Case: 18-1638 Document: 136-1 Page: 1 Filed: 07/20/2018
`
`(1 of 29)
`
`
`
`United States Court of Appeals
`for the Federal Circuit
`______________________
`
`SAINT REGIS MOHAWK TRIBE, ALLERGAN, INC.,
`Appellants
`
`v.
`
`MYLAN PHARMACEUTICALS INC., TEVA
`PHARMACEUTICALS USA, INC., AKORN, INC.,
`Appellees
`______________________
`
`2018-1638, 2018-1639, 2018-1640, 2018-1641, 2018-1642,
`2018-1643
`______________________
`
`Appeals from the United States Patent and Trade-
`mark Office, Patent Trial and Appeal Board in Nos.
`IPR2016-01127,
`IPR2016-01128,
`IPR2016-01129,
`IPR2016-01130,
`IPR2016-01131,
`IPR2016-01132,
`IPR2017-00599,
`IPR2017-00576,
`IPR2017-00578,
`IPR2017-00579,
`IPR2017-00583,
`IPR2017-00585,
`IPR2017-00586,
`IPR2017-00594,
`IPR2017-00596,
`IPR2017-00598, IPR2017-00600, IPR2017-00601.
`______________________
`
`Decided: July 20, 2018
`______________________
`
`JONATHAN MASSEY, Massey & Gail LLP, Washington,
`
`DC, argued for appellants. Appellant Allergan, Inc. also
`represented by THOMAS BRUGATO, JEFFREY B. ELIKAN,
`ROBERT ALLEN LONG, JR., ALAINA MARIE WHITT, Coving-
`ton & Burling LLP, Washington, DC.
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 1
`
`

`

`Case: 18-1638 Document: 136-1 Page: 2 Filed: 07/20/2018
`
`(2 of 29)
`
`
`
` 2
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`
`ERIC MILLER, Perkins Coie, LLP, Seattle, WA, argued
`
`for appellees. Appellee Mylan Pharmaceuticals Inc. also
`represented by DAN L. BAGATELL, Hanover, NH; SHANNON
`BLOODWORTH, BRANDON MICHAEL WHITE, Washington,
`DC; CHARLES CURTIS, ANDREW DUFRESNE, Madison, WI;
`JAD ALLEN MILLS, STEVEN WILLIAM PARMELEE, Wilson,
`Sonsini, Goodrich & Rosati, PC, Seattle, WA; RICHARD
`TORCZON, Washington, DC.
`
`
`MARK R. FREEMAN, Appellate Staff, Civil Division,
`United States Department of Justice, Washington, DC,
`argued for amicus curiae United States. Also represented
`by COURTNEY DIXON, MARK B. STERN, CHAD A. READLER.
`
`
`MICHAEL W. SHORE, Shore Chan DePumpo LLP, Dal-
`las, TX, for appellant Saint Regis Mohawk Tribe. Also
`represented by ALFONSO CHAN, JOSEPH F. DEPUMPO,
`CHRISTOPHER LIIMATAINEN EVANS; MARSHA K. SCHMIDT,
`Burtonsville, MD.
`
`JOHN CHRISTOPHER ROZENDAAL, Sterne Kessler Gold-
`
`stein & Fox, PLLC, Washington, DC, for appellee Teva
`Pharmaceuticals USA, Inc. Also represented by MICHAEL
`E. JOFFRE, WILLIAM H. MILLIKEN, PAULINE PELLETIER,
`RALPH WILSON POWERS, III.
`
` MICHAEL R. DZWONCZYK, Sughrue Mion PLLC, Wash-
`ington, DC, for appellee Akorn, Inc. Also represented by
`MARK BOLAND.
`
`YIN HUANG, Zuber Lawler & Del Duca LLP, New
`
`York, NY, for amicus curiae New York City Bar Associa-
`tion.
`
`ERIC SHUMSKY, Orrick, Herrington & Sutcliffe LLP,
`
`Washington, DC, for amicus curiae Microsoft Corporation.
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 2
`
`

