Patently Absurd: Critiquing the USPTO’s Disparate Treatment of Tribal and State Immunity in Inter Partes Review

Washington and Lee Law Review, Nov 2018

By Maya Ginga, Published on 11/05/18

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Patently Absurd: Critiquing the USPTO’s Disparate Treatment of Tribal and State Immunity in Inter Partes Review

Patently Absurd: Critiquing the USPTO's Disparate Treatment of Tribal and State Immunity in Inter Partes Review Maya Ginga 0 1 0 Washington and Lee University School of Law , USA 1 Thi s Note is brought to you for free and open access by the Washington and Lee Law Review at Washington & Lee University School of Law Scholarly Commons. It has been accepted for inclusion in Washington and Lee Law Review by an authorized editor of Washington & Lee University School of Law Scholarly Commons. For more information , please contact , USA Follow this and additional works at: https://scholarlycommons.law.wlu.edu/wlulr Part of the Indian and Aboriginal Law Commons, and the Intellectual Property Law Commons Recommended Citation Maya Ginga, Patently Absurd: Critiquing the USPTO's Disparate Treatment of Tribal and State - Patently Absurd: Critiquing the USPTO?s Disparate Treatment of Tribal and State Immunity in Inter Partes Review Maya Ginga* I. Introduction.................................................................... 1704? * Candidate for J.D. May 2019. I would like to thank Professors Shaughnessy and Seaman and the Washington and Lee Law Review Editorial Board, specifically Aileen Almonte and Corey Lipschutz, for their editorial and substantive guidance. Thank you, also, to my family for encouraging me to follow my intellectual curiosities. I would like to dedicate this Note to Carl Frappaolo. VI. Conclusion ...................................................................... 1776? I. Introduction The U.S. biopharmaceut ical industry?s profits in 2017 were $453 billion.1 Innovative drug development and commercialization is a major source of the industry?s profits.2 These medical advances are due in large part to investment in time-consuming and costly research and development efforts.3 Pharmaceutical companies then protect their investment in research via intellectual property rights?namely, patents.4 One such Irish-based biopharmaceutical company, Allergan, Inc., grossed approximately $6.45 billion in 1. Global Pharmaceutical Sales From 2014 to 2016, STAT ISTA (2017 ), https://www.statista.com/statistics/272181/world-pharmaceutical-sales-byregion/ (last visited Sept. 19, 2018) (on file with the Washington and Lee Law Review). 2. See Richard Anderson, Pharmaceutical Industry Gets High on Fat Profits, BBC NEWS (Nov. 6, 2014), https://www.bbc.com/news/business-28212223 (last visited Sept. 19, 2018) (discussing the pharmaceutical industry?s large profit margins due to expensive drugs and low manufacturing costs) (on file with the Washington and Lee Law Review). 3. See Richard Frank & Paul B. Ginsburg, Pharmaceutical Industry Profits and Research and Development, BROOKINGS INST. (Nov. 17, 2017) , https://www.brook ings.edu/blog/up-front/2017 /11/17/pharmaceutical-industryprofits-and-research-and-development/ (last visited Sept. 19, 2018) (?[T]he cost of bringing a new drug to market is very high and the process is risky.?) (on file with the Washington and Lee Law Review); Robert Weisman, Cost of Bringing Drug to Market Tops $2.5b, Research Finds, BOS. GLOBE (Nov. 18, 2014), https://www.bostonglobe.com/business/2014/11/18/cost-bringing-prescriptiondrug-market-tops-billion-tufts-research-center-estimates/6mPph8maRxzcvftWjr 7HUN/story.html (last visited Sept. 10, 2018) (estimating that bringing a new drug to market costs approximately $2.5 billion dollars over the course of a decade) (on file with the Washington and Lee Law Review). 4. See Frank & Ginsberg, supra note 3 (?[I]f free competition were permitted, firms spending hundreds of millions of dollars to bring a new drug to market would be unlikely to recoup those investments, as competition would drive prices down to production costs.?). 2017 .5 Allergan?s second-best-selling drug, a prescription eye-drop medicine called Restasis, earned $1.4 billi on in revenue in 2016 .6 In theory, pharmaceutical companies? drug monopolies are meant to incentivize medical breakthroughs,7 though in practice the industry is frequently criticized for exploiting monopolies to make windfall profits at the public?s expense.8 This has come about in a number of forms. For instance, some firms pay generic drug companies to delay selling bioequivalent versions of lucrative medications once their patents expire in exchange for large settlements, otherwise known by the shorthand phrase ?pay for delay.?9 Another example that has gained popularity in recent years is ?patent hopping.?10 This practice extends a drug?s patent monopoly and blocks generic competition by slightly reformulating the medication and filing for a new patent when a drug?s original patent is close to expiration.11 Engendering consumer distrust and 5. Annual Financials for Allergan PLC, MARKETWATCH (2016), https://www.marketwatch.com/investing/stock/agn/financials?mg=prod/accountmw (last visited Sept. 19, 2018) (on file with the Washington and Lee Law Review). 11. Id. political backlash,12 manipulative practices like these drive legal and policy developments both in antitrust and patent law.13 In contrast to highly profitable pharmaceutical companies, many Native American nations suffer from crippling poverty and lack of economic stimulation.14 A federally recognized tribe, the Saint Regis Mohawk Tribe (the Tribe) is located in northern New York, straddling the U.S. and Canadian border.15 The Tribe has an unemployment rate double that of its neighboring county?itself one of the poorest in the nation.16 The Saint Regis Mohawk Tribe?s major source of revenue is the Akwesasne Mohawk Casino Resort, bringing in about $19 million annually and employing 40% of its 12. See Andrew Pollack, Big Price Increase for Tuberculosis Drug Is Rescinded, N.Y. TIMES (Sept. 21, 2015), https://www.nytimes.com/2015/09/22/ business/big-price-increase-for-tb-drug-is-rescinded.html (last visited Sept. 19, 2018) (quoting then-Democratic presidential candidate Hillary Clinton that ?[p]rice-gouging . . . in the specialty drug market is outrageous?) (on file with the Washington and Lee Law Review). 13. See, e.g., New York ex rel. Schneiderman v. Actavis PLC, 787 F.3d 638, 642 (2d Cir. 2015) (considering whether defendant drug company?s withdrawal of an older drug from the market ?in order to force Alzheimer's patients who depend on [the drug] to switch to [the newly patented version] before [the generic drug] becomes available? is unlawfully anticompetitive); Levy, supra note 7, at 254 (discussing recent Supreme Court jurisprudence aiming to curb anticompetitive practices within the pharmaceutical industry). 14. See Robert J. Miller, American Indian Entrepreneurs: Unique Challenges, Unlimited Potential, 40 ARIZ. ST. L.J. 1297, 1298 (2008) (?American Indians remain as a group the poorest of the poor in the United States.?); Dao Lee Bernardi-Boyle, State Corporations for Indian Reservations, 26 AM. INDIAN L. REV. 41, 41 (2002) (?Reservation American Indians are among the poorest people living in this country.?). 15. See Mylan Pharm. Inc. v. Saint Regis Mohawk Tribe, No. IPR2016 -01127, 2018 WL 1100950, at *2 (P.T.A.B. Feb. 23, 2018) (describing the factual background and identity of the parties); Joe Jackson, A Native-American Nation Divided, AL JAZEERA (Jan. 9, 2015), http://www.aljazeera.com/indepth/ features/2015/01/native-american-nation-divided-20151710544289875.html (last visited Sept. 19, 2017) (describing the jurisdictional split in the Saint Regis Mohawk Tribe between United States and Canada) (on file with the Washington and Lee Law Review). 16. Adam Davidson, Why Is Allergan Partnering with the St. Regis Mohawk Tribe?, NEW YORKER (Nov. 20, 2017) , https://www.newyorker.com/magaz ine/ 2017 /11/20/why-is-allergan-partnering-with-the-st-regis-mohawk-tribe (last visited Sept. 19, 2018) (on file with the Washington and Lee Law Review). staff with members of the Saint Regis Mohawk Tribe.17 Still, the Tribe?s infrastructure struggles to support the community.18 These entities, comparatively, are two of the most and least powerful in American society and seemingly share nothing in common. That changed on September 8, 2017, when Allergan and the Tribe announced an agreement to transfer six patents protecting Restasis to the Saint Regis Mohawk Tribe.19 Lawmakers,20 judges,21 and practitioners22 immediately questioned the legitimacy of the deal. Still, the deal was not without its supporters23 and followers.24 The transaction received such a swift and polarizing response because it aimed to shield the Restasis patents from an administrative proceeding that could otherwise potentially bring about the patents? cancelation.25 Briefly summarizing how this is possible, a patent may be subject to a post-issuance review of patentability even after the United States Patent and Trademark Office (USPTO) grants a patent.26 Such ex post facto invalidation can occur through a number of procedures, but generally speaking can be adjudicated either by the Patent Trial and Appeals Board (PTAB)27 at the request of any party,28 or in federal district court, or both.29 In fact, parties almost systematically dispute patent validity in two forums simultaneously?roughly 80% of PTAB invalidation proceedings involve parallel proceedings in federal court.30 23. See Petrarca, supra note 6, at 12 (arguing that because IPR ?diminishe[s]? patent protections, Allergan was rightly motivated to invent methods to circumvent the proceeding altogether). 28. Id. ? 311(a) (?[A] person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent . . . .?). 29. Id. ? 282(b)(2) (listing invalidity as a defense available against the claim of infringement); see also Sovereign Immunity and the Intellectual Property System: Hearing Before the Subcomm. on the Courts, Intellectual Property and the Internet, 115th Cong. 1 (2017) (testimony of Professor Karl Manheim, Loyola Law School) [hereinafter Professor Manheim Testimony] (?Once issued, patent controversies can arise either in federal court or in the PTO.?). 30. Desmond O?Sullivan, PTAB Deals a Crippling Blow to Sovereign Allergan sought to preemptively evade the PTAB?s after-the-fact invalidation by transferring legal rights in the patents to a sovereign entity, the Saint Regis Mohawk Tribe.31 Tribes, like other sovereign entities such as states or foreign nations, generally enjoy immunity from suit.32 Allergan and Saint Regis believed that because a suit against the Tribe (either an administrative adjudication or civil litigation) as the patent holder should be dismissed for lack of jurisdiction due to tribal immunity,33 the drug?s intellectual property would remain somewhat insulated from third party legal attacks.34 But even before the Tribe became the patent holder, Allergan was involved in ongoing disputes with a number of generic drug companies regarding the Restasis patents.35 The dispute developed in two forums: one in the U.S. District Court for the Eastern District of Texas36 and the other in a specialized PTAB Immunity, LAW360 (Jan. 3, 2018, 4:37 PM), www.law360.com/articles/998503/ ptab-deals-a-crippling-blow-to-sovereign-immunity (last visited Sept. 19, 2018) (on file with the Washington and Lee Law Review). 31. See Press Release, Allergan, Allergan and Saint Regis Mohawk Tribe Announce Agreements Regarding RESTASIS? Patents (Sept. 8, 2017) , https://www.prnewswire.com/news-releases/allergan-and-saint-regis-mohawktribe-announce-agreements-regarding-restasis-patents-300516422.html (last visited Sept. 19, 2018) [hereinafter Allergan Press Release] (?The Tribe, a recognized sovereign tribal government, is filing a motion to dismiss the ongoing inter partes review (IPR) of the RESTASIS? patents based on their sovereign immunity from IPR challenges.?) (on file with the Washington and Lee Law Review). 