by Dennis Crouch
Mayne Pharma v. Merck Sharp & Dohme (Fed. Cir. 2019)
Mayne’s U.S. Patent 6,881,745 covers an azole antifungal drug with a particular formulation designed to increase absorption and bioavailability. Back in 2015, Mayne sued Merck for infringement — accusing Merck’s Noxafil product. In the Inter Partes Review (IPR), the PTAB agreed with Merck — finding the claims unpatentable as obvious. That decision has now been affirmed on appeal.
Time Bar under 315(b): An IPR may not be instituted if the petitioner (or its proxy or a real-party-in-interest) was served with an infringement complaint more than one year beforehand. 35 U.S.C. § 315(b). Here’s the timeline:
- May 29, 2015, Mayne sued both Merck & Co, Inc. (MCI) and the company’s international subsidiary Merck Sharp & Dohme (MSD) for infringing the ‘745 patent.
- June 12 2015, MCI and MSD both served with a summons for the lawsuit.
- June 11, 2016, MSD (but not MCI) filed for inter partes review challenging the ‘745 patent. This appears to fall within the 1-year time limit. Mayne asked the PTAB to require MCI be joined as a real-party-in-interest, but the PTAB refused at the institution stage. At institution, MSD did not respond to the allegations regarding real party in interest; and the Board found insufficient evidence of Control.
- December 2017, PTAB required MSD to add MCI as a real party in interest to the case. Although MCI was added to the case well after the one-year 315(b) deadline, the PTAB found that MCI’s addition did not alter the filing date.
The Board had provided “guidance” that it would not allow correction of non-clerical errors in the petition without also changing the filing date, 80 Fed. Reg. 50, and Mayne argued that the rule applies here.
On appeal, the Federal Circuit sided with the patent challenger and PTAB — holding that the Board did not commit reversible error based upon a no-harm no-foul rule of law:
There was no evidence suggesting that MSD intended to conceal MCI’s identity. In fact, Mayne was aware of MCI because MCI was a named defendant in parallel district court litigation, and, had MSD named MCI as a real party in interest in its original petition, Mayne would be in the same position it is in now.
With regard to the PTAB guidance, the court noted that such guidance was “non binding” [upon whom?] and that the Board had allowed several petition corrections without changing the filing date.
Why Do It? – Privileged: The gaping hole in in the analysis is any discussion of why MSD did not name its parent company who was being sued for infringement as a real party in interest.
In the IPR, Merck’s attorneys (who represented both companies) indicated that they had intentionally omitted MCI as a real-party-in-interest, but did not explain their actions other than: “privileged legal strategy immune from discovery” (although this is in quotes, it is my paraphrasing). The key patent-related reason here that comes to mind is that – at the time – Merck thought it might get around IPR estoppel by having its subsidiary file the petition. It was not until more than a year later that Merck agreed that both companies would be bound by any resulting estoppel.
Appealable: The patent challenger also argued that the issue here is not appealable because it is tied to institution. On appeal, the Federal Circuit ducked that issue and instead held that the case is affirmed whether or not it is appealable. (Interesting jurisprudence dance on this one).
I love the PTAB publication in the Federal Register is listed as guidance, but in quotation marks.
I have to wonder how admin law expert Dave Boundy would view how “binding” any such Federal Register published guidance actually is (and how much anyone may rely on which parties are to bound).
You’d have to ask Boundy’s corporate clients what they think. It would likely depend very much on the guidance in question and how it impacts their bottom line, and pretty much nothing else.
I “get” the aspersion that you are trying to cast, but it falls rather flat — unless you can actually engage on the merits and point out ANY legal flaw in Dave Boundy’s views.
As far as Admin Law goes, I have never seen any cogent view from you (regardless of what your own client’s may or may not think).
OT – so just a quick mention: the Supreme Court has released its decisions in the Iancu v Brunetti (copyright FUCT) and Knick v Township of Scott (takings) cases today.
(I will reserve comments for the particular threads to appear, although the takings case may be a bit of a stretch for this forum – even though it resounds in the views on takings that I have long expressed)
NOT yet seeing a follow-up to the Takings case of Knick v Township of Scott, but certainly worth noting that there is a direct patent impact, notably the (admittedly inartfully) argued Takings exchange in a Celgene case has had the CAFC Judge Hughes position eviscerated.
Greg was “kind enough” to bring up the Celgene case (to broadly disparage ANY Takings argument), but has he been inete11ectually honest enough to note the Supreme Court impact on his very point?
That would be a resounding no.
See: link to patentlyo.com
Off topic, but worth mentioning: cert. denied this morning for Ariosa v. Illumina. Pity, that.
The Court did grant cert. on question 1 in Dex Media, Inc. v. Click-To-Call Technologies, LP, et al., no. 18-916, asking “[w]hether 35 U.S.C. § 314(d) permits appeal of the PTAB’s decision to institute an inter partes review upon finding that § 315(b)’s time bar did not apply.” This question generally represents an appeal of the Fed. Cir.’s en banc holding in Wi-Fi One, LLC v. Broadcom Corp., 878 F.3d 1364 (Fed. Cir. 2018).
The Court denied cert. in InvestPic, LLC v. SAP America Inc., no. 18-1199.
Re: “Merck’s attorneys (who represented both companies) indicated that they had intentionally omitted MCI as a real-party-in-interest, but did not explain their actions other than: privileged legal strategy immune from discovery.”
The IPR attorneys are not immune by a privilege claim or other refusal to respond from potential discovery by the PTO’s Office of Enrollment and Discipline inquiring if they were aware of the parent corporation control or payment of the IPR to such an extent that their deliberate failure to properly identify the parent as a RPI was a violation of OED rules.
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