Filed: December 15, 2017
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`
`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 (US 8,685,930 B2)
`Case IPR2016-01128 (US 8,629,111 B2)
`Case IPR2016-01129 (US 8,642,556 B2)
`Case IPR2016-01130 (US 8,633,162 B2)
`Case IPR2016-01131 (US 8,648,048 B2)
`Case IPR2016-01132 (US 9,248,191 B2)
`_____________________________
`
`PETITIONERS’ RESPONSE AFTER
`AMICUS BRIEFING
`
`
`
`
`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. The word-for-word
`identical paper is filed in each proceeding identified in the caption pursuant to the
`Board’s Scheduling Order (Paper 10).
`
`
`
`
`
`

`

`
`
`TABLE OF CONTENTS
`
`Page
`
`The Board Should Reconsider Its Previous Sovereign Immunity
`
`IPRs Facilitate Agency Review of Prior Agency Decisions and
`
`Tribal Immunity Does Not Prevent the PTO from Applying
`
`TABLE OF CONTENTS ........................................................................................ i
`TABLE OF AMICI ................................................................................................ ii
`TABLE OF AUTHORITIES .................................................................................. v
`I.
`Introduction .................................................................................................. 1
`II.
`Private Entities Cannot Buy Tribal Sovereign Immunity .............................. 2
`III. Nonbinding Eleventh Amendment Panel Opinions Do Not Require
`Dismissal Here .............................................................................................. 4
`IV. The Board Has the Authority and Duty to Disregard this Sham
`Transaction ................................................................................................... 7
`V.
`Decisions .................................................................................................... 10
`A.
`Do Not Adjudicate Private Rights ..................................................... 11
`B.
`Generally Applicable Federal Law .................................................... 12
`C.
`Tribal Immunity Does Not Affect In Rem Proceedings ..................... 13
`VI.
`Correct Response is to Dismiss, Not Grant, the Tribe’s Motion .................. 14
`VII. Conclusion .................................................................................................. 15
`
`If the Board Lacks Jurisdiction to Consider Tribal Immunity, the
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`-i-
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`

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`
`
`
`OST
`
`TABLE OF AMICI
`
`Amicus Curiae Brief of the Oglala Sioux Tribe in Support of
`
`Corrected Patent Owner's Motion to Dismiss Based on Tribal
`
`Sovereign Immunity (Paper 104)
`
`PK
`
`Brief of Public Knowledge and the Electronic Frontier Foundation as
`
`Amici Collegii in Opposition to the Motion to Terminate (Paper 105)
`
`Scholars
`
`Brief of Amici Scholars in Support of Patent Owner the St. Regis
`
`Mohawk Tribe (Paper 106)
`
`Askeladden Brief of Askeladden LLC as Amicus Curiae in Opposition to St.
`
`Regis Mohawk Tribe’s Motion to Dismiss (Paper 107)
`
`Deva
`
`Comments of Amici Curiae Deva Holding A.S. in Response to the
`
`Board’s Invitation for Amicus Briefs Regarding the Tribe’s Motion
`
`to Terminate (Paper 108)
`
`HTIA
`
`Brief of the High Tech Inventors Alliance, Computer &
`
`Communications Industry Association, and Internet Association as
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`Amici Curiae in Support of Petitioners (Paper 109)
`
`Seneca
`
`Brief Amicus Curiae of the Seneca Nation in Support of the Patent
`
`Owner, Saint Regis Mohawk Tribe (Paper 110)
`
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`-ii-
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`NAIPEC
`
`Brief Of Amicus Curiae Native American Intellectual Property
`
`Enterprise Council, Inc. Regarding Patent Owner’s Motion to
`
`Dismiss (Paper 111)
`
`SIIA
`
`Brief Amicus Curiae of the Software and Information Industry
`
`Association in Support of Petitioners (Paper 112)
`
`USI
`
`Brief of Amicus Curiae U.S. Inventor, LLC in Support of Patent
`
`Owner, the Saint Regis Mohawk Tribe (Paper 113)
`
`NCAI
`
`Brief Amici Curiae of the National Congress of American Indians,
`
`National Indian Gaming Association, and the United South and
