Enzo Therapeutics v. Yeda Research and Dev. Co.

• Decision Date: 06 December 2006
• Docket Number: Civil Action No. 2:06cv377.
• Court: U.S. District Court — Eastern District of Virginia
• Parties: ENZO THERAPEUTICS, INC., Plaintiff, v. YEDA RESEARCH AND DEVELOPMENT CO. OF THE WEIZMANN INSTITUTE OF SCIENCE and Jon W. Dudas in his official capacity as Director of the U.S. Patent and Trademark Office, Defendants.

467 F.Supp.2d 579

ENZO THERAPEUTICS, INC., Plaintiff, v. YEDA RESEARCH AND DEVELOPMENT CO. OF THE WEIZMANN INSTITUTE OF SCIENCE and Jon W. Dudas in his official capacity as Director of the U.S. Patent and Trademark Office, Defendants.

Civil Action No. 2:06cv377.

United States District Court, E.D. Virginia, Norfolk Division.

December 6, 2006.

Thomas Jefferson Scott, Jr., Hunton & Williams LLP, Washington, DC, for Plaintiff.

Alexander Edward Gasser, Frank Jonah West, Kenneth David Wilcox, Oblon Spivak McClelland Maier & Neustadt PC, Alexandria, VA, Beth Susanne Vanderzee McMahon, Stephen Edward Noona, Kaufman & Canoles PC, George M. Kelley, III, United States Attorney's Office, Norfolk, VA, Bruce Jefferson Boggs, Jr., Erin Marie Dunston, Bingham McCutchen LLP, Roger Lowen Browdy, Ronni Sue Jillions, Browdy and Neimark PLLC, Washington, DC, Charles L. Gholz, Oblon Spivak Mccclelland Maier & Neust, Arlington, VA, for Defendants.

OPINION AND ORDER

DOUMAR, District Judge.

Presently before the Court is a motion by Defendant Jon W. Dudas, in his capacity as Director of the United States Patent and Trademark Office (the "Director"), to dismiss claims filed against him on July 3, 2006, by Plaintiff Enzo Therapeutics, Inc. ("Enzo"). The underlying lawsuit, filed pursuant to 35 U.S.C. § 146, asserts four claims against the Director and Yeda Research and Development Company ("Yeda") that emerged from an interference proceeding (the "Interference") conducted by the Board of Patent Appeals and Interference (the "Board"). Count I alleges that the Board abused its discretion by deciding a petition for which it lacks jurisdiction, and that, consequently, Enzo is entitled to have the Interference decision withdrawn and the question of priority reexamined by this Court. Count II alleges that the Board's Interference decision and factual determinations are unsupported by substantial evidence, and that new findings on the question of priority are warranted on appeal. Count III alleges the Director violated the Administrative Procedure Act, 5 U.S.C. § 706, by acting with unreasonable delay in failing to resolve a petition filed by Enzo on April 12, 2006, appealing the Board's Interference decision. Finally, Count IV prays for a writ of mandamus to compel the Director to decide the same April 12, 2006, petition. The Director seeks dismissal of Enzo's Complaint for lack of subject matter jurisdiction, pursuant to Federal Rule of Civil Procedure 12(b)(1), and for failure to state a claim upon which relief can be granted, pursuant to Rule 12(b)(6).

For the reasons stated herein, the Court GRANTS the motion to dismiss Counts I and II as to the Director, and GRANTS the motion to dismiss Counts III and IV in their entirety.

I. FACTUAL AND PROCEDURAL BACKGROUND

A. Factual Allegations

Like many claims that arise out of federal administrative hearings, the facts in this case are grounded in a labyrinth of administrative procedure. The United States Patent and Trademark Office ("USPTO") primarily conducts two types of patent proceedings. The majority are ex parte examinations of patent applications involving a single applicant, and conducted by a patent examiner who interfaces with the applicant during the application process. An applicant dissatisfied with the patent examiner's decision may appeal to the Board. If the applicant remains dissatisfied following the Board's review, another appeal may be made by filing a civil action in the United States Court of Appeals for the Federal Circuit, 35 U.S.C. § 145 (2006), or in the United States District Court for the District of Columbia, 35 U.S.C. § 145 (2006). In such judicial actions, the Director is a necessary party to defend the Board's decision in, court. Id.

The second type of patent proceeding occurs when the USPTO believes two or more parties have invented the same invention at or about the same time. Such an inter partes proceeding is heard before the Board and intended to resolve the question of priority. Because patents are typically issued on the basis of who created the patent first in time, the resolution of such a hearing is of critical importance to the parties. See Alexander Milburn Co. v. Davis-Bournonville Co., 270 U.S. 390, 400, 46 S.Ct. 324, 325, 70 L.Ed. 651 (1926) ("[O]ne really must be the first inventor in order to, be entitled to a patent."). A dissatisfied party to an interference may either appeal the Board's decision to the Court of Appeals for the Federal Circuit, 35 U.S.C. § 141 (2006), or file a civil action in any federal district court in which venue is proper, 35 U.S.C. § 146 (2006).