`

`Case: 18-1638 Document: 136-1 Page: 3 Filed: 07/20/2018
`
`(3 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM.
`
`3
`
`Also represented by SAMUEL HARBOURT; E. JOSHUA
`ROSENKRANZ, New York, NY.
`
`CHARLES DUAN, R Street Institute, Washington, DC,
`
`for amici curiae R Street Institute, Electronic Frontier
`Foundation.
`
`JOHN THORNE, Kellogg, Hansen, Todd, Figel & Freder-
`
`ick, P.L.L.C., Washington, DC, for amici curiae High Tech
`Inventors Alliance, Computer & Communications Indus-
`try Association. Also represented by GREGORY G. RAPAWY.
`
`CHARLES R. MACEDO, Amster Rothstein & Ebenstein
`
`LLP, New York, NY, for amicus curiae Askeladden, L.L.C.
`Also represented by MARK BERKOWITZ, SANDRA A. HUDAK.
`
`ANNA-ROSE MATHIESON, California Appellate Law
`
`Group, San Francisco, CA, for amicus curiae America's
`Health Insurance Plans.
`
` WILLIAM M. JAY, Goodwin Procter LLP, Washington,
`DC, for amicus curiae The Association for Accessible
`Medicines. Also represented by JAIME ANN SANTOS;
`JEFFREY FRANCER, The Association for Accessible Medi-
`cines, Washington, DC.
`
` MARIA AMELIA CALAF, Wittliff Cutter, Austin, TX, for
`amici curiae Software & Information Industry Associa-
`tion, L Brands, Inc., SAS Institute Inc., SAP America,
`Inc., Internet Association, Xilinx, Inc.
`______________________
`
`Before DYK, MOORE, and REYNA, Circuit Judges.
`Opinion for the court filed by Circuit Judge MOORE.
`Concurring opinion filed by Circuit Judge DYK.
`MOORE, Circuit Judge.
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 3
`
`

`

`Case: 18-1638 Document: 136-1 Page: 4 Filed: 07/20/2018
`
`(4 of 29)
`
`
`
` 4
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`Mylan Pharmaceuticals, Inc., petitioned for inter
`partes review (“IPR”) of various patents owned by Aller-
`gan, Inc., relating to its dry eye treatment Restasis. Teva
`Pharmaceuticals USA, Inc., and Akorn, Inc. (together
`with Mylan, “Appellees”) joined. While IPR was pending,
`Allergan transferred title of the patents to the Saint Regis
`Mohawk Tribe, which asserted sovereign immunity. The
`Board denied the Tribe’s motion to terminate on the basis
`of sovereign immunity and Allergan’s motion to withdraw
`from the proceedings. Allergan and the Tribe appeal,
`arguing the Board improperly denied these motions. We
`affirm.
`
`BACKGROUND
`This appeal stems from a multifront dispute between
`Allergan and various generic drug manufacturers regard-
`ing patents related to Allergan’s Restasis product (the
`“Restasis Patents”), a treatment for alleviating the symp-
`toms of chronic dry eye. In 2015, Allergan sued Appellees
`in the Eastern District of Texas, alleging infringement of
`the Restasis Patents based on their filings of Abbreviated
`New Drug Applications. On June 3, 2016, Mylan peti-
`tioned for IPR of the Restasis Patents. Subsequently,
`Teva and Akorn filed similar petitions. The Board insti-
`tuted IPR and scheduled a consolidated oral hearing for
`September 15, 2017.
`Before the hearing, Allergan and the Tribe entered in-
`to an agreement Mylan alleges was intended to protect
`the patents from review. On September 8, 2017, a patent
`assignment transferring the Restasis patents from Aller-
`gan to the Tribe was recorded with the USPTO. The
`Tribe moved to terminate the IPRs, arguing it is entitled
`to assert tribal sovereign immunity, and Allergan moved
`to withdraw. The Board denied both motions.
`Allergan and the Tribe appeal. We have jurisdiction
`pursuant 28 U.S.C. § 1295(a)(4)(A). Board decisions must
`be set aside if they are “arbitrary, capricious, an abuse of
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 4
`
`