`
`Eastern Tribes in Support of Patent Holder the St. Regis Mohawk
`
`Tribe’s Motion to Dismiss (Paper 114)
`
`Ortiz
`
`Brief of Amicus Curiae Luis Ortiz and Kermit Lopez in Support of
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`Patent Owner’s Motion to Dismiss for Lack of Jurisdiction Based on
`
`Tribal Sovereign Immunity (Paper 115)
`
`AAM
`
`Brief of the Association for Accessible Medicines as Amicus Curiae
`
`in Support of Petitioners (Paper 116)
`
`BSA
`
`Brief of BSA | The Software Alliance as Amicus Regarding
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`Applicability of Tribal Sovereign Immunity in IPR Proceedings
`
`(Paper 117)
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`-iii-
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`Major
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`Amicus Curiae Brief of James R. Major, D.Phil. in Support of
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`Petitioners’ Opposition to St. Regis Mohawk Tribe’s Motion to
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`Dismiss (Paper 118)
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`-iv-
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`
`
`
`TABLE OF AUTHORITIES
`
`CASES
`
`Page
`
`Allergan, Inc. v. Teva Pharm. USA, Inc., No. 2:15-cv-01455-WCB,
`2017 WL 4619790 (E.D. Tex. Oct. 16, 2017) (Bryson, J.) ................ 1, 2, 7, 8
`
`Attorneys Trust v. Videotape Comp. Prods., Inc., 93 F.3d 593 (9th Cir.
`1996) ............................................................................................................ 8
`
`Barona Band of Mission Indians v. Yee, 528 F.3d 1184 (9th Cir. 2008) .............. 2, 3
`
`Bodi v. Shingle Springs Band of Miwok Indians, 832 F.3d 1011 (9th
`Cir. 2016)...................................................................................................... 5
`
`City of Sherrill v. Oneida Indian Nation of N.Y., 544 U.S. 197 (2005) .................... 5
`
`Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016) .................................... 11
`
`Fed. Power Comm’n v. Tuscarora Indian Nation, 362 U.S. 99 (1960) .................. 13
`
`Kroll v. Bd. of Trustees of Univ. of Illinois, 934 F.2d 904 (7th Cir.
`1991) ............................................................................................................ 6
`
`Lapides v. Board of Regents, 535 U.S. 613 (2002) .................................................. 4
`
`Maysonet-Robles v. Cabrero, 323 F.3d 43 (1st Cir. 2003) .................................. 6, 7
`
`Menominee Tribal Enters. v. Solis, 601 F.3d 669 (7th Cir. 2010) .......................... 12
`
`NLRB v. Little River Band of Ottawa Indians Tribal Gov’t, 788 F.3d
`537 (6th Cir. 2015)...................................................................................... 12
`
`Oil States Energy Servs. LLC v. Greene’s Energy Grp., Inc., No. 16-
`712 .................................................................................................... 4, 11, 12
`
`Otoe-Missouria Tribe v. NY DFS, 769 F.3d 105 (2d Cir. 2014) .......................... 2, 5
`
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`-v-
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`People ex rel. Owen v. Miami Nation Enters., 386 P.3d 357 (Cal.
`2016) ............................................................................................................ 9
`
`Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S.
`806 (1945) .................................................................................................. 15
`
`Republic of Philippines v. Pimentel, 553 U.S. 851 (2008) ....................................... 9
`
`Surprenant v. Massachusetts Tpk. Auth., 768 F. Supp. 2d 312 (D.
`Mass. 2011) .................................................................................................. 6
`
`United States v. Red Lake Band of Chippewa Indians, 827 F.2d 380
`(8th Cir. 1987) ............................................................................................ 12
`
`United States v. Wheeler, 435 U.S. 313 (1978) ....................................................... 5
`
`United States v. Yakima Tribal Ct., 806 F.2d 853 (9th Cir. 1986) ......................... 12
`
`Vas-Cath, Inc. v. Curators of Univ. Mo., 473 F.3d 1376 (Fed. Cir.
