SANDOZ INC. v. AMGEN INC. et al.
Certiorari To The United States Court Of Appeals For The Federal Circuit
No. 15--1039. Argued April 26, 2017--Decided June 12, 2017 1
The Biologics Price Competition and Innovation Act of 2009 (BPCIA or Act) provides an abbreviated pathway for obtaining Food and Drug Administration (FDA) approval of a drug that is biosimilar to an already licensed biological product (reference product). 42 U. S. C. §262(k). It also provides procedures for resolving patent disputes between biosimilar manufacturers (applicants) and manufacturers of reference products (sponsors). §262(l). The Act treats the mere submission of a biosimilar application as an “artificial” act of infringement, enabling parties to bring patent infringement actions at certain points in the application process even if the applicant has not committed a traditional act of patent infringement. See 35 U. S. C. §§271(e)(2)(C)(i), (ii).
Under §262(l)(2)(A), an applicant seeking FDA approval of a biosimilar must provide its application and manufacturing information to the sponsor within 20 days of the date the FDA notifies the applicant that it has accepted the application for review. This triggers an exchange of information between the applicant and sponsor designed to create lists of relevant patents and flesh out potential legal arguments. §262(l)(3). The BPCIA then channels the parties into two phases of patent litigation. In the first, the parties collaborate to identify patents on the lists for immediate litigation. The second phase—triggered when the applicant, pursuant to §262(l)(8)(A), gives the sponsor notice at least 180 days before commercially marketing the biosimilar—involves any listed patents not litigated in the first phase. The applicant has substantial control over the timing and scope of both phases of litigation.
Failure to comply with these procedural requirements may lead to two consequences relevant here. Under §262(l)(9)(C), if an applicant fails to provide its application and manufacturing information to the sponsor under §262(l)(2)(A), then the sponsor, but not the applicant, may immediately bring an action “for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product.” And under §262(l)(9)(B), if an applicant provides the application and manufacturing information but fails to complete a subsequent step in the process, the sponsor, but not the applicant, may bring a declaratory-judgment action with respect to any patent included on the sponsor’s list of relevant patents.
Neupogen is a filgrastim product marketed by Amgen, which claims to hold patents on methods of manufacturing and using filgrastim. Sandoz sought FDA approval to market a biosimilar filgrastim product under the brand name Zarxio, with Neupogen as the reference product. A day after the FDA informed Sandoz that its application had been accepted for review, Sandoz notified Amgen that it had submitted an application and that it intended to market Zarxio immediately upon receiving FDA approval. It later informed Amgen that it did not intend to provide the application and manufacturing information required by §262(l)(2)(A) and that Amgen could sue immediately for infringement under §262(l)(9)(C).
Amgen sued Sandoz for patent infringement and also asserted that Sandoz engaged in “unlawful” conduct in violation of California’s unfair competition law. This latter claim was predicated on two alleged violations of the BPCIA: Sandoz’s failure to provide its application and manufacturing information under §262(l)(2)(A), and its provision of notice of commercial marketing under §262(l)(8)(A) prior to obtaining licensure from the FDA. Amgen sought injunctions to enforce both BPCIA requirements. Sandoz counterclaimed for declaratory judgments that the asserted patent was invalid and not infringed and that it had not violated the BPCIA.
While the case was pending, the FDA licensed Zarxio, and Sandoz provided Amgen a further notice of commercial marketing. The District Court subsequently granted partial judgment on the pleadings to Sandoz on its BPCIA counterclaims and dismissed Amgen’s unfair competition claims with prejudice. The Federal Circuit affirmed in part, vacated in part, and remanded. The court affirmed the dismissal of Amgen’s state-law claim based on Sandoz’s alleged violation of §262(l)(2)(A), holding that Sandoz did not violate the BPCIA in failing to disclose its application and manufacturing information and that the BPCIA provides the exclusive remedies for failure to comply with this requirement. The court also held that under §262(l)(8)(A) an applicant must provide notice of commercial marketing after obtaining licensure, and that this requirement is mandatory. It thus enjoined Sandoz from marketing Zarxio until 180 days after the date it provided its second notice.