36. Allergan, Inc.?s Complaint for Patent Infringement, Allergan, Inc. v. proceeding.37 Allergan initiated the litigation, suing a number of generic companies in the Eastern District of Texas for infringing the Restasis patents by filing for the right to manufacture a generic bioequivalent version of drug.38 In response, the defendant generic drug companies asserted the affirmative defense of invalidity?the companies admitted to infringing Allergan?s patents, but claimed that the patents were invalid.39 In the midst of the litigation, Allergan moved to join the Tribe as party to the lawsuit after it became the purported patent owner.40 As in most infringement suits,41 the generic pharmaceutical companies subsequently initiated the proceeding at the PTAB.42 Those seeking to invalidate patents tend to prefer the PTAB proceedings over district court litigation for a number of reasons.43 The petitioners filed a petition for inter partes review, a specialized patent review proceeding conducted by the PTAB. Inter partes review, or IPR, is a newly created and highly popular type of proceeding that allows any party to challenge a patent?s validity.44 IPRs have garnered disagreements since their creation in 2011 by the Leahy?Smith America Invents Act.45 Teva Pharm. USA, Inc., No. 2:15-CV-1455-WCB, 2017 WL 4619790, at *1 (E.D. Tex. Oct. 16, 2017) . Allergan?s CEO is among those that disapprove of the new reexamination process.46 As such, Allergan, with a history of engaging in controversial business decisions, took affirmative steps to protect its intellectual property rights.47 Apparently inspired by a recent PTAB decision allowing a state university to invoke immunity in IPR,48 Allergan agreed to transfer rights in the Restasis patents to the Tribe for $13.75 million dollars.49 In return, the Tribe agreed to invoke its sovereign immunity in IPR proceedings.50 In the light of the Allergan?Saint Regis deal, this Note argues that the legal framework for sovereign immunity should be the same with respect to state and tribal patent holders. Additionally, this Note argues that because it is unlikely Congress possesses the constitutional authority to abrogate state immunity, that the that it violates Article III and the Seventh Amendment). 46. See Brent Saunders, Reverse Patent Trolls Are Harming Drug Innovation?and Patients, WALL ST. J. (Oct. 8, 2017, 2:33 PM) , https://www.wsj.com/articles/reverse-patent-trolls-are-harming-drug-innovation and-patients-1507487600 (last visited Sept. 19, 2018) (arguing that IPRs ?disadvantage . . . biopharma innovators and the patients they serve?) (on file with the Washington and Lee Law Review). 47. See Dennis Crouch, Allergan: Creating Sovereign Immunity with Tribal Pass-Through, PATENTLYO (Sept. 8, 2017) , https://patentlyo.com/patent/2017/09/ allergan-creating-sovereign.html (last visited Sept. 19, 2018) (?Allergan is a frequent player of jurisdictional games. Its corporate ?headquarters? is in Dublin for the tax benefits, although it is ?actually? sited in New Jersey.?) (on file with the Washington and Lee Law Review); Chelsea Naso, Pfizer, Allergan End $160B Merger After New Inversion Regs, LAW360 (April 6, 2016, 7:01 AM), https://www.law360.com/articles/781067/pfizer-allergan-end-160b-merger-afternew-inversion-regs (last visited Sept. 19, 2018) (reporting that Pfizer and Allergan?s anticipated merger that would save Pfizer $35 billion in U.S. taxes was thwarted by the IRS) (on file with the Washington and Lee Law Review). 48. See Covidien LP v. Univ. of Fla. Research Found., Inc., IPR2016-01274, 2017 WL 4015009, at *11 (P.T.A.B. Jan. 25, 2017) (dismissing IPR on state immunity grounds when a third party petitioned for IPR review of a state university patent). 49. See Exhibit 2087 Patent License Agreement at 9, Mylan Pharm. Inc. v. Allergan, Inc., Case IPR2016-01132 (P.T.A.B. Nov. 16, 2017) [hereinafter License Agreement] (stipulating the ?upfront payment? between Saint Regis Mohawk Tribe and Allergan). 50. See SHORT FORM PATENT ASSIGNMENT 1?2 (2017), http://legacyassignments.uspto.gov/assignments/assignment-pat-43532-422.pdf (memorializing the patent assignment agreement between Allergan and the Saint Regis Mohawk Tribe). legislature should unequivocally extend state and tribal sovereign immunity in IPRs. To argue this, this Note explores the policy concerns and justifications of tribal and state immunity within administrative patent review. In addressing these concerns and justifications, Part II.A discusses patent law?s central policy aims. At its core, patent law aims to achieve the constitutional demand to balance incentivizing invention against over-monopolizing patent rights for the benefit of society.51 Part II.B then describes the administrative scheme that governs patent rights. In particular, this legal background will focus on the recent development of inter partes review as instituted by the America Invents Act.52 Part III first discusses the history of tribal sovereign immunity and its contemporary understanding. Specifically, this historical analysis focuses on the congressional policy objective of tribal self-determination.53 Second, Part III considers state sovereignty, notably, the recent judicial reinforcement of state sovereign immunity during the Rehnquist Court?s ?New Federalism? Era.54 This discussion illuminates the differences between the two sovereigns as stemming from their disparate legal bases: tribal sovereignty was judicially created but long understood as subject to congressional regulation55 whereas state sovereignty is tethered to the Eleventh Amendment and largely insulated from congressional control.56 Part IV then analyzes the long-term implications of the Allergan?Saint Regis deal against this legal backdrop. Chiefly, the analysis focuses on a critique of the PTAB and Federal Circuit?s 51. See infra Part II.A (discussing the constitutional and philosophical justifications for the American patent regime). 52. Pub. L. No. 112-29, 125 Stat. 284 (2011) (codified in scattered sections of 28 and 35 U.S.C.). 53. See infra Part III.B (discussing the interplay between tribal economic opportunities and immunity). 54. See In Defense of Tribal Sovereign Immunity, infra note 249 and accompanying text (discussing a series of Supreme Court decisions during the Rehnquist Court that bolstered state sovereign immunity). 55. See Michigan v. Bay Mills Indian Cmty., 134 S. Ct. 2024, 2030 (2014) (?[T]ribes are subject to plenary control by Congress.?). 56. See discussion infra Part III.C (noting the decisions where the Court struck Congress?s attempts to abrogate state immunity). recent decisions in response to the Allergan?Saint Regis deal.57 The main shortcoming of the PTAB?s reasoning is an unexplained departure from the existing, albeit developing, legal framework for sovereign immunity in administrative patent proceedings.58 The argument follows that the PTAB?s inconsistent treatment of tribes and states is not premised on discernible legal or policy reasons. The Federal Circuit, although identifying the proper legal standard, misapplies it. This has led to states and tribes possessing different rights within administrative patent reexamination. Finding that sovereign patent owners are interchangeable under the proper legal framework, this Note argues that their legal rights within the patent administrative reexamination process should likewise be identical. Furthermore, the only governing body with the authority and policymaking capability to address this inconsistency is Congress.59 Moreover, if Congress precludes this maneuver through legislation, it should not treat states and tribes differently. Two justifications support this conclusion, one pragmatic and one ethical. First, abrogating only tribal immunity in PTAB reexamination hearings does not effectively close the loophole because state universities will continue to successfully assert immunity.60 Second, robbing only one sovereign of its immunity privilege derogates Congress?s goal to incentivize tribal self-determination and economic development?a grave impairment to tribes? dignitary and financial interests.61 This leads to Congress?s second potential response: abrogating neither tribal nor state immunity in IPR. Allowing a sovereign entity to benefit from the patent system and simultaneously evade unfavorable outcomes certainly seems unfair and undermines the patent system because it forecloses the PTO from certain procedures;62 however, every invocation of sovereign immunity at the expense of the complaining party is inherently unfair.63 But more importantly, any attempt to judicially curtail both sovereigns? immunity would likely not withstand the Supreme Court?s scrutiny. That is to say that if the Federal Circuit finds that both tribal and state immunity is inapplicable in IPR,64 it is likely that the Supreme Court would reverse only the restriction of state immunity.65 Furthermore, the Federal Circuit?s decision fails to consider the implications on federal Indian law more broadly. An unthinking condemnation of the Saint Regis deal conflates the pharmaceutical industry?s pattern of dubiousness with tribal economic diversification. Abrogation of sovereign immunity in patent proceedings uniquely damages tribes because of the difficulties that tribes face generating revenue. Congress should capital is an essential ingredient for improving conditions on reservations.?). 62. See Professor Manheim Testimony, supra note 29 (advocating for legislation that abrogates state and tribal immunity in IPR). 63. See SHORTELL, infra note 140 and accompanying text (noting that many scholars denounce the doctrine of sovereign immunity because of its impact on plaintiffs). 64. See Saint Regis Mohawk Tribe v. Mylan Pharm. Inc., 896 F.3d 1322, 1326 (Fed. Cir. 2018) (holding ?that tribal sovereign immunity cannot be asserted in IPRs); Brief of the States of Indiana, Hawaii, Illinois, Massachusetts, Texas, Utah, and Virginia as Amici Curiae in Support of En Banc Rehearing at 1?2, Saint Regis Mohawk Tribe v. Mylan Pharm., Inc., 896 F.3d 1322 (Fed. Cir. July 20, 2018) (No. 18-1638) [hereinafter State Amicus Brief Support En Banc Rehearing] (supporting the Tribe for its application for a rehearing en banc due to the likelihood that the Federal Circuit?s decision will also affect state immunity in IPR). It should be noted that the litigation could unfold in a number of ways. For instance, the Federal Circuit may reverse the PTAB?s holding during an en banc rehearing. Alternatively, the Supreme Court may not grant certiorari for either case. But in a number of different scenarios, the chance of differing legal precedents concerning tribes and states is possible, if not likely. 65. See infra Part III.A?C (explaining the difference between tribal and state sovereign immunity and Congress?s ability to affect each). therefore allow continued invocation of sovereign immunity within patent review in the name of continued tribal economic development. II. Introduction to Patent Law Normatively speaking, opposition to the Tribe?s motion to dismiss the IPR proceeding stems from the concern that sovereigns should not be able to evade the U.S. patent scheme that carefully determines which inventions should benefit from protection.66 To understand this concern, it is essential to begin by examining the philosophical justifications for granting protection to patent owners. Although it is perhaps impossible to discern a singular justification for protecting intellectual property,67 utilitarianism is the primary rationalization.68 A. Philosophical Justifications Thomas Jefferson believed that ?an inventor ought to be allowed a right to the benefit of his invention for some certain time . . . . [I]ngenuity should receive a liberal encouragement.?69 Jefferson?s beliefs likely stemmed from intellectual property 66. See Professor Manheim Testimony, supra note 29 (?State and tribal sovereign immunity in patent cases distorts the patent system and can lead to anticompetitive conduct harming consumers and the public welfare.?). 67. See, e.g., Margaret Jane Radin, Property and Personhood, 34 STAN. L. REV. 957, 957 (1982) (maintaining Hegel?s theory of personhood related to property which argues that ?to achieve proper self-development?to be a person?an individual needs some control over resources in the external environment?); WILLIAM M. LANDES & RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF INTELLECTUAL PROPERTY LAW 4 (2003) (?Patent law [has] long been defended by reference to Locke?s theory that labor creates an entitlement to its fruits.?). 68. See Abraham Bell & Gideon Parchomovsky, A Theory of Property, 90 CORNELL L. REV. 531, 542 (2005) (?[M]ost scholars today base their understandings of property on a model where property is justified by utilitarianism and defined by positive law rather than upon natural rights theories.?). 69. Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 8 (1966). protections existing in English jurisprudence.70 Later, Jefferson?s view on intellectual property, particularly the incentive theory, was codified in the Constitution. The Patent and Copyright Clause of Article I gives Congress the authority ?[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries[.]?71 Unlike other rights, there is no natural right to intellectual property.72 Rather, patent rights are government-created rights. In creating the patent system, the government generally seeks to advance two competing goals which, when balanced, promote scientific advancement for the benefit of society.73 These two competing goals are: promoting invention and limiting diffusion costs.74 The following discussion is a simplistic, but nevertheless helpful, description of the economic justification for patent protections. Patents, like other types of intellectual property, are ideas or inventions that have been ?propertized.?75 Thus, patents are subject to protection only under a formal legal regime.76 In other words, patents are ?limited private monopol[ies].?77 Because ideas and inventions are different from other commodities, they require formalized protection to generate value for the inventor.78 The key difference between inventions and other commodities is that inventions are public goods whereas other commodities are private goods?the former can be disbursed endlessly without cost whereas the latter is a finite quantity, which the owner only grants access to by selling it.79 Therefore, an unscrupulous copyist can steal an idea from its original creator, circumventing any development costs, and selling the embodiment of the idea into the market at a lower cost.80 This, then, discourages the original inventor from investing time and money into an invention that can easily be stolen. Without some form of legal protection, scientific and artistic progress is impeded. To accomplish this, the U.S. patent regime confers on its owner ?the right to exclude others from making, using, offering for sale, or selling the invention throughout the United States.?81 However, unfettered monopolies would drive prices of public goods above their marginal costs and thereby reduce access at the detriment to society.82 The government, therefore, limits patent monopolies by way of its duration and scope.83 The scope of protection, for instance, does not extend to ?small details, obvious improvements, or frivolous devices.?84 Rather, only those inventions that contribute a truly novel, nonobvious contribution inherent depletion sans formal protections and noting another examples of a public good as national defense); Davidson, supra note 16 (?When it comes to physical goods and land, property rights are usually fairly intuitive. But intellectual property is inherently more arbitrary.?). 79. MENELL, ET AL., supra note 74, at 17?18. 80. See Frank & Ginsburg, supra note 3 (discussing the effect of patent monopolies within the context of the pharmaceutical industry). 81. 35 U.S.C. ? 154(a)(1) (2012). 82. See Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 816 (1945) (?The far-reaching social and economic consequences of a patent . . . give the public a paramount interest in seeing that patent monopolies . . . are kept within their legitimate scope.?); LANDES & POSNER, supra note 67, at 1 (?[E]nabling the creator of intellectual property to charge a price for copies . . . in excess of his marginal cost, prevents access to (use of) the intellectual property by persons who value that access at more than the marginal cost but less than the price.?). 83. See MENELL, ET AL., supra note 74, at 19 (?One of the reasons that intellectual property rights are limited to scope, duration, and effect is to balance these costs and benefits.?). 84. Graham, 383 U.S. at 9. are protected.85 Similarly, a patent monopoly is further controlled by limiting its duration.86 Because innovation necessarily requires a rich public domain, it is in society?s best interest to limit the length of time inventions are protected to encourage others to improve upon the invention without infringing.87 B. The Contemporary Patent System Balancing these two objectives, however, is a tricky feat.88 The difficulty of balancing incentives against over-monopolization is evident in Congress?s numerous attempts to amend the USPTO?s administrative proceedings throughout the twentieth century.89 Congress thus passed the 1952 Patent Act to address the concern that the USPTO granted too many weak patents.90 The drafters had the ambitious goal of overhauling the patent system and ?recogniz[ed that] patents are distinct from obnoxious monopolies and are a reward or an inducement to bring forth new knowledge.?91 The 1952 Act made significant improvements, such as delineating distinct grounds for patentability that were previously lacking.92 Nevertheless, the complaint about low quality patents persisted despite the 1952 Act?s substantial contribution to substantive patent law.93 Amidst these complaints, the first post-grant administrative proceedings were created.94 Although litigants could always bring an invalidation proceeding in district court, administrative reexamination was meant to correct the USPTO?s errors more efficiently and cheaply.95 The first post-grant examination mechanism was created in 1980 by the Bayh-Dole Act.96 However, the experiment was quickly met with criticism, particularly because it operated largely like the initial patent prosecution.97 This meant that the party that requested reexamination was never party to the proceeding, and hence could not argue for invalidation.98 Addressing the concern, Congress again set out to cure the plague of low quality patents through post-issuance examination, this time involving third parties in the proceeding.99 This too was largely unsuccessful.100 The latest change came by way of the Leahy?Smith America Invents Act (AIA) passed in 2011.101 The AIA amended and expanded the previous post-grant review proceedings in several significant ways.102 Relevant here, the Act replaced the former inter partes reexamination proceedings with inter partes review.103 Congress passed the AIA with the purpose of ?establish[ing] a more efficient and streamlined patent system that will improve patent quality and limit unnecessary and counterproductive litigation costs.?104 To achieve these ends, the AIA and the USPTO structured IPRs with a number of procedural and substantive changes to the prior reexamination procedure. First, IPRs were meant to give ?broader participation rights? to third parties.105 As such, IPRs allow any third party to assert that the PTO should never have issued the patent in the first instance?that is, to challenge the patent?s validity.106 IPRs also allow joinder to an existing proceeding.107 Second, a patent holder?s ability to amend her claim in an IPR, unlike in the former inter 102. See EDWARD D. MANZO, AMERICA INVENTS ACT?A GUIDE TO PATENT LITIGATION AND PATENT PROCEDURE ? 15:1 (2016) (listing the PTAB?s four post-grant review proceedings: ?(1) review adverse decisions of examiners upon applications for patents pursuant to 35 U.S.C. ? 134(a); (2) review appeals of reexaminations pursuant to ? 134(b); (3) conduct derivation proceedings pursuant to ? 135; and (4) conduct inter partes reviews and post-grant reviews pursuant to Chapters 31 and 32?); Sarah Tran, Policy Tailors and the Patent Office, 46 U.C. DAVIS L. REV. 487, 498?99 (2012) (?The USPTO?s toolbox of new or fortified proceedings . . . includes post-grant review, inter partes review, supplemental examination, and derivation proceedings, as well as a transitional post-grant review program for certain business methods patents.?). 103. See MANZO, supra note 102, ? 16:1 (describing the AIA?s procedural changes to post-grant review proceedings). 105. 106. See 35 U.S.C. ? 311(b) (2012) (?A petitioner in an inter partes review may request to cancel as unpatentable 1 or more claims of a patent only on a ground that could be raised under section 102 or 103 and only on the basis of prior art consisting of patents or printed publications.?); Microsoft Corp. v. i4i Ltd. P?ship, 564 U.S. 91, 96 (2011) (?[A]n alleged infringer may assert the invalidity of the patent?that is, he may attempt to prove that the patent never should have issued in the first place.?). 107. See Saurabh Vishnubhakat, Arti K. Rai & Jay P. Kesan, Strategic Decision Making in Dual PTAB and District Court Proceedings, 31 BERKELEY TECH. L.J. 45, 58 (2016) (finding that permitting joinder and a lack of standing creates ?opportunities for robust public participation?). partes reexamination, is far more limited if not impossible.108 Third, IPRs are adversarial proceedings that more closely resemble traditional litigation than its administrative predecessor.109 Still, there are significant substantive differences that distinguish IPR from traditional litigation.110 For instance, the AIA mandates a lower burden of proof than the district court?s ?clear and convincing evidence? to a ?preponderance of the evidence? standard.111 Additionally, the standard for claim construction in IPR is the ?broadest reasonable construction in light of the specification? standard.112 By contrast, a claim is assessed by its ?ordinary meaning . . . as understood by a person of skill in the art? in federal court.113 Because a claim is given its ?broadest reasonable construction,? in IPR it is more likely that the patent will overlap with prior art,114 rendering the patent invalid. The idea behind these changes was to create an adversarial proceeding that allows third party challengers an efficient and cost-effective means of challenging questionable patents.115 In 108. See Dolin & Manta, supra note 44, at 786 (?Th[e] radical shift from an examinational to an adjudicatory model, which deprives the patentee of the actual ability to continue its pas de deux with the PTO, is what separates inter partes reexamination from IPR.?). 109. See 35 U.S.C. ? 316(a) (stating the Director is to promulgate regulations for inter partes review proceedings that enact many features common to judicial proceedings, including discovery, depositions, protective orders, the imposition of sanctions, and an oral hearing); H.R. REP. NO. 112-98, at *46, 2011 U.S.C.C.A.N. 67, 77 (?The Act converts inter partes reexamination from an examinational to an adjudicative proceeding.?). 110. See Cuozzo Speed, 136 S. Ct. at 2143 (?[I]nter partes review is less like a judicial proceeding and more like a specialized agency proceeding.?); Tran, supra note 102, at 496 (?The [AIA] requires the USPTO, rather than the courts, to make core judgments that affect patent policy and substantive patent rights.?). 111. See 35 U.S.C. ? 316(e) (2012) (?[T]he petitioner shall have the burden of proving a proposition of unpatentability by a preponderance of the evidence.?). 112. 37 C.F.R. ? 42.100(b) (2016). Cuozzo Speed, 136 S. Ct. at 2142. 114. See 35 U.S.C. ? 102 (2012) (defining ?prior art? as an ?invention [that] was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public? before an inventor applies for a patent). 115. See Vishnubhakat et al., supra note 107, at 45 (?A major normative argument for administrative ex post review is that it should be an efficient, accessible, and accurate substitute for Article III litigation over patent validity.?). within the meaning of the tribal sovereign immunity doctrine.370 The Board thereafter employs the very same comparative analysis as in Covidien, comparing IPR to the traditional litigation, but reaches a wholly different conclusion?ultimately finding that tribal immunity does not apply to IPR.371 This conflicting outcome is perplexing. Whether IPR is similar to civil litigation should not turn on which sovereign is asserting immunity. Either IPR is sufficiently similar to civil litigation to require application of the immunity doctrine or it is insufficiently similar. To rationalize this flagrant contradiction, the panel rightly notes that tribal and state immunity are not identical.372 Indeed, Part III.A and C of this Note explore those differences. Yet, none explain why one sovereign patent owner should fare differently in an administrative patent reexamination hearing than another. Additionally, the panel states that the Supreme Court and Congress are silent as to tribal sovereign immunity in IPR.373 But neither the Court nor Congress has spoken to the applicability of state immunity in IPR, yet the PTAB nevertheless found Eleventh Amendment immunity applicable.374 Second, the PTAB?s decision effectively abrogates tribal immunity via an interpretation of congressional silence. The Court ordinarily refuses to read de facto abrogation into a generally applicable statute.375 Such an interpretation is at odds with the widely accepted rule of construction that congressional abrogation must be explicit.376 It is true that generally applicable laws ordinarily apply to Native American tribes, but this is not the same thing as congressional waiver, or abrogation.377 That is, Congress can pass a generally applicable law that applies to Indian tribes without authorizing private suits against tribes to enforce the statute.378 In fact, federal courts have considered this dynamic in the context of the Patent Act?concluding that no reference to tribes within the Patent Act warrants tribal immunity during patent infringement suits.379 D. The Federal Circuit Applies FMC to IPR In July, 2018, the Federal Circuit largely upheld the PTAB?s denial of the Tribe?s motion to dismiss based on sovereign immunity grounds. The key difference, though, is that the Panel admitted, unlike the PTAB, that ?