Harvard Journal on Legislation
Winter, 2000
Essay
*45 THE
PROPER SCOPE OF THE COPYRIGHT AND PATENT POWER
Robert Patrick Merges [FNa1]
Glenn Harlan Reynolds [FNaa1]
Copyright © 2000 President and Fellows of Harvard College;
Robert Patrick
Merges and Glenn Harlan Reynolds
In 1998, Congress passed the Sonny Bono
Copyright Term Extension Act, extending the duration of copyright protection
from the life of the author plus fifty years to the life of the author plus
seventy years. The constitutionality of this extension has been challenged on
First Amendment and other grounds. In this Essay, the authors argue that the
language of Article I, Section 8, Clause 8 contains judicially enforceable
limits on Congress's power to protect
intellectual property and suggest that the 1998 Extension Act exceeds those
limits.
Property, these days, is increasingly likely
to be intellectual property (IP). As
more and more people make their living in the "information economy,"
intellectual property sounds like a more and more reasonable proposition. As
one of our law professors once said, "I used to think that all property
was theft--but that was before I had anything worth stealing."
As an increasing amount of society's wealth
is tied up in intangible assets, strong, clear property rights can make a good
deal of sense. But it is also possible to have too much of a good thing, and
our society is in danger of reaching that point. Recent scholarship suggests as
much: a growing body of literature details the expansion of particular
doctrines, [FN1] the rising burden
of IP-related transaction costs, [FN2] or the pressing
need for collective *46 institutions to mediate between individual firms
and the mushrooming pile of IP rights they must traverse to do business. [FN3]
In this Essay, we approach one part of this
problem at the source. We argue that there are limits on Congress's power to
create and extend intellectual property interests. Such limits are
"internal" in the sense that they are the result of the very same
constitutional provision giving rise to Congress's power in the first place,
the Copyright and Patent Clause of the Constitution which grants the 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." [FN4]
We argue that the language of the Copyright
and Patent Clause may restrict some of Congress's more far-reaching efforts at
promoting intellectual property in recent years, particularly in passing ad hoc
extensions of copyrights and patents for the benefit of individual companies.
We then suggest some approaches that courts might take in evaluating, and
perhaps striking down, congressional actions in this area.
In one sense, there is nothing novel about
our approach. From the earliest days of our nation to the present era, courts
have repeatedly stressed that Congress's intellectual property powers under the
Copyright and Patent Clause are limited. Courts, however, have been somewhat
reticent when the question of defining those limits has arisen. We hope to
encourage a less deferential approach in the future.
I. SOME HISTORY AND BACKGROUND
One characteristic of legally granted
monopolies is their tendency to be misused by those in power. The grant of a
legal monopoly, after all, constitutes an easy way for the state--or those in
control of state power--to reward friends without spending state money. [FN5]
*47 Not surprisingly, the grant of
monopolies becomes particularly attractive to
politically embattled leaders faced with government revenues that are
inadequate for their purposes. Monopolies for intellectual property are not
immune from this tendency. Indeed, our modern system of copyrights and patents
arose in reaction to exactly this state of affairs. Cries of unfair influence
led English subjects to protest the grant of royal monopolies under Queen
Elizabeth I and King James I:
[In the late sixteenth century,]
malpractices began to creep in that were to bring [the patent system] into
disrepute and ultimately threaten its existence .... [Finally,] a bill in 1624
[was] enacted as the Statute of Monopolies.
Courtiers who extorted large sums from
petitioners as the price of advancing their claims were roundly condemned. But
most offensive of all was the granting of monopoly powers in established
industries ... to courtiers whom the crown could not otherwise afford to
reward.
These abuses parliament sought to
eradicate in 1624 by the restriction of letters patent, conferring monopoly
powers, to first inventors alone. The validity of royal licenses would
henceforth be liable to trial at common law, and anyone aggrieved by them could
sue for relief. [FN6]
The Founding Fathers did not forget this
history lesson. The constitutional clause enabling Congress to pass patent laws
explicitly states that patents shall be granted to "inventors" for
their "discoveries" and that these grants shall be "for limited times." [FN7] Thus, the grant of
copyright and patent power in the Constitution was intended to provide a
positive incentive for technological and literary progress while avoiding the
abuse of monopoly privileges. [FN8] As Joseph Story
put it:
It is beneficial to all parties, that the
national government should possess this power; to authors and inventors,
because, otherwise, they would be subjected to the varying laws and systems of
the different states on this subject, which would impair, and might even
destroy the value of their rights; to the public, as it will promote the
progress of science and the useful arts, and admit the people at large, *48
after a short interval, to the full possession and enjoyment of all writings
and inventions without restraint ....
It has been doubted, whether [C]ongress
has authority to decide the fact, that a person is an author or inventor in the
sense of the [C] onstitution, so as to preclude that question from judicial
inquiry. But, at all events, such a construction ought never to be put upon the
general terms of any act in favour of a particular inventor, unless it be
inevitable. [FN9]
Story's characterization seems to mesh with
our own: that the general evils of monopoly are overcome, in this specific
instance, by the benefits accruing to the public from encouraging authors and
inventors to create and invent, and to make
their works public. Story makes another important point in discussing
congressional power: he doubts that Congress has the power to make the question
of authorship or invention a purely legislative one, beyond judicial review,
and is suspicious of special--as opposed to general--legislation on the
subject.
General legislation, of course, often
requires administration, and even before the drafting of the Constitution, the
need for a special patent administration was becoming apparent. This was due in
no small part to the controversy over steamboat patents raging at the time. [FN10] In the 1770s and
1780s two rival inventors, James Fitch and Charles Rumsey, each claimed
invention of a workable steamboat. [FN11] As was the
custom in colonial times, they sought protection for their inventions at the
state level. [FN12] The result was that, as each presented his case to a new
state legislature, conflicting and overlapping monopolies were granted. [FN13] To *49 clarify their rights, each inventor sought
special legislation from the federal government, then operating under the
Articles of Confederation. [FN14]
The situation rapidly became quite confused,
and the factors surrounding each inventor's claim were hotly disputed. The
battle for credit as to priority of invention was fought in individual meetings
with each state's representatives, as well as by publishing pamphlets
purporting to set forth the "true" story of the steamboat's invention. [FN15] Even George
Washington became involved as a supporter of Rumsey. [FN16] But because the status of federal grants at the time was
unclear, not much progress was made. Nevertheless, the steamboat case, with its
complex facts pleaded to inexpert legislators, was an important impetus behind
the call for a uniform national patent system in the Constitution and then in
the first Congress. Consequently, the 1790 Patent Act was among the first
orders of business taken up in the new federal legislature. [FN17]
The steamboat case shows, among other
things, that the complicated and idiosyncratic facts associated with patent
disputes are ill-suited to resolution in a legislative forum. Busy legislators,
with little expertise in steamboat technology, were called upon to resolve a
complex dispute between rival claimants based on little more than their innate
sense of justice. And John Fitch, a somewhat untutored frontiersman, always
felt that the better connected and courtlier James Rumsey had a distinct
advantage in the arena of legislative influence. [FN18] Both the real
and potential unfairness of such an ad hoc approach was understood at the time
to militate in favor of the creation of a nonpolitical system. [FN19]
In tracing the next step in the development
of a professional, specialized patent agency, the experience of Thomas
Jefferson is instructive. He was the only President to serve as a patent
examiner, something that speaks volumes about
the perceived importance *50 of patent scrutiny two centuries ago. [FN20] As Secretary of
State, Jefferson devoted a great deal of energy to examining the patent
applications that came before him. It soon became apparent, however, that a
Secretary of State--even one as interested in technology as Jefferson--simply
lacked the time to do the job properly. [FN21] In response to this problem, a new patent system was
enacted in 1793 that allowed inventors to register their patents in Washington
without examination, leaving questions of patent validity to the courts. [FN22] This, too, proved unworkable as the system became flooded
with spurious patents. [FN23] The final step
in establishing today's patent system came in 1836, when the forerunner of
today's Patent Office was established to examine each application and pass on
its merits. [FN24]
Taken together, the steamboat example and
Jefferson's experience demonstrate that there is considerable wisdom behind the
notion of a patent system with administrative regularity. Such a system is not
only fairer to applicants and more regular in its results, but also--because
professional patent examiners are likely to be far more expert than
legislators, judges, or Secretaries of State--more efficient.
II. THE POLITICAL ECONOMY OF PATENT EXTENSIONS
Nobel prize-winner Douglass North has argued
that governments very rarely define property
rights in ways that maximize economic growth. [FN25] Great Britain, in this view, was fortunate enough to
evolve efficiency-enhancing institutional structures (including property
rights) that in turn set the stage for economic growth. [FN26] Such is the case, North argues, with the emergence of
modern patent systems. [FN27] For North, the
sovereign abuses of monopoly *51 grants in the sixteenth and early
seventeenth centuries are examples of wealth-reducing property rights. [FN28] The Anglo-American patent systems that succeeded the old
monopoly privileges, on the other hand, exemplify the brighter, pro-growth side
of the property rights picture. [FN29]
North's view is consonant with two other
traditions in constitutional theory that bear on this Essay: (1) the view,
associated with legal historians J. Willard Hurst and Stanley I. Kutler, that
the Constitution embodies a spirit of economic dynamism and growth; [FN30] and (2) the more
recent "public choice"-inspired literature describing the
Constitution as a bulwark against rent-seeking [FN31] by special interests.
A. Economic Dynamism and Growth Perspective
The economic dynamism perspective is best
exemplified by Stanley I. Kutler's famous account of the Charles River Bridge
case. [FN32] Kutler described
this cornerstone case as a contest between the forces of the privileged and well-positioned holders of an
old state charter to operate a ferry crossing and the dynamic new forces that
led a group of entrepreneurs to propose building a bridge. [FN33] Faced with the choice of upholding the original charter
against a claim of impairment of state contracts and allowing the new bridge,
the Supreme Court chose the latter. [FN34] The general
lesson was the defeat of the entrenched charter-holders' rent-seeking and the
liberation of vigorous economic forces of *52 change. [FN35] Kutler's antinomic title--"Privilege and Creative
Destruction"--describes what is at stake in many proposals to extend
intellectual property rights. Our appeal is to maintain the early
nineteenth-century, pro-growth conception of the Constitution. [FN36]
B. Public Choice Literature on Rent-Seeking
The second literature, on public choice,
sees the Constitution as a mechanism designed to prevent well-organized
interest groups from obtaining special favors from the government. [FN37] In scholarship
extending back to the mid- 1980s, authors such as Jonathan Macey have argued
that the Constitution was designed primarily as a bulwark against rent-seeking.
It is tempting to agree with some of Macey's critics, however, and argue that
the Constitution did not enact James Buchanan's The Calculus of Consent. [FN38] Cass Sunstein, in particular, sees the Constitution as a
"republican" means of transcending interests,
rather than simply a well-oiled mechanism for reconciling them. [FN39] But for our
purposes, it is not necessary to enter deeply in this debate. Regardless of
whether the Copyright and Patent Clause represents a larger theme in the design
of the Constitution, it does limit one specific congressional power. This limit
originated in British analogues that were explicitly designed to eliminate
rent-seeking abuses. In at least this context, the limit on Congress, and the
abuses that informed it, dictate a concrete constitutional approach.
Against this backdrop, we claim that the
constitutional footing for intellectual property protection was constructed
with inherent *53 limitations, as well as with a grant of power. The
specific language ("to promote progress," and "for limited
times"), the history, and the context of the Clause dictate that the
congressional power to create property rights does not extend to nonproductive
rent-seeking. Congress exceeds its authority to grant property rights when
those rights do not promote progress, or are not sufficiently limited in time.
Members of Congress should keep this in mind when considering the many bills
for "private relief" and term extensions that they now receive. And,
failing that, the courts must exercise their authority to enforce
constitutional limits on the Copyright and Patent power. To ignore this duty is
to risk the kinds of abuses that threatened the economic progress of
seventeenth-century Britain, and to turn our backs on the historical transformation of ad hoc grants of rent-seeking
privileges into rule-based systems for recognizing intellectual property
rights.
This history is of particular relevance now,
as special legislation extending individual patent terms has become more
common. Occasionally, efforts to secure such legislation overreach, as when
Swiss pharmaceutical giant Hoffman-LaRoche attempted to sneak a patent
extension rider covering its drug Toradol into legislation providing relief for
Midwest flood victims. [FN40] However, they sometimes succeed, as when G.D. Searle
slipped language extending the patent on its drug Daypro into an emergency
budget bill. [FN41] Nor is the matter limited to patents: the Disney copyright
on Mickey Mouse was poised to enter the public domain in 2003, but the Walt
Disney Company decided that procuring legislation extending that copyright for
an additional twenty years was to be its "highest priority." [FN42] The Disney request was folded into a general bill that
recently became law, *54 and is thus not a classic private bill. [FN43] Still, some experts fear that in today's freewheeling
political-funding culture it will not be long until a copyright-reliant company
discovers the magic of private intellectual property protection. [FN44] Such departures from the norm could well become the norm,
with wealthy corporate interests securing by legislative influence what they
would not be able to obtain in the normal course of business.
Such extensions raise the standard political
collective action problem: the gains to the
drug companies or Disney (even after subtracting political contributions and
lobbying costs) are enormous and obvious, while the additional harms to
consumers are relatively small on a per-person basis and not at all obvious.
This is the classic situation in which economic theory tells us government will
be over-responsive to the entreaties of well-organized parties:
[S]mall groups have a greater likelihood
of being able to organize for collective action, and can usually organize with
less delay, than large groups. It follows that the small groups in a society
will usually have more lobbying ... power per capita ... than the large groups.
[FN45]
This phenomenon certainly has been
appreciated by politicians regardless of their degree of economic training, yet
what is seldom appreciated is that success in organizing a special interest and
pursuing its claims costs society in several ways. In addition to
redistributing wealth from society to the small group (in the case of patent
extensions, from consumers to the patentee), successful special-interest
organizing also increases the likelihood that others similarly situated will
seek their own special legislation. As Jonathan Rauch puts it:
In the economy, as in nature, a parasite
is set apart from a mere freeloader by its ability to force its target to fend
it off. This is the sense in which transfer-seekers are, not so loosely
speaking, parasitic: they are not only
unproductive themselves, they also force other people to be unproductive .... A
bad stockbroker or a pesky real-estate agent can take *55 your money if
you do hire him, but only a transfer-seeker can take your money if you don't
hire him. [FN46]
Thus, political parasites are a double
danger: they not only pursue their own self-interested agenda, but also force
others into a political "arms race" to protect their own interests.
