This morning the Federal Circuit issued three opinions: one precedential opinion in a patent case; one precedential opinion in a tax case; and one nonprecedential opinion in a takings case. Here are the introductions to the opinions.
On February 3, 2017, Apotex Inc. and Apotex Corp. (collectively, Apotex) filed a petition for inter partes review of Novartis Pharmaceuticals Corporation’s U.S. Patent No. 9,187,405. The Board instituted proceedings on July 18, 2017, and granted Sun Pharmaceutical Industries, Ltd., Sun Pharmaceutical Industries, Inc., and Sun Pharma Global FZE’s (collectively, Sun); Teva Pharmaceuticals USA, Inc. and Actavis Elizabeth LLC’s; and Argentum Pharmaceuticals LLC’s requests for joinder under 35 U.S.C. § 315(c). After institution, Patent Owner, Novartis, filed a contingent motion to amend. On July 11, 2018, the Board concluded that Apotex, Sun, Teva, Actavis, and Argentum (collectively, Petitioners) had not demonstrated unpatentability of the claims and denied the motion to amend as moot. Petitioners appealed the Board’s findings. During the appeal process, all Petitioners other than Argentum settled their respective appeal with Novartis.
On August 29, 2018, before opening briefs had been filed, Novartis filed a motion to dismiss Argentum’s appeal for lack of standing. Argentum opposed the motion on September 10, 2018, and included declarations of Jeffrey Gardner, Argentum’s CEO, and Anthony Tabasso, President and CEO of KVK-Tech, Inc., Argentum’s manufacturing and marketing partner. We directed Argentum and Novartis to address Argentum’s standing in their briefs, which they did. Initially, Argentum argued that we need not reach the issue of its standing because only one party must have standing for an action to proceed in an Article III Court, and “the other seven appellants undisputedly have standing.” Appellant’s Br. viii. Following the settlement of all parties other than Argentum, Novartis submitted a notice of supplemental authority under Federal Rule of Appellate Procedure 28(j) stating that “now that Argentum is the only appellant, Article III standing has become a threshold issue” and that we must assess our “jurisdiction under Article III of the Constitution before addressing the merits of the case.” D.I. 131 at 2 (citing Phigenix, Inc. v. Immunogen, Inc., 845 F.3d 1168, 1171 (Fed. Cir. 2017)).
Because we hold that Argentum lacks Article III standing, we dismiss the appeal and do not reach the merits of the Board’s ruling on the claims of the ’405 patent.
General Mills, Inc. v. United States (Precedential)
General Mills, Inc. & Subsidiaries (collectively, GMI) sued the United States seeking refunds of interest it paid on corporate income tax underpayments that the Internal Revenue Service (IRS) assessed at the enhanced rate of interest for “large corporate underpayments” (LCU) set forth in Internal Revenue Code (I.R.C.) § 6621(c). GMI is the parent corporation of a number of partners of General Mills Cereals, LLC, a limited liability company that is treated as a partnership for tax purposes (the Partnership). GMI alleges that after certain partnership-level audits of the Partnership’s returns for the 2002–2006 tax years were settled with the IRS, the IRS erroneously collected $5,958,695 in LCU interest by selecting incorrect “applicable dates” to start interest accrual. GMI paid the LCU interest in April 2011, and, in March 2013, filed administrative refund claims with the IRS. After the IRS denied the claims, GMI initiated the underlying refund suit in the United States Court of Federal Claims. The court dismissed GMI’s suit for lack of subject matter jurisdiction, concluding that GMI was required, but failed, to file its administrative refund claims with the IRS within the sixmonth limitations period set forth in I.R.C. § 6230(c). General Mills, Inc. v. United States, 123 Fed. Cl. 576 (2015).
GMI contends that the general two-year tax refund claim limitations period under I.R.C. § 6511(a) should apply to its administrative refund claims, instead of the special six-month limitations period described in § 6230(c). Section 6230(c) provides that “[a] partner may file a claim for refund on the grounds that . . . the [IRS] erroneously computed any computational adjustment necessary . . . to apply to the partner a settlement.” § 6230(c)(1)(A)(ii).
Section 6230(c) further provides that any such claim “shall be filed within 6 months after the day on which the [IRS] mails the notice of computational adjustment to the partner.” § 6230(c)(2)(A). Because we agree with the Court of Federal Claims that the basis of GMI’s refund claims is that the IRS erroneously computed a computational adjustment resulting from a settlement by allegedly miscalculating the amount of LCU interest due, GMI’s refund claims are subject to the six-month limitations period. Since GMI received adequate notice of the computational adjustment, and yet, filed its refund claims well outside the six-month period, we affirm the dismissal.
Dissenting opinion filed by Circuit Judge NEWMAN.
I respectfully dissent, for this interest refund claim was timely filed in conformity with the statutory time period for filing such claim. That period is two or three years after the payment was made or the tax return was filed, as provided in 26 U.S.C. § 6511(a):
§ 6511(a). Period of limitation on filing claim. Claim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within 2 years from the time the tax was paid.
There was a special 6-month period in TEFRA for filing claims arising from “computational adjustment” of “partnership items,” at 26 U.S.C. § 6230(c)(2)(A):
§ 6230(c)(2)(A). [Repealed] Any claim under subparagraph (A) or (C) of paragraph (1) shall be filed within 6 months after the day on which the Secretary mails the notice of computational adjustment to the partner.
This 6-month period applied to § 6230(c)(1)(A)(ii), specific to computational adjustments of a partner’s tax liability based on settlement, adjustment, or decision:
§ 6230(c)(1)(A)(ii). [repealed] A partner may file a claim for refund on the grounds that . . . the Secretary erroneously computed any computational adjustment necessary . . . to apply to the partner a settlement, a final partnership administrative adjustment, or the decision of a court in an action brought under section 6226 or section 6228(a).
The question on appeal is whether the special 6-month limitations period applies to the present claim for refund of overpayment of interest. Interest is required and calculated and levied in accordance with the general tax law. This claim for refund of interest was filed in accordance with the general rules for filing refund claims under § 6511(a). The court errs in applying, to this interest refund claim, the 6-month limitations period that was specific to computational adjustment of tax on partnership items.
Swartzlander v. United States (Nonprecedential)
Mary Swartzlander appeals from the decision of the United States Court of Federal Claims dismissing her takings claim as timed-barred under 28 U.S.C. § 2501. See Swartzlander v. U.S., 142 Fed. Cl. 435 (2019) (“Decision”). We affirm.