In the closing decades of the twentieth century, the United States Supreme Court appeared to follow an informal policy of benign neglect toward the law of intellectual property. The Court entertained a case every few years but, on the whole, left the development of the law to lower courts, especially in the area of patent law. Those days are long gone. Even as the Supreme Court's overall docket has shrunk in recent years, its interest in intellectual property cases has escalated.
The Court reentered the field in a small but splashy way in the 2005 and 2006 Terms. In those two years, the Court heard six patent cases—noticeably higher than previous terms—that significantly changed patent law. Among other things, the Court did away with the virtually automatic right to an injunction following a finding of infringement, which had been a fixture of the patent jurisprudence of the Court of Appeals for the Federal Circuit. See eBay Inc. v. MercExchange, LLC, 547 U.S. 388 (2006). That ruling has significantly reduced the threat of an injunction in a large percentage of patent cases, especially those brought by plaintiffs who do not practice their patents. In its other decisions, the Supreme Court rejected the Federal Circuit's test for obviousness under 35 U.S.C. § 103 and revised the test for infringement related to overseas activities. See e.g.,KSR Int'l Co.v. Teleflex, Inc., 550 U.S. 398 (2007) (obviousness); Microsoft Corp. v. AT&T Corp., 550 U.S. 437 (2007) (overseas activity).
Supreme Court observers may have reasonably wondered whether the IP docket would revert to the mean. That has not happened. It seems instead that there is a new normal and that intellectual property has captured the Court's attention in an enduring way: last year, the Court took a record six patent cases along with four other intellectual property cases (two copyright cases, and two Lanham Act cases).
The Court will not hear six patent cases again this Term, but any appearance of a drop-off in the IP docket has been short lived. In recent weeks, the Court has reversed the appellate standard of review for patent claim construction, a critical aspect of virtually every patent litigation. See Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., No. 13-854 (Jan. 20, 2015). And the Court granted review in two other cases to determine whether a defendant may assert a good faith belief in a patent's invalidity as a defense to induced infringement under 35 U.S.C. § 271(b), and whether license agreements can require payment of royalties after a patent expires. See Commil USA, LLC v. Cisco Sys., Inc., No. 13-896; Kimble v. Marvel Enter., Inc., No. 13-720.
In January, the Court also issued orders calling for the views of the Solicitor General in two intellectual property cases. The Court sometimes issues such orders when evaluating whether to grant petitions for certiorari in patent cases and other complex areas of law. The Court views the Solicitor General as a (more or less) neutral party with deep expertise. When the Solicitor General advises in favor of granting certiorari, the Court often agrees and grants the petition.
The two pending petitions raise important questions and, if granted, could have widespread impact.(1) The first case is Google, Inc. v. Oracle America, Inc., No. 14-410 (filed Oct. 6, 2014), a heavyweight copyright battle that has been highly watched by both Court observers and the IP bar. The question before the Supreme Court concerns the extent to which software is entitled to copyright protection. With obvious importance to the software industry, the case has generated considerable amicus support on both sides.
The second case involves a question concerning the methodology for construing patent claims. See Google, Inc. v. Vederi, LLC, No. 14-448 (filed Oct. 16, 2014). More specifically, the question involves how courts should construe a claim term that resulted from an amendment made by an applicant to secure the patent by overcoming a rejection by the Patent Office. The petition explains that Supreme Court precedent requires strict construction of such terms but that the Federal Circuit has departed from that precedent by holding that any disclaimer of claim scope resulting from such an amendment must be clear and unmistakable. Given that most patent claims are amended multiple times during examination, the issue has the potential to affect a substantial number of patent litigations.
Although the Supreme Court's continued interest in IP cases is clear, the reasons for that interest are not because the Court grants and denies petitions without stating its reasons for doing so. It is hard not to notice, however, that the Court's spiking interest coincided with the appointment of Chief Justice John Roberts. New Members of the Court sometimes shake up the docket, and the Chief Justice often handled patent appeals to the Federal Circuit during his time in private practice.
The Court's interest may also reflect the simple reality that intellectual property has increased in importance in the modern economy. While it may have been fashionable to view patent law as a niche area of the law a few decades ago, few would hold that view today, where patents and technology are at the forefront for many businesses. The Court may well have been content to leave patent law to the Federal Circuit after its creation in 1982. It no longer has that luxury.
That said, even if the Court believed initially that it must entertain IP cases because of their importance, the Court may now simply be more comfortable with the area. A number of the Justices have written multiple opinions on complex IP topics. Having made the investment and gained the experience, the Court is now flexing its muscles. Expect the trend to continue.