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August 9, 2006
Protecting its Own
By
the power of the XI Amendment to the Constitution, the United States indemnifies
its states. Protected by the Constitution, a state may infringe a patent without
practical remedy afforded the patent holder, the Federal Appeals Court
affirmed today (05-1440).
Amendment XI
The judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by citizens of another state, or by citizens or subjects of any foreign state.Pennington Seed, Inc. and AgResearch Limited (collectively “Pennington”), the patentees, originally filed suit against the University of Arkansas (“the University”) for infringement and conversion of U.S. Patent No. 6,111,170 (“the ’170 patent”). The United States District Court for the Western District of Missouri dismissed the Original Complaint due to the University’s Eleventh Amendment immunity. Pennington Seed, Inc. v. Produce Exch. No. 299, No. 04-4194-CV-C (W.D. Mo. Nov. 29, 2004) (“November Order”).
The ’170 patent claims a type of non-toxic fescue grass that does not adversely affect livestock that graze upon it... Pennington alleged in the Original Complaint and First Amended Complaint that the University and all four of the University Officials “are actively growing, marketing, offering for sale, promoting and selling a product containing” Pennington’s patented product.
The Eleventh Amendment to the United States Constitution limits the judicial authority of the federal courts and prevents citizens from bringing suit against a state in a federal court without its consent. Idaho v. Coeur d’Alene Tribe of Idaho, 521 U.S. 261, 267-68 (1997); see also Hans v. Louisiana, 134 U.S. 1, 17 (1890). While Congress may abrogate, under certain circumstances, a state’s Eleventh Amendment immunity under Section 5 of the Fourteenth Amendment, see Tennessee v. Lane, 541 U.S. 509, 518 (2004), it may not do so under its Article I Commerce Clause power in patent cases, see Fla. Prepaid Postsecondary Educ. Expense Bd. v. Coll. Sav. Bank, 527 U.S. 627, 647-48 (1999).
In Florida Prepaid, the Supreme Court held that Congress did not have the authority under Article I, Section 8 of the Constitution to abrogate state sovereign immunity. The amendment to the Patent Act that abrogated state sovereign immunity, 35 U.S.C. §§ 271(h), 296(a) (“Act”), did not reflect any Congressional findings upon which Congress could base the abrogation of the Eleventh Amendment sovereign immunity of the states pursuant to the Fourteenth Amendment. The Act merely served as a uniform remedy for patent holders against states instead of a remedy for constitutional violations, such as where a state provides inadequate or no state court remedies. Fla. Prepaid, 527 U.S. at 646-47. The infringement of a patent by a state may be actionable in federal courts “only where the State provides no remedy, or only inadequate remedies, to injured patent owners for its infringement of their patent.” Id. at 643... As specifically explained in Florida Prepaid, it is the Congress, not this court, that can abrogate Eleventh Amendment sovereign immunity for patent infringement, pursuant to Section 5 of the Fourteenth Amendment, if there is a showing that state remedies were insufficient and violated due process. 527 U.S. at 642-43, 646-47; see also Chew v. Cal., 893 F.2d 331, 336 (Fed. Cir. 1990).
Here, Pennington alleged in its complaint that the Arkansas Claims Commission is the only body allowed to hear claims against the state, but that it could not issue injunctions, conduct discovery, or issue a monetary award over $10,000. Pennington, however, fails to allege or explain how Congress made the specific finding that these state procedures are so inadequate that it abrogated state sovereign immunity to allow a patent infringement claim to be filed in federal court. Without such a finding, abrogation would be suspect under Florida Prepaid.
The only hope for Pennington is by begging or bribing the state legislature; fat chance. To hell with Federal patent law.
Although the district court found that there was no state forum in which to contest patent infringement claims, it did not find that other available remedies pursuant to state law were so insufficient that they violated the Fourteenth Amendment. In fact, Pennington’s First Amended Complaint inherently recognizes the sufficient state remedies acknowledged in Florida Prepaid. Namely, the complaint notes that the State legislature may consider claims and appropriate monetary awards greater than $10,000 (a legislative remedy), and it alleges that the state remedy for conversion (a judicial remedy) may be available. See Fla. Prepaid, 527 U.S. at 644 n.9. Moreover, Arkansas law allows other forms of relief aside from the Claims Commission. See, e.g., Austin v. Ark. State Highway Comm’n, 895 S.W.2d 941, 943 (Ark. 1995) (“[L]andowner, claiming a taking of property, may either seek prospective injunctive relief in chancery court or damages from the State Claims Commission.”); Cammack v. Chalmers, 680 S.W.2d 689 (Ark. 1984) (allowing injunctive relief for State acts that are illegal, unconstitutional or ultra vires). While these remedies may be “uncertain” or “less convenient,” or may “undermine the uniformity of patent law,” these attributes are not sufficient to show that the patentee’s due process rights have been violated. Florida Prepaid, 527 U.S. at 644-45; see also Xechem, 382 F.3d at 1332; Jacobs Wind Elec. Co. v. Fla. Dep’t of Transp., 919 F.2d 726, 728 (Fed. Cir. 1990).
Pennington also tried to sue the responsible officials as individuals; same result, both at the district and appeal levels.
God bless America.
Posted by Patent Hawk at August 9, 2006 11:57 AM | Case Law