[a]lthough the precise contours of tribal sovereign immunity differ from those of state sovereign immunity, the FMC analysis is instructive.?380 Nevertheless it a sweeping change in the status of tribal government and reservation Indians had been contemplated by Congress.?); Smith, supra note 181, at 21 (?Absolute [statutory] silence, of course, deposes of the issue altogether.?). 376. See supra Part III.A (discussing congressional abrogation of tribal immunity). 377. See Fed. Power Comm?n v. Tuscarora Indian Nation, 362 U.S. 99, 116 (1960) (?[I]t is now well settled by many decisions of this Court that a general statute in terms applying to all persons includes Indians and their property interests.?). 378. See Bassett v. Mashantucket Pequot Tribe, 204 F.3d 343, 357 (2d Cir. 2000) (?[T]he fact that a statute applies to Indian tribes does not mean that Congress abrogated tribal immunity in adopting it.?). 379. See Home Bingo Network v. Multimedia Games, Inc., No. 1:05-CV-0608, 2005 WL 2098056, at *1 (N.D.N.Y. Aug. 30, 2005) (?Plaintiff points to no authority that Congress has expressly waived tribal immunity with respect to the enforcement of patents.?); Specialty House of Creation, Inc. v. Quapaw Tribe, No. 10-CV-371-GKF-TLW, 2011 WL 308903, at *1 (N.D. Okla. Jan. 27, 2011) (?[T]his court concludes that the Quapaw Tribe is immune from private suits under federal patent law.?). 380. Saint Regis Mohawk Tribe v. Mylan Pharm. Inc., 896 F.3d 1322, 1326 (Fed. Cir. 2018) . concluded that IPR is sufficiently distinct from civil litigation that tribal immunity does not apply.381 The Federal Circuit also had the benefit of two influential Supreme Court decisions decided after the PTAB?s Saint Regis Mohawk decision that shed more, albeit conflicting, light on the degree to which IPR is similar to civil litigation.382 Oil States, mentioned supra, reinforced that it is within the government?s authority to reconsider its own prior issuance of a public right.383 Within the framework of FMC, the Federal Circuit found this suggests IPR is not a dispute between two private parties, but principally one between the government and the patent holder.384 On the same day as Oil States, the Court held in SAS Institute, Inc. v. Iancu (?SAS?)385 that the Director does not have the discretion to hear some of a petitioner?s claims and dismiss others, but must issue a written decision on all claims.386 SAS had the effect of significantly limiting the PTO Director?s authority.387 Therefore, ?it?s the petitioner, not the Director, who gets to define the contours of the proceeding.?388 This has major implications for the analysis in Saint Regis Mohawk because it suggests that the 381. See id. at *2 (?IPR is neither clearly a judicial proceeding instituted by a private party nor clearly an enforcement action brought by the federal government.?). 382. See id. (discussing Oil States Energy Services, LLC v. Greene?s Energy Group, LLC, 138 S. Ct. 1365 (2018) and SAS Institute, Inc. v. Iancu, 138 S. Ct. 1348 (2018)). 383. See Oil States Energy Servs., LLC v. Greene?s Energy Grp., LLC, 138 S. Ct. 1365, 1373 (2018) (?[T]he public-rights doctrine applies to matters ?arising between the government and others, which from their nature do not require judicial determination and yet are susceptible of it.??). 384. See Saint Regis Mohawk Tribe, 896 F.3d, at 1327 (?[T]he [Oil States] Court emphasized the government?s central role in IPR and the role of the USPTO in protecting the public interest.?). 387. See Oral Argument at 21:33, Saint Regis Mohawk Tribe v. Mylan Pharm. Inc., No. 2018 -1638, 2018 WL 3484448 (Fed. Cir. July 20, 2018) , https://www.courtlistener.com/audio/36881/saint-regis-mohawk-tribe-v-mylanpharmaceuticals-inc/ (probing the appellee?s attorney whether filing a complaint in federal court and filing a petition at the PTO differs after SAS). SAS Inst., Inc. v. Iancu, 138 S. Ct. 1348, 1355 (2018). PTAB, much like an Article III judge must adjudicate a plaintiff?s complaint, must issue a written decision on all the petitioner?s claims.389 Yet the Federal Circuit found that although the Director?s discretion is curtailed under SAS, he still makes the pivotal decision of whether to institute review.390 Therefore, in theory, the Director has the capability to weigh the political considerations of whether to initiate IPR review of a patent held by a sovereign.391 Practically speaking, whether this balancing actually occurs?and whether the same balancing considerations are engaged when considering state versus tribal immunity?is unknown. Like the Panel?s overly formalistic consideration of SAS, it also misses the spirit of FMC by focusing too narrowly on minor procedural differences between IPR and civil litigation.392 In FMC, the Court used the similarity of procedures as helpful benchmarks,393 but also took note of the broader similarities that were pertinent to the central concern??whether they are the type of proceedings from which the Framers would have thought the States possessed immunity when they agreed to enter the Union.?394 Borrowing from a case where the Court decided that Administrative Law Judges possess absolute immunity like Article III judges for their judicial decisions, the Court observed: [F]ederal administrative law requires that agency adjudication contain many of the same safeguards as are available in the judicial process. The proceedings are adversary in nature. They are conducted before a trier of fact insulated from political influence. A party is entitled to present his case by oral or documentary evidence, and the transcript of testimony and exhibits together with the pleadings constitute the exclusive record for decision. The parties are entitled to know the findings and conclusions on all of the issues of fact, law, or discretion presented on the record.395 Undoubtedly, IPR features much of these same broader characteristics. But the Panel?s analysis obscures the practical reality that IPR has the spirit of an adversarial proceeding. As a result, it has ?many of the usual trappings of litigation,?396 without identical procedures. Another shortcoming of the Federal Circuit?s decision is the absence of any mention of Vas-Cath,397 which was itself a Federal Circuit decision that influenced the PTAB?s findings for state immunity.398 Each proceeding at the PTO can be understood on a continuum between inquisitorial and adversarial. On the far left side, proceedings like ex parte reexamination are plainly inquisitorial and therefore do not implicate sovereign immunity.399 On the right side of the continuum are those proceedings that are unmistakably adversarial.400 But many proceedings fall somewhere in the middle, forcing courts to engage in the practice 395. See id. (citing Butz v. Economou, 438 U.S. 478 (1978)). 396. SAS Inst., Inc. v. Iancu, 138 S. Ct. 1348, 1353?54 (2018). 397. 473 F.3d 1376 (Fed. Cir. 2007) . 399. See 35 U.S.C. ? 302 (2012) (?Any person at any time may file a request for reexamination by the Office of any claim of a patent on the basis of any prior art . . . .?); Saint Regis Mohawk Tribe v. Mylan Pharm. Inc., 896 F.3d 1322, 1329 (Fed. Cir. 2018) (?The Tribe acknowledged that sovereign immunity would not apply in ex parte or inter partes reexamination proceedings because of their inquisitorial nature.?). 400. There is no administrative patent proceeding in which immunity definitely applies. However, clearly the most adversarial patent proceeding in which sovereign immunity applies would be district court litigation. See Fla. Prepaid Postsecondary Educ. Expense Bd. v. Coll. Sav. Bank, 527 U.S. 627, 635 (1999) (finding unconstitutional a statute abrogating state immunity in patent disputes and thus allowing states to assert immunity in patent litigation); Tegic Commc?ns Corp. v. Bd. of Regents of Univ. of Texas Sys., 458 F.3d 1335, 1344?45 (Fed. Cir. 2006) (finding that plaintiff was barred from bringing a declaratory action against a state patent holder). of line-drawing and resulting in a handful of contradicting opinions.401 Here, Saint Regis Mohawk and Vas-Cath further compound these inconsistencies. But rather than clarify the apparent conflict, the Federal Circuit ignored this precedent entirely. Because Vas-Cath concerned an interference proceeding rather than IPR, and because the case dealt directly with the issue of waiver and not applicability of sovereign immunity, it does not explicitly control the outcome of Saint Regis Mohawk.402 Still, the Vas-Cath holding inescapably implied that sovereign immunity applies to interference proceedings.403 It seems that interference proceedings fall to the right of IPR on the inquisitorial?adversarial continuum (meaning interference and derivation proceedings are more adversarial than IPR) because the petitioner has a stake in the dispute, whereas in IPR the petitioner may lack constitutional standing.404 But rather than address and distinguish Vas-Cath head on, the Federal Circuit failed to cite or discuss it at all. Perhaps wary of the discrepancy between the PTAB?s state immunity decisions and the Saint Regis Mohawk holding, the Federal Circuit interestingly concluded, ?[w]hile we recognize there are many parallels, we leave for another day the question of whether there is any reason to treat state sovereign immunity 401. Compare Oil States Energy Servs., LLC v. Greene?s Energy Grp., LLC, 138 S. Ct. 1365, 1373 (2018) (emphasizing that it is within the USPTO?s authority to reexamine and cancel patent rights and therefore that IPR does not violate Article III), and Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2143?44, (2016) (distinguishing IPR from civil litigation to find that the PTO was reasonable for imposing a different standard of proof in IPR than in litigation), with Iancu, 138 S. Ct. at 1352 (explaining that IPR ?mimics? civil litigation). 402. See supra Part IV (discussing Vas-Cath and its effect on the intersection of sovereign immunity and IPR). 403. See, e.g., Reactive Surfaces Ltd. v. Toyota Motor Corp., No. IPR2016-01914, 2017 WL 2992429, at *2?3 (P.T.A.B. July 13, 2017) (relying on Vas-Cath?s finding that sovereign?s are immune from interference proceedings to conclude that states are likewise immune from IPR). 404. Compare 35 U.S.C. ? 135(a)(1) (2012) (?An applicant for patent may file a petition with respect to an invention to institute a derivation proceeding in the Office.? (emphasis added)), with id. ? 311 (?[A] person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent.?). differently.?405 Because the Federal Circuit evaluated tribal immunity under the FMC standard, which was originally created to determine applicability of state immunity in administrative proceedings, it seems nearly impossible that the court will come to a different conclusion if and when it considers the issue of state immunity in IPR.406 But the difficulty and capaciousness of determining whether IPR is akin to civil litigation, together with the federalism implications inherent in the federal government?s affecting a state patent holder,407 suggests that continuing application state but not tribal immunity in IPR is not a foregone conclusion. Illustrating this point, Senator McCaskill introduced a bill directly in response to the announcement of the Allergan?Saint Regis deal that would abrogate only tribal immunity in IPR.408 Additionally, the issue of whether a state university waives its Eleventh Amendment immunity in IPR by filing an infringement suit in federal court is unfolding at the time of publication.409 As such, the potential for disparate and conflicting legal standards regarding states and tribes, and their corresponding immunity 405. Saint Regis Mohawk Tribe, 896 F.3d at 1329. 