RNAi Litigation

Acts 4, 5, and possibly 6 to follow in the next 2 days. It gets better.

Section 256 says: “The error of omitting inventors or naming persons who are not inventors shall not invalidate the patent in which such error occurred if it can be corrected as provided in this section. The court before which such matter is called in question may order correction of the patent on notice and hearing of all parties concerned, and the director shall issue a certificate accordingly.”

Judge Saris: “…there’s a piece of [this] that tickles my funnybone, which is the concept of nine Justices hearing a patent dispute, but I am not sure — actually, just the thought of it, I would actually pay airfare to go listen…”

THE COURT: And which case are you relying on for that?

MR. BERMAN: Cahill.

THE COURT: Cahill.

MR. BERMAN: In fact there’s a great quote from Justice Rehnquist where he says that “We don’t want the original jurisdiction of the Supreme Court to be trivialized and open to run-of-the-mill claims simply because they are brought by a state. What we want are to include in our original jurisdiction boundary disputes and the familiar cases involving disputes over water rights. In such cases, the state seeks to vindicate its rights as a state political entity.”

THE COURT: Well, let me ask you this. He raised for the first time — you’re not a patent lawyer primarily, although maybe you’re becoming one. Let me ask you this: I’ve only had one or two inventorship disputes, even under the patent context, and I hadn’t remembered what he’s saying, which is, the only remedy lies against the Patent and Trademark Office, which is to order them to correct the patent.

MR. BERMAN: That’s not correct. If you read the statute, 256, it says one of the remedies, one of the remedies is that you may order the U.S. Patent Office to correct. But we believe that you can also order the officials to take the steps that are necessary to correct the patent.

THE COURT: And where do you get that from?

MR. BERMAN: I get it from a fair reading of the statute sitting here today hearing this for the first time, but because the statute says you “may” order this, there has to be other means –

THE COURT: No, but it’s also equitable, so the “may” could just simply refer to the court’s discretion. I just have never thought about that issue before. I think the last time around I invalidated a patent because they didn’t name the inventorship, so I didn’t have to figure out what to do. And so because Ex Parte Young does deal with prospective and equitable relief against a particular official, I’m trying to think out loud what the order would look like.

MR. BERMAN: First of all, just to restate it, if you look at the Cahill case, the Cahill case says this is not Ex Parte Young, okay, this is not really an Ex Parte Young situation. And the reason is because there is no immunity in cases between state versus state, right? So this is not exactly the Ex Parte Young kind of a situation.

THE COURT: Well, you all spent a whole lot of ink talking about Ex Parte Young.

MR. BERMAN: Because they raised it. They started their motion by saying, “We’re immuned under Ex Parte Young.”

THE COURT: Well, you dropped the state, so now I’ve got to deal with these officials, and the reason you dropped it and I’m assuming the reason you dropped some of the relief you were requesting is so that you could fall squarely within Ex Parte Young. Now you’re telling me that’s not really the dispositive case, and I’m getting confused.

MR. BERMAN: No, the reason we changed the officials and the reason we changed our complaint was to fall within the scope of Connecticut v. Cahill. So we step back and look at what is the roadmap to getting jurisdiction in this court? There was one case on point, the only circuit that ever considered this precise issue.

THE COURT: Was it a patent case? No.

MR. BERMAN: It was not a patent case.

THE COURT: Right, there are no patent cases on point, right?

MR. GINDLER: Well, on point of whether you can exercise Ex Parte Young jurisdiction. In a suit against the state, there are cases. One is the Xechem case, Judge Newman in the Federal Circuit: “Ex Parte Young may be available to correct inventorship claims against the state university.” And we cited another case to that effect in Footnote 7 of our main brief. So there are cases –

THE COURT: So why aren’t you relying on — I get you, I understand that you’re relying on Ex Parte Young, and that’s what I thought we were going to be here to discuss. You’re now telling me that I don’t need Ex Parte Young. What did the Cahill case involve?

MR. BERMAN: The Cahill case involved a dispute over regulation, I think it was lobster fishing between New York and Connecticut, right? And so the state decided to sue the state officials to get an injunction going forward as to –

THE COURT: Right.

MR. GINDLER: Right? And that’s exactly what we’re trying to do here. We want against the officials an injunction requiring them to correct inventorship by applying to the U.S. Patent Office to correct an ongoing violation of law.

THE COURT: Ex Parte Young.

MR. BERMAN: If you read the Cahill case, okay, the Cahill case is not quite Ex Parte Young. Ex Parte Young is instructive.

THE COURT: All right.

MR. BERMAN: But what Cahill says, you don’t need to go down the Ex Parte Young path because it looked at Congress’ intent outside of Ex Parte Young and said Congress intended in 1251 to limit the original jurisdiction to this very narrow group of cases, core sovereign cases. And we think that our case fits squarely within Cahill. And in fact, as to the real part-in-interest issue, Cahill says that where you’re talking about core sovereign interests of a state, the state is the real party of interest; but when you’re not talking about core sovereign interest, you can name state officials alone. So Cahill takes care of all of the issues that have been raised by the defendants, the Rule 19 issue and the original jurisdiction issue. And so we rest our argument on Cahill and its progeny, the two cases I mentioned, the State of New York v. Brown and the Oregon v. Heavy Vehicle.

