Trials@uspto.gov
`Tel: 571-272-7822
`
`Paper 28
`Entered: May 23, 2017
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`NEOCHORD, INC.,
`Petitioner,
`
`v.
`
`UNIVERSITY OF MARYLAND, BALTIMORE and
`HARPOON MEDICAL, INC.,
`Patent Owner.
`
`Case IPR2016-00208
`Patent 7,635,386 B1
`
`Before SALLY C. MEDLEY, ERICA A. FRANKLIN, and
`JAMES A. WORTH, Administrative Patent Judges.
`
`
`
`
`
`
`
`
`
`WORTH, Administrative Patent Judge.
`
`ORDER
`Decision Granting Patent Owner’s Motion to Dismiss and
`Terminating Inter Partes Review
`37 C.F.R. §§ 42.71(a) and 42.72
`
`
`
`
`
`
`
`
`
`

`

`IPR2016-00208
`Patent 7,635,386 B1
`
`Patent Owner University of Maryland, Baltimore (“the University”)
`
`moves to terminate the inter partes review proceeding, stating that it
`possesses Eleventh Amendment immunity. Petitioner NeoChord, Inc.
`(“NeoChord”) opposes. For the reasons set forth below, we grant the
`University’s Motion to Dismiss based on Eleventh Amendment immunity
`and terminate the inter partes review.
`I. Procedural History
`On November 18, 2015, NeoChord filed a Petition (Paper 2, “Pet.”)
`requesting inter partes review of claims 1–23 of U.S. Patent No. 7,635,386
`B1 (Ex. 1001, “the ’386 patent”). The University did not file a Preliminary
`Response to the Petition but did file a mandatory notice pursuant to 37
`C.F.R. § 42.8, representing that it is the Patent Owner and a real party-in-
`interest. Paper 5, 2. In the Mandatory Notice, the University explained that
`Harpoon Medical, Inc. (“Harpoon Medical”) is the exclusive licensee of the
`’386 patent and is also a real party-in-interest. Id.1
`On May 24, 2016, the Board instituted an inter partes review on
`certain of the asserted grounds of unpatentability and issued a Scheduling
`Order. Paper 6; Paper 7. On September 12, 2016, the University filed a
`Response to the Petition (Paper 11), and on November 28, 2016, NeoChord
`filed a Reply. Paper 12.
`On January 31, 2017, oral argument was heard on the merits of the
`instituted grounds pursuant to the Scheduling Order for the proceeding. See
`Paper 27. The day prior to the hearing, the University contacted the Board
`
`
`1 Per their respective mandatory notices, the parties indicate that there is no
`other judicial or administrative matter that would affect, or be affected by, a
`decision in this proceeding. Pet. 2; Paper 5, 2.
`
`2
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`seeking authorization to file a motion to dismiss based on sovereign
`immunity. Because of the lack of written briefing on this issue, the panel
`informed the parties that a separate conference call would be held for the
`University to seek written briefing, pursuant to the Board’s requirements for
`prior authorization for motions. See 37 C.F.R. § 42.20(b). On February 7,
`2017, a conference call was held between Judges Medley, Franklin, and
`Worth and counsel for NeoChord and the University. A transcript of the call
`has been placed in the record as Paper 21. On February 15, 2017, the Board
`issued an Order authorizing the subject motion and setting a schedule for
`briefing.
`Pursuant to this schedule, on February 23, 2017, the University filed a
`Motion to Dismiss (Paper 24, “Mot.”). On March 2, 2017, NeoChord filed
`an Opposition to Patent Owner’s Motion to Dismiss (Paper 25, “Opp.”). On
`March 9, 2017, the University filed a Reply to Petitioner’s Opposition to
`Patent Owner’s Motion to Dismiss (Paper 26, “Mot. Reply”).