Held: Section 262(l)(2)(A) is not enforceable by injunction under federal law, but the Federal Circuit on remand should determine whether a state-law injunction is available. An applicant may provide notice under §262(l)(8)(A) prior to obtaining licensure. Pp. 10–18.
(a) Section 262(l)(2)(A)’s requirement that an applicant provide the sponsor with its application and manufacturing information is not enforceable by an injunction under federal law. The Federal Circuit reached the proper result on this point, but its reasoning was flawed. It cited §271(e)(4), which expressly provides the “only remedies” for an act of artificial infringement. In light of this language, the court reasoned that no remedy other than those specified in the text—such as an injunction to compel the applicant to provide its application and manufacturing information—was available. The problem with this reasoning is that Sandoz’s failure to disclose was not an act of artificial infringement remediable under §271(e)(4). Submitting an application constitutes an act of artificial infringement; failing to disclose the application and manufacturing information required by §262(l)(2)(A) does not.
Another provision, §262(l)(9)(C), provides a remedy for an applicant’s failure to turn over its application and manufacturing information. It authorizes the sponsor, but not the applicant, to bring an immediate declaratory-judgment action for artificial infringement, thus vesting in the sponsor the control that the applicant would otherwise have exercised over the scope and timing of the patent litigation and depriving the applicant of the certainty it could have obtained by bringing a declaratory-judgment action prior to marketing its product. The presence of this remedy, coupled with the absence of any other textually specified remedies, indicates that Congress did not intend sponsors to have access to injunctive relief, at least as a matter of federal law, to enforce the disclosure requirement. See Great-West Life & Annuity Ins. Co. v. Knudson, 534 U. S. 204. Statutory context further confirms that Congress did not authorize courts to enforce §262(l)(2)(A) by injunction. Pp. 10–13.
(b) The Federal Circuit should determine on remand whether an injunction is available under state law to enforce §262(l)(2)(A). Whether Sandoz’s conduct was “unlawful” under California’s unfair competition statute is a question of state law, and the Federal Circuit thus erred in attempting to answer that question by referring only to the BPCIA. There is no dispute about how the federal scheme actually works on the facts of this case: Sandoz failed to disclose the requisite information under §262(l)(2)(A), and was accordingly subject to the consequence specified in §262(l)(9)(C). As a result, there is nothing to decide on this point as a matter of federal law. The court on remand should determine whether California law would treat noncompliance with §262(l)(2)(A) as “unlawful,” and whether the BPCIA pre-empts any additional state-law remedy for failure to comply with §262(l)(2)(A). Pp. 13–15.
(c) An applicant may provide notice of commercial marketing before obtaining a license. Section 262(l)(8)(A) states that the applicant “shall provide notice to the reference product sponsor not later than 180 days before the date of the first commercial marketing of the biological product licensed under subsection (k).” Because the phrase “of the biological product licensed under subsection (k)” modifies “commercial marketing” rather than “notice,” “commercial marketing” is the point in time by which the biosimilar must be “licensed.” Accordingly, the applicant may provide notice either before or after receiving FDA approval. Statutory context confirms that §262(l)(8)(A) contains a single timing requirement (180 days before marketing), rather than the two requirements posited by the Federal Circuit (after licensing, and 180 days before marketing). “Had Congress intended to” impose two timing requirements in §262(l)(8)(A), “it presumably would have done so expressly as it did in the” adjacent provision, §262(l)(8)(B). Russello v. United States, 464 U. S. 16. Amgen’s contrary arguments are unpersuasive, and its various policy arguments cannot overcome the statute’s plain language. Pp. 15–18.
794 F. 3d 1347, vacated in part, reversed in part, and remanded.
Thomas, J., delivered the opinion for a unanimous Court. Breyer, J., filed a concurring opinion.