"What is peculiar about the parasite economy, then, is its ability to suck
in resources that people would rather invest elsewhere. Activism on one side
draws counteractivism on another." [FN47] And, of course,
efforts aimed at the political redistribution of wealth make society poorer,
not richer. To the extent that people are investing in lobbyists, lawyers, and
public relations firms instead of, say, research and development, they are
foregoing investments that might benefit society as a whole. In the language of
the economic literature on "rent seeking" that describes these
behaviors, one must consider "the resource costs of individuals seeking
privileges from the government." [FN48]
As this literature makes clear, the decision
to shift resources in the direction of lobbying is quite rational if there is
even a modest chance of success. When the return on lobbying is greater than
the average returns on research and development expenditures, lobbying may well
turn out to be the more lucrative investment option.
This, of course, is only from the firm's point of view. From society's
point of view, any expenditure on lobbying that might instead have been
invested in research and development is a loss. This is due to the fact that
the return from lobbying accrues only to the patent holder, while the return
from research and development accrues in good part to society as well. Studies
consistently show that, at least for major technological advances, society as a
whole gains a very large share of the total value generated by an invention. [FN49] Indeed, it is
the need for firms to capture *56 some of the value they create through
research and development that lies at the heart of private property rights over
inventions in the first place. Where lobbying activities are concerned, there
is no need to ensure a fair return to firms--the nature of the activity
dictates that most of the returns will accrue to them in any event.
This point can be pushed a bit further, for
the contrast between a patent system and individual requests for patent
extensions is quite striking. Patents encourage new things, while requests for
patent extensions attempt to preserve old markets. Patents are forward-looking,
growth-oriented, entrepreneurial-- almost (if such a word can apply to a legal
construct) optimistic in nature. By contrast, many requests for special
treatment are backward-looking, fearful of losing ground, and pessimistic or
reactionary in character. Why protect yesterday's breakthroughs for a longer
period if there is something new just around
the corner? Obviously, efforts to protect old discoveries seem most urgent as
excitement about new ones ebbs. Putting aside economic theory, this attitude of
impending decline is perhaps the most discouraging thing about such requests;
they betray the very spirit of the patent system.
III. TAKING THE COPYRIGHT AND PATENT CLAUSE SERIOUSLY
And perhaps more than just its spirit. For
while the Copyright and Patent Clause was certainly drafted without the benefit
of modern economic theory, the concerns it embodies mesh closely with the
analysis above. Monopolies are bad for the public welfare, both because they
impose a "deadweight loss" on society and because they encourage the
sort of special- interest maneuvering that consumes valuable resources and
tends to corrupt the political system. Although monopolies are generally
undesirable, monopolies that "promote the progress of science and the
useful arts" by securing to inventors and authors property rights
"for a limited time" are the exception. They are monopolies that pay *57
their own way with new knowledge and creation. The competition that they inspire--because
of their limited character--serves the public good by sponsoring invention and
creation, rather than competition aimed at corrupting the public's
representatives.
Indeed, these sentiments were also held by
the Framers, judging from an exchange between James Madison and Thomas
Jefferson. Jefferson wrote to Madison arguing
in favor of a provision outlawing government-created monopolies, and repeated
his position in a second letter: "It is better ... to abolish ...
Monopolies, in all cases, than not to do it in any." [FN50]
Madison did not quite disagree, but rather
argued that monopolies for intellectual property were a special case. As
Madison put it, "With regard to Monopolies they are justly classed among
the greatest nuisances in Government. But is it clear that as encouragements to
literary works and ingenious discoveries they are not too valuable to be wholly
renounced?" [FN51] Of
course, for Madison's argument to hold, the monopolies in question must in fact
serve as "encouragements" and not simply as political rewards. If the
latter, they would seem to be more accurately classed with Madison's
"nuisances."
For this to be true, of course, the
monopolies must be those described in the Copyright and Patent Clause. They
must be "for a limited time" because part of the public's payback is
that the invention or creation will eventually enter the public domain. They
must also be reasonably calculated to "promote the progress of science and
the useful arts," meaning that they must bear some relationship to
creativity, not simply political clout.
As the Supreme Court put it in Graham v.
John Deere Co.:
The [Copyright and Patent] [C]lause is
both a grant of power and a limitation .... It was written against the backdrop
of the practices-- eventually curtailed by the Statute of Monopolies--of the
Crown granting monopolies to court favorites
in goods or businesses which had long before been enjoyed by the public. The
Congress in the exercise of the patent power may not overreach the restraints
imposed by the stated constitutional purpose. Nor may it enlarge the patent
monopoly without regard to the innovation, advancement or *58 social
benefit gained thereby. Moreover, Congress may not authorize the issuance of
patents whose effects are to remove existent knowledge from the public domain,
or to restrict free access to materials already available. Innovation,
advancement, and things which add to the sum of useful knowledge are inherent
requisites in a patent system which by constitutional command must "promote
the Progress of ...useful Arts." This is the standard expressed in the
Constitution and it may not be ignored. [FN52]
This passage clearly states a principle
latent in other Supreme Court cases: Congress may not obviate settled
administrative practices by overriding constitutional requirements for
protection, such as originality in copyright law [FN53] or
non-obviousness in patent law. [FN54] Not to put too
fine a point on it, this means that special legislation extending the patents
and copyrights of favored individuals or corporations is often a dubious
constitutional proposition. Arguably, at least, legislation extending a
particular copyright or patent fails both prongs of the test. First, as an ad *59
hoc (actually, a post hoc) reward, it seems unlikely to "promote the progress of science and the useful arts." [FN55] Second, as an extension of a previously granted patent or
copyright, it undercuts any constitutionally significant notion of
"limited time."
With respect to the first of these failings,
two issues are important. First, the value of intellectual property is that it
encourages authors, inventors, and investors, to take risks "on the front
end" with the expectation of reaping profits later. A post hoc reward,
granted on the basis of legislative whim or influence, is unlikely to provide
such encouragement as effectively as a regularized system. The vagaries of the
political process dictate that extensions will not always be available, and
that when they are, they may not always be granted for the most significant
inventions or copyrighted works. [FN56] In addition, an
important aspect of the copyright and patent system's promotion of creativity
lies in the way it ensures that ideas will eventually enter the public domain.
Walt Disney, after all, drew on public- domain folk tales when he created such
classics as Snow White and Cinderella. Presumably, future creators will draw on
Disney's work once it enters the public domain. The same is true of
pharmaceutical research, or any other field of technology in which cumulative
invention is the rule. Such opportunities are frustrated by legislation that
keeps creative or inventive works out of the public domain for years or decades
beyond those needed to encourage innovation.