`

`Case: 18-1638 Document: 136-1 Page: 5 Filed: 07/20/2018
`
`(5 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM.
`
`5
`
`discretion, or otherwise not in accordance with law.”
`5 U.S.C. § 706.
`
`ANALYSIS
`As “domestic dependent nations,” Indian tribes pos-
`sess “inherent sovereign immunity,” and suits against
`them are generally barred “absent a clear waiver by the
`tribe or congressional abrogation.” Okla. Tax Comm’n v.
`Citizen Band Potawatomi Indian Tribe of Okla., 498 U.S.
`505, 509 (1991). This immunity derives from the common
`law, Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58
`(1978), and it does not extend to actions brought by the
`federal government, see, e.g., E.E.O.C. v. Karuk Tribe
`Hous. Auth., 260 F.3d 1071, 1075 (9th Cir. 2001); United
`States v. Red Lake Band of Chippewa Indians, 827 F.2d
`380, 383 (8th Cir. 1987). Generally, immunity does not
`apply where the federal government acting through an
`agency engages in an investigative action or pursues an
`adjudicatory agency action. See, e.g., Pauma v. NLRB,
`888 F.3d 1066 (9th Cir. 2018) (holding the NLRB could
`adjudicate unfair labor charges brought by the Board
`against a tribally-owned business operating on tribal
`land); Karuk Tribe Hous. Auth., 260 F.3d at 1074 (holding
`tribe not immune in EEOC enforcement action); cf. Fed.
`Power Comm’n v. Tuscarora Indian Nation, 362 U.S. 99,
`122 (1960) (holding that tribal lands were subject to
`takings by the Federal Power Commission). There is not,
`however, a blanket rule that immunity does not apply in
`federal agency proceedings. Fed. Maritime Comm’n v.
`S.C. State Ports Auth., 535 U.S. 743, 754–56 (2002)
`(“FMC”).
`In FMC, the Supreme Court considered whether state
`sovereign immunity precluded the Federal Maritime
`Commission from “adjudicating a private party’s com-
`plaint that a state-run port ha[d] violated the Shipping
`Act of 1984.” Id. at 747. In answering this question, the
`Court asked whether Commission adjudications “are the
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 5
`
`

`

`Case: 18-1638 Document: 136-1 Page: 6 Filed: 07/20/2018
`
`(6 of 29)
`
`
`
` 6
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`type of proceedings from which the Framers would have
`thought the States possessed immunity when they agreed
`to enter the Union.” Id. at 756. It decided they were,
`given the FMC proceedings’ “overwhelming” similarities
`with civil litigation in federal courts. Id. at 759. For
`example, the Court noted the procedural rules in the
`Commission’s proceedings “bear a remarkably strong
`resemblance” to the rules applied in civil litigation, and
`the discovery procedures were “virtually indistinguisha-
`ble” from the procedures used in civil litigation. Id. at
`757–58. The Court also distinguished the proceedings at
`issue from other proceedings in which the Commission
`had the authority to decide whether to proceed with an
`investigation or enforcement action. Id. at 768. In doing
`so, the Court recognized a distinction between adjudica-
`tive proceedings brought against a state by a private
`party and agency-initiated enforcement proceedings.
`The Tribe argues that tribal sovereign immunity ap-
`plies in IPR under FMC. It asserts that like the proceed-
`ing in FMC, IPR is a contested, adjudicatory proceeding
`between private parties in which the petitioner, not the
`USPTO, defines the contours of the proceeding. Appellees
`dispute this comparison, arguing that the Tribe may not
`invoke sovereign immunity to block IPR proceedings
`because they are more like a traditional agency action.
`They argue the Board is not adjudicating claims between
`parties but instead is reconsidering a grant of a govern-
`ment franchise. They also argue that even if the Tribe
`could otherwise assert sovereign immunity, its use here is
`an impermissible attempt to “market an exception” from
`the law and non-Indian companies have no legitimate
`interest in renting tribal immunity to circumvent the law.
`Appellees further argue the Tribe may not assert immuni-
`ty because the assignment was a sham, and the Tribe
`waived sovereign immunity by suing on the patents.
`Although the precise contours of tribal sovereign im-
`munity differ from those of state sovereign immunity, the
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 6
`
`

