Sanctioning the “Spider”: Big Pharma Fights Back Against Kyle Bass’ IPR Campaigns

Authored by Michelle Carniaux and Michael E. Sander

Kyle Bass and his hedge fund Hayman Capital have become infamous for challenging the validity of patents owned by large biopharmaceutical companies, but now, “big pharma” is fighting back. On June 9, 2015, Celgene Corp. moved a step closer to ending Bass’ IPR reign of terror. In a set of IPRs challenging two patents owned by Celgene Corp. (IPR2015-01092,01096,1102,1103), the PTAB authorized briefing on a Motion for Sanctions over whether Bass and his related companies were, as alleged, “abus[ing] the IPR process for private financial gain.” IPR2015-01102, No. 7 at 6 (P.T.A.B. Jun. 9, 2015). Celgene argued that Bass intends to use the IPR process for the purpose of affecting the stock price of publicly traded companies, which is “not the purpose for which the IPR process was designed.” Id. Celgene also alleged that “one or more of the identified RPI previously threatened to file IPRs against the challenged patents unless Celgene met their demands.” Id. Celgene requested the Board to dismiss the petitions as a sanction for abuse of process and misuse of the IPR proceedings. Id.

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