`2007) ............................................................................................................ 7
`
`Washington v. Confederated Tribes of the Colville Indian Reservation,
`447 U.S. 134 (1980) .................................................................................. 2, 3
`
`Woods v. Rondout Valley Cent. Sch. Dist. Bd. of Ed., 466 F.3d 232 (2d
`Cir. 2006)...................................................................................................... 9
`
`STATUTES
`
`28 U.S.C. § 1359..................................................................................................... 8
`
`35 U.S.C. § 24 ...................................................................................................... 13
`
`35 U.S.C. § 314(c) .................................................................................................. 7
`
`35 U.S.C. § 315(e) ................................................................................................ 13
`
`35 U.S.C. § 316(b) .............................................................................................. 3, 7
`
`35 U.S.C. § 318(a) ................................................................................................ 14
`
`America Invents Act of 2011 .................................................................................. 3
`
`Indian Financing Act, 25 U.S.C. § 1451 et seq. ....................................................... 3
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`-vi-
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`

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`Indian Self-Determination and Education Assistance Act, 25 U.S.C. §
`5301 et seq. ................................................................................................... 3
`
`RULES
`
`37 CFR § 42.20(c) ................................................................................................ 14
`
`77 Fed. Reg. 48756, 48759 (2012) .......................................................................... 8
`
`FRCP 19 ............................................................................................................... 10
`
`MISCELLANEOUS
`
`13F C. Wright et al., Fed. Prac. & Proc. Juris. § 3641 (3d ed. Apr.
`2017 update). ................................................................................................ 8
`
`Eleventh Amendment................................................................................ 1, 4, 5, 10
`
`
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`-vii-
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`
`
`I.
`
`INTRODUCTION
`
`The Tribe and its amici fail to address the dispositive point that tribal
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`sovereign immunity is not “a monetizable commodity that can be purchased by
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`private entities as part of a scheme to evade their legal responsibilities.” Allergan,
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`Inc. v. Teva Pharm. USA, Inc., No. 2:15-cv-01455-WCB, 2017 WL 4619790, at *3
`
`(E.D. Tex. Oct. 16, 2017) (Bryson, J.). And their reliance on Eleventh Amendment
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`cases fares no better. Those cases are readily distinguishable, on many important
`
`grounds, one of the most important being that there was no question whether the
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`asserted immunity was predicated on a sham transaction.
`
`The Tribe and its amici also fail to refute Mylan’s substantive showing that
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`Allergan retains all substantial rights in the patents, and thus remains the true
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`patent owner under established patent law principles. Indeed, even the Tribe’s
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`nominally retained rights exist subject to and for the benefit of Allergan,
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`confirming that Allergan remains the patent owner. Major 2, 6. At the very least,
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`Allergan is a co-owner that has interests perfectly aligned with those of the Tribe
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`in this nearly complete IPR and is well-equipped to represent those interests before
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`the Board. With or without the Tribe’s participation, this Board has the jurisdiction,
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`authority, and duty to resolve these proceedings on their merits and invalidate the
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`patents in issue.
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`-1-
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`II.
`
`PRIVATE ENTITIES CANNOT BUY TRIBAL SOVEREIGN
`IMMUNITY
`
`Judge Bryson recently emphasized his “serious doubts” and “reservations”
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`about the legality of Allergan’s deal with the Tribe. Allergan, 2017 WL 4619790,
`
`at *3. Judge Bryson “le[ft] the question of the validity of the assignment to be
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`decided in the IPR proceedings, where it is directly presented.” Id. at *4.
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`Remarkably, neither the Tribe nor its amici even acknowledges Judge Bryson’s
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`concerns, let alone attempts to address them.