`

`Case: 18-1638 Document: 136-1 Page: 7 Filed: 07/20/2018
`
`(7 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM.
`
`7
`
`FMC analysis is instructive. We hold that tribal sover-
`eign immunity cannot be asserted in IPRs.
`IPR is neither clearly a judicial proceeding instituted
`by a private party nor clearly an enforcement action
`brought by the federal government. It is a “hybrid pro-
`ceeding” with “adjudicatory characteristics” similar to
`court proceedings, but in other respects it “is less like a
`judicial proceeding and more like a specialized agency
`proceeding.” Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct.
`2131, 2143–44 (2016). This tension was laid bare in two
`recent Supreme Court decisions decided on the same day.
`In Oil States Energy Services v. Greene’s Energy
`Group, LLC, 138 S. Ct. 1365 (2018), the Court empha-
`sized the government’s central role in IPR and the role of
`the USPTO in protecting the public interest. It held that
`IPR is a matter “which arise[s] between the Government
`and persons subject to its authority in connection with the
`performance of the constitutional functions of the execu-
`tive or legislative departments.” 138 S. Ct. at 1373 (quot-
`ing Crowell v. Benson, 285 U.S. 22, 50 (1932)). It
`recognized that IPR is “simply a reconsideration of” the
`PTO’s original grant of a public franchise, which serves to
`protect “the public’s paramount interest in seeing that
`patent monopolies are kept within their legitimate scope.”
`Id. (quoting Cuozzo, 136 S. Ct. at 2144).
`In contrast, in SAS Institute Inc. v. Iancu, 138 S. Ct.
`1348 (2018), the Court emphasized the adjudicatory
`aspects of IPR and the way in which it “mimics civil
`litigation.” Id. at 1352; see also id. at 1353, 1355. It
`explained that Congress structured IPR so that the peti-
`tioner, not the USPTO Director, “define[s] the contours of
`the proceeding.” Id. at 1355. The Court contrasted the
`“party-directed, adversarial” IPR process, in which the
`Director is only given the choice of whether to institute
`IPR, with the “inquisitorial approach” established by the
`ex parte reexamination statute, under which the Director
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 7
`
`

`

`Case: 18-1638 Document: 136-1 Page: 8 Filed: 07/20/2018
`
`(8 of 29)
`
`
`
` 8
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`was given the authority to investigate patentability on his
`own initiative. Id.
`Ultimately, several factors convince us that IPR is
`more like an agency enforcement action than a civil suit
`brought by a private party, and we conclude that tribal
`immunity is not implicated. First, although the Director’s
`discretion in how he conducts IPR is significantly con-
`strained, he possesses broad discretion in deciding wheth-
`er to institute review. Oil States, 138 S. Ct. at 1371.
`Although this is only one decision, it embraces the entire-
`ty of the proceeding. If the Director decides to institute,
`review occurs. If the Director decides not to institute, for
`whatever reason, there is no review. In making this
`decision, the Director has complete discretion to decide
`not to institute review. Oil States, 138 S. Ct. at 1371
`(“The decision whether to institute inter partes review is
`committed to the Director’s discretion.”). The Director
`bears the political responsibility of determining which
`cases should proceed. While he has the authority not to
`institute review on the merits of the petition, he could
`deny review for other reasons such as administrative
`efficiency or based on a party’s status as a sovereign. See
`Wi-Fi One, LLC v. Broadcom Corp., 878 F.3d 1364, 1372
`(Fed. Cir. 2018) (en banc). Therefore, if IPR proceeds on
`patents owned by a tribe, it is because a politically ac-
`countable, federal official has authorized the institution of
`that proceeding. See Alden v. Maine, 527 U.S. 706, 756
`(1999) (contrasting suits in which the United States
`“exercise[s] . . . political responsibility for each suit prose-
`cuted” in order to fulfill its obligation under the Take
`Care Clause with “a broad delegation to private persons
`to sue nonconsenting States”). In this way, IPR is more
`like cases in which an agency chooses whether to institute
`a proceeding on information supplied by a private party.
`In FMC, the Court recognized that immunity would not
`apply in such a proceeding. FMC, 535 U.S. at 768.
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 8
`
`

`

`Case: 18-1638 Document: 136-1 Page: 9 Filed: 07/20/2018
`
`(9 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM.
`
`9
`
`In FMC, the Federal Maritime Commission lacked the
`“discretion to refuse to adjudicate complaints brought by
`private parties,” FMC, 535 U.S. at 764, and in federal civil
`litigation, a private party can compel a defendant’s ap-
`pearance in court and the court had no discretion to
`refuse to hear the suit. In both instances, absent immuni-
`ty, a private party could unilaterally hale a sovereign
`before a tribunal, presenting an affront to the dignity of
`the sovereign. See Michigan v. Bay Mills Indian Cmty.,
`134 S. Ct. 2024, 2042 (2014) (noting the need to consider
`the dignity of the Indian tribes as sovereigns); FMC, 535
`U.S. at 760 (“The preeminent purpose of state sovereign
`immunity is to accord States the dignity that is consistent
`with their status as sovereign entities.”). The Director’s
`broad authority to not institute alleviates these concerns
`in the IPR context. It is the Director, the politically
`appointed executive branch official, not the private party,
`who ultimately decides whether to proceed against the
`sovereign.
`Second, the role of the parties in IPR suggests im-
`munity does not apply in these proceedings. Once IPR
`has been initiated, the Board may choose to continue
`review even if the petitioner chooses not to participate.
`35 U.S.C. § 317(a). The Director has also been granted
`the right to participate in appeals “even if the private
`challengers drop out.” Cuozzo, 136 S. Ct. at 2144; see also
`35 U.S.C. § 143 (granting the Director the right to inter-
`vene in appeals of Board decisions in IPRs). The Board
`has construed its rules to allow it to continue review even
`in the absence of patent owner participation. See Reactive
`Surfaces Ltd. v. Toyota Motor Corp., IPR2017-00572,
`Paper 32 (PTAB July 13, 2017) (citing 37 C.F.R.
`§§ 42.108(c), 120(a)). This reinforces the view that IPR is
`an act by the agency in reconsidering its own grant of a
`public franchise.
`Third, unlike FMC, the USPTO procedures in IPR do
`not mirror the Federal Rules of Civil Procedure. See
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 9
`
`

`

`Case: 18-1638 Document: 136-1 Page: 10 Filed: 07/20/2018
`
`(10 of 29)
`
`
`
` 10
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`FMC, 535 U.S. at 757–58. Although there are certain
`similarities, the differences are substantial. While the
`Federal Rules of Civil Procedure provide opportunities for
`a plaintiff to make significant amendments to its com-
`plaint, see Fed. R. Civ. P. 15, the Board has determined
`that in IPR a petitioner may only make clerical or typo-
`graphical corrections to its petition, see Nat’l Envtl. Prods.
`Ltd. v. Dri-Steem Corp., IPR2014-01503, Paper 11 (PTAB
`Nov. 4, 2014) (citing 37 C.F.R. § 42.104(c)). At the same
`time, a patent owner in IPR may seek to amend its patent
`claims during the proceedings, an option not available in
`civil litigation. 35 U.S.C. § 316(d). IPR also lacks many
`of the preliminary proceedings that exist in civil litiga-
`tion. See, e.g., Farmwald v. Parkervision, Inc., IPR2014-
`00946, Paper 13 (PTAB Jan. 26, 2015) (declining to con-
`duct a Markman hearing). Moreover, in civil litigation
`and the proceedings at issue in FMC, parties have a host
`of discovery options, including the use of interrogatories,
`depositions, production demands, and requests for admis-
`sion. FMC, 535 U.S. at 758. In IPR, discovery is limited
`to “(A) the deposition of witnesses submitting affidavits or
`declarations; and (B) what is otherwise necessary in the
`interest of justice.” 35 U.S.C. § 316(a)(5); see also 37
`C.F.R. § 42.51. In FMC, the Court rejected the idea that
`sovereign immunity could be circumvented by merely
`moving a proceeding from an Article III court to an equiv-
`alent agency tribunal. FMC, 535 U.S. at 760. An IPR
`hearing is nothing like a district court patent trial. The
`hearings are short, and live testimony is rarely allowed.
`Ultratec, Inc. v. CaptionCall, LLC, 872 F.3d 1267, 1270
`n.2 (Fed. Cir. 2017) (“Very seldom do IPR proceedings
`have the hallmarks of what is typically thought of as a
`trial.”). In IPR, the agency proceedings are both function-
`ally and procedurally different from district court litiga-
`tion. In short, the agency procedures in FMC much more
`closely approximated a civil litigation than those in IPR.
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 10
`
`

