Bits and Bytes No. 118: Kappos & Dudas

From Hal Wegner:

A few weeks ago Dave Kappos was involved in a webinar with Jon Dudas which provides some perspectives on the new Director’s views. It is available at http://www.foley.com/news/event_detail.aspx?eventid=2779. The webinar itself is available at http://www.foley.com/multimedia/multimedia_detail.aspx?multimediaid=58221724.

The May 8, 2009 webinar focuses on patent reform; technology issues; and reexamination.

A final version of the new Patent Case Management Judicial Guide is in print. It is also freely available on SSRN.

Dennis Crouch

About Dennis Crouch

Law Professor at the University of Missouri School of Law. Co-director of the Center for Intellectual Property and Entrepreneurship.

37 thoughts on “Bits and Bytes No. 118: Kappos & Dudas

  1. Dear Ad Astra,

    Re:
    “You’re absolutely right that a small inventor’s position of lesser power in negotiations with large entities puts them exactly at risk of irreparable harm.”

    It would be nice to see precedents set, and upheld at the CAFC, granting injunctions to non-practicing patent holders based on the risk of irreparable harm in negotiating licenses with large entities.

    Strong such precedents would go a long way to combat the ill-effects of eBay.

    Regarding your question:
    “Have you had problems with courts not giving you or other small inventors injunctions?”

    If a large entity does not fear an injunction from a small inventor after litigation, the large entity has less motivation to license-up prior to litigation. The cost of such litigation may be prohibitive to the small inventor, in which case the inventor’s patent may be worthless.
    And, given eBay and other adverse rulings, law firms are less likely then they used to be to enter contingency relationships.

  2. JAOI, the argument that inventors need the injunction right is emotionally compelling, but doesn’t have much bearing on the constitutional issue. It is, however, important when it comes to whether or not an injunction is warranted in any specific case. You’re absolutely right that a small inventor’s position of lesser power in negotiations with large entities puts them exactly at risk of irreparable harm. Have you had problems with courts not giving you or other small inventors injunctions?

    In any case, I’m also not sure I buy the argument that without the automatic injunction power, inventions will be seriously undervalued. I know that the amount that a court would award may not be what you think the invention is worth, but who’s to say that, if an injunction is granted without the four-factor test, the invention would not be commanding *more* than it’s worth? Maybe, in practice, that’s not the case, but I’ve never seen compelling evidence either way. It just seems as though the decision to mandate automatic injunctions would mean an automatic boost in the value of all patents, whereas the Ebay rule means that that boost only happens where a court sees it as justified. I understand that you may see that as unfair, but I’m just not sure I agree.

  3. Furthermore,

    If an entrepreneurial inventor went to raise money to enforce his or her patent portfolio via a licensing program, an investment banker would be reluctant to invest, or the terms may be far more onerous, if the inventor’s patents’ exclusive Rights would not necessarily exclude an infringer from practicing the inventions.

    In a license negotiation, a patent without “the exclusive Right” is akin to a revolver without bullets in a duel …
    Without “the exclusive Right,” all an independent patent owner can do is “bluff.”

    International businesses that employ unscrupulous tactics, like Cisco for example, do not back down from a bluff. I can attest to that from personal experience (although my experience was not with Cisco — someday maybe).

    * * * * *
    In my example above, the entrepreneurial inventor would suffer irreparable injury if he were unable to negotiate a license without the ability [“full faith and credit”] to fully support the grant of “the exclusive Right” as specified in the Constitution.

    From a business view, what you think of this “irreparable injury” argument?
    Do I make $ense? Am I getting warm?

  4. Dear Ad Astra, broje et al.,

    Good morning.
    Thank you for your insightful comments.
    Please pardon me if I am repetitive again (©¿®)™.

    Re:
    “…the patent clause prevents Congress from granting someone a perpetual exclusive right, or an exclusive right in someone else’s idea or writing. He [Jaoi™] seems to think it follows that Congress cannot, then, put any additional limitations on the exclusive right that it grants, if it chooses to grant such a right.”

    That is what I think — under the Constitution, neither Congress nor the Courts should limit “the exclusive Right” based on whether or not the patent holder practices the invention.

    Congress has exercised its discretion to create various forms of intellectual property that grant “the exclusive Right” for limited times, and this is literally in accord with the “Patent Clause” in Article I, §8 of the Constitution, which has never been amended:
    “The Congress shall have Power …
    “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”

    When the Patent Clause was enacted as the Law of the Land, it is inconceivable to me that its Framers would not insist on “the exclusive Right” being granted to practicing inventors and non-practicing inventors alike, without discrimination based thereon. I believe anyone would be constrained to agree on this point.

    A right to a royalty without a right to stop the infringement is not “the exclusive Right” at all — it is a merely a Right to a Royalty and no more, and that is akin to compulsory licensing.

    Re:
    “JAOI says that, since the inventor has the right to exclude, he or she must also have the injunction remedy, because otherwise the infringer would not be “excluded” from the invention, but would just be paying rent. There’s something intuitively appealing about that.. However, legally rights and remedies have always been separate, and since the patent clause doesn’t explicitly call for injunctions to be available…”

    I cannot deny that the Patent Clause does not explicitly call for an “injunction.” The word “injunction” is not found anywhere in the Constitution, although the notion of injunctions was well known in the time period the Constitution was written.

    However, I believe the Patent Clause explicitly requires the grant of “the exclusive right” to an inventor whether or not the inventor practices is invention.
    This is also in accord with the exact words from the ribbon covers of patents:

    “Therefore, this United States Patent grants to the person(s) having title to this patent the right to exclude others from making, using, offering for sale, or selling the invention throughout the United States of America…”

    Let’s not get hung up on the word or the notion of an “injunction.” What else can “the right to exclude others” mean other than “the right to exclude others” by ANY available means, whatever it takes to enforce a patent owners Constitutional “right to exclude others” if his patent’s validity is upheld and held infringed after trial in a competent court?