`
`Judge Bryson’s analysis is supported by a long line of decisions, many cited
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`in Mylan’s Opposition Brief, holding that tribes may not “market an exemption”
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`from the law, have “no legitimate interest in selling an opportunity to evade [the]
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`law”, and may not “extend” an immunity “rooted in due respect for Indian
`
`autonomy, to provide [legal] shelters for non-Indian businesses.” Paper 86, 10-11,
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`citing, e.g., Washington v. Confederated Tribes of the Colville Indian Reservation,
`
`447 U.S. 134, 155 (1980); Otoe-Missouria Tribe v. NY DFS, 769 F.3d 105, 114,
`
`116 (2d Cir. 2014); Barona Band of Mission Indians v. Yee, 528 F.3d 1184, 1187,
`
`1190 (9th Cir. 2008). Here again, neither the Tribe nor its amici acknowledge or
`
`attempt to distinguish these controlling decisions.2 This is reason enough to deny
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`2 Tribe observes in passing that “payday lending and state tax avoidance cases”
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`are “simply not relevant” here because Petitioners have not alleged that Allergan
`
`
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`-2-
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`

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`the Tribe’s Motion to Dismiss (Paper 81): it has failed to address Mylan’s showing
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`that the Allergan “assignment” is nothing more than a transparent effort to
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`purchase an exemption from IPR so that Allergan can “reap a windfall at the
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`public’s expense.” Barona Band, 528 F.3d at 1190. Such attempts to market tribal
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`immunity as a “monetizable commodity” are unlawful and unenforceable.
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`A few amici claim the Tribe’s efforts to monetize its limited sovereign status
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`are justified by various Federal statutes that encourage tribal self-government and
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`economic development, such as the Indian Financing Act, 25 U.S.C. § 1451 et seq.,
`
`and Indian Self-Determination and Education Assistance Act, 25 U.S.C. § 5301 et
`
`seq. See Ortiz 8; Scholars 8; OST 5, 8. But the Supreme Court squarely rejected
`
`this argument in Colville, emphasizing that neither those statutes nor any other
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`aspect of Federal Indian policy allows a tribe to “market an exemption” and “an
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`artificial competitive advantage”. 447 U.S. at 155; cf. 35 U.S.C. 316(b) (requiring
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`USPTO to prioritize effect on the United States economy and on the integrity of
`
`the patent system in implementing IPRs).
`
`
`and the Tribe have “evaded any specific law.” Paper 93, 6-7. But Mylan has both
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`alleged and demonstrated that the purported assignment and license-back attempts
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`to evade a “specific law”—the America Invents Act of 2011.
`
`-3-
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`

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`III. NONBINDING ELEVENTH AMENDMENT PANEL OPINIONS
`DO NOT REQUIRE DISMISSAL HERE
`
`The Tribe and its amici argue that the nonbinding panel opinions in Covidien,
`
`Neochord, and Reactive Surfaces require dismissal here, and that failure to dismiss
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`would improperly favor state sovereigns over tribal sovereigns. That argument fails
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`for many reasons. Covidien, Neochord, and Reactive Surfaces all involved
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`constitutional immunity for state universities holding patents on inventions created
`
`and funded by those universities. Mylan believes those decisions were wrongly
`
`decided and contradict the position USPTO (and the United States government)
`
`recently took on IPRs before the Supreme Court in Oil States, which controls the
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`Board’s decision here.
`
`Even if Covidien, Neochord, and Reactive Surfaces were correctly decided,
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`the sham transaction involved here is readily distinguishable on multiple grounds.
`
`Contrary to the Tribe and its amici, tribal sovereign immunity is not commensurate
`
`with Eleventh Amendment
`
`immunity, which
`
`is anchored
`
`in “a specific
`
`[constitutional] text with a history that focuses upon the State’s sovereignty vis-à-
`
`vis the Federal Government.” Lapides v. Board of Regents, 535 U.S. 613, 623
`
`(2002) (expressly distinguishing tribal immunity). The Board’s previous decisions
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`are all “specific” to the Eleventh Amendment.
`
`There is no Eleventh Amendment for tribes, whose immunity is solely a
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`matter of Federal common law. Tribes do not retain full sovereignty of foreign
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`-4-
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`

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`nations or the fifty States; “[t]he sovereignty that the Indian tribes retain is of a
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`unique and limited character.” United States v. Wheeler, 435 U.S. 313, 323 (1978).