`

`Case: 18-1638 Document: 136-1 Page: 11 Filed: 07/20/2018
`
`(11 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM.
`
`11
`
`Finally, while the USPTO has the authority to con-
`duct reexamination proceedings that are more inquisito-
`rial and less adjudicatory than IPR, this does not mean
`that IPR is thus necessarily a proceeding in which Con-
`gress contemplated tribal immunity to apply. The Tribe
`acknowledged that sovereign immunity would not apply
`in ex parte or inter partes reexamination proceedings
`because of their inquisitorial nature. Oral Arg. at 6:30–
`8:10. The mere existence of more inquisitorial proceed-
`ings in which immunity does not apply does not mean
`that immunity applies in a different type of proceeding
`before the same agency. Notably, the Supreme Court in
`Cuozzo recognized inter partes reexamination and IPR
`have the same “basic purposes, namely to reexamine an
`agency decision.” 136 S. Ct. at 2144. While IPR presents
`a closer case for the application of tribal immunity than
`reexamination, we nonetheless conclude that tribal im-
`munity does not extend to these administrative agency
`reconsideration decisions.
`The Director’s important role as a gatekeeper and the
`Board’s authority to proceed in the absence of the parties
`convinces us that the USPTO is acting as the United
`States in its role as a superior sovereign to reconsider a
`prior administrative grant and protect the public interest
`in keeping patent monopolies “within their legitimate
`scope.” See Cuozzo, 136 S. Ct. at 2144. The United
`States, through the Director, does “exercise . . . political
`responsibility” over the decision to proceed with IPR.
`FMC, 535 U.S. at 764 (quoting Alden, 527 U.S. at 756).
`The Tribe may not rely on its immunity to bar such an
`action. See Miccosukee Tribe of Indians of Fla. v. United
`States, 698 F.3d 1326, 1331 (11th Cir. 2012) (“Indian
`tribes may not rely on tribal sovereign immunity to bar a
`suit by a superior sovereign.”). Because we conclude that
`tribal sovereign immunity cannot be asserted in IPR, we
`need not reach the parties’ other arguments.
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 11
`
`

`

`Case: 18-1638 Document: 136-1 Page: 12 Filed: 07/20/2018
`
`(12 of 29)
`
`
`
` 12
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`In this case we are only deciding whether tribal im-
`munity applies in IPR. While we recognize there are
`many parallels, we leave for another day the question of
`whether there is any reason to treat state sovereign
`immunity differently.
`
`CONCLUSION
`For the foregoing reasons, the decision of the Board is
`affirmed.
`
`AFFIRMED
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 12
`
`

`

`Case: 18-1638 Document: 136-1 Page: 13 Filed: 07/20/2018
`
`(13 of 29)
`
`
`
`United States Court of Appeals
`for the Federal Circuit
`______________________
`
`SAINT REGIS MOHAWK TRIBE, ALLERGAN, INC.,
`Appellants
`
`v.
`
`MYLAN PHARMACEUTICALS INC., TEVA
`PHARMACEUTICALS USA, INC., AKORN, INC.,
`Appellees
`______________________
`
`2018-1638, 2018-1639, 2018-1640, 2018-1641, 2018-1642,
`2018-1643
`______________________
`
`Appeals from the United States Patent and Trade-
`mark Office, Patent Trial and Appeal Board in Nos.
`IPR2016-01127,
`IPR2016-01128,
`IPR2016-01129,
`IPR2016-01130,
`IPR2016-01131,
`IPR2016-01132,
`IPR2017-00599,
`IPR2017-00576,
`IPR2017-00578,
`IPR2017-00579,
`IPR2017-00583,
`IPR2017-00585,
`IPR2017-00586,
`IPR2017-00594,
`IPR2017-00596,
`IPR2017-00598, IPR2017-00600, IPR2017-00601.
`______________________
`DYK, Circuit Judge, concurring.
`I fully join the panel opinion but write separately to
`describe in greater detail the history of inter partes
`review proceedings, history that confirms that those
`proceedings are not adjudications between private par-
`ties. While private parties play a role, inter partes re-
`views are fundamentally agency reconsiderations of the
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 13
`
`

