December 17, 2013
LES Insights
Authored by R. Benjamin Cassady, D. Brian Kacedon, John C. Paul
A party facing an adverse decision by a U.S. district court may often want the ability to seek immediate review of that decision by an appellate court. This is particularly so where the decision is so significant that it can potentially dictate the results of the case, such as a claim construction decision, or affects which court will hear a case, such as a decision on a motion to transfer venue to another court. But as demonstrated by four recent orders of the Federal Circuit, the U.S. appellate courts have limited jurisdiction and not every adverse decision is immediately appealable.
In two of these cases, the Federal Circuit dismissed the appeals for lack of jurisdiction because the district courts had yet to enter a final judgment. In two other nonprecedential orders, the court denied petitioners' requests for mandamus relief affirming that "[m]andamus is a drastic remedy, to be invoked only in 'extraordinary situations.'"
Momenta appealed the district courts' findings of summary judgment of noninfringement in two separate cases.1 In both corresponding orders, the Federal Circuit dismissed Momenta's appeals for lack of jurisdiction because the district courts had yet to rule on Momenta's motion for contempt and sanctions. Because no final judgment had issued in the district court cases, the Federal Circuit found Momenta's appeals premature.
In In re ICM Inc.,2 the Federal Circuit denied ICM's petition for mandamus to vacate statements by the United States District Court for the Southern District of Indiana in an order relating to a potential transfer of venue at the conclusion of a multidistrict-litigation proceeding. Specifically, ICM wanted to strike the court's statements that "ICM Inc.'s declaratory judgment claims in Count II are properly pled and the transferor court will retain jurisdiction over them on remand; however, it is in the interests of justice to transfer this proceeding to the Southern District of New York after the Multidistrict Litigation proceedings."
To obtain mandamus relief, a party must satisfy three conditions: "(1) the party seeking issuance must have no other adequate means to attain the desired relief; (2) [the] petition[er] must establish that he or she has a 'clear and indisputable' right to relief; and (3) 'the issuing court, in the exercise of its discretion, must be satisfied that the writ is appropriate under the circumstances.'" Concluding that ICM's petition did not satisfy this test, the Federal Circuit denied the mandamus petition, reasoning that (1) ICM would be able to challenge any request for transfer on remand, and (2) the district court's statements amounted to little more than a recommendation as it had not actually transferred the case.
In In re Foundations Worldwide, Inc.,3 the Federal Circuit denied Foundations' petition for mandamus to vacate the United States District Court for the Central District of California's order denying Foundations' motion to transfer or dismiss the case. In 2009, Foundations and Coverplay, a competitor in the child-care-products industry, met to discuss the possibility of Foundations' purchasing Coverplay or licensing its products. Years later, Coverplay suspected that Foundations was using information gleaned from the meeting to infringe Coverplay's patents and, in a cease-and-desist letter, threatened to sue. Foundations requested that Coverplay wait to file suit and, in the interim, surreptitiously filed a declaratory-judgment action in the Northern District of Ohio. Coverplay immediately filed the California infringement action, and Foundations' motion to transfer or dismiss followed.
After the district court denied its motion to transfer or dismiss, Foundations petitioned for a writ of mandamus, arguing that the district court erred in failing to apply the "first-to-file" rule, which permits a district court to decline jurisdiction or transfer an action when a complaint involving the same parties and issues has already been filed in another district. The Federal Circuit determined that Foundations' petition did not satisfy the three-part test and concluded that the district court did not abuse its discretion in declining to apply the "first-to-file" rule. Affirming the high bar for granting petitions for mandamus, the court stated that only "[o]n 'rare instances,' [can] an appellate court [] override the trial court's decision not to transfer."
As these decisions show, despite procedures, such as mandamus, that allow interim review, the Federal Circuit has limited jurisdiction, and in most cases, the court will hear only appeals of final judgments. As evidenced by the Momenta orders, "final judgment" means that there no outstanding issues yet to be decided by the district courts. So while in limited circumstances, an aggrieved party may petition for a writ of mandamus asking the court to review an interlocutory decision by a district court, the bar for the court to hear such an appeal is high.
1 Momenta Pharms., Inc. v. Teva Pharms., USA, Inc., Civ. A. 10-cv-12079 (D. Mass) and Momenta Pharms. v. Amphastar Pharms., Inc., Civ. A. 11-cv-11681 (D. Mass).The Momenta Pharmaceuticals decisions are available at http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-1579.Order.11-21-2013.1.PDF and at http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-1580.Order.11-21-2013.1.PDF.
2 The In Re ICM, Inc. decision is available at http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-152.Order.11-21-2013.1.PDF.
3 The In Re Foundations Worldwide, Inc. decision is available at http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-159.Order.11-21-2013.1.PDF.
Copyright © Finnegan, Henderson, Farabow, Garrett & Dunner, LLP. This article is for informational purposes, is not intended to constitute legal advice, and may be considered advertising under applicable state laws. This article is only the opinion of the authors and is not attributable to Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, or the firm's clients.
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