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Claims barred by laches: Prosecution delay doesn’t pay, nor does skipping evidence of concrete injury

by Courtney Seams | Sep 11, 2025 | Patents

The US Court of Appeals for the Federal Circuit affirmed a district court’s judgment for the US Patent & Trademark Office (PTO) on application of prosecution laches in an action under 35 USC § 145. The Federal Circuit also agreed that the district court lacked Article III jurisdiction over certain claims because the plaintiff failed to provide evidence of concrete injury when challenged after initial pleadings. Hyatt v. Stewart, Case Nos. 2018-2390; -2391; -2392; 2019-1049; -1038; -1039; -1070; 2024-1992; -1993; -1994; -1995 (Fed. Cir. Aug. 29, 2025) (Reyna, Wallach, Hughes, JJ.) (precedential).

Gilbert Hyatt filed four GATT bubble patent applications, all of which had claims rejected by the examiner. Hyatt appealed those rejections to the Patent Trial & Appeal Board, which affirmed various rejections of others. Following the Board decisions, Hyatt filed four separate actions in district court under 35 U.S.C. § 145, challenging the PTO rejections. In response, the PTO asserted prosecution laches as an affirmative defense and, in the alternative, invalidity, based on anticipation and lack of written description.

The district court initially ruled in Hyatt’s favor, finding that the PTO’s affirmative defenses failed with respect to the claims for which the Board affirmed the examiner’s rejection. The district court concluded that it lacked Article III jurisdiction over the remaining claims (those for which the Board reversed the examiner) because there was no final agency action as to those claims.

The PTO appealed, arguing that prosecution laches barred all of the claims or, in the alternative, that the claims were invalid. Hyatt cross-appealed, contending that prosecution laches did not apply in § 145 actions or that the district court abused its discretion in applying laches in these specific § 145 actions.

In an earlier appeal, Hyatt I, the Federal Circuit vacated the district court’s rulings on prosecution laches, holding that the district court applied the wrong standard for prosecution laches and had the burden of proving that Hyatt engaged in unreasonable and unexplained delay in prosecuting his applications and that the delay was prejudicial. The panel remanded the case held the issue of Article III jurisdiction in abeyance. On remand, the district court reversed course and found in favor of the PTO on prosecution laches, concluding that Hyatt had unreasonably delayed prosecution in a manner that prejudiced the agency.

Hyatt appealed. The Federal Circuit consolidated the appeals with the earlier stayed jurisdictional issues. The Federal Circuit affirmed the district court’s application of prosecution laches, finding no clear error in its determination that Hyatt’s conduct met the standard for delay and prejudice. The Federal Circuit also agreed that the district court lacked Article III jurisdiction over claims that had not been finally rejected by the PTO, reinforcing that § 145 actions may only proceed where there is a final agency determination resulting in a justiciable controversy.

On the issue of prosecution laches, the Federal Circuit explained that it had already considered and rejected Hyatt’s argument that prosecution laches is unavailable in a § 145 action in Hyatt I, and [...]

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Derivation proceedings highlight race to file under AIA

by Brennen Baylor | Sep 11, 2025 | America Invents Act, Patents

In one of the first decisions regarding derivation proceedings under the America Invents Act (AIA), the US Court of Appeals for the Federal Circuit affirmed the Patent Trial & Appeal Board’s finding that an application earlier filer had not derived his claimed invention from a later-filing petitioner. Global Health Solutions, LLC v. Marc Selner, Case No. 2023-2009 (Fed. Cir. Aug. 26, 2025) (Stoll, Stark, JJ.) (Goldberg, J., sitting by designation).

Global Health Solutions (GHS) and Marc Selner filed patent applications governed by the AIA and covering similar subject matter. Selner filed his application first. GHS filed a petition to institute derivation under 35 U.S.C. § 135, alleging that Selner’s patent claims were derived from Burnam, the single inventor on the GHS application.

