Why this Supreme Court decision could matter for tech companies, pharma giants

Technology giants are rallying around a case heard Monday in the U.S. Supreme Court that seemingly has little to do with their companies' missions, according to CNBC.

The case — Oil States Energy Services v. Greene's Energy Group — involves a dispute over a hydraulic fracturing method and has gained the attention of both the tech and pharmaceutical industries because of its implications for the patenting of intellectual property. Specifically, the key issue in the case is inter partes review, a system for challenging patents.

IPR was introduced in 2011 with the America Invents Act. It allows patent challengers to petition, at a low cost, the U.S. Patent and Trademark Office to review patents it has already granted that seem suspect.

Companies such as Apple, Google and Facebook have been champions of IPR, which they see as an effective way of dismantling bad patents held by "patent trolls" — companies with the rights to one or more patents in an effort to profit through licensing or litigating as opposed to producing. On the contrary, pharmaceutical companies that sell branded medicines despise the practice. Their competitors, some who aim to sell generic copies of these drugs, have increasingly turned to IPR to invalidate patents.   

In Oil States Energy Services v. Greene's Energy Group, Saint Regis Mohawks, a tribe of nearly 16,000 located in upstate New York, raises the question over whether its sovereign status as a Native American tribe entitles it to special protections against IPR. Other entities that possess sovereign status are foreign governments and states, meaning state universities as well.

Congress has been critical of the exchanges. Sen. Claire McCaskill, D-Mo., introduced a bill in October to strip tribes of their sovereign immunity to IPR challenges. However, Tribal Chief Eric Thompson called Ms. McCaskill's bill a double standard, noting state university systems also benefit from sovereign status.

"It's [a] colonialistic thought," he told CNBC. "It's almost like an economic apartheid, where we're not allowed to do certain things unless otherwise given permission."

The Court is expected to reach a decision in June 2018.

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