`

`Case: 18-1638 Document: 136-1 Page: 14 Filed: 07/20/2018
`
`(14 of 29)
`
`
`
` 2
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`original patent grant, proceedings as to which sovereign
`immunity does not apply.
`As the panel makes clear, it is well established that
`tribes cannot assert sovereign immunity in proceedings
`brought by the federal government.1 This understanding
`is reflected in Federal Maritime Commission v. South
`Carolina State Ports Authority (“FMC”), which dealt with
`a proceeding conducted by the Federal Maritime Commis-
`sion adjudicating a private party’s claim that a state-run
`port had violated a federal statute in which the private
`party sought monetary and injunctive relief. 535 U.S. 743,
`747–49 (2002). “[T]he only duty assumed by the FMC, and
`hence the United States, in conjunction with [the] private
`complaint [was] to assess its merits in an impartial man-
`ner.” Id. at 764.
`The Supreme Court held that state sovereign immun-
`ity barred the FMC from adjudicating the complaint, but
`noted that it would not bar the FMC from “institut[ing]
`its own administrative proceeding against a state-run
`port,” even if that proceeding were prompted by “infor-
`mation supplied by a private party.” Id. at 768. Private
`parties, the Court explained, “remain perfectly free to
`complain to the Federal Government about unlawful state
`activity and the Federal Government [remains] free to
`take subsequent legal action.” Id. at 768 n.19.
`
`
`1 See Washington v. Confederated Tribes of Colville
`Indian Reservation, 447 U.S. 134, 154 (1980) (holding that
`tribal sovereignty is “dependent on, and subordinate to”
`the Federal Government); Pauma v. NLRB, 888 F.3d
`1066, 1078–79 (9th Cir. 2018) (holding that tribal immun-
`ity does not preclude a proceeding brought “on behalf of
`the NLRB, an agency of the United States, to enforce
`public rights”); NLRB v. Little River Band of Ottawa
`Indians Tribal Gov’t, 788 F.3d 537, 555 (6th Cir. 2015).
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 14
`
`

`

`Case: 18-1638 Document: 136-1 Page: 15 Filed: 07/20/2018
`
`(15 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`3
`
`Under FMC, it is clear that sovereign immunity can-
`not bar agency denial of an original patent application
`filed by a sovereign entity or, consequently, agency recon-
`sideration of an original patent grant. Such reconsidera-
`tion simply does not involve agency adjudication of a
`private dispute, but rather agency reconsideration of its
`own prior actions.
`At oral argument, counsel for the tribe acknowledged
`that sovereign immunity would not apply in either ex
`parte or inter partes reexamination proceedings, and even
`suggested that the USPTO could continue to provide post-
`grant review of tribe-owned patents by simply converting
`the inter partes reviews to ex parte reexaminations. Oral
`Arg. 6:30–7:08, 54:48–55:15. But inter partes review is
`not fundamentally different from other reexamination
`procedures. Rather, inter partes review is a direct succes-
`sor to ex parte and inter partes reexamination. It shares
`many of the same procedural features and is designed to
`address the same problems. And like the reexaminations
`from which it descends, it is fundamentally agency recon-
`sideration, assisted by third parties, rather than agency
`adjudication of a private dispute.
`Post-grant administrative review of issued patents is
`a relatively new feature of the patent system. It was first
`enacted in 1980 to address longstanding concerns about
`the reliability of the original examination process. Patlex
`Corp. v. Mossinghoff, 758 F.2d 594, 603 (Fed. Cir. 1985).
`Before reexamination procedures, once a patent was
`issued, “there was no way the PTO or private persons
`could have forced . . . patents back into the examination
`phase against [the patent owner’s] will.” Id. at 601.2 This
`
`
`2 The USPTO did have the authority to reissue pa-
`tents to cure errors in the original. See Grant v. Raymond,
`31 U.S. 218, 244 (1832); see also 35 U.S.C. § 251. Howev-
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 15
`
`

