It is no surprise to anyone that patent rights in the United States suffered enormously under the two terms served in the White House by President Barack Obama. That the Obama White House was uncomfortably close with Google is widely known (see here and here), and Google has been the face and driving force of the lobby that supports weakening patent rights in America.
The Executive Branch was also full of former Google executives, including heading the U.S. Patent and Trademark Office during Obama’s second term. With so much lobbying money spent by Google on patent issues, and the Executive Branch looking more like a Google Alumni organization, it is easy to understand why the government established a Patent Trial and Appeal Board (PTAB) that saw as its mission the killing of patents, and why the Department of Justice continually argued in brief after brief, positions that would fundamentally erode the value and integrity of a patent grant.
What is far less clear, and extremely difficult to explain or understand, is why the Department of Justice continues to make arguments against patents. Indeed, in the DOJ brief filed in Oil States v. Greene’s Energy, the Solicitor General argues repeatedly throughout the brief that patents are not private property, but rather are a public right.
The Republican Platform on Patents
The GOP campaign platform unveiled in Cleveland for the convention in July 2016 openly and explicitly said that patents are private property, likening patents to land and homes, protected by the Constitution. Specifically, the platform stated on page 15:
Private property includes not only physical property such as lands and homes, but also intellectual property like books and patents. Article 1, section 8 of the Constitution gives Congress the power to safeguard intellectual property rights for “Authors and Inventors.” By protecting the proprietary rights of creators and innovators, the Constitution promotes the general welfare by providing incentives for investment in all sorts of technology and artistic works. Intellectual property is a driving force in today’s global economy of constant innovation. It is the wellspring of American economic growth and job creation. With the rise of the digital economy, it has become even more critical that we protect intellectual property rights and preserve freedom of contract rather than create regulatory barriers to creativity, growth, and innovation.
The Republican platform adopted by the convention in 2016 was molded to the liking of President Trump. That is how platforms go in Presidential years, with the party nominee being able to stack the Committee that drafts the platform. So what happened? The Republican platform specifically says patents are private property akin to land and protected by the Constitution. Why is the Trump Justice Department now arguing that patents are not property rights at all? Indeed, at the very beginning of the brief filed by the DOJ in Oil States, in the Summary of the Argument, the DOJ stakes its claim and beings by arguing that patents are a public right (not private property) that is akin to a government-conferred franchise.
Do you have a government-conferred franchise in the real property you own? Of course not! You bought your real estate from the previous owner. The government did not confer anything onto you in that transaction. This very point was made by the Supreme Court in Moore v. Robbins, 96 U.S. 530 (1877). The Supreme Court explained that once title to land was granted by the government no further action from the government (or “land-office”) to revoke that right could exist. Explaining this concept the Supreme Court explained:
If this were not so, the titles derived from the United States, instead of being the safe and assured evidence of ownership which they are generally supposed to be, would be always subject to the fluctuating, and in many cases unreliable, action of the land-office. No man could buy of the grantee with safety, because he could only convey subject to the right of the officers of the government to annul his title.
The government annulling title is exactly what is happening at the PTAB, a bureaucratic tribunal made up of Executive Branch employees (as Justice Roberts characterized it during oral arguments in Oil States). But if patents are private property, patent owners have a vested ownership interest that cannot be taken away by the government without just compensation. The Fifth Amendment specifically states that “private property [shall not] be taken for public use, without just compensation.”
So again, why is the Trump DOJ making arguments that directly contradict the Republican platform adopted by President Trump? This argument, no doubt, has to be made in order to allow the government to take patents away without without paying for the taking. If patents were really private property they couldn’t be taken without just compensation. So the argument has to be made that a patent is a public right, and not private property. This is the only way to justify Executive Branch employees of the U.S. Patent and Trademark Office annulling patents away after they have been lawfully granted.
The Trump DOJ Brief in Oil States
In going through the Department of Justice brief in Oil States you will find no fewer than seven different places where the argument is made that patents are a public right, and not private property.
The Federal Government argues patents are a public right throughout its Oil States brief.
DOJ Oil States brief at pg. 13
The justification for patents is not that an inventor has a natural right to preclude others from making or using his invention, but that patent protection will ultimately benefit the public by providing an incentive to innovate. Governmentally-conferred franchises designed to serve such purposes create “public rights,” whose scope and continuing effectiveness may be resolved by non-Article III tribunals.
DOJ Oil States brief at pg. 14
As petitioner emphasizes, questions of patent validity have historically been decided by courts as well. This Court has long recognized, however, that a variety of factual and legal matters are suitable for resolution by either judicial or nonjudicial forums. Such matters are “public rights” for purposes of this Court’s Article III jurisprudence.
DOJ Oil States brief at pg. 17
The public-rights doctrine reflects the principle that, when the very existence of a right “depends upon the will of [C]ongress,” Murray’s Lessee, 59 U.S. (18 How.) at 284, Congress can set conditions on the manner of its adjudication, id. at 283-284; see Northern Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U.S. 50, 83 (1982) (plurality).
DOJ Oil States brief at pg. 33
In Thomas v. Union Carbide Agricultural Products Co., supra, this Court upheld a mandatory arbitration system under which private parties can be ordered to make payments to other private parties for using information pertaining to pesticides under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), 7 U.S.C. 136 et seq. The Court explained that “Congress, acting for a valid legislative purpose pursuant to its constitutional powers under Article I, may create a seemingly ‘private’ right that is so closely integrated into a public regulatory scheme as to be a matter appropriate for agency resolution with limited involvement by the Article III judiciary.”
DOJ Oil States brief at pg. 37-38
Patents have always been understood as privileges or franchises. Rather than reflecting any perceived “natural right” of inventors to monopolize discoveries, Graham, 383 U.S. at 9, patents were understood as creations of the sovereign that “intrude” on “the natural right of the public to appropriate all new ideas that may be voluntarily disclosed,” 1 William C. Robinson, The Law of Patents for Useful Inventions §§ 25-26 (1890); see American Bell I, 128 U.S. at 370 (patents “take from the people this valuable privilege and confer it as an exclusive right upon the patentee”); Teva Pharms., 135 S. Ct. at 848 n.2 (Thomas, J., dissenting) (explaining that the Founders saw no “ ‘core’ property right in inventions”).
DOJ Oil States brief at pg. 45
That argument overlooks that public rights are those matters that can “be granted or withdrawn at the sovereign’s discretion.”
DOJ Oil States brief pg. 46
This Court has explained since Murray’s Lessee that matters that can be resolved in both judicial and nonjudicial forums are public rights.
And these are just the most direct and obvious arguments supporting the notion that patents are not property at all, but rather just a public right — a government franchise that can be taken away without compensation by the federal government.
Save for a minute the fact that the Supreme Court has historically (and repeatedly) equated a patent grant to property rights in real estate (see here and here). Save for a minute that Republican Platform molded by President Trump defines patents as being equivalent to real property. The Patent Act itself actually says that patents are property. The statute succinctly explains: “patents shall have the attributes of personal property.” 35 U.S.C. §261. Yet, to the Trump Justice Department, patents are simply a public right — a government franchise capable of being annulled without Constitutional protections.
To consider patents a public right, or a government franchise as the DOJ does, flies in the face of two centuries of patent law and practice, as well as the 2016 Republican Platform. But for Conservatives and property rights advocates the views of the Trump Department of Justice should be considered a betrayal of the highest magnitude.
It seems as if the Trump DOJ is on the same page as the Obama DOJ, which is hard to fathom given all the promises made by President Trump during his campaign.