    From a pragmatic business standpoint, as I’ve mentioned before, this is the prejudicial and illogical result (perhaps an unintended consequence) of the USSC’s eBay Decision:
    The eBay ruling is prejudicial against a particular class of patent owners, for example, those who choose to license their invention rather than practice the invention.

  5. I think that is what he means, essentially, but he also is saying something about Constitutional law (and he’s said it before) which as far as I know is incorrect. It’s also not really relevant to the Ebay issue, but I still wanted to point out the problem.

    The core issue, as far as I can tell, is about rights and remedies. JAOI says that, since the inventor has the right to exclude, he or she must also have the injunction remedy, because otherwise the infringer would not be “excluded” from the invention, but would just be paying rent. There’s something intuitively appealing about that. However, legally rights and remedies have always been separate, and since the patent clause doesn’t explicitly call for injunctions to be available, the standard four-part test for injunctions should apply. That’s what this argument boils down to, as far as I can tell.

  6. AA, I think JAOI means that the patent clause prevents Congress from granting someone a perpetual exclusive right, or an exclusive right in someone else’s idea or writing. He seems to think it follows that Congress cannot, then, put any additional limitations on the exclusive right that it grants, if it chooses to grant such a right. Am I right, JOAI?

    Anyway, I find that logic flawed because there is nothing in the patent clause or anywhere else that says Congress cannot grant the exclusive right subject to additional limitations.

  7. JAOI – hold on a minute. You say that “The point I was trying to make is that there are exceptions within the Constitution to ‘the exclusive Right'”, but I understand that. I was, in fact, trying to contradict that very point. There are no explicit exceptions within the Constitution to the “exclusive right”. In any case, if you’re trying to find a basis for Congressional limitation of patent rights, the Commerce Clause is more than sufficient. I think the main thing is that, since the existence of patent system is discretionary to Congress anyway, and most people don’t see the phrase “exclusive right” as sufficiently specific to require injunctions, Congress has a lot of latitude to adjust patent rights as it sees fit.

    On the point of the Equal Protection Clause, you’re not really addressing my point. When I said “You’re right that the government can’t arbitrarily discriminate between practicing and nonpracticing entities”, the word I wanted to emphasize there was “arbitrarily”. As I said later in that paragraph, the government could probably pass laws discriminating against non-practicing entities, and it would be entirely constitutional. All they’d have to do is come up with a rational justification for doing so, which I don’t see being much of a problem. It’s not fair to say, then, that the decision was unconstitutional on an equal protection basis.

  8. Dear Ad Astra,

    “First it’s unlikely that a strict constructionist judge would…” agree with my eBay opinion.

    This excerpt is from the USSC’s Merc v eBay decision, page 3:
    “To be sure, the Patent Act also declares that ‘patents shall have the attributes of personal property,’ §261, including ‘the right to exclude others from making, using, offering for sale, or selling the invention,’ §154(a)(1). According to the Court of Appeals, this statutory right to exclude alone justifies its general rule in favor of permanent injunctive relief. 401 F. 3d, at 1338. But the creation of a right is distinct from the provision of remedies for violations of that right. Indeed, the Patent Act itself indicates that patents shall have the attributes of personal property ‘[s]ubject to the provisions of this title,’ 35 U. S. C. §261, INCLUDING, PRESUMABLY, THE PROVISION THAT INJUNCTIVE RELIEF ‘MAY’ ISSUE ONLY “IN ACCORDANCE WITH THE PRINCIPLES OF EQUITY,” §283.” (emphasis added)

    I believe that the Supreme Court Justices did not stop to question the constitutionality of 283, since 283, and only 283, allowed them to make their result oriented decision. It is my opinion that the Justices were influenced by the pejorative “Troll” trash propaganda that had permeated all forms of media and all branches of government.
    In other words, the Supreme Court Justices rendered a politically correct decision under the influence of Cisco and its cartel for Patent Fairness et al. and their multimillion dollar concerted effort over years to dummy-down our patent system and screw independent inventors.

    “Second …other powers granted to Congress are not relevant to the discussion..”

    I agree that they are not directly relevant. The point I was trying to make is that there are exceptions within the Constitution to “the exclusive Right.”

    “Third…You’re right that the government can’t arbitrarily discriminate between practicing and nonpracticing entities.”

    I agree; therefore, the Supreme Court’s eBay decision was (result oriented, politically correct,) contrived and constitutionally unsound.

    “Fourth … it shows more respect”

    I mean no disrespect — please forgive me if I come off that way. As I discuss this subject with different commenters I find that there are no new arguments to be made, and I cannot deny that my comments are in large part simply repetitive.

    In sum,

    I do not think it is constitutionally lawful, nor consistent with 35 USC 154, to deny any patent owner an injunction or other means to end an infringement because s/he does not practice his or her invention.

    Or put another way,

    I do not think it is constitutionally lawful, nor consistent with 35 USC 154, to allow an infringer to continue infringing without the consent of the patent owner whether or not s/he practices his or her invention.

    * * * * *

    Ad Astra, thanks for your additional comment in answer to my question:

    Suppose an injunction granted pre-eBay no longer qualifies for an injunction post-eBay. Can an enjoined infringer break the injunction?

    For what it may be worth, I think you’re right but that’s only my lay guess.

    I wonder if anybody has ever tried to break an injunction post-eBay?, or if anybody else has a different opinion?