1 Together with No. 15–1195, Amgen Inc. et al. v. Sandoz Inc., also on certiorari to the same court.
SESSIONS, ATTORNEY GENERAL v. MORALES-SANTANA
Certiorari To The United States Court Of Appeals For The Second Circuit
No. 15-1191. Argued November 9, 2016--Decided June 12, 2017
The Immigration and Nationality Act provides the framework for acquisition of U. S. citizenship from birth by a child born abroad, when one parent is a U. S. citizen and the other a citizen of another nation. Applicable to married couples, the main rule in effect at the time here relevant, 8 U. S. C. §1401(a)(7) (1958 ed.), required the U. S.-citizen parent to have ten years’ physical presence in the United States prior to the child’s birth, “at least five of which were after attaining” age 14. The rule is made applicable to unwed U. S.-citizen fathers by §1409(a), but §1409(c) creates an exception for an unwed U. S.-citizen mother, whose citizenship can be transmitted to a child born abroad if she has lived continuously in the United States for just one year prior to the child’s birth.
Respondent Luis Ramón Morales-Santana, who has lived in the United States since he was 13, asserts U. S. citizenship at birth based on the U. S. citizenship of his biological father, José Morales. José moved to the Dominican Republic 20 days short of his 19th birthday, therefore failing to satisfy §1401(a)(7)’s requirement of five years’ physical presence after age 14. There, he lived with the Dominican woman who gave birth to Morales-Santana. José accepted parental responsibility and included Morales-Santana in his household; he married Morales-Santana’s mother and his name was then added to hers on Morales-Santana’s birth certificate. In 2000, the Government sought to remove Morales-Santana based on several criminal convictions, ranking him as alien because, at his time of birth, his father did not satisfy the requirement of five years’ physical presence after age 14. An immigration judge rejected Morales-Santana’s citizenship claim and ordered his removal. Morales-Santana later moved to reopen the proceedings, asserting that the Government’s refusal to recognize that he derived citizenship from his U. S.-citizen father violated the Constitution’s equal protection guarantee. The Board of Immigration Appeals denied the motion, but the Second Circuit reversed. Relying on this Court’s post-1970 construction of the equal protection principle as it bears on gender-based classifications, the court held unconstitutional the differential treatment of unwed mothers and fathers. To cure this infirmity, the Court of Appeals held that Morales-Santana derived citizenship through his father, just as he would were his mother the U. S. citizen.
1. The gender line Congress drew is incompatible with the Fifth Amendment’s requirement that the Government accord to all persons “the equal protection of the laws.” Pp. 6–23.
(a) Morales-Santana satisfies the requirements for third-party standing in seeking to vindicate his father’s right to equal protection. José Morales’ ability to pass citizenship to his son easily satisfies the requirement that the third party have a “ ‘close’ relationship with the person who possesses the right.” Kowalski v. Tesmer, 543 U. S. 125. And José’s death many years before the current controversy arose is “a ‘hindrance’ to [José’s] ability to protect his own interests.” Ibid. Pp. 6–7.
(b) Sections 1401 and 1409 date from an era when the Nation’s lawbooks were rife with overbroad generalizations about the way men and women are. Today, such laws receive the heightened scrutiny that now attends “all gender-based classifications,” J. E. B. v. Alabama ex rel. T. B., 511 U. S. 127, including laws granting or denying benefits “on the basis of the sex of the qualifying parent,” Califano v. Westcott, 443 U. S. 76. Prescribing one rule for mothers, another for fathers, §1409 is of the same genre as the classifications declared unconstitutional in Westcott; Reed v. Reed, 404 U. S. 71–77; Frontiero v. Richardson, 411 U. S. 677–691; Weinberger v. Wiesenfeld, 420 U. S. 636–653; and Califano v. Goldfarb, 430 U. S. 199–207. A successful defense therefore requires an “ ‘exceedingly persuasive justification.’ ” United States v. Virginia, 518 U. S. 515. Pp. 7–9.
