Mylan asks SCOTUS to end NHK-Fintiv rule
Mylan Laboratories has urged the US Supreme Court to overturn the controversial NHK-Fintiv rule, claiming that it is “unlawful”.
The rule allows the Patent Trial and Appeal Board (PTAB) to refuse to institute an inter partes review (IPR) of a patent or patents also subject to parallel litigation in US district courts.
The generic drug manufacturer claimed in a petition filed on Monday that the rule unfairly denies legitimate patent challenges.
The petition further holds that the rule has resulted in the mass denial of timely IPR petitions due to “unrealistic” district court scheduling orders, leading plaintiffs to only seek out courts with a reputation for fast scheduling of patent cases to avoid IPR proceedings.
“Despite its short life, NHK-Fintiv has resulted in chaos,” the petition said. “The patent community is understandably upset about the rule and has raised a slew of challenges against it. ”
The petition queries whether the scope of section 35 of the US Patent Act —ruling that the USPTO director’s decision whether or not to institute an IPR is final—precludes the appeal of all decisions not to institute IPR. It also asks SCOTUS to determine whether the NHK-Fintiv ruling is “substantively” and “procedurally'' unlawful.
Mylan claims that the board has wielded the NHK-Fintiv Rule to terminate scores of timely filed petitions since March 2020 and that the “rule” is not “the product of a formal rulemaking”.
Making the rules
The NHK-Fintiv rule was established by former US Patent and Trademark Office Director Andrei Iancu following NHK Spring v Intri-Plex in 2018, in which the PTAB held that the existence of a parallel district court lawsuit should preclude an IPR review.
Following this, Apple v Fintiv (2020) outlined six scenarios for the PTAB to consider before instituting a review of a patent, including the trial date in the parallel case, whether the court has stalled its case for the PTAB review, and any overlap between the issues in both proceedings.
The rule has been met with considerable criticism, particularly from frequent petitioners who note the “dramatic” decrease in the rate of instituted reviews at the board.
Brenton Babcock and Tyler Train of Womble Bond Dickinson called the rule a “powerful procedural weapon” for patent owners.
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