (1992) .............................................................................................. 9
`
`Covidien LP v. Univ. of Fla. Research Found. Inc.,
`
`IPR2016-01274, Paper 21(P.T.A.B. Jan. 25, 2017) ................................. 6, 10-11
`
`Cuozzo Speed Techs., LLC v. Lee,
`136 S. Ct. 2131 (2016) ...................................................................... 2, 4, 5, 10, 11
`
`Fed. Mar. Comm’n v. S.C. State Ports Auth.,
`535 U.S. 743 (2002) .............................................................................. 2, 3, 4, 5, 6
`
`FTC v. Actavis, Inc.,
`133 S. Ct. 2223 (2013) .......................................................................................... 1
`
`Harmonic Inc. v. Avid Tech., Inc.,
`815 F.3d 1356 (Fed. Cir. 2016) ............................................................................ 5
`
`Lundgren v. Upper Skagit Indian Tribe,
`389 P.3d 569 (Wash. 2017) .................................................................................. 9
`
`Miccosukee Tribe of Indians of Fla. v. Dep’t of Envtl. Prot. ex rel. Bd.
`of Trs. of Internal Improv. Tr. Fund,
`78 So. 3d 31 (Fla. Dist. Ct. App. 2011) ................................................................ 9
`
`
`
`ii
`
`

`

`
`
`Momenta Pharm., Inc. v. Bristol-Myers Squibb Co.,
`No. 2017-1694 (Fed. Cir.) .................................................................................... 1
`
`Neochord, Inc. v. Univ. of Md.,
`
`IPR2016-00208, Paper 28 (P.T.A.B. May 23, 2017) ......................................... 10
`
`Provident Tradesmens Bank & Tr. Co. v. Patterson,
`390 U.S. 102 (1968) ............................................................................................ 13
`
`Reactive Surfaces Ltd., LLP v. Toyota Motor Corp.,
`IPR2016-01914, Paper 36 (P.T.A.B. July 13, 2017) .................................... 10, 14
`
`Smale v. Noretep,
`208 P.3d 1180 (Wash. Ct. App. 2009) ........................................................ 7, 8, 10
`
`Travelers Indem. Co. v. Dingwell,
`884 F.2d 629 (1st Cir. 1989) ............................................................................... 12
`
`United States v. Yakima Tribal Ct.,
`806 F.2d 853 (9th Cir. 1986) ............................................................................ 3-4
`
`Statute and Regulation
`
`35 U.S.C. § 317(a) ................................................................................................... 11
`
`37 C.F.R. § 42.74(a) ................................................................................................. 11
`
`Rules
`
`Fed. R. Civ. P. 19(b) ................................................................................................ 12
`
`Sup. Ct. R. 37.6 .......................................................................................................... 1
`
`Other Authorities
`Black’s Law Dictionary (8th ed. 2004) .................................................................... 10
`
`Black’s Law Dictionary (9th ed. 2009) ................................................................ 9-10
`
`Fed. R. Civ. P. 19 advisory committee note (1966) ................................................ 12
`
`
`
`iii
`
`

`

`
`
`Nat’l Acad. of Scis., Eng’g, and Med., Making Medicines Affordable:
`A National Imperative (2017), available at
`http://www.nationalacademies.org/hmd/Reports/2017/making-
`medicines-affordable-a-national-imperative.aspx ........................................ 12-13
`
`U.S. Patent & Trademark Office, U.S. Patent Statistics Chart Calendar Years
`1963-2015, U.S. Patent & Trademark Office,
`https://www.uspto.gov/web/offices/ac/ido/oeip/taf/us_stat.htm ........................ 15
`
`
`
`
`
`iv
`
`

