Berkeley Remarks on a Patent Small-Claims Tribunal

As noted in my earlier post today with my remarks from We Robot, I’ve been busy with lots of interesting conferences and workshops in the past few weeks. Because I wrote out detailed notes for two of them, I thought I would post them for people who weren’t able to attend. Here are my comments from the fantastic BCLT/BTLJ symposium on the administrative law of IP, where I was on a panel discussing IP small-claims tribunals:

You have already heard some insightful comments from Ben Depoorter and Pam Samuelson on copyright small-claims courts, including their analysis of problems with the proposed Copyright Alternatives in Small-Claims Enforcement (CASE) Act of 2017, as well as their thoughts on how a more narrowly tailored small-claims system might be beneficial. The main justification for introducing such a tribunal is that high litigation costs prevent claimants from pursuing valid small claims.

I’m here to provide some perspective from the patent law side, and the short version of my comments is that the idea of a patent small-claims court seems mostly dead in the United States, and I don’t see a reason to revive it.

We Robot Comments on Ryan Abbott's Everything is Obvious

I’ve been busy with lots of interesting conferences and workshops in the past few weeks, and since I wrote out detailed notes for two of them, I thought I would post them for people who weren’t able to attend. First, my comments from the We Robot conference two weeks ago at Stanford:

Ryan Abbott’s Everything is Obvious is part of an interesting series of articles Ryan has been working on related to how developments in AI and computing affect legal areas such as patent law. In an earlier article, I Think, Therefore I Invent, he provocatively argued that creative computers should be considered inventors for patent and copyright purposes. Here, he focuses on how these creative computers should affect one of the most important legal standards in patent law: the requirement that an invention not be obvious to a person having ordinary skill in the art.

Ryan’s definition of “creative computers” is purposefully broad. The existing creative computers he discusses are all narrow or specific AI systems that are programmed to solve particular problems, like systems from the 1980s that were programmed to design new microchips based on certain rules and IBM’s Watson, which is currently identifying novel drug targets for pharmaceutical research. And Ryan thinks patent law already needs to change in response to these developments. But I think his primary concern is the coming of artificial general intelligence that surpasses human inventors.

Naruto, the Article III monkey

The Ninth Circuit released its opinion in the "monkey selfie" case, reasonably ruling that Naruto the monkey doesn't have standing under the Copyright laws. The opinion dodges the hard questions about who can be an author (thus leaving for another day questions about artificial intelligence, for example) by instead focusing on mundane things like the ability to have heirs. As a result, it's not the strongest opinion, but one that's hard to take issue with.

But I'd like to focus on an issue that's received much less attention in the press and among my colleagues. The court ruled that Naruto has Article III standing because there is a case or controversy. I'll admit that I hadn't thought about this angle, having instead gone right to the copyright authorship question (when you're a hammer, everything looks like a nail). But I guess when you're an appellate court, that whole "jurisdiction and standing section" means something even though we often skim that in our non-civ pro/con law/fed courts classes in law school.

I'll first note that the court is doubtful that PETA has standing as "next friend." Footnote 3 is a scathing indictment of its actions in this case, essentially arguing that PETA leveraged the case for its own political ends rather than for any benefit of Naruto. Youch! More on this aspect here. The court also finds that the copyright statute does not allow for next friend standing, a completely non-shocking result given precedent.

Even so, the court looks to whether Naruto has individual standing even without some sort of guardian. Surprisingly enough, this was not an issue of first impression. The Ninth Circuit had already ruled that a group of whales had Article III standing. From this, the court very quickly decides that Naruto has standing: the allegation of ownership in the photograph easily creates a case or controversy.

Once again, the best part is in the footnotes. I'll reproduce part of note 5 here:

In our view, the question of standing was explicitly decided in Cetacean. Although, as we explain later, we believe Cetacean was wrongly decided, we are bound by it. Short of an intervening decision from the Supreme Court or from an en banc panel of this court, [] we cannot escape the proposition that animals have Article III standing to sue....