`The University moves to terminate, stating that it possesses Eleventh
`Amendment immunity pursuant to Maryland State law. Mot. 2–4 (citing
`MD Code Ann., Educ. §§ 12-102(a)(2)–(a)(4), 12-104(i)(4); Maryland
`Stadium Authority v. Ellerbe Becket Inc., 407 F.3d 255 (4th Cir. 2005)).2
`According to the University, it is entitled to assert sovereign immunity as a
`
`
`2 The University asserts that the only exception to its sovereign immunity
`under Maryland law is the Maryland Tort Claims Act (MD Code Ann., State
`Gov’t § 12-104), which, according to the University, does not create an
`exception to sovereign immunity in this proceeding. Mot. 4. NeoChord
`does not make any arguments with respect to the exception provided by the
`Maryland Tort Claims Act.
`
`3
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`IPR2016-00208
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`defense because it is an “arm of the State of Maryland,” and the ’386 patent
`is “property of the State.” Mot. 1.
`NeoChord opposes on several grounds. In particular, NeoChord
`contends that a prior panel of the Board in Covidien erred in finding that
`sovereign immunity was available as a defense before the Board, that the
`University has waived immunity through its participation in this proceeding,
`that the University has waived immunity through its licensing activity, and
`that the Board may proceed without the University. Opp. 2–13 (citing
`Covidien LP v. Univ. of Florida Research Foundation Inc., Case IPR2016-
`01274 (PTAB Jan. 25, 2017) (Paper 21)).3
`II. Whether a State May Assert Eleventh Amendment Immunity in this
`Inter Partes Review Proceeding
`The first issue that we address is whether a State’s assertion of
`sovereign immunity under the Eleventh Amendment is a cognizable defense
`in this inter partes review proceeding. NeoChord argues that a prior panel
`of the Board in the Covidien case erred in concluding that Eleventh
`Amendment immunity was available as a defense. Opp. 10–12. NeoChord
`also argues that Covidien was decided based on a different procedural
`posture and is not binding precedent on this panel. Opp. 9 (citing Chevron
`N. Am., Inc. v. Milwaukee Electric Tool Corp., IPR2015-00595, slip op. at 4
`(Paper 35) (Nov. 13, 2015)). We agree with NeoChord that the Covidien
`decision is not binding in this case. Our examination of the availability of
`Eleventh Amendment immunity is set forth below.
`
`3 NeoChord does not meaningfully contest the University’s assertion that it
`is an “arm of the State of Maryland” (see Opp. 1), and we determine that the
`University has adduced sufficient evidence that it is an arm of the State (see
`Mot. 1–4).
`
`4
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`IPR2016-00208
`Patent 7,635,386 B1
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`
`a. Background Law on Agency Proceedings and
`Application to this Inter Partes Review Proceeding
`In Federal Maritime Comm’n v. South Carolina State Ports Authority,
`535 U.S. 743, 751, 757–59 (2002) (hereinafter, “FMC”), the Supreme Court
`affirmed a ruling from the U.S. Court of Appeals for the Fourth Circuit,
`which stated that the agency proceeding “walks, talks, and squawks” like a
`court proceeding for purposes of the Eleventh Amendment analysis. The
`Supreme Court analyzed the procedures of the Federal Maritime
`Commission, and found that they resembled the procedures of a district
`court, including discovery and application of the Federal Rules of Civil
`Procedure. Id.
`In Vas-Cath, Inc. v. Curators of University of Missouri, 473 F.3d
`1376, 1382 (Fed. Cir. 2007) (hereinafter, “Vas-Cath”), the U.S. Court of
`Appeals for the Federal Circuit (“Federal Circuit”) applied FMC, explaining
`that agency proceedings may be treated like Court proceedings for Eleventh
`Amendment purposes, and indicated that interference proceedings before the
`Board of Patent Appeals and Interferences (our predecessor Board) were
`similar to district court proceedings in terms of discovery and procedure.
