Supreme Court to Revisit Abrogation of State Sovereign Immunity From IP Infringement

By James Lovsin --

Under the Eleventh Amendment of the Constitution, States enjoy sovereign immunity from a wide variety of suits.  But there are exceptions, including congressional abrogation of immunity.  Twenty years ago, in Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 U.S. 627 (1999), the Court struck down the Patent Remedy Act that abrogated state sovereign immunity from patent infringement:

Any State, any instrumentality of a State, and any officer or employee of a State or instrumentality of a State acting in his official capacity, shall not be immune, under the eleventh amendment of the Constitution of the United States or under any other doctrine of sovereign immunity, from suit in Federal court by any person, including any governmental or nongovernmental entity, for infringement of a patent under section 271, or for any other violation under this title.

35 U.S.C. § 296(a); see also id. § 271(h).

The Court in Florida Prepaid held that Congress did not have the authority to abrogate immunity from patent infringement under various provisions in the Constitution, including the Patent Clause, Commerce Clause, and the Fourteenth Amendment.  Art. I, § 8, cl. 8; id. cl. 3; and § 5 of the 14th amend.

This week, the Court granted to certiorari in Allen v. Cooper, No. 18-877 to consider the abrogation issue, again, in the context of copyright law.  In this case, Mr. Allen sued North Carolina for infringing his copyright in a documentary film related to the salvage of Blackbeard's ship, Queen Anne's Revenge.  The District Court denied the State's motion to dismiss for sovereign immunity, relying on the 1990 Copyright Remedy Act, which is substantially identical to the Patent Remedy Act:

Any State, any instrumentality of a State, and any officer or employee of a State or instrumentality of a State acting in his or her official capacity, shall not be immune, under the Eleventh Amendment of the Constitution of the United States or under any other doctrine of sovereign immunity, from suit in Federal court by any person, including any governmental or nongovernmental entity, for a violation of any of the exclusive rights of a copyright owner provided by sections 106 through 122, for importing copies of phonorecords in violation of section 602, or for any other violation under this title.

17 U.S.C. § 511(a).  In doing so, the District Court broke with the Fifth Circuit and several district courts throughout the country that have ruled the statute is invalid.

The Fourth Circuit reversed.  The Fourth Circuit found that its "conclusion is required by Florida Prepaid."  895 F.3d 337, 351 (4th Cir. 2018).  As in Florida Prepaid, the Fourth Circuit ruled that Congress did not have the authority to abrogate immunity from copyright infringement under the Copyright Clause, Commerce Clause, and Section 5 of the Fourteenth Amendment.

The Fourth Circuit rejected Allen's reliance on a 2006 Supreme Court case, Central Virginia Community College v. Katz, 546 U.S. 356, in which the Court upheld abrogation of state sovereign immunity under the Bankruptcy Clause.  According to the Fourth Circuit, Katz's holding "was made in a completely distinguishable context that was unique to the Bankruptcy Clause."  895 F.3d at 348.

It is interesting that the Court decided to grant cert. in Allen v. Cooper.  Lower courts that have addressed copyright abrogation appear to have uniformly followed Florida Prepaid.  But the composition of the Court has significantly changed since Florida Prepaid was decided.  Florida Prepaid was decided by a 5-4 majority in 1999 and only one Justice from the majority, Justice Thomas, remains on the Court.  Similarly, only two of the dissenting Justices in Florida Prepaid remain on the Court, Justices Ginsburg and Breyer.

The Court's grant of cert. in Allen v. Cooper also stands in contrast to the Court's denial of cert. in April in the tribal immunity case Saint Regis Mohawk v. Mylan Pharmaceuticals, No. 18-899.  There, the Federal Circuit ruled that the Tribe was not immune from inter partes review in the Patent Trial and Appeal Board.

Given the Copyright Remedy Act and Patent Remedy Act are substantively identical, the Court's decision in Allen v. Cooper could have an impact on patent law.  States frequently participate in the patent system and are often litigants in district courts as well as the PTAB.

The Federal Circuit is currently deciding such a state sovereign immunity case.  In Regents of University of Minnesota v. LSI Corp., No. 18-1559, the PTAB majority ruled that the State waived immunity from IPR by filing an infringement suit in district court.  In concurrence, another judge explained that states do not have any immunity from IPR.  The Court heard oral argument in Regents in March.

Patent Docs will monitor Allen v. Cooper and provide updates the case progresses.

Comments

[Greg DeLassus]

"The Court's grant of cert. in Allen v. Cooper also stands in contrast to the Court's denial of cert. in... Saint Regis Mohawk v. Mylan Pharmaceuticals..."

Not much contrast. The two cases are *very* different.

First of all, The St. Regis Mohawks were asserting their patent against Mylan, and it can hardly come as a surprise that the act of asserting the patent should be expected to work a waiver of sovereign immunity. By contrast, North Carolina has not hailed Cooper into court in any fashion.

Secondly, SRV v. Mylan involved an administrative proceeding, not a trial in a court of law (as in the present Allen v. Cooper). The outcome in SRM v. Mylan hinged on the distinction between court of law proceedings and agency actions because "[g]enerally, immunity does not apply where the federal government acting through an agency engages in an investigative action or pursues an adjudicatory agency action." St. Regis Mohawks v. Mylan Pharma., 896 F.3d 1322, 1325 (Fed. Cir. 2018).

Finally, the St. Regis Mohawks were asserting tribal immunity. Tribal immunity is a creature of federal common law, and that same federal common law makes clear that Congress' power to revoke that sovereign immunity is plenary under the "commerce with tribes" clause. Michigan v. Bay Mills Indian Community, 134 S. Ct. 2024, 2030 (2014).

By contrast, state sovereign immunity is a creature of federal common law, but is rather a positive law deriving from the XI amendment to the constitution. Congress' power, therefore, to abrogate state sovereign immunity is much more restricted than its ability to abrogate tribal sovereign immunity. There is, in other words, a whole vista of legal analysis that was not conducted in SRM that would need to have been considered if that case had instead involved a state sovereign.

The differences between the present Allen case and the earlier SRM case are so many and different that the Justices' indifference to SRM are largely uninformative about their concerns in Allen.

[Greg DeLassus]

"By contrast, North Carolina has not hailed Cooper into court in any fashion."

Whoops. Obviously enough I meant that North Carolina has not *haled Allen* into court.

[Skeptical]

The statement of "Not much contrast. The two cases are *very* different." is NOT supportable.

One only has to read what the court in the St. Regis Mohawk case ACTUALLY said to see why.

The court there held its position on the mechanism as to why Sovereignty -- as a general concept and NOT as differentiated by ANY differences that may exist between State Sovereignty and the "lesser" Indian Nations Sovereignty.

EVERY BIT of the St. Regis reasoning and holding -- on its face -- would apply to a case with the different facts of a State Sovereignty instead of the facts of an Indian Nations Sovereignty.