`

`Case: 18-1638 Document: 136-1 Page: 16 Filed: 07/20/2018
`
`(16 of 29)
`
`
`
` 4
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`was problematic because the USPTO—then and now—is
`an agency with finite resources that sometimes issues
`patents in error. Currently, for instance, the USPTO
`receives over 600,000 applications a year. U.S. Patent &
`Trademark Office, Performance & Accountability Report
`169 tbl.2 (2017). Patent examiners receive roughly 22
`hours to review each application, an amount of time that
`70% of examiners report as insufficient. See U.S. Gov’t
`Accountability Office, GAO-16-490, Patent Office Should
`Define Quality, Reassess Incentives, and Improve Clarity
`10, 25–26 (2016). And the USPTO struggles to attract and
`retain examiners with the technical competence required
`to understand the inventions being reviewed and to
`perform sufficiently thorough prior art searches. See U.S.
`Gov’t Accountability Office, GAO-16-479, Patent Office
`Should Strengthen Search Capabilities and Better Moni-
`tor Examiners’ Work 28–29 & n.50 (2016).
`In considering the enactment of reexamination, Con-
`gress was well aware of constraints on the accuracy of
`initial examination and the adverse effects of the issuance
`of bad patents. The Senate report on patent reexamina-
`tion emphasized that the USPTO faced “a situation where
`a limited staff is trying to cope with a constantly increas-
`ing workload and is under pressure to make speedy
`determinations on whether or not to grant patents.” S.
`Rep. No. 96-617, at 8 (1980); see also Patent Reexamina-
`tion: Hearing on S. 1679 Before the Comm. on the Judici-
`ary, 96th Cong. 3 (1980) (statement of Sen. Bayh)
`(characterizing the USPTO as “an understaffed and
`overworked office trying to handle an ever increasing
`
`er, reissue proceedings could only be initiated at the
`request of the patentee, so they were of limited use in
`ensuring patent quality. See Russell E. Levine et. al., Ex
`Parte Patent Practice and the Rights of Third Parties, 45
`Am. U. L. Rev. 1987, 2008 (1996).
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 16
`
`

`

`Case: 18-1638 Document: 136-1 Page: 17 Filed: 07/20/2018
`
`(17 of 29)
`
`SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`5
`
`workload.”). The USPTO Commissioner testified that
`these resource constraints led to uncertainty in the patent
`system “because pertinent prior patents and printed
`publications . . . often are discovered only after a patent
`has issued and become commercially important.” S. Rep.
`No. 96-617, at 9 (1980). The Commissioner also explained
`that
`The main reason reexamination is needed is be-
`cause members of the public interested in the va-
`lidity of a patent are sometimes able to find
`pertinent prior patents and printed publications
`not known or available to the PTO. . . .
`The patent owner’s competitors will devote great
`effort and expense to invalidating a patent that
`affects their business. They can afford to look for
`documentary evidence of unpatentability in li-
`brary collections, technical journals and other
`sources not within the PTO’s search file. Because
`of budgetary and time constraints, the examiner’s
`search seldom extends beyond the PTO’s 22 mil-
`lion document collection.
`Industrial Innovation and Patent and Copyright Law
`Amendments: Hearing on H.R. 6033, H.R. 6934, H.R.
`3806, and H.R. 2414 Before the Subcomm. on Courts, Civil
`Liberties & the Admin. of Justice of the H. Comm. on the
`Judiciary, 96th Cong. 576 (1981) (statement of Sidney A
`Diamond, Commissioner of Patents and Trademarks).3 In
`
`
`3 See also Thomas E. Popovich, Patent Quality: An
`Analysis of Proposed Court, Legislative, and PTO—
`Administrative Reform—Reexamination Resurrected (Part
`I), 61 J. Pat. Off. Soc’y 248, 269 (1979) (concluding that
`the issuance of low quality patents was attributable to the
`USPTO’s failure to discover and adequately to consider
`
`Patent Owner Saint Regis Mohawk Tribe
`Ex. 2006, p. 17
`
`

`

`Case: 18-1638 Document: 136-1 Page: 18 Filed: 07/20/2018
`
`(18 of 29)
`
`
`
` 6
`
` SAINT REGIS MOHAWK TRIBE v. MYLAN PHARM. INC.
`
`short, given the high volume of applications and the
`USPTO’s manpower limitations, pre-grant patent exami-
`nation was—and still is—an imperfect way to separate
`the good patents from the bad. Resource constraints in
`the initial examination period inevitably result in errone-
`ously granted patents.4
`As a result of these problems, there was a perception
`that the public lacked co