`See Vas-Cath, 473 F.3d at 1381. In Vas-Cath, the court ultimately found
`that the Curators of the University of Missouri had waived the Eleventh
`Amendment defense to an appeal from a district court review proceeding by
`affirmatively seeking the interference in the first instance. Nevertheless, we
`understand Vas-Cath’s explanation of FMC to provide guidance for the
`availability of the defense of sovereign immunity, i.e., when the State has
`not waived its defense by reason of litigation conduct. Indeed, the Vas-Cath
`court stated that:
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`IPR2016-00208
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`
`the Federal Maritime Commission,
`in
`Like proceedings
`contested interference proceedings in the PTO bear “strong
`similarities” to civil litigation, id. at 760, 122 S.Ct. 1864, and the
`administrative proceeding can indeed be characterized as a
`lawsuit. PTO interferences involve adverse parties, examination
`and cross-examination by deposition of witnesses, production of
`documentary evidence, findings by an
`impartial federal
`adjudicator, and power to implement the decision. See, e.g., 37
`C.F.R. § 1.651(a) (during an interference, “an administrative
`patent judge shall set a time for filing motions (§ 1.635), for
`additional discovery under § 1.687(c) and testimony period for
`taking any necessary testimony.”); § 1.671(a) (“Evidence [for an
`interference] consists of affidavits, transcripts of depositions,
`documents and things.”); § 1.671(b) (“[T]he Federal Rules of
`Evidence shall apply to interference proceedings” except
`“[t]hose portions of the Federal Rules of Evidence relating to
`criminal actions, juries, and other matters not relevant to
`interferences.”). The University invoked and participated in
`these proceedings with no claim of immunity.
`
`Vas-Cath, 473 F.3d at 1382. Thus, applying FMC, the Federal Circuit found
`that interference procedures of the Board were similar to district court
`procedures.
`The Vas-Cath court’s reliance on the Board’s interference procedures
`
`is instructive here as well because the Board’s inter partes rules bear
`resemblance to the Board’s interference procedures. Similar to an
`interference, an inter partes review typically involves adverse parties,
`examination of witnesses by motion for observation, cross-examination of
`witnesses by deposition, findings by an impartial federal adjudicator, and
`power to implement the decision, e.g., by cancellation of claims (with
`coordinate agency action). See, e.g., 35 U.S.C. § 6 (composition of the
`Board), § 311–18 (inter partes review); 37 C.F.R. § 42.51 (discovery),
`§ 42.52 (compelling testimony), § 42.53 (taking testimony). As with an
`
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`IPR2016-00208
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`interference, an administrative patent judge (APJ) in an inter partes review
`can set a time for filing motions and for additional discovery. See 37 C.F.R.
`§ 42.5 (conduct of the proceedings). As with an interference, evidence
`consists of affidavits (or declarations), transcripts of depositions and
`documents, and the Federal Rules of Evidence generally apply to inter
`partes review proceedings.4 See, e.g., id. § 42.62 (applicability of Federal
`Rules of Evidence). Accordingly, the same factors that led the Vas-Cath
`court to analogize interference proceedings to district court proceedings also
`exist when comparing the procedures of inter partes review proceedings to
`those of district court proceedings. Further, the Federal Circuit has held that
`inter partes review proceedings are subject to the formal procedures of the
`Administrative Procedure Act. See Dell Inc. v. Acceleron, LLC, 818 F.3d
`1293, 1301 (Fed. Cir. 2016) (“For a formal adjudication like the inter partes
`review considered here, the APA imposes particular requirements on the
`PTO.”).5 See generally 5 U.S.C. § 554 (impartial federal adjudicator with
`formal agency procedures).
`
`4 Portions of the Federal Rules of Evidence relating to, for example, criminal
`actions and juries are not relevant to inter partes review proceedings. Id.
`§ 42.62.
`5 We note for completeness, the Office has explained that there is not a one
`to one correspondence between inter partes review proceedings and district
`court litigation inasmuch as inter partes review proceedings are designed to
`allow for a lower cost to parties and a more rapid outcome. See Final Rule,
`Rules of Practice for Trials Before the Patent Trial and Appeal Board and
`Judicial Review of Patent Trial and Appeal Board Decisions, 77 Fed. Reg.
