January 9, 2017

An IPR Does Not Necessarily Have Standing to Appeal if it Loses

By Bryan K. Wheelock, Principal

In Phigenix, Inc. v. ImmunoGen, Inc., [2016-1544] (January 9, 2017), the Federal Circuit held that Phigenix, the losing petitioner in an IPR, lacked standing to appeal the PTAB’s decision that claims 1–8 of U.S. Patent No. 8,337,856 were nonobvious.  The Federal Circuit said that although Article III standing is not necessarily a requirement to appear before an administrative agency, an appellant must nevertheless supply the requisite proof of an injury in fact when it seeks review of an agency’s final action in a federal court.  To show this standing, an appellant must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the appellee, (3) that is likely to be redressed by a favorable judicial decision.

The Federal Circuited noted that in some cases, an appellant’s standing to seek review of administrative action is self-evident; no evidence outside the administrative record is necessary for the court to be sure of it.  When the appellant’s standing is not self-evident, however, the appellant must supplement the record to the extent necessary to explain and substantiate its entitlement to judicial review.  In doing so, an appellant may submit arguments and any affidavits or other evidence to demonstrate its standing.  Taken together, an appellant must either identify record evidence sufficient to support its standing to seek review or, if there is none because standing was not an issue before the agency, submit additional evidence to the court of appeals, such as by affidavit or other evidence.

The Federal Circuit noted that Phigenix does not contend that it faces risk of infringing the patent, that it is an actual or prospective licensee of the patent, or that it otherwise plans to take any action that would implicate the patent.  Instead, Phigenix asserted that it has suffered an actual economic injury because the existence of the patent increases competition between Phigenix and ImmunoGen, which the Federal Circuit found unsubstantiated.  The Federal Circuit also rejected Phigenix contention that it has suffered an injury in fact because 35 U.S.C. §141(c) “provides a statutory basis for appeal.”  While §141(c) permitted the filing of an appeal, it does nothing to establish Article III standing.  Finally, the Federal Circuit rejected the argument that the estoppel provisions of  35 U.S.C. § 315(e) created standing, but the Federal Circuit found it did not constitute an injury in fact when the appellant is not engaged in any activity that would give rise to a possible infringement suit.