"Suggestion" of Mootness or, alternatively, Motion for Remand in AMP v. USPTO

[Kevin E. Noonan]

MyriadOne of the interesting and unresolved issues in the Association for Molecular Pathology v. U.S. Patent and Trademark Office case ("Myriad") involves whether the Federal Circuit, or any U.S. court, has jurisdiction to hear the case.  This issue is based on the Federal Circuit's determination, in its now-vacated decision in the case, that only one plaintiff, Dr. Harry Ostrer, had standing to bring the lawsuit, coupled with Myriad's contention that the basis for jurisdiction was abolished when Dr. Ostrer changed his academic affiliation.  This issue was brought to the Court's attention two days before it handed down its now-vacated decision, and was not sufficient to induce the Federal Circuit to rehear the case either before the original panel or en banc.  After remand from the Supreme Court's decision granting certiorari and vacating the Federal Circuit's opinion for reconsideration in view of the Court's Mayo Collaborative Services v. Prometheus Labortories, Inc. decision, the Federal Circuit did not include this issue in the questions to be addressed by the parties or interested amici.

Today, Myriad filed a paper, entitled "Appellants' Suggestion of Mootness or in the Alternative Motion to Remand," that squarely brings the issue before the Federal Circuit.  After walking the Court through the procedural history of the case, Myriad's brief sets out the legal basis for its challenge.  The primary case is MedImmune, Inc. v. Genentech, Inc., wherein the Supreme Court held that for declaratory judgment jurisdiction, "the factual allegations 'must show that there is a substantial controversy, between parties have adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment,'" 549 U.S. 118, 127 (2007), citing Md. Cas. Co. v. P. Coal & Oil Co., 312 U.S. 270. 273 (1941).  Myriad cites Federal Circuit precedent following this decision, including SanDisk Corp. v. STMicroelecs. Inc., 480 F.3d 1372, 1380 (Fed. Cir. 2007) (requiring that "a patentee asserts rights under a patent based on certain identified ongoing or planned activity of another party"); 3M Corp. v. Avery Dennison Corp., 673 F.3d 1372, 1377 (Fed. Cir. 2012) ("[T]o establish an injury in fact traceable to the patentee a declaratory judgment plantiff must allege an affirmative act by the patentee relating to the enforcement of his patent rights"); and Prasco, LLC v. Medicis Pharm. Corp., 537 F.3d 1329, 1338 (Fed. Cir. 2008) (wherein standing is assessed by determing "whether there is '(1) an injury-in-fact, i.e. a harm that is 'concrete' or actual and imminent, not 'conjectural' or 'hypothetical,' (2) that is 'fairly traceable' to the defendant's conduct and (3) is redressible by a favorable decision").  In this case, Myriad reminds the Court that it required that declaratory judgment jurisdiction depended upon "affirmative acts" that were "directed at specific Plaintiffs."

The brief also cites Supreme Court and Federal Circuit precedent to the effect that the requirement for standing "apply at every stage of the case."  These include Lewis v. Cont'l. Bank Corp, 494 U.S. 72, 477-78 (1990) ("[I]t is not enough that a dispute was very much alive when the suit was filed, or when review was obtained by the Court of Appeals."); Dow Jones & Co. v. Ablaise Ltd., 606 F.3d 1338, 1345 (Fed. Cir. 2010) ("plaintiff bears the burden of proving the existence of [] a controversy throughout the litigation"); and Benitec Australia Ltd. v. Nucleonics, Inc., 495 F.3d 1340, 1344 (Fed. Cir. 2007) ("the burden is on the party claiming declaratory judgment jurisdiction to establish that such jurisdiction existed at the time the claim for declaratory relief was filed and that it has continued since").

Moreover, Myriad argues that the Court must dismiss the claim as moot if "a sufficiently real and immediate controversy does not remain throughout the pendency of the appeal," citing Nasatka v. Delta Sci. Corp., 58 F.3d 1578, 1580 (Fed. Cir. 1995), and in addition, that the district court decision should be mooted where the appeal is mooted "by the unilaterial act of the party that prevailed before the district court," citing U.S. Bancorp Mortgage Co. v. Bonner Mall P'ship, 513 U.S. 18, 23 (1994), and Tafas v. Kappos, 586 F.3d 1369 (Fed. Cir. 2009) (en banc).

Ostrer, HarryUnder the present circumstances, Myriad asserts, this case is moot; those circumstances, of course, referring to the changed circumstances of the sole plaintiff, Dr. Harry Ostrer (at left), found in the Federal Circuit's now-vacated decision to have had standing to bring the suit (see "Association for Molecular Pathology v. United States Patent and Trademark Office (Fed. Cir. 2011)").  As Myriad alleged in a letter filed with the Court two days before that now-vacated decision was handed down, Dr. Ostrer left New York University Medical Center to take a position at Albert Einstein College of Medicine and Montefiore Hospital (see "Myriad Writes to Federal Circuit on Standing Issue").  As Myriad points out, the Federal Circuit's determination that Dr. Ostrer had standing was based on the "affirmative act" by Myriad of offering a license to NYU in 1998 (with the implied threat of patent infringement litigation should NYU refuse the license and continue to offer BRCA genetic testing).  Myriad argues that the controversy upon which the Court based its jurisdictional decision was not personal to Dr. Ostrer but "derived from his position at NYU, and the facilities and past practices there."  Evidence in support of this assertion proffered in Myriad's brief is that the 1998 letter was sent to Dr. Ostrer not personally but "in his professional capacity as Director of NYU's Molecular Genetics Laboratory" (an assertion supported by a declaration of Richard Marsh, Vice President at Myriad responsible for implementing its licensing practices).  The brief cites portions of that letter indicating that Myriad was offering a license to NYU, not to Dr. Ostrer.  And the brief cites the language of the now-vacated Federal Circuit opinion that the controversy was "sufficiently real and immediate" because "the relevant circumstances remain[ed] unchanged" from when Myriad had "affirmatively acted" in 1998 by offering the license to NYU.

Now, of course, Myriad contends that the relevant circumstances "have changed" (emphasis in original) because Dr. Ostrer has left NYU.  The brief emphasizes that Dr. Ostrer changed these circumstances "voluntarily" and "unilaterally" "chang[ing] all the relevant facts and circumstances that led [the Federal Circuit] to conclude that he alone had a justiciable controversy with Myriad."  In addition, Myriad argues that it has no dispute with Dr. Ostrer's current employer, Montefiore, and states that it "has no knowledge of any past or present activities at Montefiore that could possibly give rise to a patent controversy," again relying on Mr. Marsh's declaration.  This argument was reiterated by Myriad with regard to the absence of any evidence that Dr. Ostrer had ever been offered a personal license, i.e., one that could have traveled with him from NYU to Montefiore.  The absence of such evidence makes sense, according to Myriad, because "Dr. Ostrer did not own the clinical diagnostic laboratory; NYU did.  Dr. Ostrer did not employ the individuals who operate the clinical diagnostic laboratory; NYU did.  Dr. Oster did not hold the required licenses or permits to conduct clinical diagnostic testing; NYU did."  Because Myriad's alleged affirmative act that supported jurisdiction was directed at NYU and not Dr. Ostrer, his change of position to Montefiore thus removes the controversy, Myriad argues.  Citing City of Los Angeles v. Lyons, 461 U.S. 95, 107 n.8 (1983), Myriad states that "[i]it is the reality of the threat of . . . injury that is relevant to the standing inquiry, not the plaintiff's subjective apprehensions."  Thus, Myriad argues, the absence of any affirmative act directed towards Montefiore renders irrelevant any continued apprehensions Dr. Ostrer alleges (in a declaration submitted after this issue was raised by Myriad).  Dr. Ostrer's "readiness" to perform BRCA testing is thus not enough to support jurisdiction, according to the brief, because there is no controversy between Myriad and Montefiore and no evidence that Montefiore has ever acted "in any way [that would] interfere with Myriad's rights under the patents at issue in this litigation."

Importantly to the jurisdictional issue, Myriad contends that there are no other plaintiffs that could step into Dr. Ostrer's shoes: seventeen of the other plaintiffs were found to never have had any communications from Myriad, and the remaining two doctors (Drs. Ganguly and Kazazian) "alleged no intent 'to actually and immediately engage in allegedly infringing BRCA-related activities'" and thus could not allege any "sufficiently real and immediate controversy."  Indeed, Myriad asserts that Dr. Ostrer "now finds himself identically situated to the seventeen plaintiffs with which Myriad has had no contact whatsoever, and who thus had no standing to seek a declaratory judgment against Myriad," citing the Federal Circuit's now-vacated opinion.  The affirmative acts sufficient to support declaratory judgment jurisdiction are required to be "directed at specific Plaintiffs" Myriad contends, citing SanDisk and Prasco, and acts directed towards NYU are not directed towards Montefiore.  "In the absence of a licensing inquiry from Myriad, Montefiore's Dr. Ostrer, like hundreds of other doctors in hundreds of other laboratories around the United States, all with the equipment, capability, and desire to perform genetic sequencing, lacks any real controversy with Myriad requiring an immediate resolution," Myriad argues, and any forbearance on Dr. Ostrer's part in performing BRCA testing is "a unilaterally self-imposed harm" that cannot sustain standing.

Interestingly, the brief also cites the Court's recent (May 21st) grant of certiorari (in light of an opinion from the Solicitor General urging that certiorari be granted) in a case much like this one, where the ACLU recruited "an assortment of organizational and [other] plaintiffs" who alleged "only self-imposed injury and not any action directed at them by the defendant."  Amnesty Int'l. USA v. Clapper, 638 F.3d 118 (2d. Cir 2011), cert granted, Clapper v. Amnesty Int'l. USA, 566 U.S. __ (May 21, 2012) (No. 11-1025).  Myriad (in yet another footnote) cited the Clapper case in that "self-inflicted harm does not satisfy the basic requirements for standing" because, inter alia, even if it amounted to an Article III recognized injury it "would not fairly be traceable to defendant's challenged conduct."  In this regard, Myriad asserts that "multiple other laboratories are conducting BRCA clinical diagnostic testing today without a license from Myriad, directing the Court's attention to the Genetic Testing Registry.

Myriad's brief also seeks vacatur of the District Court's decision, based on Dr. Ostrer's "unilateral action" in destroying the basis for declaratory judgment jurisdiction, citing U.S. Bancorp ("vacatur must be granted where mootness results from the unilateral action of the party who prevailed in the lower court") and Tafas.

In a footnote, Myriad raises the underlying point:  that the Federal Circuit does not have the "authority to reconsider its merits rulings in light of Mayo v. Prometheus, citing Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986), for the proposition that "'every federal appellate court has a special obligation to' ensure that it has jurisdiction before proceeding to the merits of the case."

In the alternative, Myriad argues that, "[a]t the very least," the Federal Circuit should remand the case to the District Court to hear the jurisdictional arguments and give the parties the opportunity to "adjudicate the jurisdictional effect of Dr. Ostrer's departure from NYU and his new position at Montefiore."  This argument is based on Myriad's lack of opportunity to "test these and other averments in Dr. Ostrer's new declaration," specifically averments that testing (at Montefiore) would take place "immediately" upon a judgment against Myriad.  Myriad cited the requirements for licensure, either under CLIA or New York State regulations, as well as the absence of evidence that Montefiore intends to permit Dr. Ostrer to perform such testing.  In this regard the brief cites Dr. Ostrer's declaration testimony that "he will be Director of 'Genetic and Genomic Diagnostics at Montefiore Medical Center'" against the reality that "[a]lmost a year later, a review of the websites for Montefiore fails to show any evidence that such a diagnostic entity exists."  Myriad's brief also points out that Montefiore indeed has a molecular diagnostic laboratory, "directed by Dr. Qiuliu Pan, that performs genetic testing."  But there is no evidence that Dr. Ostrer "is involved in or plans to direct any BRCA clinical genetic testing" at Montefiore or that Montefiore will permit him to do so.

Myriad also takes this opportunity to remind the Federal Circuit of an argument made in its reply brief and noted at oral argument, that there are (many) other claims in its patents that were not challenged by the ACLU and PubPat.  These claims are "also directed to BRCA clinical diagnostic testing" and "a declaratory judgment on the limited number of claims challenged by plaintiffs" would not be sufficient to provide a sufficient remedy to redress the alleged harms to the plaintiffs.  This (redressibility) is also "a required element to sustain declaratory-judgment jurisdiction" and its determination "has now become necessary due to Dr. Ostrer's new positions at Montefiore and" in "determining what BRCA clinical diagnostic testing he would there be allowed to undertake" according to Myriad's brief.

The brief closes with a "Statement of Consent or Opposition," stating that "Counsel for appellees has declined to consent, and indicated that a response will be filed."  Opening briefs and briefs by any amici remain due on June 15th.