`48612, 48636 (Aug. 14, 2012) (Response to Comment 92). Nevertheless,
`the formal trial-type procedures of the Board, as recognized by the Federal
`Circuit in Dell, retain sufficient formality that renders Board proceedings
`similar to those of a district court for purposes of the Eleventh Amendment
`analysis. Significantly, the relevant test is not one of identity, but rather one
`
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`IPR2016-00208
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`
`b. NeoChord’s Arguments Regarding Cuozzo
`NeoChord argues that sovereign immunity is unavailable as a defense
`in inter partes review proceedings because, according to NeoChord, the
`Supreme Court in Cuozzo compared inter partes review proceedings to
`reexamination proceedings and distinguished inter partes review
`proceedings from district court proceedings. Opp. 10–12 (citing Cuozzo
`Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016)). The University replies
`that the Supreme Court’s statements in Cuozzo were made in the context of
`determining the claim construction standard for inter partes review
`proceedings. Mot. Reply 7–9.
`We agree with the University that the Supreme Court’s statements in
`Cuozzo cannot be taken out of the context of the claim construction standard.
`In Cuozzo, the Supreme Court was reviewing the PTO’s standard for claim
`construction in inter partes reviews and found that the Board promulgated
`its standard for claim construction pursuant to a valid exercise of
`rulemaking. 136 S. Ct. at 2142. To be sure, the Supreme Court in Cuozzo
`examined arguments that inter partes review proceedings are similar to
`district court proceedings before concluding that inter partes review
`proceedings serve a different purpose than judicial proceedings. Id. at 2143–
`44. We understand this latter point, i.e., that inter partes review proceedings
`serve a different purpose, to be critical to the holding of the Supreme Court
`in Cuozzo in determining that the Board’s claim construction standard,
`which differs from a district court’s claim construction standard for
`
`
`of similarity, between agency proceedings and district court proceedings, as
`the Courts have found in FMC and Vas-Cath. We conclude that the test is
`met here for similar reasons as in Vas-Cath.
`
`8
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`IPR2016-00208
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`unexpired patents, was reasonable under the second step of the Chevron
`analysis applied by the Court in Cuozzo. See id. at 2144 (citing, inter alia,
`Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S.
`837, 843 (1984) (“The upshot is, whether we look at statutory language
`alone, or that language in context of the statute’s purpose, we find an express
`delegation of rulemaking authority, a ‘gap’ that rules might fill, and
`‘ambiguity’ in respect to the boundaries of that gap. We consequently turn
`to the question whether the Patent Office’s regulation is a reasonable
`exercise of its rulemaking authority.”) (emphasis added) (citations omitted)).
`In other words, the Court in Cuozzo held that the different purpose of
`inter partes review proceedings made the differing claim construction
`standard reasonable, but the similarity of procedures is what is relevant for
`analyzing the applicability of the Eleventh Amendment under FMC.
`Therefore, we conclude that FMC remains the primary case law for
`analyzing the availability of the Eleventh Amendment, e.g., as applied by
`Vas-Cath to the Board, and that the statements in Cuozzo relied on by
`NeoChord were not intended to be taken outside of the context from which
`they arose.
`
`
`c. Whether Congress Abrogated Eleventh Amendment Immunity in the
`Patent Act
`
`
`
`Congress may abrogate sovereign immunity when certain conditions
`are met, when acting under Section 5 of the Fourteenth Amendment, the
`Spending Clause Power of Article I, or the Compact Clause of Article I. See
`College Savings Bank v. Florida Prepaid Postsecondary Educ. Expense Bd.,
`527 U.S. 666, 672–87 (1999). When acting under Section 5 of the
`
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`
`Fourteenth Amendment, Congress must be acting to remedy a pervasive
`pattern of deprivation by the States. Id. at 672. When acting pursuant to its
`Spending Clause Power of Article I, Congress may condition the grant of
`funds on a waiver and States must clearly waive Eleventh Amendment
`immunity, e.g., in exchange for a gratuity. Id. at 678, 680, 686–87. When
`acting pursuant to the Compact Clause, Congress may condition approval of
`an interstate compact on a waiver of sovereign immunity. Id.
