The case involves a dispute over inventorship related to a compound for suppressing growth of blood vessels supplying tumours.

In September 2005, HIF and BizBiotech filed a complaint against Carlsbad Technology and several other parties in Los Angeles Superior Court. In November 2005, the action was removed to the United States District Court for the Central District of California.

The district court ultimately declined supplemental jurisdiction over the rights of inventorship and ownership of inventions claims, which it said were state law claims, and also declined supplemental jurisdiction over the plaintiffs' nine other state claims, thus remanding the case to state court.

Carlsbad appealed to the Federal Circuit, which declined to rule on the basis that:

In short, because every § 1367(c) remand necessarily involves a predicate finding that the claims at issue lack an independent basis of subject matter jurisdiction, a remand based on declining supplemental jurisdiction can be colorably characterized as a remand based on lack of subject matter jurisdiction. Accordingly, a remand based on declining supplemental jurisdiction must be considered within the class of remands described in § 1447(c) and thus barred from appellate review by § 1447(d).

The company subsequently appealed to the Supreme Court, which agreed to consider the case. The question presented to the Court is:

Whether a district court's order remanding a case to state court following its discretionary decision to decline to exercise the supplemental jurisdiction accorded to federal courts under 28 USC § 1367(c) is properly held to be a remand for a 'lack of subject matter jurisdiction' under 28 USC § 1447(c) so that such remand order is barred from any appellate review by 28 USC § 1447(d).

The case was not expected to be granted certiorari . However, the Court said that it agreed to rule because the Federal Circuit's decision marked a "direct conflict among the circuits".