`

`
`
`I.
`
`INTEREST OF AMICUS CURIAE1
`The Association for Accessible Medicines (“AAM”) is a nonprofit, voluntary
`
`association representing nearly 100 manufacturers and distributors of finished
`
`generic pharmaceutical products and of bulk active pharmaceutical chemicals, as
`
`well as suppliers of other goods and services to the generic pharmaceutical industry.
`
`AAM’s core mission is to improve the lives of patients by providing timely
`
`access to safe, effective, affordable prescription medicines. To that end, AAM
`
`regularly files briefs as amicus curiae, as did its predecessor, the Generic
`
`Pharmaceutical Association. See, e.g., FTC v. Actavis, Inc., 133 S. Ct. 2223 (2013).
`
`These briefs reflect the position of AAM as an organization, speaking for the
`
`industry, not any individual member.
`
`AAM’s members are frequently IPR petitioners, because the efficiency and
`
`speed of IPRs fit the industry’s mission of delivering generic alternatives to patients
`
`as soon and as cost-effectively as possible. AAM’s members thus have a significant
`
`interest in ensuring that brand-name drug manufacturers are not allowed to abuse
`
`the U.S. patent system by attempting to invoke rented Native American tribal
`
`immunity to frustrate the Board’s authority to review erroneously issued patents.
`
`
`1 No party or party’s counsel authored any portion of this brief or made a financial
`
`contribution intended to fund its preparation or submission. No one other than
`
`AAM and its counsel made such a financial contribution. Cf. Sup. Ct. R. 37.6.
`
`
`
`1
`
`

`

`
`
`II.
`
`INTRODUCTION
`
`Facing the likely loss of the remaining patents shielding a multi-billion-dollar
`
`drug from generic competition, Allergan Inc. adopted an unprecedented strategy on
`
`the eve of the oral hearings in these IPRs: it paid millions of dollars in an attempt to
`
`rent the sovereign immunity of the Saint Regis Mohawk Tribe (“Tribe”). Now, the
`
`Tribe argues that the Board has no choice but to dismiss these IPRs. But the Board
`
`is anything but hamstrung from exercising its authority to take a “second look at an
`
`earlier administrative grant of a patent” and to “protect the public’s ‘paramount
`
`interest in seeing that patent monopolies . . . are kept within their legitimate scope.’”
`
`Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2144 (2016) (citation omitted).
`
`First, IPRs do not offend the dignity of sovereign tribal entities because they
`
`do not allow private parties to subject a sovereign “to the coercive process of
`
`judicial tribunals.” Fed. Mar. Comm’n v. S.C. State Ports Auth. (“FMC”), 535 U.S.
`
`743, 760 (2002). Rather, a federal agency permissibly “institute[s] its own
`
`administrative proceeding” to take a second look at a patent it issued. Id. at 768.
`
`Second, courts have refused to dismiss analogous in rem property actions when, as
`
`in this case, a private party attempted to convey property to a tribal entity in an
`
`effort to frustrate judicial adjudication of property rights. And third, even if IPR
`
`proceedings were indistinguishable from in personam judicial proceedings, the
`
`Board need not dismiss these IPRs. The Board had authority to institute
`
`2
`
`

`

`
`
`proceedings with Allergan as Patent Owner, and it retains discretion to complete its
`
`review notwithstanding a transfer expressly calculated to prevent a final decision.
`
`The Board should deny the Tribe’s motion and finish the work it started
`
`nearly a year ago when it instituted these IPRs and concluded that there was a
`
`“reasonable likelihood” that the challenged claims are unpatentable.
`
`III. ARGUMENT
`A. Tribal Immunity Does Not Block The Board From Considering The
`Validity Of An Issued Patent.
`
`The Tribe’s argument rests on incorrectly equating IPR with civil litigation,
`
`trying to benefit from the Supreme Court’s holding in FMC that state sovereign
`
`immunity can apply in certain administrative proceedings. But the Supreme Court
`
`held only that where Congress cannot subject a State to suit in federal court,
`
`Congress also cannot force the same State to answer the complaints of private
`
`parties in an administrative tribunal that is indistinguishable from a federal court
`
`proceeding. An IPR is not a private dispute like a suit for monetary or equitable
`
`relief. Rather, an IPR is a means for the agency to reconsider its own administrative
`
`decision to issue a patent. The proceeding differs materially from civil litigation and
`
`does not require the sort of jurisdiction over the parties that civil litigation entails.
`
`1. IPRs Are Administrative Proceedings Instituted By A Federal
`Agency, Not Judicial Disputes Between Private Parties.
`
`Tribal sovereignty “does not extend to preventing the federal government
`
`from exercising its superior sovereign powers.” United States v. Yakima Tribal Ct.,
`
`3
`
`