The events leading to the Interference, and this § 146 appeal, began on April 17, 1981, when Enzo filed U.S. Patent Application Serial No. 06/255,215 ("the '215 application") naming Pravinkumer B. Sehgal as the inventor.¹ Over one year thereafter, on September 28, 1982, Yeda filed U.S. Patent Application Serial No. 06/425,933 ("the '933 application"), naming Michel Revel, et al., as inventors. On January 27, 1984, the USPTO issued a Final Office Action rejecting the pending claims of Enzo's '215 application, and granted Enzo three months to respond. Enzo admittedly failed to respond to the Board during this time, and the USPTO abandoned Enzo's '215 application on April 30, 1984. Nearly three months after such abandonment, on July 27, 1984, Enzo filed a continuation application, U.S. Patent Application Serial No. 06/634,998 ("the '998 application"). For a number of years thereafter, Enzo filed the following additional applications to the USPTO to create a "chain" of patent applications: U.S. Patent Application Serial No. 07/191,517 on May 6, 1988; 07/869,073 on April 10, 1992; 08/300,872 on June 16, 1994; and, finally, 08/479,996 ("the '996 application") on June 7, 1995. Notwithstanding this chain of applications, the Board granted Yeda's '933 application on November 25, 2005, and issued to Yeda U.S. Patent No. 5,468,609 ("the '609 patent")"

By Enzo's request, the Board declared the Interference between Enzo's '996 application and Yeda's '609 patent on March 15, 2005, in which Enzo claimed a priority date of April 17, 1981, via the series of applications it had filed with the Board culminating in the '996 application of June 7, 1995. On April 29, 2005, Yeda moved for the Board to deny Enzo's '996 application the benefit of the '215 application for lack of codependency between the two filings. Yeda contended that Enzo's failure to respond to the USPTO's Final Office Action in 1984 caused the '215 application to be abandoned on April 30, 1984, thereby breaking the supposed chain of continuity. As such, the appropriate date establishing Enzo's priority should have been the date of the initial application after the 1984 abandonment, the '998 application, filed on July 27, 1984. The Board accepted Yeda's argument and redeclared the Interference on May 18, 2005, without according Enzo the benefit of the '215 application filing date.

On July 1, 2005, Enzo filed a motion pursuant to 37 C.F.R. § 41.121(a)(1) asking the Board to revive the '215 application and to accord Enzo the benefit of the April 17, 1981, filing date on the basis that abandonment in 1984 was unintentional ("Motion for Benefit"). The Motion for Benefit contained an additional petition, styled Petition under 37 C.F.R. § 1.137(b) for Revival of an Application for Patent Abandoned Unintentionally ("Petition to Revive"), wherein Enzo petitioned for revival of the '215 application based on unintentional abandonment. Enzo's purpose in filing both the Motion for Benefit and Petition to Revive was to establish codependency between the '215 application and the '998 application, and therefore obtain a priority date of April 17, 1981. The relevant law governing such revivals, 37 C.F.R. § 1.137(b), permits an applicant to file a petition "to revive an abandoned application" if the delay was "unintentional." Moreover, a "grantable petition" pursuant to that provision must also contain: (1) the required reply unless previously filed, (2) the petition fee, (3) a statement that the entire delay in filing the required reply was unintentional, and (4) a terminal disclaimer. 37 C.F.R. § 1.137(b). Enzo's Petition to Revive allegedly contained the first three requisite elements, as well as a petition to waive the requirement of a terminal disclaimer.

On August 2, 2005, the Board denied Enzo's Motion for Benefit. This decision by the Board represents the crux of Enzo's underlying claims against the Director. On August 16, 2005, Enzo requested a rehearing of the Motion for Benefit ("Request for Rehearing"), pursuant to 37 C.F.R. § 41.125(c), and filed a petition requesting the Chief Administrative Judge to instruct the Board to withdraw its denial of Enzo's Motion for Benefit ("Petition to CAJ"), pursuant to 37 C.F.R. § 41.3. Both the Request for Rehearing and the Petition to CAJ rested on Enzo's assertion that the Board lacks jurisdiction to decide the Petition to Revive, which is vested in the Office of the Deputy Commissioner for Patent Examination Policy ("Deputy Commissioner"), a different entity within the USPTO. Enzo further argued that the Board's disposition of the Motion for Benefit was premature without first obtaining the Deputy Commissioner's decision regarding the Petition to Revive.

On December 21, 2005, the Board informed Enzo that it would not change its decision denying the Motion for Benefit, and explained that it had only decided the Motion for Benefit — which related to priority and was therefore within the Board's jurisdiction — and not the Petition to Revive — which Enzo had inappropriately filed as an exhibit to the Motion for Benefit. Additionally, the Board dismissed Enzo's Petition to CAJ on the grounds that such a petition was not authorized by the rules governing interference proceedings. In brief, the Board argued that because Enzo's Motion for Benefit raised a question of priority, and because...