`NeoChord argues that Congress abrogated sovereign immunity in the
`second sentence of 35 U.S.C. § 271(h) addressing infringement of a patent.6
`Opp. 13–15. NeoChord contends that the Supreme Court in Florida Prepaid
`only analyzed the first sentence of 271(h) but not the second sentence. Opp.
`14 (discussing Florida Prepaid Postsecondary Educ. Expense Bd. v. Coll.
`Sav. Bank, 527 U.S. 627 (1999)). We do not agree with this reading of
`Florida Prepaid. See 527 U.S. at 632. In any event, even if this were true,
`the Supreme Court’s reasoning is equally applicable to both sentences of
`271(h). In Florida Prepaid, the Court understood that Congress intended to
`abrogate States’ Eleventh Amendment immunity but held that Congress
`lacked the authority to do so under Section 5 of the Fourteenth Amendment,
`
`
`6 Section 271(h) of Title 35 U.S.C. states as follows:
`(h) As used in this section, the term “whoever” includes any
`State, any instrumentality of a State, and any officer or employee
`of a State or instrumentality of a State acting in his official
`capacity. Any State, and any such instrumentality, officer, or
`employee, shall be subject to the provisions of this title in the
`same manner and to the same extent as any nongovernmental
`entity.
`35 U.S.C. § 271(h).
`
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`IPR2016-00208
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`i.e., because there was no pervasive pattern of abuse by the States. As such,
`NeoChord’s argument does not overcome or distinguish Florida Prepaid.
`Indeed, in Vas-Cath, the Federal Circuit indicated that participation in the
`Patent System does not create a waiver for purposes of infringement. See
`Vas-Cath, 473 F.3d at 1381. See also Mot. Reply 9–10 (citing Florida
`Prepaid, 527 U.S. at 635–48).
`NeoChord does not appear to have argued that the State waived
`Eleventh Immunity by market participation or by accepting a gratuity.
`Moreover, we note that in College Savings, the Supreme Court overturned
`Parden v. Terminal Ry. of Ala. Docks Dept., 377 U.S. 184 (1964), and held
`that market participation does not constitute a constructive waiver. College
`Savings, 527 U.S. at 681, 684. In College Savings, the Court held that
`participation in a federal program does not in itself create a waiver of
`sovereign immunity, and indicated that a State would typically only waive
`immunity (by constructive waiver) when accepting a gratuity from Congress
`such as federal funds or in engaging in interstate compacts under the
`Compact Clause. 527 U.S. at 687 (“In the present case, however, what
`Congress threatens if the State refuses to agree to its condition is not the
`denial of a gift or gratuity, but a sanction: exclusion of the State from
`otherwise permissible activity.”).
`Indeed, in Xechem, the Federal Circuit explained that the grant of a
`patent does not constitute a predicate for application of a “gratuity doctrine”
`waiver because a patent is not a gratuity, i.e., the quid pro quo for receiving
`a patent is an invention. See Xechem Int’l., Inc. v. Univ. of Tex. M.D.
`Anderson Cancer Ctr., 382 F.3d 1324, 1331 (2004).
`
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`
`Therefore, following Florida Prepaid, College Savings, Vas-Cath,
`and Xechem, we conclude that Congress has not abrogated Eleventh
`Amendment immunity with respect to this inter partes review proceeding,
`under Section 5 of the Fourteenth Amendment or under Article I of the
`Constitution. Nor has the State of Maryland expressed an intent to waive
`Eleventh Amendment immunity.