(c) The Government must show, at least, that its gender-based “ ‘classification serves “important governmental objectives and that the discriminatory means employed” are “substantially related to [achieving] those objectives.” ’ ” Virginia, 518 U. S., at 533. The classification must serve an important governmental interest today, for “new insights and societal understandings can reveal unjustified inequality . . . that once passed unnoticed and unchallenged.” Obergefell v. Hodges, 576 U. S. ___, ___. Pp. 9–14.
(1) At the time §1409 was enacted as part of the Nationality Act of 1940 (1940 Act), two once habitual, but now untenable, assumptions pervaded the Nation’s citizenship laws and underpinned judicial and administrative rulings: In marriage, husband is dominant, wife subordinate; unwed mother is the sole guardian of a nonmarital child. In the 1940 Act, Congress codified the mother-as-sole-guardian perception for unmarried parents. According to the stereotype, a residency requirement was justified for unwed citizen fathers, who would care little about, and have scant contact with, their nonmarital children. Unwed citizen mothers needed no such prophylactic, because the alien father, along with his foreign ways, was presumptively out of the picture. Pp. 9–13.
(2) For close to a half century, this Court has viewed with suspicion laws that rely on “overbroad generalizations about the different talents, capacities, or preferences of males and females.” Virginia, 518 U. S., at 533. No “important [governmental] interest” is served by laws grounded, as §1409(a) and (c) are, in the obsolescing view that “unwed fathers [are] invariably less qualified and entitled than mothers” to take responsibility for nonmarital children. Caban v. Mohammed, 441 U. S. 380. In light of this equal protection jurisprudence, §1409(a) and (c)’s discrete duration-of-residence requirements for mothers and fathers are anachronistic. Pp. 13–14.
(d) The Government points to Fiallo v. Bell, 430 U. S. 787; Miller v. Albright, 523 U. S. 420; and Nguyen v. INS, 533 U. S. 53, for support. But Fiallo involved entry preferences for alien children; the case did not present a claim of U. S. citizenship. And Miller and Nguyen addressed a paternal-acknowledgment requirement well met here, not the length of a parent’s prebirth residency in the United States. Pp. 14–16.
(e) The Government’s suggested rationales for §1409(a) and (c)’s gender-based differential do not survive heightened scrutiny. Pp. 16–23.
(1) The Government asserts that Congress sought to ensure that a child born abroad has a strong connection to the United States. The statute, the Government suggests, bracketed an unwed U. S.-citizen mother with a married couple in which both parents are U. S. citizens because she is the only legally recognized parent at birth; and aligned an unwed U. S.-citizen father with a married couple, one spouse a citizen, the other, an alien, because of the competing national influence of the alien mother. This rationale conforms to the long-held view that unwed fathers care little about their children. And the gender-based means scarcely serve the suggested congressional interest. Citizenship may be transmitted to children who have no tie to the United States so long as their U. S.-citizen mother was continuously present in the United States for one year at any point in her life prior to the child’s birth; but it may not be transmitted by a U. S.-citizen father who falls a few days short of meeting §1401(a)(7)’s longer physical-presence requirements, even if he acknowledges paternity on the day the child is born and raises the child in the United States. Pp. 17–19.
(2) The Government also maintains that Congress wished to reduce the risk of statelessness for the foreign-born child of a U. S. citizen. But congressional hearings and reports offer no support for the assertion that a statelessness concern prompted the diverse physical-presence requirements. Nor has the Government shown that the risk of statelessness disproportionately endangered the children of unwed U. S.-citizen mothers. Pp. 19–23.