[The concurrence] insightfully identifies a series of issues raised by the prospect of allowing animals to sue. For example, if animals may sue, who may represent their interests? If animals have property rights, do they also have corresponding duties? How do we prevent people (or organizations, like PETA) from using animals to advance their human agendas? In reflecting on these questions, Judge Smith [in the concurrence] reaches the reasonable conclusion that animals should not be permitted to sue in human courts. As a pure policy matter, we agree. But we are not a legislature, and this court’s decision in Cetacean limits our options. What we can do is urge this court to reexamine Cetacean. See infra note 6. What we cannot do is pretend Cetacean does not exist, or that it states something other, or milder, or more ambiguous on whether cetaceans have Article III standing.

I was glad to see this, because when I read the initial account that Article III standing had been granted, I wondered why the court would come to that decision and thought of many of these questions (and more - like what if there's no statute to deny standing, like diversity tort liability).

I'll end with perhaps my favorite part of the opinion: the award of attorneys' fees. The award itself is not surprising, but the commentary is. It notes that the court does not know how or whether the settlement in the case dealt with the possibility of such an award, but also that Naruto was not part of such a settlement. It's unclear what this means. Can Slater collect from Naruto? How would that happen? Can Slater collect from PETA because Naruto was not part of the settlement? The court, I'm sure, would say to blame any complexity on the whale case.

Chris Walker & Melissa Wasserman on the PTAB and Administrative Law

Christopher Walker is a leading administrative law scholar, and Melissa Wasserman's excellent work on the PTO has often been featured on this blog, so when the two of them teamed up to study how the PTAB fits within broader principles of administrative law, the result—The New World of Agency Adjudication (forthcoming Calif. L. Rev.)—is self-recommending. With a few notable exceptions (such as a 2007 article by Stuart Benjamin and Arti Rai), patent law scholars have paid relatively little attention to administrative law. But the creation of the PTAB has sparked a surge of interest, including multiple Supreme Court cases and a superb symposium at Berkeley earlier this month (including Wasserman, Rai, and many others). Walker and Wasserman's new article is essential reading for anyone following these recent debates, whether you are interested in specific policy issues like PTAB panel stacking or more general trends in administrative review.

Comprehensive Data about Federal Circuit Opinions

Jason Rantanen (Iowa) has already blogged about his new article, but I thought I would mention it briefly has well. He has created a database of data about Federal Circuit opinions. An article describing it is forthcoming in the American University Law Reviw on SSRN and the abstract is here:

Quantitative studies of the U.S. Court of Appeals for the Federal Circuit's patent law decisions are almost more numerous than the judicial decisions they examine. Each study painstakingly collects basic data about the decisions-case name, appeal number, judges, precedential status-before adding its own set of unique observations. This process is redundant, labor-intensive, and makes cross-study comparisons difficult, if not impossible. This Article and the accompanying database aim to eliminate these inefficiencies and provide a mechanism for meaningful cross-study comparisons.

This Article describes the Compendium of Federal Circuit Decisions ("Compendium"), a database created to both standardize and analyze decisions of the Federal Circuit. The Compendium contains an array of data on all documents released on the Federal Circuit's website relating to cases that originated in a federal district court or the United States Patent and Trademark Office (USPTO)-essentially all opinions since 2004 and all Rule 36 affirmances since 2007, along with numerous orders and other documents.

This Article draws upon the Compendium to examine key metrics of the Federal Circuit's decisions in appeals arising from the district courts and USPTO over the past decade, updating previous work that studied similar populations during earlier time periods and providing new insights into the Federal Circuit's performance. The data reveal, among other things, an increase in the number of precedential opinions in appeals arising from the USPTO, a general increase in the quantity-but not necessarily the frequency-with which the Federal Circuit invokes Rule 36, and a return to general agreement among the judges following a period of substantial disuniformity. These metrics point to, on the surface at least, a Federal Circuit that is functioning smoothly in the post-America Invents Act world, while also hinting at areas for further study.

The article has some interesting details about opinions and trends, but I wanted to point out that this is a database now available for use in scholarly work, which is really helpful. The inclusion of non-precedential opinions adds a new wrinkle as well. Hopefully some useful studies will come of this

Statute v. Constitution as IP Limiting Doctrine

In his forthcoming article, "Paths or Fences: Patents, Copyrights, and the Constitution," Derek Bambauer (Arizona), notices (and provides some data to support) a discrepancy in how boundary and limiting issues are handled in patent and copyright. He notes that, for reasons he theorizes, big copyright issues are often "fenced in" by the Constitution - that is the constitution limits what can be protected. But patent issues are often resolved by statute, because the Constitution creates a "path" which Congress may follow. Thus, he notes, we have two types of IP emanating from the same source, but treated differently for unjustifiable reasons.