Second, special legislation extending
patents and copyrights does violence to the
constitutional time limits that apply to the grant of intellectual property
rights. Patents and copyrights are granted for a "limited time." The
length of that time, of course, is discretionary, and Congress has fixed
copyright and patent *60 terms at varying lengths throughout our
history. [FN57] Yet while the
length of the generally applicable term is largely at Congress's discretion
(including, under the Patent Act in effect for part of the nineteenth century,
a renewal term), once the patent or copyright has been granted we know the
length of its maximum "limited time." When the term is subsequently
extended, that "limit" is abolished because, in principle, there is
no reason that it cannot be extended more than once. Can anyone doubt that now
that Disney has the twenty-year extension on Mickey Mouse that it wanted, it
will be back in 2023 asking for another? If the language of the Clause is to
mean anything, the grant of an intellectual property right that can be extended
by special, post hoc legislation can hardly be considered "limited" for
constitutional purposes. [FN58]
Just how radical is our proposal? On the one
hand, it would appear to call into question a longstanding practice. A Library
of Congress study commissioned in 1984 shows that modest numbers of patent
extensions have been part of the patent scene almost from the time of the first
Patent Act in 1790. [FN59] But the study also shows that most requests for patent
extensions traditionally have been denied. [FN60] Of the few that
were successful, the lion's share involved
cases of government infringement. [FN61] Before
contemporary doctrine softened the impact of traditional principles of
sovereign immunity, inventors were forced to make special requests for relief
when their inventions were, in effect, taken by the government for some public purpose.
[FN62] A large group of such requests came, for example, in the
aftermath of World War II. [FN63] Inventors argued
that they had allowed and even encouraged royalty-free government use of
valuable war technologies until the war was over, which in some cases meant
that *61 the patent in question had expired before any compensation
could be earned. [FN64]
It is likely that such requests would today
take the form of claims for compensation under the Takings Clause of the Fifth
Amendment. Under this approach fair compensation would be paid for the past
value of the invention used by the government, and there would be no need for a
prospective extension of the patent term.
The 1984 Library of Congress Report is
instructive for another reason: it recounts in detail a tradition of
congressional unease with the legislation of private patent bills. In
particular, the Report shows that Congress consistently acted to consolidate
related special requests into new administrative practices, beginning with the
first Patent Act itself, which pre-empted a number of special requests for the
reward of particular inventions (including the Rumsey-Fitch dispute referred to
earlier). [FN65] A similar consolidation occurred in the early
nineteenth century when the process of ruling on many particular requests for
private relief was replaced with an administrative procedure that would
determine which patents should be extended for a single, final, seven-year
term. [FN66] Congress pre-empted another category of special relief
when it passed an amendment to the Patent Act permitting alien citizens to file
patent applications. [FN67] In each case,
the evolution of ad hoc legislation into a system of regularized procedures
subject to judicial review recapitulated the evolution of the modern patent
system from its origins as a tangle of royal privileges. [FN68] The emergence of administrative regularity does not
necessarily show that Congress considered special legislation *62
unconstitutional under the Copyright and Patent Clause. [FN69] But it certainly shows consistent congressional doubts
regarding the wisdom of excessive legislative treatment. It is our view that
the Framers shared these doubts and imposed implicit limits on copyrights and
patents.
It is true, of course, that the extension of
existing copyrights and patents differs in one way from the discredited
practice outlawed by the Statute of Monopolies. Under the old English system,
monarchs rewarded court favorites with monopolies on goods that, in the Supreme
Court's words, "had long before been enjoyed by the public." [FN70] When a patent or
copyright is extended, on the other hand, it deals with goods that have
previously been ""enjoyed by the
public" only in accordance with the patent- or copyright- holder's
monopoly.
This distinction,however, is not as great as
it may seem. In fact, the extension of a patent or copyright interest
prospectively removes items from the public domain. When a patent or copyright
is granted, the creation in question will automatically--by action of
law--enter the public domain when the patent or copyright expires. Prior to
that grant, the public has no right to the creation in question; the owner
could have kept it as a trade secret and secured protection of indefinite
length. Upon the granting of a patent or copyright, however, the statutory
protection is vested, as is, arguably, the entry of the creation into the
public domain when the protection expires. In many cases business plans will be
drawn based on that expiration. And even when they are not, it is not too
fanciful to characterize the movement *63 of the protected interest into
the public domain as creating a remainder interest in the public. In this
sense, the extension of an already-granted patent or copyright, by depriving
the public of the remainder interest it already holds by statute, is in fact
the deprivation of a right "enjoyed by the public." Indeed, a number
of rules and doctrines in patent and copyright law are designed precisely to
protect the public's "reliance interest" in fixed expiration dates. [FN71]
We would be remiss if we did not answer one
other possible objection to our argument:
can't Congress just extend patents and copyrights by invoking the Commerce
Clause, thus rendering our argument beside the point? Certainly some
commentators have argued that, in the absence of the Copyright and Patent
Clause, Congress would have the power to create a patent and copyright system
under its authority to regulate commerce among the several states. [FN72]
There is much to this position, but as a
criticism of our approach it has one key failing. Instead of the absence of a
copyright and patent clause, we have the presence of the Copyright and Patent
Clause. That Clause is generally understood to serve as a limit on
congressional power, not simply a grant thereof. To allow Congress to do things
under its general commerce power that it is forbidden to do under its
specifically applicable copyright and patent power would in essence read the
Copyright and Patent Clause out of the Constitution. Such an approach could
hardly be said to be faithful to the text of the Constitution or the intent of
the Framers.
Nor is this observation merely an example of
academic curmudgeonism at work. We grant that, at least in the post-Wickard [FN73] era, one could
argue that Congress possesses the *64 power to regulate intellectual
property under the Commerce Clause. The Supreme Court rejected a similar
argument made with regard to the bankruptcy power in Railway Labor Executives
Association v. Gibbons. [FN74]
"[I]f," said the Court, "we were to hold that Congress had the
power to enact nonuniform bankruptcy laws pursuant to the Commerce Clause, we would eradicate from the
Constitution a limitation on the power of Congress to enact bankruptcy
laws." [FN75] "To hold otherwise," the Court continued,
"would allow Congress to repeal the uniformity requirement from Art. I,
§ 8, cl. 4, of the Constitution." [FN76] The same argument should apply to efforts to override the
restrictions imposed upon Congress by the Copyright and Patent Clause.
IV. A FAIRLY MODEST PROPOSAL
As should be obvious, we believe that
special legislation to extend copyrights and patents for individuals or
corporations should receive the strictest of scrutiny from the courts.
There is an additional value to our
approach. As humorist P.J. O'Rourke has said, when buying and selling are
controlled by legislation, the first things to be bought and soldwill be
legislators. Control of corruption was an important goal of our constitutional
system, and there is no doubt that the Framers believed that a system of
limited and enumerated powers was a significant check on corruption. There also
seems little doubt that copyright and patent extension bills--granted almost
uniformly to wealthy corporations and big contributors, rather than to
struggling basement inventors--constitute exactly the kind of corruption that
the limits in the Copyright and Patent Clause were designed to prevent.
As a result, we believe that courts should strictly scrutinize laws
extending copyrights and patents that have already been granted. Although it
would be difficult, and probably impossible, *65 to formulate a
satisfactory per se rule, we suggest some factors that courts should consider.
The first might be called the "extent of the extension"--how many
companies or individuals qualify, and how long is the extension? The fewer who
benefit, the greater is the likelihood that the extension represents special-interest
graft of the sort that the Copyright and Patent Clause was intended to prevent.
The longer the extension, the greater is the inroad it represents into the
"limited time" prescribed by the Copyright and Patent Clause.
Similarly, statutes that set up a
regularized process for extending patents-- without naming the beneficiaries
explicitly (or implicitly via too-narrow criteria) [FN77]--are far less
suspect than those that merely set up a procedure whereby the Patent and
Trademark Office may extend patents held up by lengthy regulatory (typically,
Food and Drug Administration) review. [FN78] Where extensions
are based on some specific and identifiable government error (say a failure to
notify a patentee that a patent has been granted, or inordinate delay in
processing claims), they are less suspect than they would be if based on other
considerations.