  9. Well, I’m no expert in injunction law, and all the usual caveats apply (I’m not your lawyer, this is not legal advice, etc.), but my impression would be that yes, an infringer could get their injunction vacated, though they’re highly unlikely to succeed. Courts have an ongoing ability to review and modify their own injunctions, in order to make sure that equity is still being served. If the court had originally granted the injunction because it felt it had to by tradition, but would not have done so post-Ebay, the infringer might be able to convince the court to remove the injunction. It’s just not very likely that any court would be willing to do so, given how little Ebay explicitly changed the law. I expect most courts that granted an injunction before Ebay would be unlikely to want to go back and admit that they didn’t balance the equities in the first place, and since nothing in Ebay explicitly forces them to do so, I can’t see it happening.

    Of course, I could be wrong; as I said, this is certainly not my area of expertise, assuming I have one in the first place.

  10. Dear Ad Astra,

    Thank you for your comment. While I contemplate the substance of your thoughts so that I can respond intelligently (hopefully with a clear sober head tomorrow), perhaps you’d address the question I’ve asked above (for the very first time), i.e.,:

    I’ve been thinking about another eBay-related question for a long time:
    Suppose an injunction granted pre-eBay no longer qualifies for an injunction post-eBay. Can an enjoined infringer break the injunction?

  11. JAOI, this is territory we went over a few months ago (and I’m sure many before have done the same), but I would like to throw in a couple of thoughts.

    First, it’s unlikely that a strict constructionist judge would side with you on this, for as much as you may say otherwise, in the way legal interpretation is done the text of the Constitution simply isn’t explicit enough on the subject to provide a core to construe strictly. The strongest proponents on the court for “strict construction” (though their philosophies are somewhat different), Scalia and Thomas, agreed with the unanimous decision of the Court.

    Second, as I said before, the three Congressional powers you mention do not form some sort of list of exceptions applicable to the patent right. As broje noted, the preamble to the Constitution is not binding. Also, in regard to the Commerce clause, that is a grant of power to Congress. It is not a limitation on or exception to the Patent clause. The Patent clause is its own separate grant of power. You can argue (as you have) that the terms of the Patent clause itself limit Congress’s power, but the other powers granted to Congress are not relevant to the discussion.

    Third, the Equal Protection Clause of the Fourteenth Amendment doesn’t only protect enumerated classes; it doesn’t enumerate any classes at all; however, the Sixteenth and Nineteenth Amendments specifically protect race and gender, respectively. You’re right that the government can’t arbitrarily discriminate between practicing and nonpracticing entities. However, that doesn’t mean they can’t do it all. Practicing status does not fall into any of the protected classes built up over the years by the Supreme Court, so all the government would have to do is present a rational basis for the discrimination. While I’m sure you disagree that such a basis exists, I’m pretty sure the government could come up with one.

    Fourth, and please take this as advice rather than insult, some of the longer paragraphs in your posts on this thread look very familiar. I know it’s time-consuming to type up new arguments every time, but it’s pretty bad internet form to just cut and paste whole blocks of argument from previous conversations. It also leads to bad habits. It would be better if you would just type out a new argument each time – it shows more respect for the people you’re talking to, at least for those of us who’ve been following the PatentlyO comment threads for a while.

  12. Dear broje,

    I am constrained to admit that we must agree to disagree; I enjoyed our conversation.

    And, by the way, I admire your honesty, your admission that you are not a know it all (©¿®)™.

    PS:
    Neither am I.

  13. I think that a strict constructionist would likely find that Congress has the power to grant the exclusive right without being forced to grant an absolutely exclusive right. So I think a strict constructionist would most likely find that 283 does not conflict with the patent clause, and neither does Ebay.

    I don’t know about the injunction.

  14. Dear broje,

    As a practical matter, of course, you are right:
    I agree that, as a practical matter, there does not appear to be any recourse against the eBay Opinion — I am hoping however, that an extraordinary attorney will come up with a strategy to reverse eBay.

    Be that as it may, may I assume that a strict constructionist would agree in principle with my eBay analysis, i.e., that eBay is not consistent with the Patent Clause?

    I’ve been thinking about another eBay-related question for a long time:
    Suppose an injunction granted pre-eBay no longer qualifies for an injunction post-eBay.
    Can the enjoined infringer break the injunction?

  15. Even if legislating from the bench is a “no no,” who is going to prevent SCOTUS from doing it? One possible answer is Congress. But Congress will have to pass an amendment (in the case of a disagreement over Constitutional interpretation) or new legislation (in the case of a disagreement over application of a statute).

    The simple truth is that SCOTUS has the power to legislate from the bench. So, frown on it as you will, it is a fact that it happens and that it will continue to happen however the Justices see fit. Only the Justices’ own predilections for strict construction will prevent them from doing it.

    When I say they are “infallible” when interpreting the Constitution, I mean that they have the first, last, and only say over what the Constitution means. That doesn’t mean that I necessarily like all of their decisions.

    If you want to change the existing law about injunctions for non-practicing inventors, you will have to get Congress to pass new legislation. Even if all the Justices died tomorrow and we had all new Justices who agreed with you entirely, they would still refrain from overturning Ebay for twenty years or so. That’s the power of Stare Decisis. SCOTUS will decline to overrule its own prior decisions for at least 20 years (or thereabouts), simply to preserve and underscore the effect of precedent.

  16. Dear broje,

    Re:
    “So, if SCOTUS said that DC can be built beyond 10 miles square, and if Congress did nothing, then the Constitution would become, in effect, as amended as if Congress has amended it.”

    With all due respect, I am surprised to hear you say that. Where do you draw your opinion from?

    Legislating from the bench, even the SC bench, is a no-no. Where there is ambiguity or lack of clarity in the Constitution, the SC would have the final say — to that extent I agree.

    I think Article VI, Clause 2 speaks for itself:

    “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.”

    and is in stark contrast with your view.