406. See State Amicus Brief Support En Banc Rehearing, supra note 64, at 1?2 (filing an amicus brief in support of an en banc rehearing because of the likelihood that the Federal Circuit?s Saint Regis Mohawk decision will affect state immunity in IPR). 407. Note that under FMC, the federal government can institute a proceeding against a state. See Fed. Mar. Comm?n v. S.C. State Ports Auth., 535 U.S. 743, 764 (2002) (?[T]he States have consented to actions brought by the Federal Government.?). Still, the Court?s recent state immunity jurisprudence is increasingly sensitive to the federal government?s encroachment on state authority. See Christopher G. Paulraj, Federal Maritime Commission v. South Carolina State Ports Authority: Extending the States? Sovereign Immunity to Administrative Adjudications, 55 ADMIN. L. REV. 679, 680 (2003) (?[T]he Supreme Court has extended the principles of federalism to unprecedented new heights, resulting in a drastic curtailment of the federal government?s ability to regulate the states and their instrumentalities.?). 408. See S. 1948, 115th Cong. (1st Sess. 2017) (?Notwithstanding any other provision of law, an Indian tribe may not assert sovereign immunity as a defense in a review that is conducted under chapter 31 of title 35, United States Code.?). 409. See Ericsson Inc. v. Regents of Un iv. of Minn., No. IPR2017 -01186, 2017 WL 6517563, at *2 (P.T.A.B. Dec. 19, 2017) (?[W]e determine . . . Patent Owner has waived its Eleventh Amendment immunity by filing an action in federal court alleging infringement of the patent being challenged in this proceeding.?). within patent administrative adjudication, is growing ever complex. To ensure uniformity both in law and policy, Congress is the organ of government best equipped to address the applicability of sovereign immunity in administrative patent review. Abrogating immunity should not be taken lightly, as evidenced by Congress?s continued reluctance to do so.410 This is especially true in the area of Indian law. The Supreme Court repeatedly emphasizes that ?federal encroachment upon Indian tribes? natural rights is a serious undertaking.?411 The trepidation with which the Court approaches sovereign immunity reflects an understanding that Congress?s decision not to abrogate is purposeful, not accidental.412 Furthermore, tribal immunity is one narrow legal principle embedded within a far-reaching socio-political landscape?one which oftentimes robs tribes of other opportunities for economic development.413 The PTAB and the Federal Circuit, in considering just the isolated issue of tribal immunity in IPR, unavoidably misses the broader political ramifications of its decision. The proceeding discussion examines the broader implications of the PTAB and Federal Circuit?s decisions. In doing so, this Note argues that Congress should not legislate differently with respect to tribes and states in IPR proceedings?whether it upholds immunity for both governmental units or forecloses each from asserting immunity in IPR. This discussion offers a potential avenue for congressional abrogation of both tribes and states despite Congress? constitutional constraint to affect state immunity. V. Sovereign Patent Holders in IPR That the PTAB has held that state universities, but not tribes, are immune from inter partes review is illogical from both a legal and policy standpoint. The PTAB?s finding, affirmed by the Federal Circuit, that tribal sovereign immunity does not apply to IPR creates a disparity between the two sovereigns unsupported by any meaningful justification.414 What is more, this differential treatment does little to abate the legitimate concern that sovereign immunity in IPR manipulates the U.S. patent regime because state universities continue to enjoy immunity from IPR review. The Board misconstrued any differences between tribal and state immunity in finding that tribal immunity is inapplicable to IPR.415 Furthermore, although not so flagrantly treating tribes and states differently, the Federal Circuit did little to clarify earlier decisions upholding Eleventh Amendment immunity patent administrative proceedings and declining to extend tribal immunity to IPR.416 As described in Parts II and III, tribal and state sovereign immunity are indeed different in some respects?the most important difference being Congress?s ability (and inability) to affect the scope of their sovereignty. But those differences are not significant, let alone dispositive, in the context of patent reconsideration. Amici supporting the petitioner generic drug companies lumped the two sovereigns together in their argument that ?a State or a Tribe may, on the one hand, take full advantage of the remedies and benefits afforded the patent owner, but yet use sovereign immunity to escape IPR.?417 Additionally, a number of states have filed an amicus brief supporting the Tribe?s petition for en banc reconsideration, arguing that the Panel misapplied FMC and the decision gravely harms states and tribes.418 This demonstrates that opponents of sovereign immunity in IPR place no significance on whether the entity is a state or a tribe?both are equally damaging to the patent system. Similarly, states are wary that exclusion of tribal sovereign immunity presupposes the same fate for state sovereign immunity in IPR. As such, states and tribes are fungible, that is, interchangeable in their participation in IPR as patent holders.419 Accepting that patent owners are fungible, there is no policy reason for state and tribal patent owners to possess different legal rights during administrative patent reexamination hearings. Either shielding patent rights intolerably harms the patent system or immunity is necessary to protecting sovereign dignity. To correct the currently disparate treatment of each sovereign within IPR, Congress should speak to this issue unequivocally and uniformly. Accepting that Congress has the authority to abrogate tribal immunity, the proceeding analysis explores one avenue which Congress may utilize to abrogate state immunity. It is therefore arguable that Congress has the authority to abrogate both state and tribal immunity in IPR to prevent evasion of the PTO?s administrative reexamination system.420 A. Congressional Abrogation of Tribal and State Immunity in Inter Partes Review To take this position, this Note argues that state sovereign immunity may not apply in IPR at all because the PTAB?s jurisdiction is a species of in rem jurisdiction. This analysis is similar to the FMC standard: that application of the immunity presumption turns on ?whether [it is] the type of proceedings from which the Framers would have thought the States possessed immunity when they agreed to enter the Union.?421 But instead of observing the similarities and differences between IPR and civil litigation, comparing the similarities between a bankruptcy court?s in rem jurisdiction over debts and the PTAB?s jurisdiction over patents demonstrates a lack of the state immunity presumption. The following discussion considers the similarities and differences between in rem jurisdiction and the PTAB?s jurisdiction, ultimately finding that there is a legitimate argument that PTAB jurisdiction inheres no state immunity presumption.422 The similarities between a bankruptcy proceeding and IPR flow from the fact that both are types of in rem jurisdiction.423 Like a bankruptcy court?s jurisdiction over an individual?s assets, the USPTO has jurisdiction over patent reexamination claims because of the patent, irrespective of the identity of the patent holder.424 Put differently, the PTAB has jurisdiction over ?the res, not on the persona.?425 Additionally, the Director does not require the patent owner?s continued participation to have jurisdiction over the patent,426 much like a bankruptcy court need not join every creditor to discharge the debtor?s liabilities.427 Both the PTAB and the Federal Circuit support this argument. In the PTAB?s decision denying the Tribe?s motion to terminate, it stated that ?Congress has enacted a generally applicable statute providing that any patent (regardless of ownership) is subject to the U.S. patent regime.?428 Similarly, reinforcing the majority holding that tribal immunity is inapplicable in IPR because the USPTO?s reexamination is sufficiently dissimilar to civil litigation, Judge Dyk noted in his concurrence that ?the Supreme Court has held that ?adversarial proceedings? that do not involve the exercise of personal jurisdiction do not necessarily raise sovereign immunity concerns.?429 The differences between PTAB jurisdiction and in rem jurisdiction, however, highlight the weaknesses in this comparison. Thus, there is a significant likelihood that if Congress were to statutorily eliminate state immunity in IPR, the Supreme Court would find the abrogation unconstitutional. The most notable difference between a bankruptcy discharge and a patent invalidation is that a bankruptcy discharge cancels the debtor?s liability against the entire world,430 whereas a patent invalidation does the opposite?the invalidation renders the invention available to the entire world by entering the invention into the public domain.431 Second, the very name of the proceeding, inter 426. See 35 U.S.C. ?? 317(a), 318(a) (2012) (?If no petitioner remains in the inter partes review, the Office may terminate the review or proceed to a final written decision . . . .? (emphasis added)). 427. See Hood, 541 U.S. at 447 (describing bankruptcy procedures which allows the bankruptcy court to discharge the debtor?s liability despite an absence of creditor claimants); In re Collins, 173 F.3d 924, 928 (4th Cir. 1999) (?The state, of course, well may choose not to appear in federal court.?). 428. Mylan Pharm. Inc. v. Saint Regis Mohawk Tribe, No. IPR2016 -01127, 2018 WL 1100950, at *4 (P.T.A.B. Feb. 23, 2018) . 429. Saint Regis Mohawk Tribe, 896 F.3d, at 1333 (Dyk, J., concurring). 430. See MOORE, ET AL., supra note 261, ? 6.21 (describing the nature of in rem jurisdiction generally). 431. See Covidien LP v. Univ. Fla. Research Found. Inc., No. IPR2016-01274, 2017 WL 4015009, at *6 (P.T.A.B. Jan. 25, 2017) (?[T]he term inter partes means between the parties, which in itself captures the notion that the proceeding is partes, indicates that the proceeding is adversarial in nature.432 The Hood Court examined this point only as to the specific proceeding at issue?an ?adversary proceeding,? and found that despite its name and notice of process on the state, the Bankruptcy proceeding was not in fact a ?suit? within the meaning of the Eleventh Amendment.433 Third, and least compelling, the PTAB?s authority touches the patent holder herself in its estoppel provisions.434 The rules governing estoppel, however, only extend the PTAB?s jurisdiction to the patent owner in so far as she is estopped from acting inconsistently with an adverse board decision relative to patents that are substantially similar.435 Ultimately, this argument faces a number of obstacles. In general, the Court?s protection of state immunity based in federalism suggests congressional abrogation of state immunity would be unsuccessful.436 Additionally, the Court?s decision in Florida Prepaid is more on point than Hood.437 Although the procedural touchstones of an in rem proceeding are present in IPR, IPR is clearly substantively similar to patent litigation. Because these difficulties are specific to state immunity, any attempt to abrogate both state and tribal immunity would likely lead to the same discrepant treatment that exists under the current law. directed to both parties over whom the Board exercises jurisdiction.?). 432. See id. at *8, (?Patent Owner argues that, under the enacted rules, inter partes review is similar to civil litigation . . . because inter partes reviews are adversarial ?contested cases between a patent owner and a petitioner . . . .??). 433. See Tenn. Studen Assistance Corp. v. Hood, 541 U.S. 440, 452 (2004) (?In this case, however, there is no need to engage in a comparative analysis to determine whether the adjudication would be an affront to States? sovereignty. As noted above, we have long held that the bankruptcy courts? exercise of in rem jurisdiction is not such an offense.?). 