`
`Thus, “[t]ribal immunity is not synonymous with a State’s Eleventh Amendment
`
`immunity, and parallels between the two are of limited utility.” Bodi v. Shingle
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`Springs Band of Miwok Indians, 832 F.3d 1011, 1020 (9th Cir. 2016). Rules of
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`state sovereignty can “provide a helpful point of reference” in tribal sovereignty
`
`cases, but they “do not dictate a result.” City of Sherrill v. Oneida Indian Nation of
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`N.Y., 544 U.S. 197, 218 (2005). The Tribe and its amici simply assume that tribal
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`and state immunity are equivalent in IPR, without demonstrating what similarities
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`warrant that conclusion on the facts of this proceeding.
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`One significant difference is that the state universities in the prior Board
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`decisions all had invested heavily in the patents in dispute, and thus had substantial
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`“sunk costs” at stake. Conversely, the Tribe is accepting payment in exchange for a
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`promise to assert sovereign immunity in IPR, with no prior connection between the
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`Tribe and the proceeding or the underlying patents. The Tribe has zero sunk costs
`
`in the patents at issue here—it played no role in developing the underlying
`
`technology and paid nothing to obtain the rights it purports to hold. What matters is
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`“a tribe’s sunk costs in a venture, not their potential future earnings,” even if those
`
`earnings would be spent on worthy causes. Otoe-Missouria Tribe v. N.Y. Dept. Fin.
`
`Servs., 769 F.3d 105, 116 n.8 (2d Cir. 2014).
`
`-5-
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`

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`The Tribe cites three decisions in support of the assertion “[a]ll sovereigns
`
`use immunity for commercial purposes and to avoid liability in pending lawsuits.”
`
`Paper 93, 9-10. But each of these decisions involved a state legislature absorbing
`
`the assets of an entity closely affiliated with the state. See Maysonet-Robles v.
`
`Cabrero, 323 F.3d 43, 46, 51-54 (1st Cir. 2003) (legislature liquidated assets from
`
`a state-created public housing authority to another state entity); Kroll v. Bd. of
`
`Trustees of Univ. of Illinois, 934 F.2d 904, 906, 909-10 (7th Cir. 1991) (legislature
`
`merged assets from the University of Illinois Athletic Association into the Board of
`
`Trustees of the University of Illinois before complaint filed); Surprenant v.
`
`Massachusetts Tpk. Auth., 768 F. Supp. 2d 312, 314-15, 318 (D. Mass. 2011)
`
`(legislature dissolved the Massachusetts Turnpike Authority and transferred its
`
`assets into the Massachusetts Department of Transportation). There was nothing
`
`questionable or improper about any of these transactions, and each involved the
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`transfer of assets from a state-affiliated entity to an arm of the State. That is not the
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`case here, where Allergan (a private corporation with no prior affiliation to the
`
`Tribe) has blatantly sought to cloak a portion of its assets in the Tribe’s sovereign
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`immunity in exchange for fixed regular payments—something clearly forbidden
`
`under Federal law.
`
`In addition, the Maysonet-Robles decision distinguished its facts from a case
`
`in which a tribe had knowingly chosen to acquire property subject to a preexisting
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`-6-
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`

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`legal dispute over the property, which the court characterized as waiving immunity
`
`in the ongoing action. 323 F.3d at 49-50 n.4. Likewise, the Tribe here knew the
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`patents were under active—and nearly completed—Board patentability review at
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`the time of the purported assignment, as Allergan’s deal obligated the Tribe to
`
`attack the Board’s IPR authority. EX2086, 10; see also 35 U.S.C. § 314(c) (public
`
`notice of IPR institution decisions). This is precisely the scenario that Maysonet-
`
`Robles noted precludes immunity.
`
`It bears noting that the Tribe willingly joined the related court action in the
`
`misguided belief that courts are more forgiving of patent invalidity. On the same
`
`day Mylan filed its Opposition to the Tribe’s Motion to Terminate (Paper 86), the
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`Tribe consented to join the E.D. Tex. litigation and be subject to Mylan’s invalidity
`
`counterclaims there. Allergan, 2017 WL 4619790, at *2, 5. Yet as events showed,
`
`the court was just as capable of invalidating the patents without impinging any core
`
`sovereign interest as the Board is. The Tribe is simply (and ineffectively) gaming
`
`the patent system. Vas-Cath, Inc. v. Curators of Univ. Mo., 473 F.3d 1376, 1383,
`
`1385 (Fed. Cir. 2007) (cautioning that immunity must not be used to game the
`
`patent system); cf. § 316(b) (prioritizing patent system integrity).