One possible approach to the constitutional
test we advocate would be to examine a proposed extension from the hypothetical
perspective of an author or inventor who is
at the very outset of his or her creative work--that is, to ask: could the term
of protection possibly serve as additional motivation to set pen to paper, or
to sit down at the lab bench? Or does it stretch out so far in time that the
latter years of the term are irrelevant to any potential creator? This approach
essentially translates proposed patent extensions into the "present
value" calculations familiar to accountants. The constitutional rationale
for such an approach is simple: the phrase "to promote the progress of
science and the *66 useful arts" is inherently prospective. It
states a utilitarian, incentive-based rationale for intellectual property
protection. If the term of protection could not, under any plausible set of
assumptions, serve as an incentive, it fails the constitutional requirement of
a forward-looking grant of property rights. [FN79] When the absence of a plausible incentive is joined by the
presence of firm-specific legislation, the conclusion must be that the proposed
bill amounts to rent-seeking, pure and simple. [FN80] Since we know--based on the closely contemporaneous
experience of British abuses of the patent monopoly--that the Framers wanted to
avoid just such abuses, we also know that these extensions fail the
constitutional test. [FN81]
One argument typically made on behalf of
patent extensions is that the invention in question has contributed enormously
to the general social welfare. [FN82] This is joined in many cases by the assertion that for one
reason or another the inventor has not
received a commensurate or adequate reward. [FN83] Both arguments *67
beg the question whether Congress has the authority to exercise independent
judgment in individual cases. By settling on a generally available patent term
(the current statutory source for which, incidentally, has built-in relief for
excessive administrative delay), [FN84] Congress has exercised its constitutional role of
"securing" rights via a systematic administrative procedure. To grant
perpetual patents or copyrights would clearly violate the Constitution's
"for limited times" language, even if Congress thought the default
statutory term an inadequate reward in a particular case. The same limits on
Congress's ability to "balance" social costs and benefits (under the
watchful eyes of a bevy of well-heeled lobbyists) are latent in the remaining
language and historical context of the Copyright and Patent Clause. Surely
progress will not be "promoted" if every successful invention spawns
a lobbying effort aimed at patent extension. And just as surely, the British
experience of the late sixteenth and early seventeenth centuries was in the
minds of the Framers as they adopted a prudent, limited form of state-backed
monopoly for significant "writings and discoveries."
The key in all these cases is to ensure that
Congress is living up to its constitutional duty as spelled out in the
Copyright and Patent Clause. Taking this duty and its corresponding limit on
congressional power seriously will no doubt
require judicial interpretation, just as determining the extent of Congress's
power under the Commerce or Bankruptcy Clauses has required extensive judicial
interpretation. [FN85] This
task should be easier here than it has been elsewhere, however, because of the
relatively clear history and text of the Copyright and Patent Clause.
As the Supreme Court has made clear in cases
like United States v. Lopez, [FN86] constitutional limitations do matter, and it is *68
the job of courts to locate and enforce those limitations. The Supreme Court
has already recognized such limitations in the Copyright and Patent Clause.
Enforcing these limitations will not only uphold both the letter and the spirit
of the Clause, but will also remove one source of persistent corruption from
the legislative arena.
[FNa1]. Wilson, Sonsini, Goodrich & Rosati Professor of Law
and Technology, Boalt Hall School of Law, University of California at Berkeley.
B.A., Carnegie Mellon University, 1981; J.D., Yale Law School, 1985.
[FNaa1]. Professor of Law, University of Tennessee. B.A.,
University of Tennessee, 1982; J.D., Yale Law School, 1985.
The authors would like to thank Brannon
Denning, Jack McCall, Carol Parker, Tom Plank, and Edward C. Walterscheid for
some helpful comments. Lori Ritter provided
excellent research assistance.
[FN1]. See, e.g., Kenneth L. Port, The
Illegitimacy of Trademark Incontestability, 26 IND. L. REV. 519 (1993) (arguing that since 15
U.S.C. § 1115(b) speaks of a conclusive presumption of the trademark
holder's "ownership of the mark," trademark incontestability creates
what is in effect an unprecedented property right in trademarks).
[FN2]. See, e.g., Michael A. Heller & Rebecca S. Eisenberg,
Can Patents Deter Innovation? The Anticommons in Biomedical Research, 280
SCIENCE 698, 700 (1998).
[FN3]. See Robert P. Merges, Contracting
into Liability Rules: Intellectual Property Rights and Collective Rights
Organizations, 84 CAL. L. REV. 1293, 1301 (1996).
[FN4]. U.S.
Const. art. I, § 8, cl. 8.
[FN5]. See Robert P. Merges, The Economic Impact of Intellectual
Property Rights: An Overview and Guide, 19 J. CULTURAL ECON. 103, 110-11
(1995). For an account featuring this factor in the genesis of our own
intellectual property regime, see Edward C.
Walterscheid, To
Promote the Progress of Science and Useful Arts: The Background and Origin of
the Intellectual Property Clause of the United States Constitution, 2 J.
INTELL. PROP. L. 1, 34-35 (1994) [[hereinafter To
Promote the Progress of Science].
[FN6]. CHRISTINE MACLEOD, INVENTING THE INDUSTRIAL REVOLUTION:
THE ENGLISH PATENT SYSTEM, 1660-1800 (1988), 14-15.
[FN7]. U.S.
Const. art. I, § 8, cl. 8.
[FN8]. See id. (setting forth Congress's power to grant
copyrights and patents in order to "Promote the Progress of Science and
the Useful Arts").
[FN9]. Joseph Story, Commentaries on the Constitution of the
United States § § 558-559 (Ronald D.
Rotunda & John E. Nowak eds., 1987).
[FN10]. The following account draws on JAMES THOMAS FLEXNER,
STEAMBOATS COME TRUE: AMERICAN INVENTORS IN ACTION (1944).
[FN11]. See id. at 73-76 (discussing Fitch) and 66-69 (discussing
Rumsey).
[FN12]. See id. at
87-100 (describing various state patents granted in Virginia, Pennsylvania, New
York, and Delaware).
[FN13]. See Walterscheid, To Promote the Progress of Science,
supra note 5, at 22-23:
Although the states in their individual
capacities had sought to provide some form of limited-term exclusive rights to
inventors and authors, by early 1787 the defects in the state copyright and
patent customs were obvious. The most singular defect was that states only
could legislate with respect to their own territory. Thus, state patents and
copyrights could be infringed with impunity in adjoining states. Obtaining
multiple state patents or copyrights was time consuming, expensive, and
frequently frustrating. Moreover, consistency in terms and conditions varied
from state to state. With regard to patents, no guarantee of consistency from
patent to patent existed even within a particular state because each patent
required a private legislative act. Furthermore, what a state could grant, it
could also take away, and on occasion did so.
[FN14]. See id. at 124 (discussing Fitch's proposed bill before
Congress in 1787 and 1788).
[FN15]. See id. at
122-24.
[FN16]. See id. at 82 (describing Washington's influence in
obtaining state protection, and his role in Rumsey's steamboat company).
[FN17]. See P.J. Federico, Operation of the Patent Act of 1790,
18 J. PAT. OFF. SOC'Y 237, 240 (1936).
[FN18]. See Flexner, supra note 10, at 132-33.