During Board proceedings, the parties submitted evidence regarding the timing of their respective conceptions of the claimed inventions, including several email communications. Based on Selner’s evidence, the Board determined that he could not have derived the claimed invention from Burnam. The Board also rejected GHS’s argument that actual reduction to practice was necessary to complete conception of the claimed invention. GHS appealed.

The Federal Circuit explained that while pre-AIA patent interference proceedings required a party alleging derivation to establish prior conception and communication of the invention to the opposing party, the AIA does not expressly define the evidentiary requirements for derivation petitions. Nevertheless, the Court, borrowing from its interference jurisprudence, reasoned that an AIA derivation proceeding similarly requires a showing of both conception and communication of the claimed invention. The Court emphasized, however, that standards articulated in case law from pre-AIA interference proceedings must be applied with caution and considered in light of the AIA’s distinct statutory framework.

The Federal Circuit determined that although the Board focused on which party had proof of the earliest conception (typically the dispositive issue in interference proceedings), it was harmless error. Under the AIA first-to-file framework, determination of the first to invent is not dispositive. The Court noted that because Selner was first to file, he only needed to show that his conception was independent of Burnam’s. Here, Selner’s proof of earlier conception was also proof of conception independent of Burnam, the Court noted.

The Federal Circuit also determined that the Board did not err in rejecting GHS’s argument that Selner failed to demonstrate invention in the absence of evidence of actual reduction to practice. The Court found that the Board appropriately addressed whether such a requirement (often applied in interference proceedings to complicated, unpredictable technology) applied to the invention at issue. The Court explained that Selner’s conception was complete either when he could define the invention by its method of preparation or when he had formed a definite and permanent idea of the complete and operative invention. Selner’s earlier email communication to Burnam supported the finding that Selner had reached the requisite understanding to establish complete conception without the need for actual reduction to practice. Accordingly, the Court affirmed the Board’s decision in favor of Selner, finding no derivation.

Practice note: [...]

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When is a word too common to trademark? Asking for a four-letter friend

by Sarah Bro | Sep 4, 2025 | Trademarks

In response to artist and entrepreneur Erik Brunetti’s ongoing efforts to register FUCK as a trademark for various goods and services, the US Court of Appeals for the Federal Circuit vacated the Trademark Trial & Appeal Board’s refusal to register the term but agreed with the Board’s position on the registrability of widely used “all-purpose words.” The Court ordered the remand because it found the Board’s reasoning insufficiently clear and lacking a coherent standard. In re Brunetti, Case No. 23-1539 (Fed. Cir. Aug. 26, 2025) (Dyk, Reyna, JJ.) (Lourie, J., dissenting).

Brunetti filed four intent-to-use applications to register FUCK as a trademark for goods, including sunglasses, jewelry, and backpacks, and services such as retail store offerings. The US Patent & Trademark Office (PTO) refused registration, asserting that the term failed to function as a trademark under Sections 1, 2, 3, and 45 of the Lanham Act and citing its widespread use as a commonplace expression conveying varied sentiments.

The Board affirmed the PTO’s decision, concluding that FUCK was “arguably one of the most expressive words in the English language” and that consumers were accustomed to seeing it used by various sources on similar goods. The Board reasoned that such ubiquity rendered the term incapable of serving as a source identifier. It rejected Brunetti’s constitutional arguments and distinguished the Supreme Court’s prior decision in Iancu v. Brunetti, which invalidated the PTO’s refusal to register the mark FUCK on grounds of immorality. Brunetti appealed.

The Federal Circuit agreed that the Board had properly considered third-party use and the expressive nature of the term. However, the Court found the Board’s decision wanting in clarity and consistency. It criticized the Board’s failure to articulate a workable standard for when “all-purpose word marks” such as FUCK can function as trademarks, especially in light of other registrations for similarly ubiquitous terms such as LOVE and even FUCK itself for snow globes and gummy candies.

The Federal Circuit emphasized that the Board must engage in reasoned decision-making under the Administrative Procedure Act and provide sufficient guidance for future cases. The Court therefore vacated the decision and remanded for further proceedings.