`
`d. Whether this Proceeding May Be Likened to a Bankruptcy Proceeding
`for Which Sovereign Immunity Does Not Apply
`
`
`
`NeoChord argues that this proceeding may be likened to a bankruptcy
`proceeding, which is in rem. Opp. at 12–13 (citing Tennessee Student
`Assistance Corp. v. Hood, 541 U.S. 440 (2004); Central Virginia Cmty.
`College v. Katz, 546 U.S. 356 (2006)). In Hood, the Supreme Court held a
`bankruptcy court was free to discharge a petition for bankruptcy without a
`State’s participation. Hood, 541 U.S. at 448 (“At least when the bankruptcy
`court’s jurisdiction over the res is unquestioned, our cases indicate that the
`exercise of its in rem jurisdiction to discharge the debt does not infringe state
`sovereignty.” (citations omitted)). The Court reasoned, inter alia, that
`bankruptcy proceedings are in rem. See id. at 450–51.
`NeoChord argues that bankruptcy proceedings do not apply sovereign
`immunity because, in addition to being in rem, they rely on rights
`exclusively granted to the federal government under the Constitution
`conferred under Article I, Section 4 of the Constitution Opp. at 13 (citing
`Katz, 546 U.S. at 370–71). NeoChord argues that patent law similarly
`administers powers exclusively granted to the federal government under
`Article I, Section 8 of the Constitution to create uniform laws and therefore
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`that the Patent Office does not apply sovereign immunity. Id. The
`University replies that the Federal Circuit has rejected this very argument in
`Biomedical Patent Management Corp. v. California, Department of Health
`Services, 505 F.3d 1328 (Fed. Cir. 2007), holding that Katz had not
`implicitly overruled Florida Prepaid. Mot. Reply 9–10.
`We agree with the University that NeoChord’s analogy to bankruptcy
`law is without merit. As the Federal Circuit observed in Biomedical Patent
`Management Corp., the discussion in Katz regarding the constitutional basis
`for bankruptcy law was provided in the context of a larger historical
`examination of the bankruptcy laws, in which the Court explained that there
`is a unique historical tradition of the courts exercising bankruptcy
`jurisdiction to which the States acquiesced. 505 F.3d at 1343. NeoChord
`has not presented a similar historical tradition for the patent laws, nor has
`NeoChord demonstrated that application of Eleventh Amendment immunity,
`which is also constitutional in origin, would frustrate development of a
`uniform law for the patent system. Rather, the Supreme Court has merely
`required, e.g., in Florida Prepaid, that the State act as complainant in order
`to enter the patent system for adjudication.
`
`III. Whether the University Has Waived Its Defense By Reason of
`Participation in this Proceeding
`
`The next issue that we consider is whether the University has waived
`
`its defense of sovereign immunity through participation in this proceeding,
`as argued by NeoChord. NeoChord argues that the University waived any
`defense of sovereign immunity by “participating in [the inter partes review
`proceeding] up until the Oral Hearing without a single mention of sovereign
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`immunity.” Opp. 5. In support of its position, NeoChord relies on Hill v.
`Blind Industries and Services of Maryland, 179 F.3d 754 (9th Cir. 1999).
`Opp. 3–4. In Hill, the U.S. Court of Appeals for the Ninth Circuit held that
`the Blind Industries and Services of Maryland (BISM) had waived its
`immunity by failing to raise the defense of immunity until the first day of
`trial. 179 F.3d at 757, 763. The court reasoned, inter alia, that the State
`delayed for tactical purposes such that it had the ability not to pursue the
`defense if the State liked the direction in which the court would rule on the
`merits. Id. at 757. Further, the Hill court amended its opinion, on denial of
`rehearing, to add a footnote explaining that BISM had failed to argue that
`State law precluded waiver of sovereign immunity. Hill v. Blind Industries
`and Services of Maryland, 201 F.3d 1186 (9th Cir. 1999) (Order denying
`reh’g and amending opinion).
`The University replies that the Federal Circuit has never followed
`Hill. Mot. Reply 4. The University further cites Florida Dep’t of State v.