[FN19]. See Edward C. Walterscheid, Priority of Invention: How
the United States Came to Have a "First-to-Invent" Patent System, 23
AM. INTELL. PROP. L. ASS'N Q.J. 263, 265 (1995) [hereinafter Walterscheid,
Priority of Invention].
[FN20]. See id.
[FN21]. See Edward C. Walterscheid, Patents and the Jeffersonian
Mythology, 29 JOHN MARSHALL L. REV. 269, 293 (1995) (quoting a letter from
Jefferson describing the burdens of patent examination duty).
[FN22]. See id. at 292-97 (describing the origin and passage of
the 1793 Act).
[FN23]. See Edward C. Walterscheid, The
Winged Gudgeon--An Early Patent Controversy, 79 J. Pat. & Trademark. Off.
Soc'y 533 (1997) (describing the origins of the
1836 Act).
[FN24]. See Patent Act of July 4, 1836, ch. 357, § 6,5 Stat. 117, 119; see also Edward C.
Walterscheid, To
Promote the Progress to Useful Arts: American Patent Law and Administration,
1787-1836 (Part 1), 79 J. PAT. & TRADEMARK OFF. SOC'Y 61 (1997).
[FN25]. See DOUGLASS C. NORTH & ROBERT PAUL THOMAS, THE RISE
OF THE WESTERN WORLD: A NEW ECONOMIC HISTORY 147-48 (1973).
[FN26]. See id. at 155.
[FN27]. See id. at 152-53.
[FN28]. See id. at 148-49. Cf. WILLIAM J. BAUMOL, ENTREPRENEURSHIP,
MANAGEMENT, AND THE STRUCTURE OF PAYOFFS 1 (1995) (arguing that entrepreneurs
will innovate either productively or, alternatively, via rent-seeking schemes, depending on the incentives they face).
[FN29]. See DOUGLASS C. NORTH, STRUCTURE AND CHANGE IN ECONOMIC
HISTORY 164- 65 (1981) ("It is only with the Statute of Monopolies in 1624
that Britain developed a patent law.").
[FN30]. See STANLEY I. KUTLER, PRIVILEGE AND CREATIVE
DESTRUCTION: THE CHARLES RIVER BRIDGE CASE (1971); JAMES WILLARD HURST, LAW AND
ECONOMIC GROWTH (1964).
[FN31]. Economists define "rent" as a supra-normal
return, i.e., revenue higher than would be necessary to justify a given
investment, taking into account a "normal" level of profit. See Alan
W. Evans, On Monopoly Rent, 67 LAND ECON. 1, 2-4 (1991). Rent-seeking is the
expenditure of resources in an effort to capture these supra-normal returns;
lobbying for special legislative privileges is a classic example. See JAMES M.
BUCHANAN ET AL., TOWARD A THEORY OF THE RENT-SEEKING SOCIETY 7 (1980).
[FN32]. STANLEY I. KUTLER, PRIVILEGE AND CREATIVE DESTRUCTION:
THE CHARLES RIVER BRIDGE CASE (1971).
[FN33]. See id.
[FN34]. See
Charles River Bridge v. Warren Bridge, 36 U.S. (11 Pet.) 420 (1837).
[FN35]. Cf. Robert E. Mensel, Privilege Against Public Right: A
Reappraisal of the Charles River Bridge Case, 3 DUQ. L. REV. 1 (1994) (arguing
that the Charles River Bridge case introduced Jacksonian themes of economic
dynamism and democratic egalitarianism into constitutional discourse).
[FN36]. Cf. Charles K. Rowley et al. eds., Rent-Seeking in
Constitutional Perspective, in THE POLITICAL ECONOMY OF RENT-SEEKING 447,
462-63 (1988).
[FN37]. See Jonathan R. Macey, Promoting
Public-Regarding Legislation Through Statutory Interpretation: An Interest
Group Model, 86 COLUM. L. REV. 223, 247-50 (1986)
(discussing ways in which the structure of the Constitution impedes
rent-seeking by interest groups); Robert D. Tollison, Symposium
on the Theory of Public Choice: Public Choice and Legislation, 74 VA. L. REV.
339 (1988) (giving an overview of the
"economic theory of legislation").
[FN38]. JAMES BUCHANAN & GORDON TULLOCK, THE CALCULUS OF
CONSENT (1962).
[FN39]. See, e.g., Cass Sunstein, Naked
Preferences and the Constitution, 84 COLUM. L. REV. 1689, 1690-91 (1984).
[FN40]. Roche Taradol Patent Language Removed from Senate
Appropriations Bill., PINK SHEET, May 12, 1997, Vol. 59, Issue 19, available in
1997 WL 16952572.
[FN41]. Jim Drinkard, Drug Firm Seeking Rider on Flood Relief;
Hoffman- LaRoche Finds Friends in Senate, CINCINNATI ENQUIRER, May 3, 1997, at
B10.
[FN42]. The Hotline (American Pol. Network), Aug. 12, 1998, at
41. See also Steve Zeitlin, Strangling Culture with a Copyright Law, N.Y.
TIMES, Apr. 25, 1998, at A15 ("Dennis Karjala, law professor at the
University of Arizona, has noted that under the new law our roly-poly Santa
Claus, originally created by the 19th-century cartoonist Thomas Nast, would not
have gone into the public domain until 1973. Even the United States Government
would have had to pay royalties to use Nast's Uncle Sam in all of this
century's wars. Just as Uncle Sam and Santa eventually became part of the
public domain, available for anyone to use in any season, so eventually should
Mickey Mouse and Bugs Bunny take their places in our free-to-all pantheon of
cultural icons.").
[FN43]. See The Sonny Bono Copyright Term Extension Act, Pub. L.
No. 105- 298, 112 Stat. 2827 (1998).
[FN44]. Cf.
United Christian Scientists v. First Church of Christ, 829 F.2d 1152, 1166
(D.C. Cir. 1987) (invalidating private copyright
bill for certain works of the Christian Science religion, but under the
Establishment Clause, rather than under the Copyright and Patent Clause).
[FN45]. MANCUR OLSON, THE RISE AND DECLINE OF NATIONS 41 (1982).
[FN46]. JONATHAN RAUCH, DEMOSCLEROSIS: THE SILENT KILLER OF
AMERICAN GOVERNMENT 72-73 (1994).
[FN47]. Id. at 75. See also Glenn Harlan Reynolds, Is Democracy
Like Sex?, 48
VAND. L. REV. 1635 (1995) (discussing costs to
society of transfer- seekers and ways constitutional structure may reduce such
costs); Glenn Harlan Reynolds, Chaos
and the Court, 91 COLUM. L. REV. 110 (1991)
(same).
[FN48]. THRAINN EGGERTSSON, ECONOMIC BEHAVIOR AND INSTITUTIONS
278 (1990).
[FN49]. See, e.g., Zvi
Griliches, Research Expenditures, Education, and the Aggregate Agricultural
Production Function, 54 AM. ECON. REV. 961, 961 (1964) (asserting that the
social rate of return on agricultural research is at least 150% greater than
the private rate of return to the researchers); Robert E. Evenson & Yoav
Kislev, Research and Productivity in Wheat and Maize, 81 J. POL. ECON. 1309,
1309 (1973) (arguing that the social return is up to 300% greater than private
return); Edwin Mansfield et al., Social and Private Rates of Return from
Industrial Innovations, 91 Q.J. ECON. 221, 221 (1977) (concluding that the
social rate of return on 17 major products was between 77% and 150% greater
than the private rate of return); Timothy F. Bresnahan, Measuring the
Spillovers from Technical Advance: Mainframe Computers in Financial Services,
76 AM. ECON. REV. 742, 753 (1986) (demonstrating very large social gain from
mainframe computers, 1.5 to 2.0 orders of magnitude above cost of inventing
them).
