For the third time, the Board applied sovereign immunity as a defense to IPR. In Reactive Surfaces Ltd. v. Toyota Motor Corporation (IPR2017-00572 & IPR2016-01914), the Board determined that a public university could raise the defense of sovereign immunity as a reason why it should not be subject to IPR. However, in Reactive Surfaces, the Board refused to dismiss the proceeding because it found that Toyota, a co-owner of the challenged patent that did not claim sovereign immunity, "would represent adequately the [university's] interests."
Before determining that the IPR could proceed without the university, the Board first addressed whether the university could raise sovereign immunity in IPR. The panel cited the Covidien decision (IPR2016-01274), where Wolf Greenfield first developed sovereign immunity as a defense to IPR, and the NeoChord decision (IPR2016-00208). The Board noted that neither of those decisions are binding but found "their reasoning persuasive." The Board also determined that the university is an "arm of the State" and is thus entitled to sovereign immunity.
This decision illustrates that the Board continues to accept sovereign immunity as a defense to IPR. Patent owners entitled to sovereign immunity should not neglect to consider it. However, this decision must also be kept in mind in cases where the challenged patent has a non-sovereign co-owner.
We'll continue to follow the latest developments regarding sovereign immunity and IPR. Be sure to subscribe to The Post-Grant Strategist to receive the latest updates.
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