`

`
`
`806 F.2d 853, 861 (9th Cir. 1986) (citation omitted). Tribes suffer no harm to their
`
`sovereign dignity when the federal government corrects its own error by cancelling
`
`a patent that never should have issued.
`
`First, the Board plays a different role than the agency adjudicator in FMC. In
`
`the challenged Federal Maritime Commission proceeding, the agency played no
`
`role except refereeing a private dispute in which one party claimed that the other
`
`had violated federal law and demanded a remedy. FMC, 535 U.S. at 764. The
`
`Court emphasized that the agency “d[id] not even have the discretion to refuse to
`
`adjudicate complaints brought by private parties.” Id. The Court therefore
`
`concluded that the agency was in substance no different from a court, where
`
`sovereign immunity would apply. But, the Court made clear, the agency was free to
`
`“institute its own administrative proceeding” against a sovereign entity, “either
`
`upon its own initiative or upon information supplied by a private party.” Id. at 768
`
`(emphasis added).
`
`That distinction is crucial here, because the Board does not simply act as an
`
`adjudicator of a private dispute. The Board is limited to taking a “second look” at
`
`the agency’s own actions in issuing a patent, not the conduct of the patent owner in
`
`obtaining it. Cuozzo, 136 S. Ct. at 2144. That is not a private dispute, which is why
`
`any interested member of the public may file a petition. Cf. Consumer Watchdog v.
`
`Wis. Alumni Research Found., 753 F.3d 1258, 1262 (Fed. Cir. 2014). Unlike the
`
`4
`
`

`

`
`
`Federal Maritime Commission, the Board has “discretion to refuse” to institute an
`
`IPR. See Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356, 1367 (Fed. Cir. 2016).
`
`And once the Board has decided to institute an IPR, it may keep reviewing the patent
`
`even if the patent owner and petitioner reach a settlement: the agency “may continue
`
`to conduct an [IPR]” and “may intervene in a later judicial proceeding to defend its
`
`decision—even if the private challengers drop out.” Cuozzo, 136 S. Ct. at 2144
`
`(emphasis in original). These characteristics, which civil litigation does not share,
`
`make clear that IPRs are just the type of administrative proceedings that the
`
`government “remains free” to continue irrespective of sovereign immunity, even
`
`where the IPRs were instituted based “upon information supplied by a private party.”
`
`FMC, 535 U.S. at 768.
`
`Second, there are fundamental differences between adversarial civil lawsuits
`
`and IPRs, as the Supreme Court detailed just a year ago when it rejected the
`
`argument that inter partes review is “a ‘surrogate’ for court proceedings” and stated
`
`instead that in many ways “inter partes review is less like a judicial proceeding and
`
`more like a specialized agency proceeding.” Cuozzo, 136 S. Ct. at 2143. Perhaps
`
`most important, the “basic purpose[]” of an IPR is different from the purpose of
`
`district court litigation. Id. at 2144. Indeed, IPR proceedings even allow a patent
`
`owner to move to amend his claims—“just [as] he would do in the examination
`
`process,” and which he could not do in federal court. Id. at 2145.
`
`5
`
`

`

`
`
`Third, these points are especially salient here, because the putative sovereign
`
`entered the case at the last possible moment. To the extent that IPRs bear any
`
`resemblance to civil litigation, the similarities (such as deposition discovery) were
`
`conducted with a non-sovereign Patent Owner in the case, and were already over by
`
`the time the Tribe appeared. All that remained was the final IPR hearing, which
`
`Patent Owner Allergan had requested. Paper 47. There is no precedent for finding
`
`a present affront to sovereignty based on past proceedings.
`
`The Board’s previous treatment of how its role in IPR proceedings bears on
`
`sovereign immunity boils down to one key sentence of analysis. After reciting
`
`various procedural features of IPR, the Board opined that “the Board’s role in the
`
`inter partes review is not unlike that of the Commission in FMC, which is to assess
`
`the merits of the arguments presented by the parties in an impartial manner.”
`
`Covidien LP v. Univ. of Fla. Research Found. Inc., IPR2016-01274, Paper 21, 16-
`
`17 (P.T.A.B. Jan. 25, 2017). The Tribe here relies heavily on Covidien. But the
`
`Board did not address key features of IPR—in particular, the fact that an IPR
`
`(unlike the proceeding in FMC) requires the exercise of the Board’s discretion, but
`
`does not require adversity between parties. It should do so here.
`
`2. Instituted IPRs Are In Rem Proceedings, And The Transfer Of The
`Subject Patents To A Tribe Does Not Defeat In Rem Jurisdiction.
`
`Though Allergan’s sham transaction is the first to involve a patent, the
`
`company is far from the first to pursue sovereign-immunity protection. Courts have
`
`6
`
`