2. Because this Court is not equipped to convert §1409(c)’s exception for unwed U. S.-citizen mothers into the main rule displacing §§1401(a)(7) and 1409(a), it falls to Congress to select a uniform prescription that neither favors nor disadvantages any person on the basis of gender. In the interim, §1401(a)(7)’s current requirement should apply, prospectively, to children born to unwed U. S.-citizen mothers. The legislature’s intent, as revealed by the statute at hand, governs the choice between the two remedial alternatives: extending favorable treatment to the excluded class or withdrawing favorable treatment from the favored class. Ordinarily, the preferred rule is to extend favorable treatment. Westcott, 443 U. S., at 89–90. Here, however, extension to fathers of §1409(c)’s favorable treatment for mothers would displace Congress’ general rule, the longer physical-presence requirements of §§1401(a)(7) and 1409 applicable to unwed U. S.-citizen fathers and U. S.-citizen parents, male as well as female, married to the child’s alien parent. Congress’ “ ‘commitment to th[is] residual policy’ ” and “ ‘the degree of potential disruption of the statutory scheme that would occur by extension as opposed to abrogation,’ ” Heckler v. Mathews, 465 U. S. 728, n. 5, indicate that Congress would likely have abrogated §1409(c)’s special exception, preferring to preserve “the importance of residence in this country as the talisman of dedicated attachment,” Rogers v. Bellei, 401 U. S. 815. Pp. 23–28.
804 F. 3d 520, affirmed in part, reversed in part, and remanded.
Ginsburg, J., delivered the opinion of the Court, in which Roberts, C. J., and Kennedy, Breyer, Sotomayor, and Kagan, JJ., joined. Thomas, J., filed an opinion concurring in the judgment in part, in which Alito, J., joined. Gorsuch, J., took no part in the consideration or decision of the case.
MICROSOFT CORP. v. BAKER et al.
Certiorari To The United States Court Of Appeals For The Ninth Circuit
No. 15-457. Argued March 21, 2017--Decided June 12, 2017
Orders granting or denying class certification are inherently interlocutory, hence not immediately reviewable under 28 U. S. C. §1291, which empowers federal courts of appeals to review only “final decisions of the district courts.” In Coopers & Lybrand v. Livesay, 437 U. S. 463, a 1978 decision, this Court held that the death-knell doctrine—which rested on courts’ recognition that a denial of class certification would sometimes end a lawsuit for all practical purposes—did not warrant mandatory appellate jurisdiction of certification orders. Id., at 470, 477. Although the death-knell theory likely “enhanced the quality of justice afforded a few litigants,” it did so at a heavy cost to §1291’s finality requirement. Id., at 473. First, the potential for multiple interlocutory appeals inhered in the doctrine. See id., at 474. Second, the death-knell theory forced appellate courts indiscriminately into the trial process, circumventing the two-tiered “screening procedure” Congress established for interlocutory appeals in 28 U. S. C. §1292(b). Id., at 474, 476. Finally, the doctrine “operat[ed] only in favor of plaintiffs,” even though the class-certification question may be critically important to defendants as well. Id., at 476.
Two decades later, in 1998, after Congress amended the Rules Enabling Act, 28 U. S. C. §2071 et seq., to empower this Court to promulgate rules providing for interlocutory appeal of orders “not otherwise provided for [in §1292],” §1292(e), this Court approved Federal Rule of Civil Procedure 23(f). Rule 23(f) authorizes “permissive interlocutory appeal” from adverse class-certification orders in “the sole discretion of the court of appeals.” 28 U. S. C. App., p. 815. This discretionary arrangement was the product of careful calibration on the part of the rulemakers.
Respondents, owners of Microsoft’s videogame console, the Xbox 360, filed this putative class action alleging a design defect in the device. The District Court struck respondents’ class allegations from the complaint, and the Court of Appeals denied respondents permission to appeal that order under Rule 23(f). Instead of pursuing their individual claims to final judgment on the merits, respondents stipulated to a voluntary dismissal of their claims with prejudice, but reserved the right to revive their claims should the Court of Appeals reverse the District Court’s certification denial. Respondents then appealed, challenging only the interlocutory order striking their class allegations. The Ninth Circuit held it had jurisdiction to entertain the appeal under §1291. It then held that the District Court’s rationale for striking respondents’ class allegations was an impermissible one, but refused to opine on whether class certification was inappropriate for a different reason, leaving that question for the District Court on remand.
Held: Federal courts of appeals lack jurisdiction under §1291 to review an order denying class certification (or, as here, an order striking class allegations) after the named plaintiffs have voluntarily dismissed their claims with prejudice. Pp. 11–17.