Despite the remand, the Federal Circuit dismissed Brunetti’s argument that the PTO had retaliated against him for his prior Supreme Court victory in Iancu v. Brunetti. Brunetti claimed that the timing of the refusals (following his successful challenge to the PTO’s immoral/scandalous bar) suggested retaliation. The Court found this argument unpersuasive, noting that Brunetti offered no evidence beyond timing, and that the Board’s analysis remained viewpoint-neutral and focused on whether the mark functioned as a source identifier.

Judge Lourie dissented, arguing that the Federal Circuit should have affirmed the Board’s refusal on grounds that the term FUCK is too ubiquitous and expressive to function as a source identifier for the goods and services in question. He emphasized that the word’s widespread use across varied emotional contexts prevents consumers from associating it with a specific brand. From Judge Lourie’s perspective, FUCK on its own [...]

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Feel the burn: Mechanical improvement is patent eligible under § 101

by Dexter Hamilton | Aug 21, 2025 | Patents

The US Court of Appeals for the Federal Circuit reversed a district court’s partial dismissal of the plaintiff’s patent claims under 35 U.S.C. § 101, finding that the claims were not directed to an abstract idea under Alice step one. PowerBlock Holdings, Inc. v. iFit, Inc., Case No. 24-1177 (Fed. Cir. Aug. 11, 2025) (Taranto, Stoll, Scarsi, JJ.)

PowerBlock sued iFit for allegedly infringing its patent related to dumbbells. IFit moved to dismiss the claims under § 101. The district court found that the challenged claim was broadly directed to the idea of automated weight stacking, and that it purported to cover any system having a few basic components for selecting and adjusting weights, rather than describing a specific method or design for how the system actually worked. Applying the Supreme Court’s two-step framework for determining patent eligibility, the district court determined that all but one claim of the asserted patent were ineligible under § 101. PowerBlock appealed.

The Federal Circuit reversed, finding that the district court erred in its Alice step one analysis under § 101. The Court explained that the crux of the district court’s incorrect determination was that the challenged claim was directed to the abstract idea of automated weight stacking, which in turn led to misplaced preemption concerns. The Court found instead that the claim was limited to a specific implementation of a technological improvement – namely, a particular type of selectorized dumbbell featuring nested left and right weight plates, a handle, a movable selector, and an electric motor operatively connected to the selector that adjusts the weight based on user input.

Distinguishing the challenged claim from prior cases in which claims were found ineligible, the Federal Circuit emphasized that the claim was directed to an “eligible mechanical invention” and “focused on a specific mechanical improvement,” not merely an abstract or generalized concept. The Court also rejected iFit’s argument that limitations should be discounted simply because they appear in the prior art. The Court reiterated that it is inappropriate to dissect claims into old and new elements and then ignore the old when assessing eligibility under § 101. Rather, under Alice, the “step one inquiry involves consideration of the claims ‘in their entirety to ascertain whether their character as a whole is directed to excluded subject matter.’” The Court cautioned against conflating the patent eligibility inquiry under § 101 with the separate questions of novelty and nonobviousness under §§ 102 and 103.

Identical or not? Jury can’t decide issues of claim construction

by Cecilia Choy, Ph.D. | Aug 21, 2025 | Patents

The US Court of Appeals for the Federal Circuit reversed a district court’s denial of a motion for judgment as a matter of law (JMOL) of noninfringement, finding that the jury’s infringement findings were unsupported by sufficient evidence and that the district court had improperly delegated claim construction to the jury. Laboratory Corp. of America Holdings v. Qiagen Sciences, LLC, Case No. 23-2350 (Fed. Cir. Aug. 13, 2025) (Lourie, Dyk, Cunningham, JJ.)