The article is forthcoming in Iowa Law Review, and is posted on SSRN. The abstract is here:

Congressional power over patents and copyrights flows from the same constitutional source, and the doctrines have similar missions. Yet the Supreme Court has approached these areas from distinctly different angles. With copyright, the Court readily employs constitutional analysis, building fences to constrain Congress. With patent, it emphasizes statutory interpretation, demarcating paths the legislature can follow, or deviate from (potentially at its constitutional peril). This Article uses empirical and quantitative analysis to show this divergence. It offers two potential explanations, one based on entitlement strength, the other grounded in public choice concerns. Next, the Article explores border cases where the Court could have used either fences or paths, demonstrating the effects of this pattern. It sets out criteria that the Court should employ in choosing between these approaches: countermajoritarian concerns, institutional competence, pragmatism, and avoidance theory. The Article argues that the key normative principle is that the Court should erect fences when cases impinge on intellectual property’s core constitutional concerns – information disclosure for patent and information generation for copyright. It concludes with two examples where the Court should alter its approach based on this principle.

The article is an interesting theory piece that has some practical payoff.

Tun-Jen Chiang: Can Patents Restrict Free Speech?

Guest post by Jason Reinecke, a 3L at Stanford Law School whose work has been previously featured on this blog.

Scholars have long argued that copyright and trademark law have the potential to violate the First Amendment right to free speech. But in Patents and Free Speech (forthcoming in the Georgetown Law Journal), Professor Tun-Jen Chiang explains that patents can similarly restrict free speech, and that they pose an even greater threat to speech than copyrights and trademarks because patent law lacks the doctrinal safeguards that have developed in that area.

Professor Chiang convincingly argues that patents frequently violate the First Amendment and provides numerous examples of patents that could restrict speech. For example, he uncovered one patent (U.S. Patent No. 6,311,211) claiming a “method of operating an advocacy network” by “sending an advocacy message” to various users. He argues that such “advocacy emails are core political speech that the First Amendment is supposed to protect. A statute or regulation that prohibited groups from sending advocacy emails would be a blatant First Amendment violation.”

Perhaps the strongest counterargument to the conclusion that patents often violate free speech is that private enforcement of property rights is generally not subject to First Amendment scrutiny, because the First Amendment only applies to acts of the government, not private individuals. Although Professor Chiang has previously concluded that this argument largely justifies copyright law’s exemption from the First Amendment, he does not come to the same conclusion for patent law for two reasons.

Masur & Mortara on Prospective Patent Decisions

Judicial patent decisions are retroactive. When the Supreme Court changed the standard for assessing obviousness in 2007 with KSR v. Teleflex, it affected not just patents filed after 2007, but also all of the existing patents that had been filed and granted under a different legal standard—upsetting existing reliance interests. But in a terrific new article, Patents, Property, and Prospectivity (forthcoming in the Stanford Law Review), Jonathan Masur and Adam Mortara argue that it doesn't have to be this way, and that in some cases, purely prospective patent changes make more sense.

As Masur and Mortara explain, retroactive changes might have benefits in terms of imposing an improved legal rule, but these changes also have social costs. Most notably, future innovators may invest less in R&D because they realize that they will not be able to rely on the law preserving their future patent rights. (Note that the private harm to existing reliance interests from past innovators is merely a wealth transfer from the public's perspective; the social harm comes from future innovators.) Moreover, courts may be less likely to implement improvements in patent law from the fear of upsetting reliance interests. Allowing courts to choose to make certain changes purely prospectively would ameliorate these concerns, and Masur and Mortara have a helpful discussion of how judges already do this in the habeas context.

The idea that judges should be able to make prospective patent rulings (and prospective judicial rulings more generally, outside habeas cases) seems novel and nonobvious and right, and I highly recommend the article. But I had lots of thoughts while reading about potential ways to further strengthen the argument: