Is the Patent Act more like the Sherman Act or the securities laws?
on Dec 4, 2014 at 9:53 am
After this Friday’s Conference, we will finally get to see what the Justices think about Kimble v. Marvel Enterprises. This is a well-aged petition, seeking review of a July 2013 decision of the Ninth Circuit; it was deferred when the Court sought the views of the Solicitor General.
The petition is striking because of the boldness of the question presented: whether “this Court should overrule Brulotte v. Thys Co., which held that ‘a patentee’s use of a royalty agreement that projects beyond the expiration date of the patent is unlawful per se.’” It is not often that the Court gets a petition that cuts so directly to the heart of the matter. When it does (as in the same-sex-marriage cases), the petition typically can seek cover in strong signals from the Justices indicating their displeasure with the prior decision. But nothing of the kind is offered here. The Justices have not considered the topic since the Brulotte decision itself more than half a century ago.
So what can Kimble say for himself? He can say that Brulotte rests on an outmoded conception of competition policy, rejected by modern economic analysts, which ignores the foundational restructuring of antitrust law during the intervening years. He situates Brulotte well to point out that it was written by Justice William O. Douglas: how many of Justice Douglas’s antitrust opinions fit well with the Court’s current antitrust jurisprudence?
The government’s answer, responding to the Court’s call for the views of the Solicitor General, is that Kimble cannot overcome the high hurdle for overturning one of the Court’s statutory interpretation decisions. The Solicitor General emphasizes the discussion just last Term in Halliburton v. Erica P. John Fund, in which the Court declined to overrule its decision in Basic v. Levinson despite the dubious connection of that decision to modern economic analysis.
What makes this case interesting for me is the spotlight on what the Justices are doing with the Patent Act. When they look at the securities laws (in cases like Halliburton), they operate against a baseline expectation that Congress can and will revise the statute to levels of tedious detail if courts take the statute someplace offensive to legislative sensibilities. Cases under the antitrust laws, as we all know, get a much different reception, as the Court has consciously developed antitrust law as a largely common-law field, built upon the broad and vague generalities of the congressional enactments.
So where does the Patent Act fit in all this? In some areas, the Justices view the language of the statute as calling for them to pour judicially created content into vague and general words in the statute: the most obvious examples are patentability cases like Bilski v. Kappos, Mayo Collaborative Services v. Prometheus Laboratories, and Alice Corp. v. CLS Bank. I’d probably put the Court’s analysis of definiteness in Nautilus v. Biosig in the same pile.
In other situations, the Court seems much more inclined to treat cases as purely statutory, to be resolved almost entirely by parsing the statute, however detailed or general it might be. Here I’m thinking of cases like Octane Fitness v. Icon and Highmark v. Allcare, cases that (in Justice Sonia Sotomayor’s words) “begin and end with” the language of the Patent Act. Limelight Networks v. Akamai Technologies – or at least Justice Samuel Alito’s explanation of the result – is another example.
So into which pile will the Justices sort Kimble? Recognizing that the safe bet is always that the Justices will deny review, I’m going out on a limb here to suggest that the “patent-misuse” issue seems to me too similar to the antitrust questions that the Court so commonly arrogates to itself. So I’m guessing the Justices will decline to take the government’s suggestion, grant review, and set the case for argument in the spring.