`
`IV. THE BOARD HAS THE AUTHORITY AND DUTY TO
`DISREGARD THIS SHAM TRANSACTION
`
`The Tribe and its amici argue the Board cannot “declare the contract void
`
`since it has no jurisdiction over the Tribe.” Paper 93, 7; see also Ortiz 2-4,7;
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`-7-
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`

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`Scholars 12; OST 1. Yet the Tribe placed their deal into issue by offering it as the
`
`basis for its sovereign interest and hence its motion. Allergan, 2017 WL 4619790,
`
`at *4 (deal validity “directly presented” in IPRs). If the deal is not properly before
`
`the Board, the motion must be dismissed because the Tribe’s argument rests on a
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`fundamental—and, as Tribe would have it, wholly untestable—assumption that the
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`assignment is valid and effective. If the deal is contrary to law or otherwise invalid
`
`or ineffective, Tribe is not the patent owner, so the Board could not be exercising
`
`jurisdiction over the Tribe.
`
`The Tribe also claims that sham-assignment cases are “easily distinguished”
`
`because they all are based on 28 U.S.C. § 1359. Paper 93, 7. The lead case Mylan
`
`cited holds just the opposite: courts have the authority and responsibility to pierce a
`
`sham assignment intended to destroy jurisdiction, even in the absence of a statute
`
`authorizing them to do so. See Attorneys Trust v. Videotape Comp. Prods., Inc., 93
`
`F.3d 593, 595 (9th Cir. 1996) (nominal assignment to tamper with jurisdiction
`
`improper); 13F C. Wright et al., Fed. Prac. & Proc. Juris. § 3641 (3d ed. Apr. 2017
`
`update). The Board itself routinely looks behind agreements to determine real
`
`party-in-interest. Office Pat. Trial Guide, 77 Fed. Reg. 48756, 48759 (2012).
`
`Some amici argue that, “where a patent owner establishes a prima facie
`
`showing of tribal sovereign immunity, the Board should accept that showing at
`
`face value” without any further inquiry and dismiss the IPR. Scholars 2. But the
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`-8-
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`

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`rule for all sovereigns—state, foreign, and tribal—is just the opposite. Courts
`
`routinely look at the evidence to determine whether sovereign immunity applies,
`
`whether or not a sovereign is present. See, e.g., Woods v. Rondout Valley Cent. Sch.
`
`Dist. Bd. of Ed., 466 F.3d 232, 237-39 (2d Cir. 2006); People ex rel. Owen v.
`
`Miami Nation Enters., 386 P.3d 357, 365 (Cal. 2016) (denying immunity to tribe-
`
`created payday loan companies).
`
`The Tribe’s amici argue for a different rule based on Republic of Philippines
`
`v. Pimentel, 553 U.S. 851 (2008). Scholars 4-5. But as Mylan’s Opposition
`
`demonstrated (Paper 86, 21-22), Pimentel is readily distinguishable because it
`
`involved a claim to foreign sovereign immunity in Federal interpleader litigation
`
`dealing with disputed claims to money that had been stolen from the foreign
`
`sovereign, which had initiated proceedings in its own judicial system to recover the
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`funds. The Supreme Court’s decision was “premised upon the ‘perfect equality and
`
`absolute independence’” of the United States and the Philippines, and emphasized
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`that since the litigation arose from “events of historical and political significance
`
`for the Republic and its people,” it belonged there. 553 U.S. at 851, 865-67
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`(citation omitted). Here, on the other hand, the Tribe is clearly subordinate to the
`
`Federal government and the Federal patent system, and was a complete stranger to
`
`these proceedings prior to taking money from Allergan as part of a concerted effort
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`to destroy the Board’s jurisdiction.
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`-9-
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`

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`Dismissing IPRs to insulate patents from USPTO review does not advance
`
`“equity and good conscience,” the express function of FRCP 19 and the purpose by
`
`which evaluation of its factors must be calibrated. AAM 12-13. Prior Board
`
`decisions using FRCP 19 as guidance to address an absent sovereign patent owner
`
`never dealt with the scenario here where the undisputed, non-sovereign owner
`
`engaged in a last-minute transfer intended to divest the Board of jurisdiction. AAM
`
`14. Even in those cases, the Board recognized that IPR proceedings could continue
`
`without the sovereign state patent owner where a remaining party could adequately
`
`represent the patent-owner interests. Id. (discussing Reactive Surfaces).
`
`Contrary to Tribe and amici arguments, Allergan’s ownership interests over
`
`these patents are adequate to protect Tribe’s interests in the patents. Allergan is the
`
`leading party in proceedings addressing the validity of the patents. AAM 14.
`
`Allergan’s continued prosecution of an infringement suit asserting the involved
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`patents against Deva Holdings S.A. in a district court proceeding without Tribe’s
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`participation also belies their premise. Deva 1, 3-5.
`
`V. THE BOARD SHOULD RECONSIDER ITS PREVIOUS
`SOVEREIGN IMMUNITY DECISIONS
`
`The Tribe’s claim of sovereign immunity is distinguishable from the Board’s
`
`prior decisions addressing state sovereign
`
`immunity under
`
`the Eleventh
`
`Amendment. In addition, the Board should reconsider the analysis underlying
`
`those nonbinding panel opinions.
`
`-10-
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`

`

`A.
`
`IPRs Facilitate Agency Review of Prior Agency Decisions and
`Do Not Adjudicate Private Rights
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`The Tribe and its amici argue that tribal immunity bars IPR of any tribally
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`owned patent. E.g., Ortiz 1-2; Scholars 2-4; OST 1-4. As other amici explain,
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`however, sovereign immunity does not preclude IPR because the PTO always
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`retains the authority to revisit its prior administrative decision to grant a patent. PK
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`1-3, 7, 10-13; HTIA 6-11; SIIA 5, 8-10; Askeladden 4-7 (citing FCC examples);
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`AAM 3-11; BSA 9-13. As the Supreme Court explained, IPR is not a private suit;
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`rather, it is the agency’s “second look at an earlier administrative grant of a patent.”
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`Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2144 (2016).
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`The Federal government, including USPTO, has taken precisely this position
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`before the Supreme Court. See Br. Fed. Resp., Oil States Energy Servs. LLC v.
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`Greene’s Energy Grp., Inc., No. 16-712 (“Oil States,” EX1167), 24 (IPRs do “not
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`determine ‘the liability of one individual to another under the law as defined’—the
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`characteristic hallmark of a matter of ‘private right.’”).
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`IPRs provide the PTO with an efficient mechanism to confirm whether a
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`granted patent complies with statutory conditions for patentability and, where
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`necessary, correct its own administrative errors. See Oil States, 22 & n.4
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`(“Agencies’ use of administrative processes to correct their own mistakes is
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`commonplace.”). Although the Board permits private petitioners to depose
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`witnesses and offer arguments, public participation does not void Federal
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`-11-
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`sovereignty over patents. Id. at 11 (explaining that involving a petitioner merely
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`provides a “mechanism by which the USPTO seeks to leverage knowledge
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`possessed by persons outside the government to assist it in making a decision
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`within its bailiwick”). Once issued, patent rights remain “privileges that the
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`government may revoke without judicial involvement,” id. at 16, and the PTO
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`retains power to revisit patentability using congressionally authorized proceedings.
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`See id. at 50-51; see also Askeladden 6 n.2 (demonstrating that Federal agencies
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`can regulate the rights they have previously granted, even when granted to a tribe).
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`B.
