No Supreme Court Jurisdiction and UMass Not an Indispensable Party in Patent Inventorship Dispute: Federal Circuit | Practical Law

No Supreme Court Jurisdiction and UMass Not an Indispensable Party in Patent Inventorship Dispute: Federal Circuit | Practical Law

In University of Utah v. Max-Planck-Gesellschaft, the US Court of Appeals for the Federal Circuit affirmed the district court's determination that a patent inventorship dispute between two state universities did not fall within the Supreme Court's exclusive original jurisdiction and that the University of Massachusetts was not an indispensable party under Federal Rule of Civil Procedure 19.

No Supreme Court Jurisdiction and UMass Not an Indispensable Party in Patent Inventorship Dispute: Federal Circuit

by Practical Law Intellectual Property & Technology
Published on 20 Aug 2013 • USA (National/Federal)
In University of Utah v. Max-Planck-Gesellschaft, the US Court of Appeals for the Federal Circuit affirmed the district court's determination that a patent inventorship dispute between two state universities did not fall within the Supreme Court's exclusive original jurisdiction and that the University of Massachusetts was not an indispensable party under Federal Rule of Civil Procedure 19.
In its August 19, 2013 opinion in University of Utah v. Max-Planck-Gesellschaft, the US Court of Appeals for the Federal Circuit affirmed the US District Court for the District of Massachusetts's ruling that the dispute did not fall within the Supreme Court's exclusive original jurisdiction because the University of Massachusetts (UMass) was not a real party in interest and therefore the case did not present a conflict between two states. The court also held that UMass was not an indispensable party under FRCP 19(b).
The University of Utah (UUtah) brought suit against UMass to correct inventorship over patents concerning RNA interference (the Tuschl Patents). UUtah originally named as defendants assignees of the patents and UMass. UUtah then amended its complaint replacing UMass with four UMass officials. The UMass officials moved to dismiss the case because:
  • UUtah's claims were barred by sovereign immunity.
  • UUtah failed to join UMass, which was an indispensable party.
The district court denied the UMass officials' motion and they appealed to the Federal Circuit raising three arguments:
  • The district court lacked jurisdiction because the case falls within the Supreme Court's jurisdiction.
  • UMass was entitled to sovereign immunity.
  • UMass was an indispensable party and the case should be dismissed under FRCP 19(b).
On appeal, the Federal Circuit, in a split decision, affirmed the district court's denial of the UMass officials' motion to dismiss. Since the case did not involve a suit by citizens against a state, the court held there was no sovereign immunity issue to consider.
The court rejected the defendants' argument that this case fell under the Supreme Court's exclusive original jurisdiction. Specifically, it found that UMass was not a real party in interest and so the dispute did not constitute a conflict between states. While both UUtah and UMmass are arms of the state, a state is a real party in interest only if it is a mandatory or indispensable party such that the decree would operate directly against it and adequate relief cannot be granted without it. Because the regional circuit court, the Court of Appeals for the First Circuit, has not addressed the issue of when the state is an indispensable party, the Federal Circuit followed the US Court of Appeals for the Second Circuit's approach in Connecticut ex rel. Blumenthal v. Cahill. It reasoned that UMass was not a real party in interest because the defendants had not identified a core sovereign interest of Massachusetts in this case. Specifically, a state has no core sovereign interest in inventorship. In addition, following US Supreme Court caselaw, the Federal Circuit noted that the district court could grant the relief sought by UUtah even if UMass was not a party and this also supported a finding that UMass was not a real party in interest.
The court also held that UMass was not an indispensable party under FRCP 19(b) because:
  • UMass's interests were adequately represented by the defendants, including all of the Tuschl Patent owners except UMass.
  • The defendants were jointly represented by legal counsel in protecting the Tuschl Patents.
  • An order directing the US Patent and Trademark Office (USPTO) to correct inventorship would not be insufficient in the absence of Umass, as it would still bind the USPTO.
Court documents: