Regents of University of Michigan v. Novartis Pharmaceuticals Corporation

Background

The Regents of University of Michigan and other plaintiffs alleged that Novartis Pharmaceuticals Corporation’s Entresto product infringed claims 10, 11, 16, and 18 of expired U.S. Patent No. 10,633,344. The parties had engaged in discovery and completed claim-construction briefing, but no trial date had been set, no fact depositions had occurred, and discovery remained incomplete.

On August 28, 2023, Novartis filed two petitions for inter partes review, a proceeding in which the Patent Trial and Appeal Board reviews challenges to patent claims. One petition challenged claims 10, 11, and 18; the other challenged claim 16. Novartis then moved to stay the district-court case while those proceedings were pending. The court vacated the scheduled hearing and decided the motion based on the written submissions.

Legal standard

The court explained that federal courts have authority to manage their cases, including by staying a patent-infringement case while a related Patent Trial and Appeal Board proceeding is pending. Courts generally consider three factors: whether discovery is complete and a trial date has been set; whether the stay could simplify the issues; and whether the stay would unfairly harm or tactically disadvantage the party opposing it. The court also noted that courts in the district commonly favor stays pending inter partes review.

Court’s analysis

The first factor favored a stay because the case had not reached any substantive determination on the merits, no trial date had been set, and discovery was far from complete. The court stated that the parties’ progress on early patent-litigation requirements did not outweigh the substantial work that remained.

The second factor weighed slightly in favor of a stay. The Patent Trial and Appeal Board had not yet decided whether to begin either review, so the extent to which the proceedings would simplify the district-court case was uncertain. Even so, the court concluded that the possibility of streamlining the issues and avoiding inconsistent outcomes favored a stay.

The third factor also favored a stay. The patent had expired on May 11, 2023, so the Universities could seek only monetary damages for the alleged infringement. The court reasoned that a stay would not prevent them from eventually seeking that recovery. It also found that any additional risk of lost evidence or fading memories was minimal and that the Universities had not shown a clear tactical disadvantage. The court stated that whether Novartis’s filings were intended to gain a tactical advantage was not the relevant question; the question was whether the stay would disadvantage the Universities.

Disposition

The court granted Novartis’s motion to stay and ordered that the case be stayed pending inter partes review. The parties must file a joint case-management statement within seven days after any of the listed events, including an institution decision, a final written decision, a notice of appeal, expiration of the appeal period, or issuance of an appellate mandate. The statement must describe the Patent Trial and Appeal Board’s decision and the parties’ positions on whether the stay should continue.