Bass Hole

  • by: |
  • 06/22/2015

The Patent Trial and Appeal Board of the U.S. Patent and Trademark Office has accepted a request from Celgene to consider sanctions against the Coalition for Affordable Drugs, an entity controlled by hedge fund manager Kyle Bass.

Celgene filed a motion seeking sanctions as part of its response to an inter partes review (IPR) petition the Coalition filed that attempts to invalidate some of Celgene’s patents on Thalomid thalidomide. 
In a document filed with the PTAB, Celgene accused the Coalition of using the IPR process to affect the value of public companies. "This is not the purpose for which the IPR process was designed,” the company wrote. Celgene also alleged that before the IPRs were filed, someone associated with the Coalition “threatened to file IPRs against the challenged patents unless Celgene met their demands.”

Celgene wrote that when it did not pay, the IPRs were filed. 
Celgene described the alleged attempt to obtain payment to forestall IPR challenges as an “abuse of process and misuse of the IPR proceedings.” 
In granting Celgene’s request to file a sanctions motion to dismiss the petitions, the PTAB said its decision “is not a decision on the merits of Patent Owner’s allegation of abuse of process.” The board set a July 30 deadline for Celgene to submit a brief supporting its request.

Per a report in BioCentury, the board’s decision is likely to be announced three months after the Celgene brief is submitted, according to Matthew Kreeger, a partner at Morrison & Foerster who is an expert in patent law.
The Celgene request puts the PTAB and the IPR process “in uncharted waters,” Kreeger told BioCentury. He noted that if the decision hinges on a demand for payment made prior to filing the IPR, then it might not affect other IPRs filed by Bass or other investors. 


Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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