By Kevin E. Noonan —

Horsham, Pennsylvania biotech company Nucleonics, Inc. announced today that it has filed a petition with the Court of Appeals for the Federal Circuit for rehearing en banc of the Court’s July 20, 2007 decision upholding dismissal of its declaratory judgment counterclaims against Benetic Australia Ltd. over patents on RNA interference (RNAi) technology.

The case involved a patent infringement suit brought against Nucleonics by Benitec over U.S. Patent No. 6,573,099 claiming "gene silencing" technology.  Although Benitec’s infringement action was mooted by the Supreme Court’s decision in Merck KGaA v. Integra Life Sciences decision (and Benetec moved for its compliant to be dismissed without prejudice), Nucleonics wanted the District Court to hear its declaratory counterclaims of invalidity and unenforceability.  The District Court dismissed Nucleonics’ counterclaims on the grounds that the Court did not have jurisdiction under the Declaratory Judgments Act, because the basis for Benitec’s infringement case had evaporated in view of the Merck decision.

The Federal Circuit affirmed, based on its interpretation of the Supreme Court’s MedImmune, Inc. v. Genentec, Inc. decision, "disapproving" of the CAFC’s prior "reasonable apprehension of imminent suit" test (see Patent Docs report).  The Federal Circuit held that the requirements of Article III jurisdiction contained in the Declaratory Judgments Act, even when interpreted under the Supreme Court’s MedImmune decision, included that there be an underlying dispute between the parties to trigger jurisdiction, and that MedImmune had not absolved declaratory judgment plaintiffs from the burden of establishing that there was an underlying controversy between the parties that created a cause of action for the declaratory judgment defendant.  Holding that Nucleonics had "not made a showing of ‘sufficient immediacy and reality’ to support declaratory judgment jurisdiction," the Federal Circuit affirmed dismissal of Nucleonics’ declaratory judgment counterclaims.

Nucleonics has now asked the full Court to reconsider the decision.  Under Federal Circuit Rule 35(b), a party may petition for rehearing en banc if either:

(A)  the panel decision conflicts with a decision of the United States Supreme Court or of the court to which the petition is addressed and consideration by the full court is therefore necessary to secure and maintain uniformity of the court’s decisions; or
(B)  the proceeding involves one or more questions of exceptional importance, for example, where the panel decision conflicts with the authoritative decisions of other United States Courts of Appeals that have addressed the issue.

If Nucleonics’ petition is denied, or if the CAFC sitting en banc should affirm the panel decision, Nucleonics may give the Supreme Court another opportunity to review a Federal Circuit decision on declaratory judgment jurisdiction.  Since the crux of Justice Scalia’s decision in MedImmune was contained in a footnote, the Supreme Court may welcome the additional opportunity to address the issue more thoroughly (or at least more directly) by granting certiorari.