`

`
`
`repeatedly refused to dismiss real-property actions when faced with virtually
`
`identical circumstances—private parties attempting to convey real property to a
`
`tribal entity and thereby to frustrate judicial adjudication of property rights.
`
`In one case, a plaintiff filed suit to quiet title to a parcel of real property, and
`
`it recorded a lis pendens to provide record notice of the action. Anderson &
`
`Middleton Lumber Co. v. Quinault Indian Nation, 929 P.2d 379, 381 (Wash. 1996).
`
`More than a month later, ten individuals who were named as defendants in the
`
`quiet-title action conveyed their interest in the land to the Quinault Indian Nation.
`
`Id. The defendants then moved to substitute the Nation as a defendant in the
`
`lawsuit, and the Nation moved to dismiss the action based on tribal sovereign
`
`immunity. Id. The trial court nonetheless continued to exercise jurisdiction over
`
`the quiet-title action, and the Supreme Court of Washington affirmed. Because the
`
`trial court had proper in rem jurisdiction over the res in dispute at the time the
`
`property transfer took place, any lack of in personam jurisdiction over an entity that
`
`obtained interest in the property in a “subsequent sale” did not divest the trial court
`
`of its in rem jurisdiction to divide the property among its legal owners. Id. at 385.
`
`In another case, a couple sought to quiet title to property they claimed to have
`
`acquired through adverse possession. Smale v. Noretep, 208 P.3d 1180, 1180
`
`(Wash. Ct. App. 2009). Thereafter, the defendant deeded the property to the
`
`Stillaguamish Tribe of Indians, and the Tribe sought to dismiss the action based on
`
`7
`
`

`

`
`
`tribal immunity. Id. Affirming the trial court’s denial of the Tribe’s motion to
`
`dismiss, the court of appeals held that the trial court’s “continuing jurisdiction over
`
`the land claimed by the Smales for the purposes of determining ownership does not
`
`offend the Tribe’s sovereignty,” because the Tribe was not being sued for monetary
`
`relief and instead the plaintiffs were seeking a court’s disposition of a property res
`
`over which the court had properly assumed jurisdiction. Id. at 1180, 1183.
`
`Another state supreme court reached a similar result in a condemnation
`
`action. An individual conveyed his property rights to the Turtle Mountain Band of
`
`Chippewa Indians, trying to prevent the county from using eminent domain to
`
`acquire his land to build a dam. Cass Cnty. Joint Water Res. Dist. v. 1.43 Acres of
`
`Land, 643 N.W.2d 685, 688 (N.D. 2002). The court held that the condemnation
`
`action was not barred by tribal immunity because the trial court’s jurisdiction was in
`
`rem: the court’s judgment would not “impose responsibility or liability on a person
`
`directly, but operate[] directly against the property in question . . . irrespective of
`
`whether the owner is subject to the jurisdiction of the court in personam.” Id. at 689
`
`(citation omitted). The court noted that a contrary rule would have “far-reaching
`
`effects on the eminent domain authority of states and all other political
`
`subdivisions”: “Indian tribes would effectively acquire veto power over any public
`
`works project attempted by any state or local government merely by purchasing a
`
`small tract of land within the project.” Id. at 694.
`
`8
`
`