Laboratory Corp. of America Holdings (LabCorp) holds two patents with substantially overlapping specifications, both generally directed to methods for preparing DNA samples for sequencing and enrichment techniques aimed at enabling whole-genome sequencing. LabCorp initiated litigation alleging that various Qiagen Sciences kits containing materials used in DNA sample preparation for sequencing infringed its patents. During claim construction, the district court construed several patent terms as follows:

In the first patent, “second target-specific primer” means a single-stranded oligonucleotide with a 3’ portion that specifically anneals to a portion of the known target nucleotide sequence in the amplicon from step (b), and a 5’ portion identical to a second sequencing primer.
Also in the first patent, “second adaptor primer” refers to a nucleic acid molecule containing a sequence identical to part of the first sequencing primer and nested relative to the first adaptor primer.
In the second patent, “target-specific primer” is defined as a primer sufficiently complementary to the target to enable selective annealing and amplification, without amplifying non-target sequences in the sample.

The jury found that Qiagen infringed the first patent under the doctrine of equivalents and willfully and literally infringed the second patent. The jury awarded damages accordingly. The district court denied Qiagen’s renewed motion for JMOL to reverse the damages and the jury’s findings of infringement and validity, and its alternative request for a new trial. Qiagen appealed.

Qiagen raised two noninfringement arguments regarding the first patent, and the Federal Circuit agreed with both. First, the Court held that it was error to allow the jury to apply “plain meaning” and equate a sequence being “identical to another” with being “identical to a portion” of another. Specifically, Qiagen’s accused second target-specific primer (Sample Index Primer, or SIP) was 19 nucleotides long while the second sequencing primer (Read2 primer) was 34 nucleotides. The fact that they shared an overlapping sequence did not make them identical.

Although the district court had treated “identical” as a factual issue for the jury, the Federal Circuit, citing its 2008 decision in O2 Micro Int’l Ltd. v. Beyond Innovation Tech., found that this was a claim construction matter that should not have been left to the jury. The term “identical” must be given its full meaning under claim construction and cannot be interpreted as “identical to a portion.” The Court emphasized that the specification and claims distinguished between full and partial identity: The second target-specific primer must be “identical to” the second sequencing primer while the adaptor primer need only be “identical to a portion” of the first sequencing primer. This difference [...]

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Specification controls: Written description must be clear

by Taylor MacDonald | Aug 21, 2025 | Patents

The US Court of Appeals for the Federal Circuit reversed a district court’s decision upholding patent validity, finding that the subject patent’s specification clearly established that the written description failed to adequately support the full scope of the asserted claims (35 U.S.C. § 112). Mondis Technology Ltd. v. LG Electronics Inc., Case Nos. 23-2117; -2116 (Fed. Cir. Aug. 8, 2025) (Taranto, Clevenger, Hughes, JJ.)

Mondis sued LG for alleged infringement of a patent related to computer display technology. During prosecution, Mondis amended the claims to overcome prior art, changing a limitation from identifying a particular display unit to identifying a type of display unit (the type limitation). A jury found in favor of Mondis and awarded $45 million in damages. LG moved for judgment as a matter of law (JMOL), arguing that the patent was invalid due to a lack of written description supporting the type limitation. The district court denied the motion but granted a retrial on damages. The second jury awarded more than $14 million. LG appealed.

The Federal Circuit applied regional law standard (here, Third Circuit law) to review the district court’s denial of JMOL (i.e., assessing whether a reasonable jury could have reached the verdict). In evaluating patent validity under the written description requirement of § 112, the Court focused on whether the specification sufficiently demonstrated that the inventor possessed the claimed invention, including any amendments made during prosecution.

The Federal Circuit examined whether substantial evidence supported the jury’s finding of validity and concluded that LG did not need extrinsic evidence to challenge the patent’s validity but properly relied on the specification. The Court found that Mondis’ attempt to piece together fragments of testimony (primarily related to infringement) to argue for implicit support in the specification was insufficient because the specification’s plain language supported only the original unamended claim limitation, not the amended type limitation.

The Federal Circuit acknowledged that both parties presented expert testimony at trial. However, the Court found that even Mondis’ expert testimony, when considered alongside the specification’s plain meaning, failed to provide adequate support for the jury’s finding. While a jury may infer implicit support, Mondis did not present enough particularized testimony to justify such an inference.