434. See 37 C.F.R. ? 42.73(d)(3) (2018) (?A patent applicant or owner is precluded from taking action inconsistent with the adverse judgment, including obtaining in any patent.? (emphasis added)). 435. See id. ? 42.73(d)(3)(i) (extending a PTAB invalidation only over patents that ?[a] claim that is not patentably distinct?). 436. See supra Part III.C (discussing Seminole Tribe and Florida Prepaid, making the point that Congress has been unsuccessful at abrogating state immunity). 437. See Fla. Prepaid Postsecondary Educ. Expense Bd. v. Coll. Sav. Bank, 527 U.S. 627, 635 (1999) (finding that the Patent Clause does not give Congress authority to abrogate state immunity). B. Maintaining Tribal and State Immunity in IPR Congress can also elect not to limit sovereign immunity in IPR. The obvious difficulty in considering whether to abrogate any sovereigns? immunity is the potential unfairness to plaintiffs, or here, petitioners seeking patent review.438 In the context of patent review, this concern is exasperated by the sense that sovereigns are undermining the patent system as a whole and, in effect, weakening the quality of patents. In the case of the Saint Regis Mohawk Tribe, this seems especially unfair because, unlike state universities that are involved in developing the underlying technology, here the Tribe?s only contribution to the transaction is their sovereign status and concomitant immunity.439 This is because the FMC framework accounts for only the primary justification for sovereign immunity?dignitary interests?with little if no attention given to the secondary justification, financial interests.440 Shifting focus to protecting a sovereign?s financial interest, it becomes less objectionable to allow tribes to strategically ?rent? their immunity in exchange for lucrative patent rights. Keeping in mind the often-forgotten justification for sovereign immunity to protect a sovereign?s economic interests, with special attention given to tribes? desperate need for economic diversification, invocation of tribal immunity in IPR is more defensible. States continue to enjoy sovereign immunity after Florida Prepaid in patent disputes, and now also within IPR at the PTO.441 Why unequally disadvantage tribes, especially where their opportunities for economic diversification are so limited? 438. See Lundgren, 187 Wash. 2d at 877 (Gonzales, J., dissenting) (characterizing the majority?s analysis as misplaced because of a ?desire to reach the merits of the action so that both parties can have their day in court? instead of the threshold question of whether a sovereign is an indispensable party). 439. See Crouch, supra note 47 (?Of course, a major difference with the university situation is that the university patents are the outcome of original university research.?). 440. See Fed. Mar. Comm?n v. S.C. State Ports Auth., 535 U.S. 743, 760 (2002) (?The preeminent purpose of state sovereign immunity is to accord States the dignity that is consistent with their status as sovereign entities.?). 441. See Covidien LP v. Univ. Fla. Research Found. Inc., No. IPR2016?01274, 2017 WL 4015009, at *17 (P.T.A.B. Jan. 25, 2017) (dismissing petitions for review Despite Congress?s push towards tribal economic independence, tribes continue to struggle generating sufficient economic support for such basic infrastructural needs like paved roads, housing, sewage systems, and steady electricity.442 This chronic economic underdevelopment is due in part, although certainly not entirely,443 to certain tax policies: the unavailability of tax exempt bonds for tribes444 and states? authority to collect taxes from on-reservation mineral leases.445 Generally, governmental entities finance projects in one of three ways: (1) tax revenue, (2) debt instruments, such as bank loans or bond of University of Florida?s patent on Eleventh Amendment immunity grounds). 442. See Clarkson, supra note 165, at 1012?13 (describing tribal governments? reliance on federal grants rather than tax free bonds that most state and municipal governments rely on to improve infrastructure). 443. Because the federal government holds most tribal lands in trust, this prevents tribes from using that land either as collateral to secure bank loans or to collect taxes. See Clarkson, supra note 165, at 1016?17 (?Given that the federal government holds most tribal land in trust, those lands are not available for property taxes, and thus the tax base of a tribe is usually insufficient for a tribe to issue general obligation bonds.?); OFFICE OF THE COMPTROLLER OF THE CURRENCY, COMMERCIAL LENDING IN INDIAN COUNTRY: POTENTIAL OPPORTUNITIES IN A GROWING MARKET 7 (2016), https://www.occ.gov/topics/communityaffairs/publications/insights/insights-commercial-lending-indian-country.pdf [hereinafter COMPTROLLER LENDING MANUAL] (?Tribal trust lands generally may not be sold, taxed, or encumbered, requiring a different process to secure and perfect a bank?s mortgage liens on real property.?). Additionally, there is a separate but interrelated issue of tribal jurisdiction over criminal trials of non-Indians leading to widespread abuse and community safety degradation. See Oliphant v. Suquamish Indian Tribe, 435 U.S. 191, 195 (1978), overruled in part by United States v. Lara, 541 U.S. 193 (2004) (?We granted certiorari . . . to decide whether Indian tribal courts have criminal jurisdiction over non-Indians. We decide that they do not.?); Jessica Rizzo, Native American Women Are Rape Targets Because of a Legislative Loophole, VICE (Dec. 16, 2015, 11:00 AM), https://www.vice.com/en_us/article/bnpb73/native-american-women-arerape-targets-because-of-a-legislative-loophole-511 (last visited Sept. 19, 2018) (?Eighty percent of the reported sexual violence against Native women is committed by white men, who do so with virtual criminal impunity because, with very few exceptions, they cannot be tried in tribal courts.?) (on file with the Washington and Lee Law Review). 444. See 26 U.S.C. ?? 103, 7871(c)(1) (2012) (regulating tax-exempt bonds for states and tribes, but stipulating that tribes only issue tax-exempt bonds to ?be used in the exercise of any essential governmental function?). 445. See Cotton Petroleum Corp. v. New Mexico, 490 U.S. 163, 176 (1989) (considering whether the ??multiple burden? imposed by the state and tribal taxes is unconstitutional?). issuances, and (3) federal grants.446 Two of these three major sources of funding are impeded as a matter of law for tribal governments. Because of additional restrictions on tribal tax-free bonding that do not apply to states, tribes have far less access to capital markets than states or other governmental entities.447 Tax-exempt bonds are established by ? 103 of the Internal Revenue Code and are at the heart of state and municipal financing for any number of public projects.448 Investors are incentivized to buy bonds at a lower interest rate to state bond-issuers because the interest on the bonds are tax-exempt.449 The tax scheme, although technically benefiting the bond-buyer, operates as a subsidy to state projects.450 Understandably, then, the Internal Revenue Code places restrictions on the types of projects such bonds can be used to finance.451 However, there are restrictions imposed on tribes that are not likewise imposed on states?effectively preventing tribes from taking advantage of borrowing through tax-free bonds to the same extent that states do. The two key limitations on tribal bonding were instituted by the Tribal Tax Status Act in 1982,452 an update 446. See Peter J. Herne, Tribal Nations, Indian Gaming, and the Rigged Economy, 10 ALB. GOV?T L. REV. 239, 246?47 (2017) (?For many governments when the need to raise large sums of money arises, many resort to issuing their own debt instruments rather than securing a loan, or simply raising taxes.?); Clarkson, supra note 165, at 1014 (listing ?tax revenues, borrowing, and federal grants? as the three major sources of financing for state and local governments). 447. See Clarkson, supra note 165, at 1017 (?The narrow interpretation of this language by the IRS has had a stifling effect on tribes? tax-free bonding authority.?). 448. See 26 U.S.C. ? 103(a) (2012) (?[G]ross income does not include interest on any State or local bond.?); South Carolina v. Baker, 485 U.S. 505, 531 (1988) (?Long-term debt obligations are an essential source of funding for state and local governments.?); Clarkson, supra note 165, at 1054?59 (detailing typical public projects constituting ?governmental functions? that states finance through tax-exempt bonding, including hotels, parking garages, and golf courses). 449. See Clarkson, supra note 165, at 1032?34 (explaining the IRS? tax-free bonds available to states to incentivize investment in governmental projects). 450. Id. 451. See 26 U.S.C. ?? 103(b)(1), 141 (excepting private activity bonds from tax exemption and defining private activity bonds based on comprehensive criteria to ensure tax-exempt bonds are not used for private business ventures). 452. S. 1298, 97th Cong. (1982). to the Internal Revenue Code ironically meant to equalize tribes? tax treatment with states.453 First, tribes? ability to issue bonds per ? 103 is permitted ?only if such obligation is part of an issue substantially all of the proceeds of which are to be used in the exercise of any essential governmental function.?454 Second, because that criteria was ambiguous and routinely litigated, a provision of the Omnibus Budget Reconciliation Act of 1987455 was meant to clarify the governmental function requirement.456 The provision made the requirement even narrower, specifying that the scope of tribal bond authority be limited to projects that are ?customarily performed by State and local governments with general taxing powers.?457 Although these provisions seem facially reasonable and in keeping with the purpose of tax-free bonding schemes, the two additional restrictions have had the effect of eliminating altogether tax-exempt bonds as a financing option for tribes.458 Furthermore, they mark a significant difference between the federal government?s treatment of states and tribes despite the legislative intent to achieve equal tax treatment.459 The 453. See Robert A. Williams, Jr., Small Steps on the Long Road to Self-Sufficiency for Indian Nations: The Indian Tribal Governmental Tax Status Act of 1982, 22 HARV. J. ON LEGIS. 335, 339 (1985) (?[T]he Tribal Tax Status Act is intended to ?strengthen tribal governments significantly by providing additional sources of financing and by eliminating the unfair burden of taxes Indian tribal governments must now pay.??). 454. Id. 455. Pub. L. No. 100-203, ?10632(a), 101 Stat. 1330-1, 1330-455 (1987) (codified at 26 U.S.C. ?7871(e) (2012)). 456. See Ellen P. Aprill, Tribal Bonds: Indian Sovereignty and the Tax Legislative Process, 46 ADMIN. L. REV. 333, 361 (1994) (?Representative Gibbons sponsored a measure [in the Omnibus Budget Reconciliation Act] to tighten the tribal bond measures by limiting essential governmental functions to those customarily financed with exempt bonds by state and local governments.?). 457. See 26 U.S.C. ? 7871 (?For purposes of this section, the term ?essential governmental function? shall not include any function which is not customarily performed by State and local governments with general taxing powers.?). 458. See Aprill, supra note 456, at 363 (?Reported tribal bond offerings came to a standstill for several years.?); Jenny Small, Financing Native Nations: Access to Capital Markets, 32 REV. BANKING & FIN. L. 463, 466 (2013) (?[The IRS?] restrictive interpretation has long served as a barrier for native nations attempting to raise capital through the issuance of bonds.?). See Clarkson, supra note 165 at 1039 (noting that the stated purpose of differential treatment is rooted, like in the instant issue of immunity in IPR, in sovereignty. That is, exempting states from the federal taxation scheme stems directly from notions of state sovereignty implicit in the constitutional structure.460 As previously discussed, tribes have no similar constitutional protection.461 Perhaps the most traditional source of income for governmental entities is tax revenue.462 Here, too, tribes face difficulties unfamiliar to states. In Cotton Petroleum Corporation v. New Mexico,463 the Supreme Court held that nontribal organizations that lease land for mining on tribal property can be taxed not just by the tribal government, but also by the state in which the tribal land sits?causing entities to be doubly taxed.464 Thus, tribes are faced with the dilemma of foregoing their own tax revenue to keep mineral lessees doing business on tribal property, or imposing their own tax, making the double-tax prohibitively expensive for the lessee.465 In both of these discrete tax areas, tribes are denied the same economic opportunities as their state and municipal counterparts. Therefore, tribes rely on commercial enterprises in an attempt to boost revenue.466 By allowing tribes to develop technology the introduced legislation was to eliminate the perception of differences between tribal governments and state or local governments?). 