Federal Circuit Finds IPR Petitioner Lacks Standing To Appeal

10 January 2017 PTAB Trial Insights Blog
Authors: George C. Beck Stephen B. Maebius

Yesterday in Phigenix, Inc. v. Immunogen, Inc., the Federal Circuit held that petitioner Phigenix lacked standing to appeal an adverse final written decision in an IPR.  While acknowledging that the AIA permits a party without Article III standing to file an IPR, the Federal Circuit confirmed that the AIA does not eliminate the need for an appellant to the Federal Circuit (an Article III Court) to have standing in the form of “an injury that is both concrete and particularized”.  The court found insufficient evidence to show such an “injury-in-fact” on the part of Phigenix, and so it dismissed the appeal.

The Federal Circuit has previously required Article III standing for reexamination appellants

In Consumer Watchdog v. WARF, the Federal Circuit found that an inter partes reexamination requester also had to have Article III standing (see “Federal Circuit Finds Consumer Watchdog Lacks Standing To Appeal Reexamination Decision Upholding WARF Stem Cell Patent”).  While Consumer Watchdog made clear “Article III standing is not necessarily a requirement to appear before an administrative agency,” 753 F.3d 1258, 1261, it did not specifically address the legal standard for demonstrating standing on appeal from the PTO, specifically, the required burden of production, the evidence required to meet that burden and when an appellant must produce that evidence.

What evidence of standing is needed and when it must be provided?

Relying on the D.C. Circuit’s interpretation of Supreme Court precedent, the court stated that an appellant’s burden of production is “the same as that of a plaintiff moving for summary judgment in the district court.”  In some cases, standing is self-evident and no evidence outside the administrative record is necessary.  The court noted that “[w]hen the [appellant]’s standing is not self-evident, however, the [appellant] must supplement the record to the extent necessary to explain and substantiate its entitlement to judicial review.”

The court observed that an appellant may meet its burden of production by submitting arguments and any affidavits. Taken together, an appellant must either identify  record evidence, sufficient to support its standing to seek review, or, if there is none because standing was not an issue before the agency, submit additional evidence to the court  of appeals, such as by affidavit or other evidence.

As to timing, the court stated that an appellant must identify the relevant evidence demonstrating its standing “at the first appropriate” time, whether in response to a motion to dismiss or in the opening brief.  If there is no record evidence to support standing, the appellant must produce such evidence at the appellant level at the earliest possible opportunity.

Phigenix’s failure to establish standing

Phigenix did provide a declaration in response to a motion to dismiss the appeal filed by Immunogen.  However, the court found that the declaration was insufficient for a number of reasons.  Among the reasons listed were the following:

The Gold Declaration and the attorney letter are insufficient to demonstrate injury in fact. It is possible that, if Phigenix had licensed the ’534 patent to the same parties to which ImmunoGen had licensed the ’856 patent, the invalidation of the ’856 patent might have increased Phigenix’s revenues.  However, there is simply no allegation here that Phigenix has ever licensed the ’534 patent to anyone, much less that it licensed the ’534 patent to entities that have obtained licenses to the ImmunoGen ’856 patent.

Potential impact of failure to provide evidence of standing

Petitioners should be mindful of the need to identify admissible evidence of an actual injury-in-fact resulting from an adverse PTAB decision.  Phigenix clarifies that standing is a constitutional requirement for judicial review of a final decision by the PTAB, which is not met simply by virtue of a statutory right to appeal.  Both Consumer Watchdog and Phigenix make clear that the potential estoppel effect of inter partes reexamination alone does not constitute an injury-in-fact sufficient to establish standing.

In the absence of record evidence establishing standing, an appellant seeking review of a final decision by the PTAB should be prepared to provide evidence of a non-hypothetical injury to the Federal Circuit.  Absent such evidence, final decisions by the PTAB will not be subject to judicial review.

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