REGENTS OF THE UNIV. OF MINN. v. LSI CORPORATION

Before Dyk, Wallach, and Hughes. Appeal from the Patent Trial and Appeal Board.

Summary: State sovereign immunity does not apply to IPR proceedings asserted against patents owned by or assigned to states, regardless of whether the state has asserted the patent claims in a district court litigation.

The Regents of the University of Minnesota (“UMN”), an arm of the state of Minnesota, sued LSI Corp. and customers of Ericsson Inc. in district court for infringement of a number of patents. In turn, LSI and Ericsson separately petitioned for IPR against UMN’s patents. UMN filed a motion to dismiss the petitions based on state sovereign immunity. An expanded panel at the PTAB concluded that although state sovereign immunity applies to IPR proceedings, UMN waived its immunity by filing the district court suit. A concurring opinion concluded that state sovereign immunity was not implicated because IPR proceedings are in rem proceedings.

The Federal Circuit agreed that the IPR against UMN’s patents could continue, but held that state sovereign immunity does not apply to IPR proceedings. The Federal Circuit found that because IPR proceedings are more similar to agency enforcement actions than civil litigation, are an adjudication of a public right, are not barred by tribal sovereign immunity, and because state and tribal sovereign immunity do not materially differ with regard to IPR proceedings, state sovereign immunity also does not apply to IPR proceedings. The Federal Circuit did not address the issue of whether, if state sovereign immunity were to apply to IPR proceedings, UMN waived its immunity by asserting patent claims in district court.

Separate from the opinion, judges Dyk, Wallach, and Hughes also provided their additional views on the matter, arguing that “state sovereign immunity also does not apply to IPR proceedings because they are in substance the type of in rem proceedings to which state sovereign immunity does not apply.”