460. See South Carolina v. Baker, 485 U.S. 505, 531 (1988) (O?Connor, J., dissenting) (?In my view, the Tenth Amendment and principles of federalism inherent in the Constitution prohibit Congress from taxing or threatening to tax the interest paid on state and municipal bonds.?). 461. See supra Part III.A (describing the trustee relationship between the federal government and Native American tribes). 462. See supra note 446 and accompanying text (describing the traditional sources of income for governmental bodies). 463. 490 U.S. 163 (1989). 464. See id. at 180 (?We thus agree that a purpose of the [Indian Mineral Leasing Act] is to provide Indian tribes with badly needed revenue, but find no evidence for the further supposition that Congress intended to remove all barriers to profit maximization.?). 465. See id. at 206 (Blackmun, J., dissenting) (?State taxes would also reduce the funds available to oil and gas producers to meet the financial obligations placed upon them by the extensive federal and tribal regulatory schemes.?). 466. See Gary Davis, Tribal Economic Development Aspirations: Analyzing Senator Warren's Recent Speech To Indian Country, FORBES (Mar. 16, 2018, 9:00 initiatives like the Saint Regis Mohawk Tribes?, Congress has an opportunity to equalize technological-driven revenue streams in at least this one, narrow respect. Indeed, state universities have been hugely successful in their patent development efforts.467 This would also be in keeping with Congress?s initiative to support tribal economic independence and self-determination.468 The congressional initiative towards self-determination has proved successful both politically and economically. Politically, tribal self-determination receives widespread support from progressives and conservatives.469 Economically, policies rooted in self-determination have yielded empirically-proven developments in infrastructure, including availability of schools, health clinics, and water supply.470 AM), https://www.forbes.com/sites/forbesfinancecouncil/2018/03/16/tribaleconomic-development-aspirations-analyzing-senator-warrens-recent-speech-toindian-country/#bf1fd8a355a2 (last visited Sept. 19, 2018) (?Unlike other governments, which can levy taxes (or collect sales taxes) to fund these critical initiatives, tribes are forced to rely largely on the creation of tribal businesses to generate the revenues that fund tribal government operations.?) (on file with the Washington and Lee Law Review). 467. See Brief of Amicus Curiae the Association of Public and Land-Grant Universities in Support of Appellant, Regents of the University of Minnesota, Seeking Reversal, Regents of the Univ. of Minn. v. Ericsson Inc. (No. 18-1565) at 3 Collaboration between public universities and industry has led to the development of countless products that Americans use every day[.] . . . In addition to these economic and societal impacts, technology transfer occasionally provides some public universities a source of revenue that is used to deepen the impact through reinvestment in further research and educational objectives for the public good. 468. See COMPTROLLER LENDING MANUAL, supra note 443, at 2 (?There is a consensus among field experts that Indian Country has experienced significantly higher economic growth rates since the onset of the self-determination era in the mid-1970s, compared with preceding decades.?). 469. See Stephen Cornell & Joseph Kalt, American Indian SelfDetermination: The Political Economy of a Successful Policy 15 (Joint Occasional Papers on Native Affairs, Working Paper No. 1 2010), http://nni.arizona.edu/pubs/jopna-wp1_cornell&kalt.pdf (noting that self-determination has bipartisan support from both liberals and conservatives). 470. See id. at 8 (noting that the recent boom in tribal economic development coincides with low federal funding relative to governmental support of other impoverished areas). In light of the fact that Congress cannot so easily limit state immunity, abrogating tribal immunity in IPR will not actually accomplish the benefits of strengthening the quality of patents through administrative reexamination. Therefore, the Federal Circuit?s decision finding that tribal immunity does not apply in IPR should be reversed?leaving such a weighty decision to the policymaking branch of government that can take into account the far-reaching landscape of Indian law as it affects tribal communities.471 As for their part, Congress should not unequally disadvantage tribal patent holders in IPR?especially considering other challenges tribal governments face generating revenue. VI. Conclusion According to the PTAB and the Federal Circuit, states enjoy immunity in IPR but tribes do not.472 On the one hand, the PTAB came to this conclusion by finding that IPR is sufficiently similar to civil litigation that it offends the dignity of states because it requires that a state university, as the defendant, be haled into an adversarial proceeding. On the other hand, the PTAB did not undergo the same FMC comparison in finding that tribes do not enjoy immunity from IPR proceedings,473 likely because it would be patently absurd to find that the extent of the similarity between IPR and civil litigation hinges on the identity of the sovereign, rather than the procedures. 471. See Upper Skagit Indian Tribe v. Lundgren, 138 S. Ct. 1649, 1654 (2018) (?Determining the limits on the sovereign immunity held by Indian tribes is a grave question; the answer will affect all tribes . . . .?). 472. Compare Saint Regis Mohawk Tribe v. Mylan Pharm. Inc., 896 F.3d 1322, 1329 (Fed. Cir. 2018) (?[W]e conclude that tribal sovereign immunity cannot be asserted in IPR . . . .?), with Covidien LP v. Univ. Fla. Research Found., Inc., No. IPR2016?01274, 2017 WL 4015009, at *17 (P.T.A.B. 2017) (?[W]e conclude that Eleventh Amendment immunity applies to inter partes review proceedings.?). 473. See Mylan Pharm. Inc. v. Saint Regis Mohawk Tribe, No. IPR2016 -01127, 2018 WL 1100950, at *3 (P.T.A.B. Feb. 23, 2018) (?The Tribe and its supporting amici, however, have not pointed to any federal court or Board precedent suggesting that FMC?'s holding with respect to state sovereign immunity can or should be extended to an assertion of tribal immunity in similar federal administrative proceedings.?). Rather, the PTAB found narrowly that the non-tribal entity was the true patent holder, and more broadly that even if a tribe retained substantial rights in a disputed patent, that tribal sovereign immunity does not apply to IPR.474 Setting aside the Board?s narrower holding, the broader holding that FMC does not extend to tribal sovereignty in administrative proceeding places undue weight on the difference between state and tribal sovereignty in the patent context. True, ?the immunity possessed by Indian Tribes is not co-extensive with that of the States.?475 But the PTAB placed too much emphasis on this axiom. In the context of administrative patent reexamination, any difference between the two is insignificant. That is to say, the focus on a patent reexamination is on the patent, not the patent holder. In this sense, a patent holder?s participation in the proceeding is limited to defending the grounds of patentability,476 therefore a state?s interest in defending its patent is no different from a tribe?s interest in doing the same. The Federal Circuit, in affirming the PTAB?s holding based on different reasoning, did little to correct the currently disparate treatment of tribes and states in IPR. Perhaps the PTAB misjudged these differences because Administrative Patent Judges, whose authority is delegated via the Patent Act and who consider primarily substantive patent issues, cannot consider the broader policy questions of sovereign immunity.477 Congress should therefore respond to this growing issue to address policy and uniformity concerns. Because states and tribes as patent holders are identical in IPR, Congress is faced with two options: (1) abrogate both state 474. See id. at *7?8 (finding that tribal immunity does not apply to IPR and that Allergan retained all substantial rights under the license agreement). 475. Kiowa Tribe v. Mfg. Techs., Inc., 523 U.S. 751, 756 (1998). 476. See 35 U.S.C. ? 311(b) (2012) (defining the scope of inter partes review). 477. See id. ? 6 (?[T]he administrative patent judges shall constitute the Patent Trial and Appeal Board. The administrative patent judges shall be persons of competent legal knowledge and scientific ability who are appointed by the Secretary, in consultation with the Director.?); Scholars? Brief, supra note 59 (?Petitioners? objections are being raised in the wrong forum. Congress ? rather than the Board, the Article II executive, or even the Article III courts ? controls the availability of tribal sovereign immunity.?). II. Introduction to Patent Law ........................................... 1715 ? A. Philosophical Justifications..................................... 1715 ? B. The Contemporary Patent System.......................... 1718 ? III. Sovereign Immunity ...................................................... 1725 ? A. Tribal Sovereignty ................................................. 17285 ? B. Tribal Economic Liberty and Self-Determination.. 1735 ? C. State Sovereignty..................................................... 1736 ? Sovereign Immunity ...................................................... 1745 ? Law and Sovereign Immunity................................. 1745 ? B. The ?Sham? Transaction in District Court............. 1750 ? C. The PTAB Rejects Tribal Immunity ....................... 1755 ? D. The Federal Circuit Applies FMC to IPR ............... 1758 ? V. Sovereign Patent Holders in IPR .................................. 1765 ? Immunity in Inter Partes Review............................ 1766 ? B. Maintaining Tribal and State Immunity in IPR .... 1770 ? 6 . Ashley E. Petrarca , Allergan's Battle to Stay in Court: Does Inter Partes Review Violate the Constitution by Circumventing Courtroom Adjudication?, 2017 B.C. INTELL. PROP. & TECH . F. 1 , 6 ( 2017 ). 7. See Mark S. Levy , Big Pharma Monopoly: Why Consumers Keep Landing on ?Park Place? and How the Game Is Rigged , 66 AM. U. L. REV. 247 , 247 ( 2016 ) multiple sclerosis, and various forms of cancer . ?) . 8. See id. at 252 (describing one of the most sensational and highly instituted a 5000% overnight price hike for a medication used to treat a life-threatening illness found in patients with HIV/AIDS). 9 . See FTC v. Actavis, Inc., 570 U.S. 136 , 160 ( 2013 ) (addressing the issue challenge the patent in exchange for millions of dollars violates antitrust laws ). 10 . See Benjamin Lajoie & Lauren Barnes , Uncertainty Remains for Pharma Product Hopping Liability , LAW360 (Aug. 31 , 2017 , 12 :48 PM), https://www.law360.com/articles/959102/uncertainty-remains -for-pharma- product-hopping-liability (last visited Sept . 19 , 2018 ) (describing the phenomena of ?patent hopping?) (on file with the Washington and Lee Law Review) . 17 . Jackson , supra note 15; Brief of Appellants at 5 , Saint Regis Mohawk Tribe v. Mylan Pharm ., Inc., 896 F.3d 1322 ( Fed. Cir . 2018 ). 18 . See Katie Thomas, How to Protect a Drug Patent? Give It to a Native American Tribe , N.Y. TIMES (Sept. 8 , 2017 ), https://www.nytimes.com/2017/ 09 /08/health/allergan-patent-tribe. html (last visited Sept . 10 , 2018 ) (quoting the Patents , BLOOMBERG (Sept. 9 , 2017 , 12 :01 AM), https://www.bloomberg.com/news/ articles/2017-09-09/casinos-aren -t-enough-as-native-tribe-makes-deal-on-drug- patents (last visited Sept . 19 , 2018 ) (quoting the Tribe's general counsel as noting file with the Washington and Lee Law Review) . 