From The Field

July 15, 2019

The Federal Circuit ruled in Regents of the University of Minnesota v. LSI Corp., 2019 U.S. App. LEXIS 17887 (Fed. Cir. June 14, 2019), that state sovereign immunity does not bar an IPR proceeding against patents owned by a state university.

The Federal Circuit explained that state sovereign immunity is a “fundamental aspect of the sovereignty which the States enjoyed before the ratification of the Constitution.” Its main purpose is to “accord the States the dignity that is consistent with their status as sovereign entities.” However, the court noted, states are not immune to suits brought by the United States, or by “agency proceedings commenced by the United States.”

In this case, the University of Minnesota argued that IPRs are not suits brought by the United States, and that they more closely resemble a dispute between the patent-owner state and the other private party to the IPR proceeding. In response, the Federal Circuit cited its decision in St. Regis Mohawk Tribe v. Mylan Pharms., Inc., 896 F.3d 1322 (Fed. Cir. 2018), which held that tribal sovereign immunity does not apply to IPR proceedings. St. Regis “concluded that tribal sovereign immunity did not apply to IPR because the ‘USPTO [was] acting as the United States in its role as a superior sovereign to reconsider a prior administrative grant.’”

The Federal Circuit in University of Minnesota held that the reasoning from St. Regis applied more broadly to IPRs in which a state owns the patent in question, and that any “differences between tribal and state sovereign immunity do not warrant a departure from the reasoning in Saint Regis.” Just as in the tribal context, “IPR represents the sovereign’s reconsideration of the initial patent grant” and the state sovereign immunity doctrine does not apply.

The panel also appended “additional views” opining that state sovereign immunity “does not apply to IPR proceedings because they are in substance the type of in rem proceedings to which state sovereign immunity does not apply.”

Author: Larry Gabuzda