In a recent ruling, the U.S. Court of Appeals for the Federal Circuit (CAFC) transferred an appeal to the Second Circuit, citing lack of jurisdiction. The case involved Acorda Therapeutics, Inc.’s petition to modify an arbitral award stemming from an international arbitration with Alkermes PLC. Acorda sought relief from royalty payments to Alkermes after the expiration of a patent covering the active ingredient in its multiple sclerosis drug. The arbitral tribunal granted Acorda relief for payments made under protest but not for those made between 2018 and 2020. Acorda then petitioned the U.S. District Court for the Southern District of New York to confirm the award and modify the denial of recoupment for the 2018–2020 payments.
The district court affirmed the award but rejected the modification request, leading to the appeal to the CAFC. The CAFC determined that the case did not meet the criteria for jurisdiction under federal patent law, as there was no patent law cause of action involved. The court’s analysis found that Acorda’s petitions did not necessarily raise a patent law issue, as confirmation of an arbitral award does not require proof of correctness under the law. While the case raised questions about the ‘substantial’ prong of the jurisdiction test, the CAFC did not address those in its ruling. This decision highlights the complexities involved in jurisdictional issues in biotech cases and the importance of understanding the criteria for federal court involvement.
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