    Re: “I also think that SCOTUS is basically infallible …”

    I cannot agree — I agree instead with Boston Legal’s Alan Shore, Esq’s. stunning lambasting of our Honorable Supreme Court Justices. Mr. Shore put it so well when he said, “You folks aren’t as hot as all get out.”

  17. I still think that the Constitution basically says that Congress can grant a property right, without mandating that it be an absolute right. Congress chose to grant the property right subject to an easement if the Court finds it appropriate. So, no, I don’t think that 283 is in conflict with the Constitution.

    I also think that SCOTUS is basically infallible, for all practical purposes, when interpreting the Constitution. If they say black is white, then black is white until Congress amends the Constitution. And, even then, SCOTUS can just keep saying “no” until Congress amends the Constitution to change the number of Justices, reallocate the balance of powers, set up a new Court, etc. That’s just the reality of the situation.

    Further, SCOTUS has said that the preamble to the Constitution is not a binding part of the Constitution. Congress has not acted to contradict that decision by amending the Constitution to include the preamble. Silence on the part of Congress is interpreted as assent.

    So, if SCOTUS said that DC can be built beyond 10 miles square, and if Congress did nothing, then the Constitution would become, in effect, as amended as if Congress has amended it. This “end run” around the need for a Constitutional amendment drives some people crazy, but it is part of how our system of government works.

    But I don’t think that such an “end run” is required for 283. According to the plain language of the Constitution, Congress can grant the exclusive right, not subject to any restrictions regarding it being an absolute exclusive right. 283 merely specifies that the right is not absolute, which is not in conflict with the plain language of the Constitution.

  18. In other words, Congress screwed up when it enacted 35 USC 283 and, presumably, SCOTUS didn’t recognize the inconsistency between 283 and the Patent Clause – in essence, SCOTUS based its eBay decision on 283 and nothing more.

  19. Dear broje,

    Would you agree that 154 and 283 are in conflict with each other?, and that 154 is consistent with the Patent Clause while 283 is in conflict with the plane language of the Patent Clause?

    35 USC 154 is explicitly consistent with Article I, §8, Clause 8: “… the right to exclude others from making, using, offering for sale, or selling …”

    35 USC 283, however, is in direct conflict with patent Clause 8:
    “The several courts … may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.”

  20. Dear broje,

    Yes. I also recognize the requirement that SCOTUS must faithfully abide the mechanical laws and limitations laid down in the Constitution and its amendments.

    May I ask if you recognize that neither the SCOTUS nor any other governmental entity can make a military appropriation for longer than two years?, or build Washington DC beyond 10 Miles square?

  21. IANYL = I am not your lawyer.

    TINLA = This is not legal advice.

    Let me ask you this: Do you recognize the authority of SCOTUS to interpret the Constitution?

  22. Dear broje,

    With regard to your comment at 10:40AM, I agree in substantive part.

    However, other than the constitutional exceptions I’ve described in my missive, I do not think it is constitutionally lawful to deny any patent owner an injunction simply because s/he does not practice his or her invention; and I do not think it is constitutionally lawful to allow an infringer to continue infringing without the consent of the patent owner.

  23. Dear broje,

    What does IANYL. TINLA. mean?

    Here are my complete thoughts — perhaps in the full context of the eBay opinion you may agree with me.

    The Supreme Court’s eBay Decision
    is in Conflict with the U.S. Constitution

    The “Patent Clause” in Article I, §8 of the Constitution, which has never been amended, reads:

    “The Congress shall have Power …
    “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”

    With the red ribbon and gold seal on the cover of original United States patents, which are “granted under the law” by the Director of the USPTO, the following grant is printed:

    “Therefore, this United States Patent Grants to the person(s) having title to this patent “the right to exclude others from making, using or selling his invention…”

    Thus, a patent does not grant the patentee the right to make, use or sell his invention. Rather, a patent grants the patentee “the right to exclude others from making, using or selling his invention…” Under the Constitution, with rare exception, when a District Court found that a patent was valid and was infringed, the Judge granted an injunction to stop the infringement. The exposure, for any infringer who did not obey the court order, was contempt.

    Most of the 18 Clauses of Article I, §8 of the Constitution allow Congress discretion to set the limits for the Powers given to it. For example, the limits of the following Powers granted to Congress are left to Congress’s discretion: taxes; duties; pay debts; borrow money; regulate commerce; rules for naturalization and bankruptcies; coin money; punishments; rules governing military bodies; and to make laws as necessary to fulfill its “Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department thereof.” (Clause 18).
    However, three Clauses of Article I, §8 of the Constitution contain specific enumerated limits. The limits in these three Clauses have never been amended.
    The limit in Clause 17 is: “100”:
    The limit in Clause 12 is: “two”;
    The limit in Clause 8 is: “one”;
    It has never even been suggested that the Framers of the Constitution meant for these three specific limits to be interpreted in any way other than plainly, naturally, by the numbers; and so, historically, until the Supreme Court eBay ruling, they have been interpreted literally.
    — — — — —
    Clause 17: “The Congress shall have Power …
    “To exercise exclusive Legislation in all Cases whatsoever, over such District
    (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, …”
    Washington D.C. is 68 sq. miles; “ten Miles square” = 100 square miles.

    Clause 12: “The Congress shall have Power …
    “To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years;”
    Congress’s military appropriations (which may include appropriations to pay for patent royalties, discussed below) have never exceeded two years.

