Acorda Therapeutics, Inc. v. Alkermes Plc

Court of Appeals for the Federal Circuit·Decided July 25, 2025·No. 23-2374·Published

Opinion

United States Court of Appeals for the Federal Circuit

ACORDA THERAPEUTICS, INC., Petitioner-Appellant

v.

ALKERMES PLC, Respondent-Appellee

2023-2374

Appeal from the United States District Court for the Southern District of New York in No. 1:23-cv-00223-NRB, Judge Naomi Reice Buchwald.

Decided: July 25, 2025

GARRARD R. BEENEY, Sullivan & Cromwell LLP, New York, NY, argued for petitioner-appellant. Also represented by STEPHEN J. ELLIOTT, MORGAN ROSE KNUDTSEN; BRITTANY BRUNS, Washington, DC.

BRIAN TIMOTHY BURGESS, Goodwin Procter LLP, Washington , DC, argued for respondent-appellee. Also represented by JORDAN BOCK, CHRISTOPHER T. HOLDING, Boston, MA.

Before TARANTO, HUGHES, and STARK, Circuit Judges.

2 ACORDA THERAPEUTICS, INC. v. ALKERMES PLC

TARANTO, Circuit Judge.

Acorda is the developer of Ampyra®, a drug used to treat patients with multiple sclerosis. Until 2018, Alkermes owned a patent covering Amprya’s active ingredient. Alkermes licensed the patent to Acorda in return for royalty payments and contracted to supply Acorda with the active ingredient in return for royalty payments. In July 2018, the licensed patent expired, but Acorda continued to make royalty payments—without protest until July 2020 and thereafter under protest.

Acorda initiated an international arbitration, pursuant to the parties’ agreement, in July 2020. It sought (a) a judgment that, when the patent expired, the royalty provisions became unenforceable under federal law based on Brulotte v. Thys Co., 379 U.S. 29, 30–34 (1964); see also Kimble v. Marvel Entertainment, LLC, 576 U.S. 446, 449, 458–60 (2015) (declining to overrule Brulotte), and (b) recoupment of royalties paid since July 2018. The arbitration tribunal (Tribunal) agreed that the provisions were unenforceable but concluded that Acorda was entitled to recoup only payments made under formal protest. Amended Findings of Fact, Conclusions of Law, and Final Reasoned Award, Acorda Therapeutics, Inc. v. Alkermes PLC, Arbitration No. 01-20-0010-8421 (Am. Arb. Assoc. Int’l Ctr. Disp. Resol. Apr. 11, 2022) (Award); J.A. 33–55. Acorda filed the legal action now before us by petitioning the United States District Court for the Southern District of New York to confirm all the Tribunal’s rulings except for the denial of recoupment of the unprotested 2018–2020 payments, which Acorda sought to modify on the ground that the Tribunal acted in “manifest disregard” of federal patent law and a non-patent-law principle of law. Alkermes disputed the modification request only. The district court rejected Acorda’s manifest-disregard arguments and confirmed the award in full. Acorda Therapeutics, Inc. v. Alkermes PLC, No. 23-cv-223, 2023 WL 5003767, at *1 (S.D.N.Y. Aug. 4, 2023) (Decision); J.A. 1–20.

ACORDA THERAPEUTICS, INC. v. ALKERMES PLC 3

Acorda appealed, asserting that this circuit has appellate jurisdiction over the appeal and should reverse the district court’s denial of the 2018–2020 recoupment it sought. We conclude that Acorda’s petition to modify the arbitral award on the ground that the arbitration panel manifestly disregarded the law is not within our jurisdiction under 28 U.S.C. § 1295(a)(1). We therefore transfer the case to the United States Court of Appeals for the Second Circuit.

I

A

Acorda is the developer of Ampyra®, a drug used to improve the walking ability of patients with multiple sclerosis . Decision, at *1; J.A. 357. Alkermes owned now-expired U.S. Patent No. 5,540,938, which claimed a sustained-release formulation of the active ingredient in Ampyra, dalfampridine . Decision, at *1. In 1998, Acorda and Alkermes entered into a joint-venture agreement, under which Alkermes licensed the ’938 patent to Acorda, and supplied the active ingredient, for an ongoing royalty of 18% of the net sales price of drugs sold as part of the joint venture, among other conditions. Award, at 6–7; J.A. 320. In 2003, Acorda and Alkermes dissolved the joint venture due to regulatory concerns and entered into a new agreement with two contracts . Award, at 7; J.A. 329–30. Under those two contracts , Acorda, as seller of Ampyra, would pay a 18% royalty to Alkermes, structured as a 10% royalty under a License Agreement plus an 8% royalty under a Supply Agreement. J.A. 154; J.A. 214–15; J.A. 329–30. In 2010, upon FDA approval of the relevant new drug application, Acorda began to market Ampyra. J.A. 357.

On July 30, 2018, the ’938 patent expired and generic versions of Ampyra soon entered the market. J.A. 365, 388. In December 2019, Acorda contacted Alkermes and requested an adjustment to the royalties in light of the expiration , but Alkermes refused. J.A. 265; J.A. 391, 394. Acorda continued to make payments, without (as the 4 ACORDA THERAPEUTICS, INC. v. ALKERMES PLC

parties accept before us) stating a formal protest. Acorda Opening Br. at 11–12; Alkermes Response Br. at 9; J.A. 265; J.A. 628 n.5. In April 2020, Acorda again asserted to Alkermes that the royalty provision of the License Agreement was unenforceable due to the expiration of the ’938 patent, citing Brulotte, 379 U.S. at 32, but Acorda continued to make payments without a protest. J.A. 390, 394. In July 2020, two years after the ’938 patent expired, Acorda began to include a protest with each payment made under the License Agreement, while not doing so for payments made under the Supply Agreement. J.A. 265; J.A. 446.

B

On July 28, 2020, Acorda filed with the American Arbitration Association’s International Centre for Dispute Resolution a Demand for Arbitration with Alkermes, pursuant to arbitration terms of the License and Supply Agreements. Award, at 1–2; J.A. 83. Among other claims, Acorda sought a declaration that the licensing royalty provision was unenforceable after the expiration of the ’938 patent in July 2018, and a return of royalties Acorda had paid after July 2018, invoking unjust enrichment as a basis for such recoupment. Award, at 2–3. As the parties agree, New York law governed the arbitration. Id. at 18 n.10.

On November 7, 2022, after discovery, summary-judgment , and other proceedings, the Tribunal issued an arbitral award. See generally Award. It agreed with Acorda that, under Brulotte, the License Agreement’s royalty provision was unenforceable upon the expiration of the ’938 patent. Id. at 8–16; see Brulotte, 379 U.S. at 32 (“[A] patentee ’s use of a royalty agreement that projects beyond the expiration date of the patent is unlawful per se.”). It then determined that “the License and Supply Agreements are, for all intents and purposes, one agreement” and thus that the Supply Agreement’s royalty provision was also unenforceable . Award, at 16–17.

ACORDA THERAPEUTICS, INC. v. ALKERMES PLC 5

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