(a) Section 1291’s final-judgment rule preserves the proper balance between trial and appellate courts, minimizes the harassment and delay that would result from repeated interlocutory appeals, and promotes the efficient administration of justice. This Court has resisted efforts to stretch §1291 to permit appeals of right that would erode the finality principle and disserve its objectives. See, e.g., Mohawk Industries, Inc. v. Carpenter, 558 U. S. 100. Attempts to secure appeal as of right from adverse class certification orders fit that bill. Pp. 11–12.
(b) Respondents’ voluntary-dismissal tactic, even more than the death-knell theory, invites protracted litigation and piecemeal appeals. Under the death-knell doctrine, a court of appeals could decline to hear an appeal if it determined that the plaintiff “ha[d] adequate incentive to continue” despite the denial of class certification. Coopers & Lybrand, 437 U. S., at 471. Under respondents’ theory, however, the decision whether an immediate appeal will lie resides exclusively with the plaintiff, who need only dismiss her claims with prejudice in order to appeal the district court’s order denying class certification. And she may exercise that option more than once, interrupting district court proceedings with an interlocutory appeal again, should the court deny class certification on a different ground.
Respondents contend that their position promotes efficiency, observing that after dismissal with prejudice the case is over if the plaintiff loses on appeal. But plaintiffs with weak merits claims may readily assume that risk, mindful that class certification often leads to a hefty settlement. And the same argument was evident in the death-knell context, yet this Court determined that the potential for piecemeal litigation was “apparent and serious.” Id., at 474. That potential is greater still under respondents’ theory, where plaintiffs alone determine whether and when to appeal an adverse certification ruling. Pp. 12–14.
(c) Also like the death-knell doctrine, respondents’ theory allows indiscriminate appellate review of interlocutory orders. Beyond disturbing the “ ‘appropriate relationship between the respective courts,’ ” Coopers & Lybrand, 437 U. S., at 476, respondents’ dismissal tactic undercuts Rule 23(f)’s discretionary regime. This consideration is “[o]f prime significance to the jurisdictional issue” in this case, Swint v. Chambers County Comm’n, 514 U. S. 35, because Congress has established rulemaking as the means for determining when a decision is final for purposes of §1291 and for providing for appellate review of interlocutory orders not covered by statute, see §§2072(c) and 1292(e).
Respondents maintain that Rule 23(f) is irrelevant, for it concerns interlocutory orders, whereas this case involves an actual final judgment. Yet permitting respondents’ voluntary-dismissal tactic to yield an appeal of right would seriously undermine Rule 23(f)’s careful calibration, as well as Congress’ designation of rulemaking “as the preferred means for determining whether and when prejudgment orders should be immediately appealable,” Mohawk Industries, 558 U. S., at 113. Plaintiffs in putative class actions cannot transform a tentative interlocutory order into a final judgment within the meaning of §1291 simply by dismissing their claims with prejudice. Finality “is not a technical concept of temporal or physical termination.” Cobbledick v. United States, 309 U. S. 323. It is one “means [geared to] achieving a healthy legal system,” ibid., and its contours are determined accordingly. Pp. 14–16.
(d) The one-sidedness of respondents’ voluntary-dismissal device reinforces the conclusion that it does not support mandatory appellate jurisdiction of refusals to grant class certification. The tactic permits only plaintiffs, never defendants, to force an immediate appeal of an adverse certification ruling. Yet the “class issue” may be just as important to defendants, Coopers & Lybrand, 437 U. S., at 476, for class certification may force a defendant to settle rather than run the risk of ruinous liability. P. 17.
797 F. 3d 607, reversed and remanded.
Ginsburg, J., delivered the opinion of the Court, in which Kennedy, Breyer, Sotomayor, and Kagan, JJ., joined. Thomas, J., filed an opinion concurring in the judgment, in which Roberts, C. J., and Alito, J., joined. Gorsuch, J., took no part in the consideration or decision of the case.