    Clause 8: “The Congress shall have Power …
    “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”
    The “exclusive Right” means the Right to exclude all but “one,” the inventor, as stated on the cover of original “ribbon” patents.
    — — — — —
    The exclusive Right Yes, But Only for a Limited Time …

    The Framers give Congress the means and the Power up-front to regulate the “exclusive Right.” By including in Clause 8, “securing for limited Times,” Congress can pass patent statutes that grant more or less time to a patent, and, by statute, Congress has done so. And, also by statute, Congress has the Power to create different types of patents with different lifetimes, as they have done for Design Patents. Congress has also created Trademark statutes that live somewhere between Copyrights and Design patents.

    Thus, Congress has absolute Constitutional Power to administer our patent system, and it has rightly (and wrongly) done so. Further, within the Constitution itself, one finds authority for Congress to exercise its Power to moderate “the exclusive Right” under certain constitutionally certified circumstances:

    (A) To regulate Commerce,
    (B) provide for the common defense, and to
    (C) promote the general Welfare.

    Article I, §8, Clause 3:
    “The Congress shall have Power … To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;”
    Thus, in its body of antitrust statutes, Congress imposes certain limits when exercising a patent’s “exclusive Rights” in order to regulate Commerce.
    The Preamble:
    “We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”
    Eminent domain power:
    When exercised over a patent’s “exclusive Rights,” for national security and defense, Eminent Domain power is consistent with the Preamble, to “provide for the common defence.” Thus, military appropriations bills in peacetime and wartime routinely include allocations for patent royalties.
    If an independent inventor discovered and patented a vaccine for Anthrax, but refused to license or manufacture it for his anti-American religious reasons, eminent domain could absolutely and reasonably be asserted to “promote the general Welfare.”
    The Supreme Court’s Faulty Argument:

    This excerpt from the USSC’s Merc v eBay decision, page 3, is referred to below:

    “To be sure, the Patent Act also declares that ‘patents shall have the attributes of personal property,’ §261, including ‘the right to exclude others from making, using, offering for sale, or selling the invention,’ §154(a)(1). According to the Court of Appeals, this statutory right to exclude alone justifies its general rule in favor of permanent injunctive relief. 401 F. 3d, at 1338. But the creation of a right is distinct from the provision of remedies for violations of that right. Indeed, the Patent Act itself indicates that patents shall have the attributes of personal property ‘[s]ubject to the provisions of this title,’ 35 U. S. C. §261, including, presumably, the provision that injunctive relief ‘may’ issue only “in accordance with the principles of equity,” §283.” (emphasis added)

    35 USC 154 is explicitly consistent with Article I, §8, Clause 8: “… the right to exclude others from making, using, offering for sale, or selling …”

    35 USC 261 is also consistent with Clause 8: “Subject to the provisions of this title, patents shall have the attributes of personal property … patents … shall be assignable”. Congress, by a lawfully-correct permissible statute, 35 USC 261, made patents a “personal property” and allowed the assignment thereof.

    35 USC 283, however, is in direct conflict with patent Clause 8:
    “The several courts … may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.”
    35 USC 283 would (presumably?) cede discretion to courts to diminish the Power the Constitution gave Congress. Of course, this change may be made by formal amendment in accord with Article V, the procedure to amend the Constitution, but certainly not by mere statute. When such conflict exists, the Supremacy Clause, Article VI, says there is no contest – the Constitution wins. Our Supremes’, however, in their eBay Decision, made the mistake to rely, essentially solely, on what they called a presumption in 35 USC 283! Remarkable.

    Although the following does not concern the Constitutional or other legal arguments underlying the USSC’s faulty Merc v eBay decision, it does describes the consequences for the U.S. economy. Whether intended or not intended, it is merely the pragmatic by-product of that fateful eBay Decision. The implications of the by-product are horrific and could plague American innovation and the IP profession for generations.

    Put Simply, this is the prejudicial result of the USSC’s eBay Decision:
    • The Supremes’ eBay ruling is prejudicial against a particular class of patent owners, those that choose not to practice their invention.
    • In a business negotiation, a patent without “the exclusive Right” is akin to a revolver without bullets in a duel …
     Without “the exclusive Right,” all a patent owner can do is “bluff.”
    The Exclusive Right is a Settled Expectation
    In Connolly v. Pension Benefit Guaranty Corp. 457 U.S 1, 222, 106 S.Ct. 1018, 89 L.Ed.2d l66 (1986), the Supreme Court held, in essence, that historically every patentee’s exclusive Right to his invention, via a patent injunction, has been a well “settled expectation.”
    The USSC’s MercExchange v eBay decision lacks authority to change this. Connolly held that:
    “… legislation readjusting rights and burdens is not unlawful SOLELY because it upsets otherwise settled expectations.” (emphasis added)
    The eBay decision is not “unlawful solely because it upsets” many inventors’ settled expectation of “the exclusive Right to their…Discoveries.” However, the eBay ruling lacks any prerequisite Amendment for authority to alter the Constitution which clearly provides for an Inventor to have the exclusive Right to his invention, the right to exclude others, just as the Director of the USPTO says on the cover of United States patents:
    “Therefore, this United States Patent Grants to the person(s) having title to this patent “the right to exclude others from making, using or selling his invention…”
    The Supremes’ MercExchange v eBay ruling is a corruption of our Constitution. The Supremacy Clause in the Constitution mandates that it should not stand. In attempting to defend the Supremes’ Merc v eBay Decision, some have pointed out that other corruptions to our Constitution have also occurred, as if there is binding precedent for such corruptions – such arguments are nonsense! Each corruption becomes more threatening to our way of life. Our country is on a slippery slop – our democracy is no easy trip, it never has been.
    Opinion: Our Constitution is unrivaled and supreme, and essential to our freedom and democracy – few would deny that. It is our duty, especially Officers of the Court, to tackle those corruptions, even when the Supremes make a mistake and issue a faulty decision.
    We all should fight to regain our Constitutional footing every time we see a slip.
    * * * * *

  24. JAOI:

    Here is a quote form Wikipedia, because I am too busy to consult more “reliable” sources at the moment:

    “an exclusive right is not necessarily absolute, as an easement may allow a certain level of public access to private land.”