[FN50]. Letter from Thomas Jefferson to James Madison (July 31,
1788), in 13 THE PAPERS OF THOMAS JEFFERSON, 1788, at 442-43 (Julian P. Boyd
ed., 1958).
[FN51]. Letter from James Madison to Thomas Jefferson (Oct. 17,
1788), in 14 THE PAPERS OF THOMAS JEFFERSON, 1788-1789, at 17 (Julian P. Boyd
ed., 1956).
[FN52]. 383
U.S. 1, 5 (1966) (citation omitted). In Graham
the Court did not discuss the copyright provision, "which we omit as not
relevant here." Id. at 5 n.1. There seems to be no reason for interpreting
the provision differently given the parallel structure of the clause.
The quoted passage is in stark contrast to
the early views of Justice Story, who wrote (in his capacity as a circuit
judge):
The [constitutional] power is general, to
grant to inventors; and it rests in the sound discretion of congress to say,
when and for what length of time and under what circumstances the patent for an
invention shall be granted. There is no restriction, which limits the power of
congress to enact, [only to] where the invention has not been known or used by
the public.
Blanchard
v. Sprague, 3 Fed. Cas. 648, 650 (Case No. 1,518)
(C.C.D.Mass. 1839). We are indebted to Edward C. Walterscheid for this
citation.
[FN53]. See
Feist Publications, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 359 (1991) (holding that copyrights in factual compilations, such as
phone directories, are invalid under the "originality" requirement of
the Constitution).
[FN54]. See 35
U.S.C. § 103 (1998). See also
Trademark-Cases, 100 U.S. (10 Otto) 82, 94 (1879)
(invalidating Trademark Act passed by Congress under
Copyright and Patent Clause authority of Constitution):
[A trademark] is often the result of
accident rather than design, and when under the act of Congress it is sought to
establish it by registration, neither originality, invention, discovery,
science, nor art is in any way essential to the right conferred by that act. If
we should endeavor to classify it under the head of writings of authors, the objections
are equally strong. In this, as in regard to inventions, originality is
required. And while the word writings may be liberally construed, as it has
been, to include original designs for engravings, prints, &c., it is only
such as are original, and are founded in the creative powers of the mind. The
writings which are to be protected are the fruits of intellectual labor,
embodied in the form of books, prints, engravings and the like.
Cf.
San Francisco Arts & Athletics, Inc. v. United States Olympic Comm'n, 483
U.S. 522, 532 (1987) ("There is no need in
this case to decide whether Congress ever could grant a private entity
exclusive use of a generic word.").
[FN55]. It must be admitted, though, that at least under some
theories of innovation, mega-awards to highly successful inventors may serve as
the primary spur to further invention and innovation. For more on this
"home run" theory of invention, see F.M. Scherer, The Innovation
Lottery (June 25, 1998), paper presented at NYU Law School Conference on
Intellectual Products: Novel Claims to
Protection and Their Boundaries, Florence, Italy (June 25, 1998) (on file with
the authors).
[FN56]. See, e.g., Library of Congress, Congressional Research
Service, The History of Private Patent Legislation in the House of
Representatives, Jan. 31, 1978, reprinted in Hearings on Private Patent
Litigation (H.R. 2882) before the House Committee on the Judiciary, Subcomm. On
Courts, Civil Liberties, and the Admin. Of Justice, 98th Cong., 2d sess. (Sept.
13, 1984) (written by Christine P. Benagh), at 97, 102 [hereinafter Library of
Congress Report] (patent extension denied to Oliver Evans, a very important
early nineteenth century inventor; yet granted for many minor inventions).
[FN57]. See ROBERT P. MERGES ET AL., INTELLECTUAL PROPERTY IN THE
NEW TECHNOLOGICAL AGE, 131 n.23 (1997); William F. Patry, The
Copyright Term Extension Act of 1995: Or How Publishers Managed to Steal the
Bread from Authors, 14 CARDOZO ARTS & ENT. L.J. 661, 669-79 (1996) (reviewing history of copyright term up until 1995).
[FN58]. Cf. Joseph A. Lavigne, Comment, For Limited Times? Making
Rich Kids Richer Via the Copyright Term Extension Act Of 1996, 73
U. DET. MERCY L. REV. 311, 313 (1996) (arguing
that the copyright term extension under GATT amendments
in 1996 violated the "for a limited time" language of the Copyright
and Patent Clause).
[FN59]. See Library of Congress Report, supra note 56, at 102.
[FN60]. See id. at 102-04.
[FN61]. See id. at 105.
[FN62]. See id.
[FN63]. See id.
[FN64]. See id.
[FN65]. See id. at 101; Edward C. Walterscheid, Priority of
Invention, supra note 19, at 265 (describing disposition of Rumsey-Fitch
dispute under 1790 Patent Act).
[FN66]. See Act of July 4, 1836, ch. 361, § 18, 5 Stat. 117, 124-25 (1846) (granting a seven-year extension for
patentees who showed they had failed to
obtain "reasonable remuneration for the time, ingenuity, and expense [[of
the invention], and the introduction thereof into use."). The 1836 Act
reflected its Jacksonian origins in that it established, in the words of
Jacksonian Senator Ruggles, not a "regal prerogative" but "a
general law ... without discrimination." Report of the Select Committee
Appointed To Take into Consideration the State and Condition of the Patent
Office, 24th Cong., 1st sess. (1936), reprinted in 6 NEW AMERICAN STATE PAPERS,
SCIENCE AND TECHNOLOGY 47 (1973).
[FN67]. See Library of Congress Report, supra note 56, at 103,
(noting that between 1808 and 1836, when the law was changed, Congress passed
eighteen special acts allowing aliens to file patent applications).
[FN68]. See id. at 104 ("The principal reasons underlying
the passage of the earlier private patent bills [i.e., from 1790 to 1836] had
been addressed through general legislation.").
[FN69]. Indeed, a Congressional Report from 1879 details a number
of convincing prudential reasons to deny private patent bills, but does not
express the opinion that such extensions are unconstitutional in general.
Private bills of various kinds have been upheld as constitutional. See, e.g., Williams v. Norris, 25 U.S. (12 Wheat.) 117
(1827) (holding the Court has no jurisdiction
over an essentially private act under state law that does not raise federal
constitutional issues); United
States v. Gettysburg Electric Realty Co., 163 U.S. 427 (1896) (upholding constitutionality of private bill to pay claims
on government under expired and later renewed sugar bounty acts). And indeed,
there are some very old cases upholding private patent extensions in the face
of constitutional challenges. See
Evans v. Jordan, 13 U.S. (9 Cranch) 199, 203-04 (1815); Evans v. Weiss, 8 Fed. Cas. (No. 4,572) (C.C.D.Pa. 1809);
Evans v. Robinson, 8 Fed. Cas. (No. 4,571) (C.C.D.Md. 1813) (all involving
congressional statutes extending patents of Oliver Evans). Note that in each
case, however, objection of the special bill was premised on the Constitution's
prohibition of ex post facto laws, not on the copyright and patent clause. Note
also that Thomas Jefferson strenuously objected to the outcome in these cases.