Mondis also argued that the examiner’s allowance of the amended claim indicated sufficient support in the specification, and that the presumption of validity of an issued patent supported its position. The Federal Circuit rejected this argument, noting that the examiner’s focus was on overcoming prior art, not on evaluating written descriptions. Accepting Mondis’ position would effectively shield most patents from later invalidation, a result the Court deemed impractical.

Accordingly, the Federal Circuit reversed the district court’s ruling and found the asserted claims invalid for lack of written description.

Claim construction misstep undoes injunction

by Joshua Revilla | Aug 14, 2025 | Patents

The US Court of Appeals for the Federal Circuit vacated and remanded a preliminary injunction (PI), finding that the district court improperly construed a claim term based on references cited in a provisional application but omitted from the asserted patents. FMC Corp. v. Sharda USA, LLC, Case No. 224-2335 (Fed. Cir. Aug. 21, 2025) (Moore, Chen, Barnett, JJ.)

FMC owns two patents claiming priority to a provisional application concerning insecticides and miticides compositions. The patents specifically cover formulations comprising bifenthrin and a cyano-pyrethroid. Sharda currently markets an insecticide product known as Winner, which contains both bifenthrin and a cyano-pyrethroid.

FMC sued Sharda for patent infringement on its two patents and sought a temporary restraining order (TRO) and a PI. The district court denied both motions but issued a claim construction for the term “composition.” Instead of applying the term’s plain and ordinary meaning, the district court interpreted “composition” narrowly to mean “stable compositions, rather than the well-known unstable compositions that produce ineffective results as discussed throughout the prosecution history.” In reaching this construction, the district court relied on statements made in the provisional application and disclosures found in a separate, non-asserted FMC patent that claimed priority to the same provisional application. However, these disclosures were absent from the asserted patents themselves, appearing only in the provisional application and the non-asserted patent.

FMC renewed its motion for a TRO, which the district court granted and later converted into a PI. In issuing the PI, the district court again relied on its narrow construction of the term “composition” as a key point in rejecting Sharda’s invalidity defenses. Sharda appealed.

Sharda argued that the district court erred in both its construction of “composition” and its determination that Sharda failed to raise a substantial question regarding the patents’ validity. The Federal Circuit first addressed Sharda’s challenge to the district court’s construction of the term “composition,” which had been limited to stable compositions based on disclosures in the provisional application and a non-asserted patent. The Court acknowledged that while the provisional application contained multiple references to “stability,” all such references were deliberately removed from the common specification of the two asserted patents. As a result, the specifications of the asserted patents did not simply carry forward the language of the provisional application but instead reflected a substantive evolution.

Citing its 2024 decision in DDR Holdings, LLC v. Priceline.com LLC, the Federal Circuit emphasized that such omissions are legally significant. The Court concluded that a person of ordinary skill in the art, considering the deliberate removal of all references to stability, would not interpret the term “composition” as limited to stable formulations. Because FMC chose to revise the asserted patents’ written descriptions to exclude any mention of stability, the district court erred in importing a stability limitation from the provisional application and non-asserted patent into the claims. Accordingly, the Federal Circuit held that the district court improperly grafted a “stability” requirement onto the term “composition.”

The Federal Circuit also found fault with the district court’s [...]

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Collateral estoppel remains inapplicable to unchallenged IPR claims

by Courtney Seams | Aug 14, 2025 | Patents

Returning to its decision in Kroy IP, the US Court of Appeals for the Federal Circuit denied a petition for panel rehearing and rehearing en banc, leaving undisturbed its prior opinion that collateral estoppel does not apply to the assertion of claims from a patent, even when other patentably indistinct claims from that patent have been found unpatentable in inter partes review (IPR) proceedings before the Patent Trial & Appeal Board. Kroy IP Holdings, LLC v. Groupon, Inc., Case No. 23-1359 (Fed. Cir. Aug. 1, 2025) (per curiam) (Moore, J., concurring) (Dyk, J., dissenting).