    The Constitution does not grant Congress the power to grant to authors and inventors “only an absolute exclusive right.” It just says, “the exclusive right.”

    It seems to me that you are reading limitations into the clause that are not present. Granting the exclusive right, subject to a compulsory license under certain circumstances, is equivalent to granting someone title to land and then granting someone else an easement over it.

    There is an example that demonstrates that the exclusive right granted by a patent is not absolute. For example, the government gets to use your patented invention without your permission if it relates to certain types of technology. So there is an example of compulsory license for you, and it has been around for a long, long, long, long time. In view of that, I think that it is well established that Congress does grant the exclusive right subject to a compulsory license in certain circumstances, and did so long before Ebay.

    To sum up, I think that it is your position that “the exclusive right” must mean “only the absolute exclusive right.” So I’m sorry, but I don’t think that you are right about that.

    IANYL. TINLA.

  25. Dear broje,

    Re: “The Constitution empowers Congress to grant patents, but it does not require Congress to do so. Therefore, Congress can choose not to grant patents …”

    Yes, I agree.

    Re: “I do think that Congress can discriminate between practicing inventors and non-practicing inventors, SIMPLY BECAUSE CONGRESS IS NOT SPECIFICALLY PROHIBITED FROM DOING SO.” (Emphasis added).

    Sorry, but I am perplexed and I am constrained to disagree. There are myriad things our Constitution did not specifically prohibit Congress from doing — that doesn’t mean Congress can do those myriad things.

    I’m glad we can agree that the plain unambiguous meaning of the patent clause in the Constitution gives discretion to Congress whether or not to grant to inventors “the exclusive Right” to their inventions.

    However, your notion, inter alia, that — Congress can discriminate between an inventor working for himself or an inventor working for someone else, or practicing inventors and non-practicing inventors — simply because, for example (as I understand your argument), since the Constitution and its amendments prohibit racial, gender or religious discrimination, but the Constitution doesn’t specifically prohibit discriminating between an inventor working for himself or an inventor working for someone else, and it doesn’t specifically prohibit discriminating between practicing inventors and non-practicing inventors — with all due respect, this argument to me seems to be facially flawed and absurd to say the least.

    Is that your argument? Did I understand it correctly?

    Be that as it may, I asked you:
    “Would you agree with me that this [patent clause] language does not encompass ‘compulsory licensing’?, i.e., that any reasonable interpretation of this language would exclude ‘compulsory licensing?’”

    And you said — No.
    But, I see the clear meaning of our Constitution’s patent clause thusly:

    It cedes discretion to Congress whether or not to grant “the exclusive Right” to an inventor for his invention. It does not give Congress (or the Courts or anyone else) the right to force an inventor to license his invention if he has been granted “the exclusive Right” under the Constitution’s patent clause.

    Why, pray tell, would you think discrimination between, for example, an inventor working for himself or an inventor working for someone else, or discrimination between practicing inventors and non-practicing inventors, has any basis whatsoever in the Constitution or equity or in any of the Patent Laws that have heretofore been legislated by Congress?

    I haven’t thought about and have no opinion about whether or not Congress could lawfully legislate different Patent Laws for different classes of inventors.
    Certainly Cisco and its cohorts in their bullyshit cartel for “patent fairness” would try to do so if they thought they could possibly get away with it. However, I don’t think their collective intelligence is bright enough to come up with such an innovative plan first place — they do business “the old-fashioned way” if you catch my drift.

    And I’d bet the upper class would like to see Congress legislate different laws for them to abide by compared to laws for the lower class.

    In Alice’s Wonderland maybe such discrimination would be possible, but in America, under our Constitution, attempts at such discrimination would be folly.

    Here’s the skinny of our Constitution’s patent clause in regard to Congress’s discretion and the question of discrimination (whether patent Rights discrimination would be attempted by Congress or by our Courts including, especially including, our Supreme Court:

    Congress is specifically instructed in the body of the Constitution to grant “the exclusive Right” if, and only if, Congress elects to utilize the power afforded to it in the Constitution’s patent clause.

    You also say that:
    “It follows that Congress can choose to grant patents with certain ones of the available remedies available to some patentees but not others.”

    I hope you will now agree that it follows that your conjecture is facially unconstitutional. (©¿®)™

  26. “Would you agree with me that this language does not encompass “compulsory licensing”?, i.e., that any reasonable interpretation of this language would exclude “compulsory licensing”?”

    No.

    “… do you know of anything in the Constitution that would explicitly conflict with Congress enacting legislation that granted patents (with “the exclusive right”) only to certain classes of inventors?”

    Sure. There are certain classes of people that are specifically protected. I don’t think Congress could choose to grant patents: to whites but not blacks; to men but not women; to Christians but not Jews; to people who were born to married couples but not to people born out of wedlock; etc. The Constitution was specifically amended to prevent that kind of discrimination.

    I do think that Congress can discriminate between practicing inventors and non-practicing inventors, simply because Congress is not specifically prohibited from doing so.

    The Constitution empowers Congress to grant patents, but does not require Congress to do so. Therefore, Congress can choose not to grant patents to anyone.

    The Constitution enumerates certain classes of people with regard to which Congress cannot discriminate. Therefore, Congress can choose to grant patents to some people but not others, so long as the distinction is not drawn along the lines of those enumerated classes of people.

    It follows that Congress can choose to grant patents with certain ones of the available remedies available to some patentees but not others.

  27. Dear broje,

    Again, thank you for your comment. I concur in part and dissent in part.