See Letter from Thomas Jefferson to Issac McPherson (Aug. 13, 1813) in THE
WRITINGS OF THOMAS JEFFERSON, at 326-27 (A.A. Lipscomb ed., 13th ed., 1903). We
thank Edward C. Walterscheid for the cites and information in this footnote.
[FN70]. Graham,
383 U.S. at 5.
[FN71]. See, e.g., 35
U.S.C. § 154(c)(2)(A) (Supp. 1998) (failing to provide for
remedies against infringers whose activities began before or within six months
of passage of Act extending patent term from 17 years from patent grant to 20
years from patent filing); 17
U.S.C. § 104A (Supp. 1998) (giving "reliance parties" a grace period of 12
months to end uses of previously uncopyrighted works whose copyrights were
restored under 1995 amendments to the Copyright Act).
[FN72]. U.S.
Const. art I, § 8, cl. 3. Cf.
Chamberlin v. Uris Sales, Inc., 150 F.2d 512 (2d Cir. 1945). Indeed this very theory underlies recent bills aimed at
protecting computer databases under copyright-like federal law. See Collections
of Information Antipiracy Act, H.R. 2652, 105th Cong. (1998).
[FN73]. The high-water mark of congressional power under the
Commerce Clause is often said to be Wickard
v. Filburn, 317 U.S. 111 (1942). In Wickard, the
Court upheld the regulation of wheat grown upon a farmer's own land and
consumed upon his property by his family and livestock as an exercise of
Congress's power to regulate commerce among the several states--the theory
being that such wheat took the place of wheat that would otherwise be purchased
on the interstate market for wheat. But see
United States v. Lopez, 514 U.S. 549, 559-60 (1995)
(stressing that the regulation in Wickard was economic in character, and that
so was wheat growing, and denying that this logic might render the commerce power effectively
unlimited). For more on the limits imposed by Lopez see David B. Kopel and
Glenn H. Reynolds, Taking Federalism Seriously: Lopez and
the Partial-Birth Abortion Ban Act, 30 Conn. L. Rev. 59 (1997) (arguing that Congress may not regulate abortion practices
under the commerce power).
[FN77]. Cf. 35
U.S.C. § 155A (Supp. 1998) (granting a very specific
""general" extension, applying for example to a patent
for a product "which ... if during regulatory review ... the [FDA]
notified the patentee, by letter dated February 20, 1976, that such product's
new drug application was not approvable ... [but] the [FDA] approved, by letter
dated December 18, 1979, the new drug application for such product ...''). This
was a patent extension for the drug Lopid, manufactured by Warner-Lambert
Pharmaceuticals, Inc.
[FN78]. Compare 35
U.S.C. § 156 (Supp. 1998), codifying Pub. L. No. 100- 418, § §
9201-9202, 102 Stat. 1107 1569-70; S. Rep. No. 83, 100th Cong., 1st
sess. (1987) (describing reasons for special legislative relief for Lopid) with
Drug Price Competition and Patent Term Restoration Act of 1984, codified at 35
U.S.C. § 156 (Supp. 1998) (regular extension procedure for general classes of patents).
See generally Richard M. Cooper, Legislative Patent Extensions, 8 FOOD &
DRUG L.J. (1993) (reviewing legislative history of Lopid Bill, and arguing that
private bills such as this are well-accepted, constitutional, and in effect, a
growth industry).
[FN79]. Extensions only serve as an incentive if they are
anticipated at the time a work is created; given how rare they are, this is
unlikely. And for many proposed extensions, particularly in the copyright
realm, an additional term of protection adds next to nothing in present value
terms because of the powerful effect of discounting over time. See, e.g.,
Stewart Sterk, Rhetoric
and Reality in Copyright Law, 94 MICH. L. REV. 1197, 1223 n.115 (1996) (demonstrating the effects of discounting over time).
[FN80]. Of course, there must be some room for the classic case
of a private bill to relieve government oversight or mistake. See Library of
Congress Report, supra note 56, at 105 n.101 (affording patent protection where
Patent Office had misplaced patent application); id. at 106 (restoring patent invalidated as a result of judicial
corruption). One way to preserve this traditional congressional safety valve,
while at the same time cutting off rent-seeking, is to characterize the
government oversight as a taking and grant compensation under the Fifth
Amendment.
[FN81]. At the same time, it is clear that even a general
intellectual property statute should be invalidated if it extends protection
for an absurdly long period. For a good example of proposed legislation that
would surely qualify for this treatment, consider a proposal made in the U.S.
House of Representatives. The Hon. Mrs. Sonny Bono (R-Cal.) wanted Congress to
extend the copyright term to forever minus one day. See 144 CONG. REC. H9952
(daily ed. Oct. 7, 1998), reprinted in 56 PAT. TRADEMARK & COPYRIGHT J.
(BNA) 740 (1998). One recently filed complaint even alleges that a series of
recent copyright term extensions violate the Constitution. See Hiawatha Bray,
Net Publisher Challenges Law; Harvard Law Faculty, Firm Join Copyright Fight,''
BOSTON GLOBE, Jan. 13, 1999, at C1.
[FN82]. See Library of Congress Report, supra note 56, at 105
(requesting patent extension for Samuel Colt's invention of the revolver); U.S.
Senate Committee on the Judiciary, Subcommittee on Patents, Copyrights and
Trademarks, Patent Extension Hearing, 102d Cong., (1991) at 9 [hereinafter 1991
Senate Extension Hearings] (1991 Senate
Extension Hearings statement of Sen. John Glenn in support of S. 1506, "A
Bill to Extend the Term of the Olestra Patents, and for Other Purposes":
"Olestra may be one of the most important food additives in
history").
[FN83]. See Library of Congress Report, supra note 56, at 104-05
(describing numerous extensions granted to inventors who alleged they had not
sufficiently recouped investments); 1991 Senate Extension Hearings, supra note
82, at 281 (declaring that a ten-year patent extension is required for the
Olestra food additive in order to justify needed investment in manufacturing
facilities).
[FN84]. See 35
U.S.C. § 154(b) (Supp. 1998) (granting extensions for excessive patent examination time
and appeals of rejected applications).
[FN85]. Cf. Richard Posner, The
Constitution as an Economic Document, 56 GEO. WASH. L. REV. 4, 10 (1987) (pointing out that it may be difficult for the judiciary
to tell the difference between rent-seeking and efficiency-enhancing
legislation: "[C]ourts cannot readily identify purely redistributive
legislation, in part because much redistributive legislation may be defensible
on efficiency grounds by reference to problems of social peace, free-rider
problems, and so forth."). Of the enumerated grounds, only free riding
could plausibly create difficulties for a
judge sorting redistributive from efficient private IP legislation. Note that
Congress presumably strikes the appropriate balance between appropriation and
free riding when it sets the uniform term of protection under copyright and
patent law. See generally Thomas E. Plank, The
Constitutional Limits of Bankruptcy, 63 TENN. L. REV. 487 (1996).
[FN86]. 514
U.S. 549 (1995) (striking down the Gun-Free
School Zones Act as outside Congress's Commerce Clause power). See also, e.g.,
City of Boerne v. Flores, 521 U.S. 507 (1997)
(striking down Religious Freedom Restoration Act as outside Congress's
Fourteenth Amendment enforcement power).
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DOCUMENT