`Treasure Salvors, Inc., 458 U.S. 670, 683 n.18 (1982), which explains that
`the Eleventh Amendment defense is in the nature of a jurisdictional bar that
`may be raised at any time. Mot. Reply 4. Here, we understand the Supreme
`Court’s holding in Treasure Salvors to stand for the proposition that there is
`no time limit on asserting the Eleventh Amendment defense.
`In general, mere participation in judicial proceedings does not create a
`waiver unless the State has taken affirmative steps to invoke federal
`jurisdiction, such as filing suit as a plaintiff or seeking removal of a
`proceeding to federal court. See Lapides v. Bd. of Regents of Univ. Sys. of
`Ga., 535 U.S. 613, 619–20 (2002); see also Vas-Cath, 473 F.3d at 1381
`(discussing Lapides). In other words, when a State serves as a defendant in
`
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`federal court, without more, it generally has not waived sovereign immunity
`and remains free to raise the defense of Eleventh Amendment immunity at
`any time.
`In sum, we have found that the facts of this case differ from those
`presented in Hill, and that our determination is consistent with applicable
`Federal Circuit and Supreme Court precedent. Nevertheless, there is not
`necessarily a difference among the circuits, as the University suggests.
`Rather, the Hill opinion, as amended, appears to follow precedent which
`acknowledges that the law of waiver may vary from State to State, based on
`an individual State’s precedent regarding waiver. See also Opp. 2 (citing
`Wisconsin Dept. of Corr. v. Schacht, 524 U.S. 381, 389 (1998)). In
`particular, the Supreme Court has explained that the Eleventh Amendment
`defense can even be raised for the first time at the Supreme Court unless
`State law provides for waiver by participation in judicial proceedings. See
`Sosna v. Iowa, 419 U.S. 393, 396 n.2 (1975) (citing Edelman v. Jordan, 415
`U.S. 651 (1974); Ford Motor Co. v. Department of Treasury of Indiana, 323
`U.S. 459 (1945)). In Sosna, the Supreme Court examined the precedents of
`the State of Iowa, and distinguished the law of Iowa from that of Indiana, in
`determining that Iowa provided for waiver. This may have been the
`underlying rationale for the Hill opinion, as amended. Further, unlike the
`precedents of Iowa examined by the Court in Sosna v. Iowa, the precedent of
`Maryland indicates that Maryland does not provide for waiver of State
`sovereign immunity by reason of delay. See State v. Sharafeldin, 382 Md.
`129, 141 (2004). As such, the precedent of Maryland appears to be more
`like the precedent of Indiana discussed in Sosna, 419 U.S. at 396 n.2 (citing
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`Ford Motor Co. v. Department of Treasury of Indiana, 323 U.S. 459
`(1945)).
`Further, unlike in Hill, there is no indication that the University has
`delayed for any tactical reasons. Rather, we take at face value the
`University’s stated reason for not raising the defense sooner, i.e., that before
`the Covidien decision it had not been aware that it could raise the Eleventh
`Amendment defense before the Board, and that it raised the defense within
`five business days of the Covidien decision. See Paper 27, 5:19–6:7.
`NeoChord argues that ignorance of the law does not excuse delay. Opp. 4
`(citing Advanced Estimating Systems, Inc. v. Riney, 130 F.3d 996, 999 (11th
`Cir. 1997)). Nevertheless, apart from the fact that the University’s stated
`reason for the delay is one that additionally distinguishes the Court’s
`rationale in Hill, it is well established that Eleventh Amendment immunity is
`a defense that may be raised at any time. See Treasure Salvors, Inc., 458
`U.S. at 683 n.18 (“‘the Eleventh Amendment defense sufficiently partakes of
`the nature of a jurisdictional bar’ that it may be raised at any point of the
`proceedings.”) (citations omitted).