`

`
`
`Relying on the Supreme Court’s recognition that in rem actions do not offend
`
`tribal sovereignty in the way that in personam actions do, these courts concluded
`
`that while tribal sovereign immunity bars actions against the tribe itself, it does not
`
`bar in rem actions in which a court need not obtain in personam jurisdiction over
`
`the property holder, much less over a transferee to whom the property is conveyed
`
`in order to evade the court’s resolution of property disputes. See, e.g., Cass Cnty.,
`
`643 N.W.2d at 691 (discussing County of Yakima v. Confederated Tribes & Bands
`
`of the Yakima Indian Nation, 502 U.S. 251, 264-265 (1992)). Indeed, even where a
`
`tribe has acquired land from a private party before the court action, many courts
`
`have held that tribal immunity poses no bar to in rem actions involving the
`
`disposition of that property. See, e.g., Lundgren v. Upper Skagit Indian Tribe, 389
`
`P.3d 569, 572-573 (Wash. 2017), as amended (June 8, 2017) (adverse-possession
`
`claim against tribe), petition for cert. filed, No. 17-387 (Sept. 11, 2017) (discussing
`
`split of authority on this issue); Miccosukee Tribe of Indians of Fla. v. Dep’t of
`
`Envtl. Prot. ex rel. Bd. of Trs. of Internal Improv. Tr. Fund, 78 So. 3d 31, 32 (Fla.
`
`Dist. Ct. App. 2011) (eminent domain action against land held in fee by Tribe).
`
`To the extent IPR proceedings resemble judicial proceedings rather than
`
`specialized administrative ones, they bear the hallmarks of in rem real-property
`
`actions, which can be resolved irrespective of tribal sovereign immunity. In rem
`
`proceedings are actions “[i]nvolving or determining the status of a thing, and
`
`9
`
`

`

`
`
`therefore the rights of persons generally with respect to that thing,” Black’s Law
`
`Dictionary 864 (9th ed. 2009), whereas in personam cases seek personal judgments
`
`regarding “personal rights and obligations” that bind only the parties. Black’s Law
`
`Dictionary 807 (8th ed. 2004). IPR petitioners do not seek to hold a patent holder
`
`liable or to obtain a personal judgment against him. Rather, they ask the Board to
`
`determine the scope of a government-granted monopoly and whether that grant
`
`comports with the governing statutes. Given the in rem nature of IPRs, sovereign
`
`immunity poses no bar to the Board’s taking a “second look” at patents that were
`
`previously administratively granted, Cuozzo, 136 S. Ct. at 2144, and, as in Smale, it
`
`does not bar the Board from “continuing” to resolve IPRs over which it
`
`unquestionably had jurisdiction at institution. 208 P.3d at 1180.
`
`Previous decisions concluding that IPR proceedings are unlike in rem actions
`
`do not bind this Board. See Neochord, Inc. v. Univ. of Md., IPR2016-00208, Paper
`
`28, 12-13 (P.T.A.B. May 23, 2017); Covidien, Paper 21, 12-15; Reactive Surfaces
`
`Ltd. v. Toyota Motor Corp., IPR2016-01914, Paper 36, 7 (P.T.A.B. July 13, 2017).
`
`The Board in Reactive Surfaces rejected an analogy to in rem actions without any
`
`discussion or supporting authority, and only “on the present record and arguments.”
`
`Paper 36, 7. The Neochord and Covidien petitioners compared IPRs to in rem
`
`bankruptcy jurisdiction, and the Board concluded that the “analogy to bankruptcy
`
`law is without merit.” Neochord, Paper 28, 13; Covidien, Paper 21, 15 (“Petitioner’s
`
`10
`
`