    Re: “The clause is like a claim limitation. It only specifies the type of right, and does not prevent Congress from granting that right in differing degrees to different classes of inventors.”

    Here is where I dissent: The “type of right” in question is “the exclusive Right”.
    Would you agree with me that this language does not encompass “compulsory licensing”?, i.e., that any reasonable interpretation of this language would exclude “compulsory licensing”?

    Re: “I expect you would make a good lawyer.”

    Flattery will get you everywhere; however, I’m happy being an ordinary inventor with a couple of extra ordinary inventions — please pardon my lack of humility.

    Re: “There is no basis in the Constitution I can think of that would prevent Congress from granting patents only to practicing inventors, or only to large entities, etc.”

    Arguendo, if this were deemed acceptable to lawyers, that’s another reason I wouldn’t like to be one (please take no offense). Even if there were to be no explicit basis in the Constitution to prevent Congress from doing as you hypothesize (I suspect there may be), I would argue any such legislative enactment would be facially unconstitutional.
    Looking at it from this view, do you know of anything in the Constitution that would explicitly conflict with Congress enacting legislation that granted patents (with “the exclusive right”) only to certain classes of inventors?

    Other than, of course, the Patent Clause: I mean, what logic or equity would there be to grant different patent Rights for a given invention based on the size or affiliation of the inventor, or the ability of the inventor to practice this invention?

    There are of course specific exceptions in the Constitution to “the exclusive Right”: For example, “To regulate Commerce” gives rise to antitrust statutes; the Preamble, for example, says “… provide for the common defence, promote the general Welfare…” which gives rise to Constitutional “eminent domain” power.

  28. Well, why don’t you think that those who infringe your right to exclude should be put to death? Why is “injunction” mandated by the language in the Constitution?

    And exclusive right is just a property right. When you own property, you have the right to exclude others from enjoying it. But that right is subject to certain limitations. For example, others can take your land by adverse possession. The government can take your land on the basis that you are not making the best use of it. An easement can be forced over your land “by necessity.”

    So when the Constitution says you get an exclusive right, it just says you get a property right (a personal property right as specified by statute), but does not mandate that it is not subject to any limitations Congress puts on it, or mandate particular remedies. The clause is like a claim limitation. It only specifies the type of right, and does not prevent Congress from granting that right in differing degrees to different classes of inventors. There is no basis in the Constitution I can think of that would prevent Congress from granting patents only to practicing inventors, or only to large entities, etc. It grants Congress the power to grant an exclusive right, without any such limitations placed on it.

    You obviously have an interest in Constitutional law and Property law. I think you would enjoy taking some law classes or reading some text books and law outlines. I expect you would make a good lawyer.

  29. Please let me clarify my last paragraph:

    In other words, there is no pre-requisite Constitutional basis to distinguish between one class of inventors and another (e.g., practicing versus non-practicing)

    in regard to “… the exclusive Right to their respective Writings and Discoveries.”

    In this specific regard, all “Inventors” are equal in the eyes of the Constitution, the Supreme Law of the Land, and that can only be changed by an amendment to the Constitution.

  30. Dear broje,

    Thank you for your comment. I would like to clarify this thought:

    Re: “I think that you are saying, essentially, that a right to a royalty without a right to an injunction is not an “exclusive right” at all.”

    with the exact words from the ribbon covers of my many patents:

    “Therefore, this United States Patent grants to the person(s) having title to this patent the right to exclude others from making, using, offering for sale, or selling the invention throughout the United States of America…”

    What else can “the right to exclude others” mean other than “the right to exclude others” by ANY available means (e.g., cease and desist, the threat of, or a finding of, Contempt of Court, a Court Order to Just “Stop it,” incarceration for a recalcitrant infringer, putting the infringer in stocks & bonds [no, not financial instruments] in public display, confiscating and destroying infringing goods in a public square, tar and feathering, injunction, etc., whatever it takes to enforce a patent owners Constitutional “right to exclude others”) if his patent’s validity is upheld and held infringed after trial in a competent court?

    The cover of a ribbon patent is perfectly and unmistakably consistent with the Constitution’s Patent Clause, Article I, §8, (Patent) Clause 8, which reads:

    “The Congress shall have Power … To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”

    In so far as Patent Law 35 USC 283 or any other law is inconsistent with our Constitution’s patent clause, the Constitution’s Supremacy Clause, Article VI, says there is no contest – the Constitution wins.

    Re: your comment:
    “Under Ebay, the patentee still has the right to exclude others, but the remedy for failure of others to comply with that exclusion is mere monetary damages in certain circumstances.”

    You are, of course, correct – and that’s why I believe eBay is inconsistent with our Constitution – that’s what I have a problem with: There is no room for injecting “certain circumstances” into the plain unadulterated meaning of the Constitution’s Patent Clause.

    In other words, there is no pre-requisite Constitutional basis to distinguish between one class of inventors and another (e.g., practicing versus non-practicing). All “Inventors” are equal in the eyes of the Constitution, the Supreme Law of the Land, and that can only be changed by an amendment to the Constitution.

  31. The primary operative limit on the power of the SCOTUS is its inability to rule on matters not properly brought before it. For that reason, it is EXTREMELY bad form for SCOTUS to raise issues sua sponte. Instead, SCOTUS should only rule on the issues raised by the parties and, in my opinion, only consider the arguments made by counsel.

    That said, I am not so familiar with the Ebay decision to know if that issue was raised, or if so, whether that argument was put forth. Please enlighten me.

    But, going further, I’m not sure I find it convincing that the Constitutional clause giving Congress the power to grant exclusive rights in writings and discoveries actually prevents Congress from granting those rights in the form of personal property, subject to injunctive relief in accordance with the principles of equity.