Kroy sued Groupon for patent infringement, and Groupon subsequently filed two IPR petitions. The Board ultimately found 21 of the asserted claims unpatentable. Kroy amended its complaint to remove those 21 claims and proceed only with claims that were not at issue in the IPR proceedings. Groupon moved to dismiss the complaint, arguing that Kroy was collaterally estopped from asserting the remaining claims because of the Board’s prior IPR rulings finding other patentably indistinct claims unpatentable. The district court agreed with Groupon, finding that the remaining asserted claims were not materially different from the unpatentable claims in terms of validity and granted the motion to dismiss with prejudice. Kroy appealed.

The Federal Circuit held that a Board determination finding certain patent claims unpatentable under the preponderance of the evidence standard did not collaterally estop Kroy from asserting other unreviewed claims of the same patent in district court litigation against Groupon. Groupon subsequently petitioned for panel rehearing and rehearing en banc, both of which the Federal Circuit denied per curiam.

Chief Judge Moore, joined by Judge Stoll, concurred in the decision. In her concurring opinion, Judge Moore explained that collateral estoppel does not apply where differing standards of proof exist (namely, the preponderance of evidence standard used by the Board versus the clear and convincing evidence standard applied in district courts) because this difference can materially affect a patent’s validity determination. She emphasized that collateral estoppel should apply consistently in patent cases and cautioned against deviating from the established collateral estoppel standards. Judge Moore also noted that policy concerns are mitigated by the ability to file a second IPR petition, because the Board is likely to grant review where a petition raises a substantially similar question of invalidity.

Judge Dyk, joined by Judge Hughes, dissented from the decision. The dissent advocated departing from the traditional burden-of-proof rule applicable in the collateral estoppel context to avoid duplicative litigation regarding patent validity. The dissent argued that the majority opinion conflicted with the Federal Circuit’s 2018 opinion in XY, LLC v. Trans Ova Genetics, which held that collateral estoppel extends between Board decisions and district court proceedings in pending or co-pending actions. According to the dissent, the majority’s approach permits repeated litigation of the validity of patent claims previously found unpatentable in IPR proceedings affirmed on appeal. The dissent expressed concern that applying collateral estoppel in this manner would enable patentees to evade the preclusive effect of adverse IPR [...]

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Dim damages methods can doom bright ideas

by Keval Amin | Aug 7, 2025 | Patents

In a mixed ruling on evidentiary exclusions and damages methodology, the US Court of Appeals for the Federal Circuit affirmed in part, reversed in part, vacated in part, and remanded a district court’s decision that excluded patent validity evidence and granted judgment as a matter of law (JMOL). The Federal Circuit found that the district court erred in blocking the defendant’s invalidity case and directed it to reassess the reliability of the damages expert’s testimony under Rule 702. Jiaxing Super Lighting Co., Ltd. v. CH Lighting Technology Co., Ltd., Case No. 23-1715 (Fed. Cir. July 28, 2025) (Dyk, Chen, Hughes, JJ.)

Jiaxing Super Lighting and its affiliate Obert (collectively, Super Lighting) sued CH Lighting over three patents related to LED tube lamps – two covering structural designs and one addressing electrical safety. CH Lighting admitted infringement but argued that the structural patents were invalid under the America Invents Act’s (AIA) on-sale bar. The district court excluded key evidence, found the remaining expert testimony insufficient, and granted JMOL in Super Lighting’s favor. A jury later found CH Lighting liable and awarded damages, which the district court doubled. CH Lighting’s motions for a new trial and renewed JMOL were denied. CH appealed.

CH Lighting contended that certain 2014 LED tubes met all claim limitations and triggered the on-sale bar. The Federal Circuit disagreed, affirming the district court’s finding that CH Lighting’s expert lacked a proper foundation, having offered no concrete evidence or personal knowledge of the alleged sales. However, the Court found error in the exclusion of two key evidentiary items: testimony authenticating sales documents and an internal presentation showing competitor products predating the patents. The district court excluded the documents for lack of authentication and barred the presentation because of its connection to a dropped inequitable conduct claim, later reasoning that the products shown differed in wattage. The Federal Circuit rejected both rationales, explaining that the relevant inquiry focused on whether the products disclosed patented features, not their wattage. The Federal Circuit deemed these exclusions an abuse of discretion, warranting a retrial on validity.