`

`
`
`reliance on bankruptcy actions . . . is misplaced.”). The Board has never considered
`
`similarities between IPR proceedings regarding the boundaries of patent property
`
`and real-property actions. Those cases, in which courts continued to exercise in rem
`
`jurisdiction when an individual transferred real property to a tribe to evade judicial
`
`adjudication of property rights, furnish the closest analogy to this one.
`
`B. Tribal Immunity Does Not Block The Board From Completing
`Instituted IPRs When A Patent Owner Transfers Its Patents To Avoid
`An Adverse Decision.
`
`The Board can and should complete its review of patent claims that it has
`
`found reasonably likely to be invalidated, even if tribal immunity applies in an IPR
`
`and even if the patent owner transfers its patents to a sovereign entity for the
`
`express purpose of preventing a final IPR decision (which is exactly what Allergan
`
`and the Tribe have admitted doing, see EX. 1145; EX. 1157). The Tribe contends
`
`(at 16) that “[t]his case cannot proceed” without its consent. But nothing in the
`
`governing statutes or regulations precludes the Board from completing its resolution
`
`of an instituted IPR in this situation. Indeed, IPRs may continue even with no
`
`parties participating. See 37 C.F.R. § 42.74(a); see also 35 U.S.C. § 317(a) (“If no
`
`petitioner remains in the inter partes review, the Office may terminate the review or
`
`proceed to a final written decision . . . .”); accord Cuozzo, 136 S. Ct. at 2144. If an
`
`IPR can proceed even when a petitioner and patent owner jointly decide to settle, it
`
`plainly is not true that an IPR “cannot” proceed simply because a patent owner
`
`11
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`