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`Tribal Immunity Does Not Prevent the PTO from Applying
`Generally Applicable Federal Law
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`As several amici explain, tribal immunity does not apply here because IPRs
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`are Federal agency actions applying generally applicable law. Tribal immunity
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`“‘does not extend to preventing the federal government from exercising its superior
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`sovereign powers.’” United States v. Yakima Tribal Ct., 806 F.2d 853, 861 (9th Cir.
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`1986) (citation omitted); United States v. Red Lake Band of Chippewa Indians, 827
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`F.2d 380, 382 (8th Cir. 1987) (“a tribe may not interpose its sovereign immunity
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`against the United States”). Tribal immunity need not be affirmatively abrogated
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`for the Federal Government to enforce generally applicable law. E.g., NLRB v.
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`Little River Band of Ottawa Indians Tribal Gov’t, 788 F.3d 537, 555 (6th Cir.
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`2015); Menominee Tribal Enters. v. Solis, 601 F.3d 669, 670-71 (7th Cir. 2010).
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`The Board and the PTO are part of the U.S. government, and the AIA and its
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`-12-
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`IPR provisions are laws of general applicability. See Fed. Power Comm’n v.
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`Tuscarora Indian Nation, 362 U.S. 99, 116 (1960) (“a general statute in terms
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`applying to all persons includes Indians and their property interests”). The Board’s
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`administrative review of an agency-issued patent’s compliance with statutory
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`conditions of patentability may continue regardless of asserted tribal immunity.
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`C. Tribal Immunity Does Not Affect In Rem Proceedings
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`As several amici show in detail, tribal immunity does not affect this in rem
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`proceeding. Askeladden 9-11; HTIA 12-15; PK 8-10; AAM 6-11. Neither the
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`Tribe nor any of its amici has offered substantive argument to the contrary. Careful
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`review of chapter 31 reveals that Congress gave the Board no power over a patent
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`owner. Board power extends only over the patent and the proceeding (and, by
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`delegation, over counsel). Tellingly, the only IPR-related statutory power to
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`compel requires court action. 35 U.S.C. § 24. Even estoppel (§ 315(e)) is enforced
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`against a proceeding, application or patent, but does not compel a party to do
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`anything. There is no basis to consider IPRs anything other than in rem.
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`In rem actions against tribal properties do not implicate tribal sovereignty
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`because they do not constitute action against a tribe itself, and the Board need not
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`exercise jurisdiction over the Tribe to resolve the patentability of the disputed
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`claims. A final written decision would not impose any liability or obligation on the
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`Tribe itself (particularly as all briefing is done), and would merely determine the
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`-13-
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`legal status of the claims under the Board’s statutory authority to review prior
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`USPTO patentability determinations. As amici note, “[t]he Board has never
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`considered similarities between IPR proceedings regarding the boundaries of
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`patent property and real-property actions” in its prior decisions on sovereign
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`immunity. AAM 6-11; see also PK 8-10.
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`VI.
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`IF THE BOARD LACKS JURISDICTION TO CONSIDER
`TRIBAL IMMUNITY, THE CORRECT RESPONSE IS TO
`DISMISS, NOT GRANT, THE TRIBE’S MOTION
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`Several amici argue the Board lacks the authority to decide common-law
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`tribal immunity issues (Scholars 3-13; USI 6-7, NCAI 14-15, Ortiz 10-11) and that
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`the Board should therefore grant the Tribe’s motion. But if the Board indeed lacks
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`power to decide whether tribal immunity applies, the Board should dismiss the
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`Tribe’s motion. 37 CFR § 42.20(c) (movant has burden to justify relief).
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`Issuing a patentability decision certainly is not beyond the Board’s core
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`competency or congressional mandate. 35 U.S.C. § 318(a) (“shall issue”). Amici
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`argue the Board cannot decide constitutional questions, but would have the Board
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`disobey its statutory mandate anyway. See Scholars 11-12. Instead, those
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`authorities counsel that the Board should not substitute immunity determinations
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`for its statutory duty to safeguard the public’s “paramount interest in seeing that
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`patent monopolies ... are kept within their legitimate scope.” Precision Instrument
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`Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 816 (1945). Amici also argue
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`-14-
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`that recently proposed legislation proves that trib