Though the philosophical case for intellectual property as property is weak at best, the United States Supreme Court has found that the granting of a patent constitutes an “exclusive property.” From the 1882 case James v. Campbell,
That the government of the United States when it grants letters-patent for a new invention or discovery in the arts, confers upon the patentee an exclusive property in the patented invention which cannot be appropriated or used by the government itself, without just compensation, any more than it can appropriate or use without compensation land which has been patented to a private purchaser, we have no doubt.
If intellectual property is legally considered property, then violations of that property right could be unconstitutional. Specifically, they could violate the takings clause of the Fifth Amendment, which reads that any person shall not “be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
This is the argument made by Advanced Audio Devices, LLC in its petition for writ of certiorari to brings its case to the Supreme Court. Steve Brachmann explains at IPWatchdog.org.
In recent weeks, Lake Forest, IL-based audio tech developer Advanced Audio Devices filed a petition for writ of certiorari seeking the U.S. Supreme Court to take up its appeal of decisions to invalidate its patents handed down by the Patent Trial and Appeal Board (PTAB). If granted, the case would ask the Supreme Court to decide the constitutionality of the PTAB under the Fifth Amendment’s Takings Clause, which was a grounds for arguing the PTAB’s constitutionality reserved by Justice Clarence Thomas’ opinion in Oil States v. Greene’s Energy Services.
Advanced Audio Devices owns five U.S. patents which were invalidated in inter partes review (IPR) proceedings at the PTAB. Advanced Audio had appealed those decisions to the Federal Circuit but the appellate court issued a Rule 36 affirmance this May which upheld the PTAB decisions without issuing an opinion.
Inter partes review is the process by which a petitioner can challenge the eligibility of a patent “only on the basis of prior art consisting of patents or printed publications.” The review may be granted “upon a showing that there is a reasonable likelihood that the petitioner would prevail with respect to at least one claim challenged.” This process is conducted by the Patent Trial and Appeal Board, created in 2012 by the America Invents Act.
This is an interesting legal question. On the one hand, if IP is legally considered property, the invalidation of a patent could constitute a regulatory taking, which SCOTUS has found to be a Fifth Amendment violation if it significantly reduces the value of the property.
Whether Advanced Audio Devices will prevail is unclear. But it does raise an interesting question: what would the arguments against PTAB’s inter partes review process be if, instead of being viewed as property, patents were considered a state-sanctioned monopoly?
In light of precedent this is an academic exercise, but food for thought nonetheless.