THE COURT: All right. All right, now I’ve got that. So what we’ll do is, we’ll jump into the sufficiency of the allegations.

MR. GINDLER: May I add one thing on Cahill?

THE COURT: Yes.

MR. GINDLER: Your Honor, Cahill doesn’t rely upon Ex Parte Young because it deals with a completely different kind of case. That was a case by the State of Connecticut against certain officials, the State of New York to enjoin the enforcement of a New York law. In particular, “The defendants are officers of the state of New York charged with enforcing a law that allows resident New York commercial permit-holders to trap lobsters in a small but quite productive area near Fishers Island, New York, but forbids nonresident commercial permit-holders from lobstering in the area.”

So this was an action by one state to preclude enforcement of a law by another. It was not an action about property rights. It was an action by one state, and it chose to sue the other state’s officials to preclude enforcement of a law on the grounds that it was unconstitutional. That is a completely different kettle of fish than an action about correcting a patent or about property rights where you have one state suing another over a commercial matter, as opposed to a dispute about the constitutionality of another state’s law.

THE COURT: But I’m just wondering out loud. Under Ex Parte Young, as I read those cases, and Cahill is a close kissing cousin, it’s not a core — maybe you can’t draw these distinctions anymore now that states enter into commerce, but it’s not a core sovereign interest the way rivers and boundaries and the like are. Here, as I know this case better than I usually do at the beginning, all the parties have licensed pharmaceutical companies. This is commerce in its essence, and I’m struggling with whether or not that’s the same kind of sovereignty — for sure, there’s ownership interests there — that rivers and lakes and property boundaries are.

MR. GINDLER: Well, all of those cases which involved rivers and lakes and property boundaries, they all involve the Ex Parte Young doctrine. What has not involved that doctrine is this other class of cases, of which Cahill is an example, where one state is suing to enjoin another state from enforcing its laws.

THE COURT: Because it violates the interstate — it’s unconstitutional. That’s pretty darn close because the law is in violation of the, I’m assuming there, the interstate commerce clause.

MR. GINDLER: Your Honor, the Supreme Court doesn’t think of it as falling into the same box. They have the Ex Parte –

THE COURT: All right, I will look at both boxes, but I’m just deeply concerned — I know for a fact Ex Parte Young applies if it was a continuing patent tort. The Supreme Court itself cited a continuing patent violation as one of the examples of when it does apply, and then to boot we have the Federal Circuit opinion. So, now, you’re saying — in a case of continuing patent infringement, I know Ex Parte Young would apply, at least under prevailing case law, unless the Supreme Court changes its opinion. But the second issue is, you’re saying this is different because it goes to the ownership of the patent itself, not a tort.

MR. GINDLER: It goes to the ownership of the patent itself, and, moreover, it addresses something that happened in the past. And I do have Section 256 in front of me in terms of how it operates, and what Section 256 says in the second paragraph, it says, “The error of omitting inventors or naming persons who are not inventors shall not invalidate the patent in which such error occurred if it can be corrected as provided in this section. The court before which such matter is called in question may order correction of the patent on notice and hearing of all parties concerned, and the director shall issue a certificate accordingly.” And that’s how it works.

THE COURT: It sounds right if you read from the statute, but I’m trying to figure out what legal significance that has because Ex Parte Young is typically prospective injunctive, but it could also include prospective declaratory relief, so –

MR. GINDLER: The significance it has is, it just reenforces the points, which is that this relief that’s being sought operates against the sovereign.

THE COURT: All right, I get the issue, and I must admit there’s a piece of it that tickles my funnybone, which is the concept of nine Justices hearing a patent dispute, but I am not sure — actually, just the thought of it, I would actually pay airfare to go listen, but the issue is, I don’t think it’s as clear as you’re saying it is.

MR. GINDLER: As much fun as it would be to think that we get to go and argue discovery motions before Justice Breyer –

THE COURT: I would like –

MR. GINDLER: — I think what happens is –

THE COURT: — a Markman hearing.

MR. GINDLER: — the Court appoints a special master. You actually don’t have an argument before the Supreme Court. There’s a special master that’s appointed, and that’s who you litigate against.

THE COURT: Anyway — okay, what?

MR. BERMAN: One last point, your Honor, if I may.

THE COURT: Yes, one last one. Go ahead.

MR. BERMAN: On your issue of what kind of sovereign interests are implicated here, I direct you or ask you to read again the Oregon case where it says, “It is exactly the sort of quarrel over money and technology that the District Courts hear frequently that are not the subject of the Supreme Court’s original exclusive jurisdiction.” And that’s what we have here, a fight over technology and licensing fees.

THE COURT: Okay, thank you. I’ve got it. On to Part B.

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