19 . See Mylan Pharm. Inc., 2018 WL 1100950 , at *1 (introducing the chronology of the dispute surrounding the Restasis deal ). 20 . See S. 1948 , 115th Cong. ( 2017 ) (proposing a bill restricting an Indian Native-American Tribe , REUTERS (Sept. 20 , 2017 , 9 :38 PM), allergan-patent-deal-with-native-american-tribe-idUSKCN1BQ2BE (last visited Sept. 19 , 2018 ) (quoting an Ohio democratic senator that Congress should ?close Washington and Lee Law Review). 21 . See Allergan , Inc. v. Teva Pharm. USA, Inc., No. 2 : 15 -CV-1455-WCB, 2017 WL 4619790 , at *3 ( E.D. Tex . Oct. 16 , 2017 ) (comparing the transaction to other ?sham? transactions, such as abusive tax shelters ). 22 . See David Crow, Pharma Industry Faces Hypocrisy Charge over Patents, FINANCIAL TIMES (Nov. 1 , 2017 ), https://www.ft.com/content/ad85104e-bd86 - 11e7- b8a3-38a6e068f464 (last visited Sept . 19 , 2018 ) (citing a spokesperson for Eli deal) (on file with the Washington and Lee Law Review) . 24 . See Patent Owner's Motion to Dismiss, Apple Inc . v. MEC Resources, LLC , No. IPR2018 -00286, at *1 ( P.T.A.B. Feb . 13 , 2018 ) (moving to dismiss IPR proceedings on tribal immunity grounds) . 25 . See Mylan Pharm. Inc. v. Saint Regis Mohawk Tribe, No. IPR2016-01127 , 2018 WL 1100950, at *1 ( P.T.A.B. Feb . 23 , 2018 ) (discussing the grounds) . 26 . See 35 U.S.C. ? 311 (b) ( 2012 ) (dictating the scope of reconsideration prior art consisting of patents or printed publications ). 27 . Id . ? 303 (?[T]he Director will determine whether a substantial new the request [for reexamination] . . . .?). 32 . See Kiowa Tribe v. Mfg. Techs., Inc., 523 U.S. 751 , 759 ( 1998 ) (comparing tribal, state, and foreign sovereign immunity) . 33 . See Covidien LP v . Univ. of Fla . Research Found., No. IPR2016 - 01274 , 2017 WL 4015009 , at *11 ( P.T.A.B. Jan . 25 , 2017 ) (?[C]onsidering the nature of the States by the Eleventh Amendment.?) . 34 . See Allergan , Inc. v. Teva Pharm. USA, Inc., No. 2 : 15 -CV-1455-WCB, 2017 WL 4619790 , at *1- 2 ( E.D. Tex . Oct. 16 , 2017 ) (describing the patent the suit , thereby waiving any immunity privilege) . 35 . See Allergan , Inc., No. 2 : 15 -CV-1455 -WCB , 2017 WL 4619790, at *1- 2 companies , and later the Saint Regis Mohawk Tribe) . 37 . See Mylan Pharm. Inc. v. Allergan, Inc., No. IPR2016 -01132, at * 24 (P.T.A.B. Dec . 8 , 2016 ) (instituting inter partes review for Allergan's patents) . 38 . Allergan , Inc. v. Teva Pharm., Inc., No. 2 : 15 -CV-01455 -WCB , 2017 WL 4803941, at *1 ( E.D. Tex . Aug. 24 , 2015 ). 39 . See Defendant's Answer to Plaintiff's Complaint, Allergan, Inc . v. Teva Pharm. USA , Inc., No. 2 : 15 -CV-1455 -WCB , 2017 WL 4619790, at *21 ( E.D. Tex . Oct. 21 , 2015 ) (answering that the Restasis patents are invalid ). 40 . See Allergan , Inc. v. Teva Pharm. Inc., No. 2 : 15 -CV-1455 -WCB , 2017 WL 4619790, at *1- 2 ( E.D. Tex . Oct. 16 , 2017 ) (describing the procedural background after Allergan notified the court of the patent transfer to Saint Regis) . 41 . See O ' Sullivan, supra note 30 (discussing the frequency that patents are disputed in parallel district court litigation and PTAB proceedings) . 42 . Mylan Pharm . Inc. v. Allergan, Inc., Case IPR2016-01132 , 2018 WL 1100950, at *1 ( P.T.A.B. Feb . 23 , 2018 ). 43 . See infra Part II.B (discussing a number of procedural and substantive advantages for the patent challenger in PTAB proceedings) . 44 . See Gregory Dolin & Irina D. Manta , Taking Patents, 73 WASH. & LEE L. REV. 719 , 740 - 41 ( 2016 ) (describing inter partes review, a newly crafted reexamination proceeding conducted by a panel of administrative patent judges ). 45 . See Oil States Energy Services v. Greene's Energy Group , LLC, 138 S. Ct. 1365 , 1370 ( 2018 ) (challenging the constitutionality of IPR on the grounds 57 . See infra Part IV.B-C (arguing that the PTAB and Federal Circuits reasoning is unsound) . 58 . See Covidien LP v . Univ. of Fla . Research Found., Inc., No. IPR2016-01274 , 2017 WL 4015009, at * 11 ( Jan . 25, 2017 ) (holding that state litigation) . 59 . See Brief of Amici Scholars in Support of Patent Owner the Saint Regis Mohawk Tribe at 1 , Mylan Pharm ., Inc. v. Allergan, Inc., No. IPR2016 01127 , 2016 WL 10655556 (P.T.A.B. Feb . 23 , 2018 ) [hereinafter Scholars' Brief] by Petitioners.?) . 60 . See Professor Manheim Testimony, supra note 29 (?Whatever the outcome in Allergan, the issue is likely to recur .?). 61 . See Bernardi-Boyle, supra note 14 , at 41 (?[G] reater access to private 70. See Oil States Energy Services v. Greene's Energy Group , LLC, 138 S. Ct. 1365 , 1377 ( 2018 ) (?The Patent Clause in our Constitution 'was written against the backdrop' of the English system .?); LANDES & POSNER, supra note 67, at 1 (noting early law protection of intellectual property such as the English Statute of Monopolies of 1624 and the Statute of Anne) . 71. U.S. CONST. art. I, ? 8 , cl . 8 . 72. See Bell & Parchomovsky, supra note 68, at 542 ( 2005 ) (noting the realist movement) . 73 . See id. at 563 (balancing ?incentives for innovation against the costs determining this precise trade-off is ?elusive? in the real world ). 74 . See PETER S. MENELL , MARK LEMLEY & ROBERT P. MERGES , I INTELLECTUAL PROPERTY IN THE NEW TECHNOLOGICAL AGE: 2017 16- 20 (describing the economic justifications for intellectual property ). 75 . See LANDES & POSNER, supra note 67, at 1 (noting the historical development of intellectual property legal protection in the United States) . 76 . Id . 77 . Graham , 383 U.S. at 9. 78. See MENELL , ET AL., supra note 74 , at 17-18 (describing public goods' 85. See 35 U.S.C. ?? 101 - 103 ( 2012 ) (codifying criteria for an invention to be patentable) . 86 . See WILLIAM NORDHAUS , INVENTION, GROWTH , AND WELFARE: A THEORETICAL TREATMENT OF TECHNOLOGICAL CHANGE 3-7 ( 1969 ) (arguing that the term lengths) . 87. See id. at 20 ( ?Knowledge in society is cumulative . ?) . 88 . See id. at 22 ( ?[S]ociety must determine the appropriate requirements & Parchomovsky, supra note 68, at 563 (?[D] etermining where this balance lies in the real world has proved to be elusive . ?) . 89 . See Dolin & Manta, supra note 44, at 735 (? Congress made several Office that supposedly resulted in 'low quality' patents .?). 90 . See Rudolph P. Hofmann , Jr. & Edward P. Heller , III, The Rosetta Stone for the Doctrines of Means-Plus-Function Patent Claims, 23 RUTGERS COMPUTER & TECH. L .J. 227 , 272 ( 1997 ) (?The Patent Act of 1952 was enacted in part as a response to the harsh attitude toward patents in the thirties and forties . ?) . 91 . Id. at 273 . 92. See Dolin & Manta, supra note 44, at 734 (describing the 1952 Patent Act's substantive provisions) . 93 . See id. (?The drumbeat of complaints about 'poor quality' patents that enacted the far-reaching reforms in the 1952 Patent Act .?). 94 . See Saint Regis Mohawk Tribe v . Mylan Pharm . Inc., 896 F.3d 1322 , 1330- 34 (Fed. Cir. 2018 ) (Dyk, J., concurring) (explaining the history of reexamination procedures that preceded IPR) . 95 . See Sherry M. Knowles et al., Inter Partes Patent Reexamination in the United States , 86 J. PAT . & TRADEMARK OFF. SOC'Y 611 , 611 ( 2004 ) (?The and less expensively than litigation . '?) . 96 . Bayh-Dole Act , Pub. L. No. 96 - 517 , 94 Stat. 3015 ( 1980 ). 97 . Dolin & Manta, supra note 44, at 736- 37 . 98 . Id . 99 . See American Inventors Protection Act of 1999 , Pub. L. No. 106 - 113 , 113 Stat. 1501 (codified in relevant part in 35 U .S.C. ?? 311 - 318 ( 2006 )) (repealed 2012 ) (creating inter partes reexamination ). 100 . See Knowles et al., infra note 95 , at 614 ( ?A common complaint [of the options, not more input . ?) . 101 . Pub . L. No. 112 - 29 , 125 Stat. 284 (codified in scattered Sections of 28 U.S.C . and 35 U.S.C.). 104 . Press Release, Sen. Patrick Leahy, Senate Begins Debate on Leahy-Smith America Invents Act ( Sept . 6, 2011 ) ( on file with the Washington Cuozzo Speed Techs. , LLC v. Lee , 136 S. Ct . 2131 , 2137 ( 2016 ). 370 . See Mylan Pharm. Inc. v. Saint Regis Mohawk Tribe , 2018 WL 1100950, at *1 (quoting Santa Clara Pueblo v . Martinez , 436 U.S. 49 , 58 ( 1978 )). 371 . See id. at 16-18 (comparing IPR and other ?suits,? finding that the patent holder) . 372. See id. at 9 (?[T] he immunity possessed by Indian Tribes is not 523 U.S. 751 , 756 ( 1998 ))). 373 . See id. at 8 (?The Tribe and its supporting amici, however, have not assertion of tribal immunity in similar federal administrative proceedings . ?) . 374 . But see Vas-Cath, Inc . v. Curators of Univ. of Mo., 473 F.3d 1376 , 1382 (Fed. Cir . 2007 ) (applying the FMC standard to patent interference proceedings at the PTAB) . 375 . See Bryan v. Itasca Cty., 426 U.S. 373 , 381 ( 1976 ) (?This omission has affecting Indian immunities, as some mention would normally be expected if such 389 . Id. 390 . See Oil States, 138 S. Ct . at 1371 (? The decision whether to institute inter partes review is committed to the Director's discretion . ?) . 391 . See Saint Regis Mohawk Tribe v . Mylan Pharm. Inc., 896 F.3d 1322 , 1327 (Fed. Cir . 2018 ) (?The Director bears the political responsibility of determining which cases should proceed . ?) . 392 . See id. at 1328 (?[T]he USPTO procedures in IPR do not mirror the Federal Rules of Civil Procedure.?) . 393 . See Fed . Mar. Comm'n v. S.C. State Ports Auth ., 535 U.S. 743 , 758 ( 2002 ) Rules of Procedures and the FMC's procedures , and discovery practices) . 394. Id. at 757-60 . 398 . See , e.g., Covidien LP v. Univ. of Fla . Research Found., No. IPR2016-01274 , 2017 WL 4015009, at *4- 5 (P.T.A.B. Jan . 25 , 2017 ) (discussing Vas-Cath before comparing civil litigation and IPR) . 410 . See Kiowa Tribe v. Mfg. Techs., Inc., 523 U.S. 751 , 758 ( 1998 ) (?It has MURPHY , CONG. RESEARCH SERV., 97 -851 A , FEDERAL INDIAN LAW: BACKGROUND AND CURRENT ISSUES 26-27 ( 1997 ) [hereinafter Murphy Congressional Research] funding because of the statute's overly broad language ). 411 . Fla . Paraplegic, Ass'n v. Miccosukee Tribe of Indians , 166 F.3d 1126 , 1130 ( 11th Cir . 1999 ). 412 . See Santa Clara Pueblo v. Martinez , 436 U.S. 49 , 61 ( 1978 ) (finding that choice not to afford a remedy that would abrogate tribal immunity ). 413 . See Allergan's E.D. Texas Complaint , supra note 36 , at 9-10 (discussing tribal initiatives to generate income to support its infrastructure). 414. See Mylan Pharm . Inc. v. Saint Regis Mohawk Tribe, No. IPR2016-01127 , 2018 WL 1100950, at *2 ( P.T.A.B. Feb . 23 , 2018 ) (?[W]e immunity should be applied to these proceedings . ?) . 415 . See Brief of Appellants at 23, Saint Regis Mohawk Tribe v. Mylan Pharm. , Inc., 896 F.3d 1322 ( Fed. Cir . 2018 ) (No. 18 - 1638 ) (?But the Board never explained the differences or why they dictated opposite results . ?) . 416 . See supra Part IV.C (pointing to the Vas-Cath gap in the Federal Circuit's Saint Regis Mohawk analysis) 417. Software Industry Association Amicus Brief, supra note 131, at 3 . 418. See State Amicus Brief Support En Banc Rehearing , supra note 406 , at 2 (?Sovereign immunity protects States' sovereign dignity and the value of patents held by States and their public universities . ?) . 419 . See Petition for Rehearing En Banc of Appellants Saint Regis Mohawk Tribe and Allergan, Inc., Saint Regis Mohawk Tribe v. Mylan Pharm., Inc., 896 F. 3d 1322 (Fed . Cir. 2018 ) (No. 18 - 01638 ) (?Although the panel stated that its are the same for all IPRs . . . . ? (citations omitted)) . 420 . See S. 1948 , 115th Cong. (1st Sess . 2017 ) (abrogating only tribal sovereign immunity in IPR) . 421 . Fed . Mar. Comm'n v. S.C. State Ports Auth ., 535 U.S. 743 , 756 ( 2002 ). 422 . See Tenn . Student Assistance Corp. v. Hood, 541 U.S. 440 , 452 ( 2004 ) (internal citations omitted) . 423 . See Ericsson Inc. v. Regents of Univ. of Minn ., 2017 WL 6517563 , No. IPR2017-01186 at *6 (Dec. 19 , 2017 ) (? At its core, inter partes review is a over the patent challenged, rather than the parties named . ?) . 424 . See Oil States Energy Servs ., LLC v. Greene's Energy Grp ., LLC, 138 S. Ct. 1365 , 1373 ( 2018 ) (explaining that because the USPTO has authority to grant patents, it also has the authority to reconsider them) . 425. Hood , 541 U.S. at 450; Saint Regis Mohawk Tribe v . Mylan Pharm . Inc., 896 F. 3d 1322 (Fed . Cir. 2018 ) (?[IPR] does not involve exercise of personal


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Maya Ginga. Patently Absurd: Critiquing the USPTO’s Disparate Treatment of Tribal and State Immunity in Inter Partes Review, Washington and Lee Law Review, 2018,