`

`
`
`unilaterally tries to pay its way out of an IPR by renting tribal immunity.
`
`Furthermore, when determining whether to continue IPRs in light of an
`
`absent sovereign patent owner, the Board has sometimes looked for guidance from
`
`Federal Rule of Civil Procedure 19(b), which addresses when an action should be
`
`dismissed if a person considered necessary to the dispute is unable to be joined.2
`
`The Rule is expressly premised on “equity and good conscience,” Fed. R. Civ. P.
`
`19(b), and allows courts to consider any “considerations which may be applicable in
`
`particular situations,” Fed. R. Civ. P. 19 advisory committee note (1966); see also
`
`Cloverleaf Standardbred Owners Ass’n, Inc. v. Nat’l Bank of Wash., 699 F.2d 1274,
`
`1279 n.11 (D.C. Cir. 1983) (“The four enumerated factors [in Rule 19(b)] do not
`
`have independent significance; they serve as guides to the overarching ‘equity and
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`good conscience’ determination.”). The Rule focuses on “pragmatic
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`considerations,” and not on “the technical or abstract character of the rights or
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`obligations of the persons whose joinder [is] in question.” Travelers Indem. Co. v.
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`Dingwell, 884 F.2d 629, 635 (1st Cir. 1989) (alteration in original) (citation
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`omitted). It is intended to balance the interests of the parties properly before the
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`court, the absent party that cannot be joined, the courts, and the public. See
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`2 As is true of IPR proceedings, a court’s inability to include a relevant party in
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`litigation does not “negate the court’s power to adjudicate as between the parties
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`who have been joined.” See Fed. R. Civ. P. 19 advisory committee note (1966).
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`Provident Tradesmens Bank & Tr. Co. v. Patterson, 390 U.S. 102, 109-111 (1968).
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`Considering the interests of the public, the Board, and the parties that must be
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`balanced, and the “pragmatic” consequences of the standard the Tribe advocates,
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`dismissing these IPRs would not in any way advance “equity and good conscience.”
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`To the contrary, allowing a drug company patent owner to force an IPR to halt on
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`the eve of an IPR hearing, by paying tens of millions of dollars to rent tribal
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`immunity, would reward bad-faith behavior. It would also provide other holders of
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`weak but extremely profitable patents with a roadmap for shielding their patents
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`from review while wasting the valuable resources of their competitors and the
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`Board. A rule that has as guideposts “equity” and “good conscience” would not
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`create such incentives or countenance such a result.
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`The compelling public interest in preventing the abuse of the patent system
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`warrants the Board’s continued jurisdiction over this case. As the National
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`Academy of Sciences, Engineering, and Medicine recognized just this week,
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`“[a]ctions to continually foster greater access to off-patent generic drugs, which are
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`usually much less expensive than branded products, should be taken. One way this
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`could be accomplished would be to prevent the common industry practices that
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`delay entry of generics into the market and extend market exclusivity of branded
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`products.” Nat’l Acad. of Scis., Eng’g, and Med., Making Medicines Affordable: A
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`National Imperative 3 (2017), available at http://bit.ly/2AAxzDn. Allergan’s
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`scheme is precisely the type of patent “evergreening” that NAS has stated must be
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`prevented to address the high and rising costs of prescription drugs. Id. at 3, 44.
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`Prior Board decisions involving sovereign state entities are of limited
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`relevance here because none of those cases involved last-minute bad-faith transfers
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`specifically intended to divest the Board of its authority to take a second look at an
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`issued patent—actions that cannot be squared with equity or good conscience.
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`Nevertheless, it is notable that the Board has permitted IPRs to continue in the
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`absence of a sovereign state entity (the Regents of the University of Minnesota)
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`where a remaining party (Toyota) could adequately represent the sovereign’s
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`interest. See Reactive Surfaces Ltd., LLP v. Toyota Motor Corp., No. IPR2016-
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`01914, Paper 36, 11-17 (P.T.A.B. July 13, 2017) (rejecting a bright-line rule that
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`IPRs must be dismissed when one party successfully asserts sovereign immunity).
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`The same is certainly true here. Allergan not only has an enormous financial stake
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`in its product—Restasis® is Allergan’s second-largest revenue producer, bringing in
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`nearly $1.5 billion in 2016 alone, see EX.1146; EX. 1155—but it has litigated the
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`validity of its patents since their issuance, including in the Eastern District of Texas
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`litigation, which the Tribe did not initially join after the transaction with Allergan.
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`In sum, there is no statute, rule, or precedent that requires the Board to
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`dismiss instituted IPRs if a patent holder assigns its patents to a sovereign entity to
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`avoid a final IPR decision. To maintain the integrity of the patent system and
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`discourage the large-scale use of sham patent transfers, the Board can and should
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`continue to exercise its lawful authority to reexamine the challenged claims.
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`IV. CONCLUSION
`As Judge Bryson concluded in the related Hatch-Waxman case, “sovereign
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`immunity should not be treated as a monetizable commodity that can be purchased
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`by private entities as part of a scheme to evade their legal responsibilities.”
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`Allergan, Inc. v. Teva Pharm. USA, Inc., No. 2:15-cv-1455-WCB, 2017 WL
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`4619790, at *3 (E.D. Tex. Oct. 16, 2017). That applies with particular force here,
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`before the Board. Given the volume of patent applications (more than 600,000 in
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`2015, with the number rising each year, U.S. Patent & Trademark Office, U.S.
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`Patent Statistics Chart Calendar Years 1963-2015, http://bit.ly/2jCjZ5V), and the
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`limited number of patent examiners, IPRs and similar post-grant reviews play a
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`vital role in allowing the PTO to ensure accuracy and reliability by taking a second
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`look at patents it issued. The Board can carry out that function notwithstanding the
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`assertion of sovereign immunity by a patent owner, or its eleventh-hour transferee.
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`The Board should deny the Tribe’s motion to dismiss.
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`Dated: December 1, 2017
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`
`
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`Respectfully submitted,
`
`/Cynthia Lambert Hardman/
`Cynthia Lambert Hardman
`Registration No. 53,179
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that on December 1, 2017, a complete and
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`entire copy of this “BRIEF OF THE ASSOCIATION FOR ACCESSIBLE
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`MEDICINES AS AMICUS CURIAE IN SUPPORT OF PETITIONERS” was
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`provided, via electronic mail, to Mylan Pharmaceuticals Inc., Teva Pharmaceuticals
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`USA, Inc., Akorn Inc., Allergan, Inc., and the Saint Regis Mohawk Tribe by serving
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`the correspondence e-mail addresses of record as follows:
`
`Dorothy P. Whelan
`Michael Kane
`Susan Morrison Colletti
`Robert M. Oakes
`Jonathan Singer
`Fish & Richardson P.C.
`3200 RBC Plaza
`60 South Sixth Street
`Minneapolis, MN 55402
`IPR13351-0008IP1@fr.com
`IPR13351-0008IP2@fr.com
`IPR13351-0008IP3@fr.com
`IPR13351-0008IP4@fr.com
`IPR13351-0008IP5@fr.com
`IPR13351-0008IP6@fr.com
`PTABInbound@fr.com
`
`Attorneys for Allergan, Inc.
`
`Alfonso Chan
`Joseph DePumpo
`Michael Shore
`Christopher Evans
`SHORE CHAN DEPUMPO LLP
`901 Main Street, Suite 3300
`Dallas, TX 75201