The Federal Circuit separately upheld the jury’s findings on a different patent where the jury found the patent not invalid for anticipation and infringed. CH Lighting had argued that a prior art reference anticipated the asserted claims and that the accused chips could not infringe if the reference did not. The Court found, based on the conflicting testimony of the parties’ expert witnesses, that the jury was free to credit one expert over the other and therefore had substantial evidence supporting the jury’s no invalidity verdict. Similarly, the parties’ experts presented conflicting evidence on infringement and that Jiaxing’s expert’s theory was not necessarily inconsistent with the validity ruling. The Court thus affirmed the findings of validity and infringement.

Turning to damages, the Federal Circuit emphasized that expert testimony must be based on reliable methodology and sufficient factual grounding, reinforcing standards articulated in the recent EcoFactor, Inc. v. Google en banc decision. Because the jury [...]

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Federal Circuit lacks jurisdiction over award that doesn’t raise issue of patent law

by Katherine Pappas | Aug 7, 2025 | Patents

The US Court of Appeals for the Federal Circuit determined that it lacked appellate jurisdiction over a district court judgment confirming an arbitration award stemming from a dispute over royalties paid under patent license and supply agreements. The Court concluded that the petition did not “necessarily raise” a substantial issue of patent law. Acorda Therapeutics Inc. v. Alkermes PLC, Case No. 2023-2374 (Fed. Cir. July 25, 2025) (Taranto, Hughes, Stark, JJ.)

Acorda Therapeutics, the developer of Ampyra®, a treatment for multiple sclerosis, licensed a patent from Alkermes covering Ampyra’s active ingredient. In exchange, Acorda paid running royalties and sourced the active ingredient directly from Alkermes. Although the patent expired in July 2018, Acorda continued making royalty payments for two years without formal protest.

In July 2020, Acorda challenged the ongoing payments and initiated arbitration. Acorda sought a declaration that the licensing royalty provision was unenforceable after the patent’s expiration and sought recovery of royalties paid after July 2018, invoking unjust enrichment. The arbitration tribunal agreed that the royalty provision was unenforceable after the patent’s expiration. However, it limited Acorda’s recovery to payments made under formal written protest, which only started in July 2020. This ruling relied on a state law principle that payments made with full knowledge of the facts, even if under a mistake of law, are not recoverable unless accompanied by written protest.

Acorda filed suit in federal district court under the Federal Arbitration Act, invoking diversity jurisdiction. It sought confirmation of the tribunal’s findings, except for the denial of recoupment of more than $65 million in unprotested payments made between 2018 and 2020. Acorda argued that the tribunal’s refusal to allow full recoupment constituted “manifest disregard” of the law and offered two alternative theories: the tribunal improperly applied state law in derogation of federal patent law, and the award effectively enforced an illegal licensing agreement. The district court upheld the tribunal’s award. Acorda appealed.

The Federal Circuit declined to reach the merits and instead examined its jurisdiction. Under the “well-pleaded complaint” rule, the Federal Circuit’s jurisdiction applies only if patent law creates the cause of action or the plaintiff’s right to relief necessarily depends on resolving a substantial question of patent law.In its 1988 decision in Christianson v. Colt Industries and 2013 decision in Gunn v. Minton, the Supreme Court made clear that situations falling within the “special and small” second category (where right to relief necessarily depends on resolution of a substantial question of patent law) are “extremely rare.”

Here, Acorda’s complaint did not assert a patent cause of action. The request to confirm the arbitration award could be resolved without judicial interpretation of patent law. The Federal Circuit also noted that even the modification request, although it was premised on the award’s finding of unenforceability, presented two alternative arguments, only one of which involved patent law. Because the district court could have ruled for Acorda without addressing patent law, the Federal Circuit concluded that patent law was not “necessarily raised.” As a result, the Federal [...]

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