    I think that you are saying, essentially, that a right to a royalty without a right to an injunction is not an “exclusive right” at all. But I would like to point out that the remedy to be applied when others trample your right to exclude does not affect whether it is a right to exclude. Please let me explain.

    The right to exclude should be contrasted with a positive right. Imagine, for example, that a hybrid vehicle does not yet exist, and that Congress makes it illegal to manufacture, sell, own, or operate a hybrid vehicle. Then imagine that Congress grants permission to the peron who invents the hybrid vehicle for that person to make and use it. In this case, that person cannot control whether or not anyone else is able to make, use or sell it. That person has not been granted a right to exclude others. Similarly, the right to vote is not an exclusive right, but rather a positive right, because it does not give you the power to exclude others from voting, but only to vote yourself.

    Under Ebay, the patentee still has the right to exclude others, but the remedy for failure of others to comply with that exclusion is mere monetary damages in certain circumstances. Thus, it seems not quite right to say that the right granted is not an exclusive one. Rather, the available remedy makes that right to exclude less powerful a right than once it was thought to be.

  32. Dear broje,

    I agree with your comments and I would like to emphasize two points you made:

    “And decisions like Bilski and KSR are really just interpretations of statute’s anyway, not the Constitution.”
    and
    “Congress cannot grant patents or copyrights that last forever, or that are not rights to exclude others…”

    May I supplement your comments?
    My contention is that the Supreme Court’s Merc v eBay decision is constitutionally unlawful for the following reason.

    Here is an excerpt from the Supreme Court’s Merc v eBay decision, page 3:
    “To be sure, the Patent Act also declares that ‘patents shall have the attributes of personal property,’ §261, including ‘the right to exclude others from making, using, offering for sale, or selling the invention,’ §154(a)(1). According to the Court of Appeals, this statutory right to exclude alone justifies its general rule in favor of permanent injunctive relief. 401 F. 3d, at 1338. But the creation of a right is distinct from the provision of remedies for violations of that right. Indeed, the Patent Act itself indicates that patents shall have the attributes of personal property ‘[s]ubject to the provisions of this title,’ 35 U. S. C. §261, INCLUDING, PRESUMABLY, THE PROVISION THAT INJUNCTIVE RELIEF ‘MAY’ ISSUE ONLY “IN ACCORDANCE WITH THE PRINCIPLES OF EQUITY,” §283.” (emphasis added)

    The Supreme Court’s “presumption” regarding 35 USC 283 was a correct interpretation of 283. However, the fault lies with Congress’s 35 USC 283 Patent Law, because 283 is in tension with the Patent Clause, Article I, §8 of the Constitution*; 283 reads:

    “The several courts … may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.”

    The Supreme Court was mistaken to predicate its eBay ruling on a Patent Law, 35 USC 283, that was plainly in conflict with the Constitution.

    The Supreme Court should have recognized the conflict and enjoined the PTO from enforcing 283, and further, the Supreme Court should have directed the lower court to issue a ruling in accord with the Constitution’s Patent Clause, Article I, §8.

    *Patent Clause 8:
    “The Congress shall have Power … To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;”

  33. I have to agree that Congress can certainly choose whether or not to grant patent rights. The limits imposed by the Constitution are found in the phrases “limited time,” “exclusive rights,” and “their respective writings and discoveries. So, without a Constitutional amendment, Congress cannot grant patents or copyrights that last forever, or that are not rights to exclude others, or that are rights to other people’s writings or discoveries and not to their own. But, Congress can certainly choose to stop granting patents or copyrights. But that does not mean that the USPTO can unilaterally decide to stop granting them in accordance with the Statute passed by Congress.

    The Court’s authority to interpret Statute’s and the Constitution grew out of practicality more than anything. Basically, someone has to do it, and Courts are in the business of applying the statutes, so why not? If Courts have to ask Congress how to apply statutes in each case, why have Courts at all? And decisions like Bilski and KSR are really just interpretations of statute’s anyway, not the Constitution. If Congress does not like the interpretations, then Congress can amend the Statutes or even the Constitution.

    That doesn’t mean I like what the Courts and the PTO have done in KSR, Bilski, and the proposed limits on Continuations. But I recognize the practicality of the process and the authority of the Courts to decide these issues.

  34. Dear Ken Brooks,

    Re: “Would any consitutional infirmities exist were Congress to preclude the filing of patent applications?”

    No.

    The “Patent Clause”:
    The Congress shall have Power …
    Clause 8: To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

    I have a question for you.
    Since our Constitution gives power to Congress to enact patent statutes, and Congress has done so, on what authority does the Supreme Court rely on to so radically undermine the value of pre-existing patents — patents that have been granted by the PTO in accord with to Congress’ patent statutes — with decisions like eBay, KSR, etc?

    Does the provision in The Constitution, Article I, Section 9, Clause 3: “No Bill of Attainder or ex post facto Law shall be passed.” speak to my question?

    If an inventor pays the fees to patent his invention, where is the rationale for the Supreme Court to in essence invalidate a patent at a later date by raising the bar of patentability?, or effectively undermine the ability of an independent inventor to negotiate a license with an infringer?

  35. I was hoping we had some constitutional scholars that monitor this website. I pose the following question: would any consitutional infirmities exist were Congress to preclude the filing of patent applications?

    I pose this question, because such an act would inherently create a monopolistic imbalance in the market due to pre-existing patents. Furthermore, were there constitutional infirmities to such an act, then the next question arises:

    To what extent can changes to the procedural aspects of the United States Patent Office be undertaken by Congress that result in a monopolistic imbalance in the market due to pre-existing patents?

    I recall some dicta in Graham v. Deere about Congress’ plenary authority over patents being subject to limits imposed by the Constituion.

    Ken Brooks

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