`
`IV. Whether the University Waived Its Defense Through Its License
`Agreement
`
`Next, we address whether the University has waived its defense of
`sovereign immunity by licensing its patent to Harpoon Medical, as argued
`by NeoChord. NeoChord argues that the University has waived sovereign
`immunity in Section 3.7.1 of its Master License Agreement (Ex. 2015,
`“MLA”) with Harpoon Medical. Opp. 6–8. Section 3.7.1. of the MLA
`states as follows:
`
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`3.7 Patent Challenges.
`3.7.1 (a) Prior to taking or causing the taking of any Patent
`Challenge, Company agrees to first pursue an appropriate
`proceeding, filing, or other action in the USPTO in the form of a
`reexamination pursuant to 35 U.S.C. §302, and all applicable
`statutes, rules, and regulations.
`(b) If 35 U.S.C. §302 is not applicable, Company agrees
`to give University the first option, in its sole discretion, to pursue
`the Patent Challenge under a reissue pursuant to 35 U.S.C. §251.
`(c) Company agrees to await a final determination of any
`reexamination or reissue pursuant to this Section 3.7.1 by the
`tribunal of last resort having jurisdiction prior to taking or
`causing the taking of the Patent Challenge in a forum outside of
`the USPTO.
`(d) Company and University agree that this Section 3.7.1
`does not prohibit or limit Company’s ability to take or cause the
`taking of any Patent Challenge, but merely dictates procedurally
`a Patent Challenge falling under the scope and kind that the
`USPTO is authorized to adjudicate.
`
`Ex. 2015 § 3.7.1. However, the University argues that Section 3.7.1 only
`waives immunity with respect to challenges by Harpoon Medical, and that
`Section 14.6 of the MLA expressly reserves the defense of sovereign
`immunity, as follows:
`14.6 State Immunity and Limitations of Liability. No provision
`of this Agreement shall constitute or be construed as a limitation,
`abrogation, or waiver of any defense or limitation of liability
`available to the State of Maryland or its units (including without
`limitation USM and University), officials, or employees under
`Maryland or Federal law, including without limitation the
`defense of sovereign immunity or any other governmental
`immunity.
`
`Id. § 14.6; see Mot. 6; Mot. Reply 5.
`We agree with the University that the waiver of Section 3.7.1 operates
`as a waiver limited to Harpoon and that Section 14.6 of the license
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`agreement operates as a savings clause to preserve the defense of sovereign
`immunity, i.e., with respect to non-parties. States may enter into contracts
`that effect a limited waiver of sovereign immunity, e.g., as to the parties of
`the contract, without opening the door to suits from others. See, e.g., Lizzi v.
`Alexander, 255 F.3d 128, 133 (4th Cir. 2001), overruled on other grounds
`by Nevada Dep’t of Human Res. v. Hibbs, 123 S. Ct. 1972 (2003); see also
`Class Plaintiffs v. City of Seattle, 955 F.2d 1268 (9th Cir. 1992) (settlement
`discussions do not waive immunity from suit) (“With these principles in
`mind, we find no legal impediment to a state’s waiver of its Eleventh
`Amendment immunity for the limited purpose of taking part in the
`settlement proceedings despite otherwise interposing immunity.”).
`
`We recognize that the University’s assertion of sovereign immunity
`creates special treatment for a State entity. Nevertheless, the Supreme Court
`has explained that any asymmetry is the result of the Eleventh Amendment
`itself:
`
`In contrast, a suit by an individual against an unconsenting State
`is the very evil at which the Eleventh Amendment is directed—
`and it exists whether or not the State is acting for profit, in a
`traditionally “private” enterprise, and as a “market participant.”
`In the sovereign-immunity context, moreover, “[e]venhandness”
`between individuals and States is not to be expected: “[T]he
`constitutional role of the States sets them apart from other
`employers and defendants.”
`
`College Savings, 527 U.S. at 685–86 (citations and footnote omitted).
`
`
`V. Whether the Board May Proceed Without the University
`
`NeoChord also argues that Harpoon Medical “should be considered
`
`the real-party-in-interest and the ‘effective patentee’ for purposes of this
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`IPR2016-0020