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Irresistible Force Meets Immovable Object: Copyright Infringement Liability, State Sovereign Immunity and the Supreme Court’s Upcoming Decision in Allen v. Cooper

Matthew F. Abbott

Notwithstanding the efforts of Congress, intellectual property owners have been left with little redress against infringement by state actors. In 1999, the Supreme Court struck down two statutes that eliminated the states’ sovereign immunity to patent infringement claims and false advertising claims under the Lanham Act.  Following these decisions, lower courts have consistently held the Copyright Remedy Clarification Act (CRCA) to be similarly unconstitutional, and the Department of Justice has declined to defend the law. On June 3, 2019 the Supreme Court granted certiorari in Allen v. Cooper, and will consider whether CRCA is a valid Congressional abrogation of the States’ sovereign immunity to copyright infringement liability.

The Copyright Remedy Clarification Act (CRCA)

In 1988, Congress designated the Register of Copyrights to assess the extent of the clash between the Eleventh Amendment and federal copyright law. Following receipt of the Register’s report, which warned of “dire financial and other repercussions” if states retained immunity to copyright lawsuits, Congress passed CRCA in 1990.  CRCA, set forth at 17 U.S.C. § 511, provides that the states are not immune to suits in federal court arising from violations of the Copyright Act.

Rejection of the Patent Act and Trademark Remedy Clarification Act by the Supreme Court

In 1992, Congress enacted both the Patent Remedy Act (PRA) and the Trademark Remedy Clarification Act (TRCA), which similarly nullified the sovereign immunity of states to patent and trademark infringement claims.  In 1999, the Supreme Court ruled that Congress was not empowered to abrogate the states’ immunity to claims filed under the Patent Act and Section 43(a) of the Lanham Act.  Fla. Prepaid Postsecondary Educ. Expense Bd. v. Coll. Sav. Bank, 527 U.S. 627 (1999) (Patent Act); Coll. Sav. Bank v. Fla. Prepaid Postsecondary Educ. Expense Bd., 527 U.S. 666 (1999) (Lanham Act).

In each case, the Supreme Court considered the Commerce and Patent Clauses of the Constitution, as well as the Fourteenth Amendment, which empowers Congress to enact legislation implementing the constitutional ban on state deprivation of “property” without due process of law. In both decisions, the Supreme Court held that, under Seminole Tribe of Fla. v. Florida, 517 U.S. 44, 55 (1996), Congress had no authority to abrogate state sovereign immunity under its Article I powers (i.e., the Commerce Clause and the Patent Clause).  In the patent case, the Supreme Court confirmed that patent rights are property for the purposes of the Due Process Clause.[1]  Citing City of Boerne v. Flores, the Supreme Court held that that for Congress to invoke § 5 of the Fourteenth Amendment, it must identify conduct that transgresses the Fourteenth Amendment’s substantive provisions, and must tailor its legislative scheme to remedying or preventing such conduct.  521 U.S. 507, 519-20 (1997).   Applying this test requires examination of (1) the nature of the injury to be remedied; (2) Congress’s consideration of the adequacy of state remedies to redress the injury; and (3) the scope of the legislation.  The Supreme Court found that Congress had identified no pattern of infringement by states, had barely considered the availability of state remedies and had drafted the legislation with the broadest scope possible (i.e., all states amenable to suit in federal court for every kind of patent infringement for an indefinite duration) without support in the record.

Rejection of CRCA In The Lower Courts

Following Seminole Tribe and the Fla. Prepaid decisions, the Fifth Circuit held that the CRCA was an improper abrogation of states’ sovereign immunity against copyright infringement claims. Chavez v. Arte Publico Press, 204 F.3d 601, 608 (5th Cir. 2000). The Court found that when enacting the CRCA, Congress had failed to identify any significant pattern of state copyright infringement, had barely considered the existence and adequacy of state remedies, and had made no attempt to confine the reach of the Act to limit to certain types of infringement, or limit to states with questionable remedies or high incidences of infringement.  Since 2000, a number of federal courts have followed Chavez, but no court has upheld the CRCA against a constitutional challenge without reversal on appeal.

In 1999, Attorney General Janet Reno wrote to Congress that, in light of the Florida Prepaid decisions, the “current legislative record will no longer support the constitutionality” of CRCA  – a position also adopted by later administrations. Accordingly, CRCA has not been defended by the Department of Justice since 1999.

Allen v. Cooper: Factual and Procedural Background

In 1996, the wreck of the “Queen Anne’s Revenge” – the flagship of the pirate known as Blackbeard – was found off the coast of North Carolina. The North Carolina Department of Natural and Cultural Resources undertook a process to recover, preserve and archive the wreckage based on its historical and archeological interest.  Frederick Allen is a documentary filmmaker who was hired to document the Department’s recovery process with the understanding that he would maintain the rights to his footage.   After the Department posted several of Allen’s copyrighted videos on its website, Allen brought a copyright infringement suit against the Department and several state officials, including Governor Roy A. Cooper, in the U.S. District Court for the Eastern District of North Carolina.  The Department moved to dismiss on the basis that North Carolina has sovereign immunity from copyright claims.  On March 23, 2017, the District Court granted the motion in part, holding that although Congress could not abrogate state sovereign immunity using its Article I powers, it could so under Section 5 of the Fourteenth Amendment, and that the legislative record contains ‘sufficient evidence of infringement of copyrights by states” to justify this result.

The Fourth Circuit reversed on July 10, 2018, holding that under Seminole Tribe, Congress could not abrogate state sovereign immunity using its Article I powers, nor was CRCA valid under Section 5 of the Fourteenth Amendment.  The Court held that Congress had relied only on its Article I powers in enacting CRCA, not Section 5, and thus CRCA could not be justified based on Section 5.  The Court further held that, regardless, CRCA was not valid legislation under Section 5 because the legislative record failed to show “widespread and persistent deprivation of constitutional rights.”  Instead, the Court observed that the record showed “at most a dozen incidents of copyright infringement by the states” and was therefore “analogous” to the legislative record in Florida Prepaid that was held to be inadequate (showing ten patent infringement suits against the states). Finally, the Court held that Congress’s imposition of “sweeping liability for all [copyright infringement]” was “wholly incongruous” with the “sparse” record of infringement by the states, and had similarly been found overbroad in Florida Prepaid.  North Carolina thereafter filed its Petition for Certiorari on January 4, 2019, which was granted on June 3, 2019.

The Parties’ Arguments Regarding Congress’s Article I Power

Allen relies on Central Virginia Community College v. Katz, 546 U.S. 356 (2006), in which the Supreme Court ruled that state sovereign immunity for adversary proceedings in bankruptcy should be abrogated based in part on its finding that “States had agreed in the plan of the Convention not to assert any sovereign immunity defense they might have” in proceedings brought pursuant to bankruptcy law. Id. at 377.  Allen argues that the Supreme Court should, following Katz, disregard the Florida Prepaid cases and look to whether the states surrendered sovereign immunity in the plan of the Convention.  Allen argues that sovereign immunity was not surrendered because the Intellectual Property Clause was inserted into Article I without significant debate or opposition, and that it was “indispensable to this Plan that the States surrender their sovereign immunity” in order to secure “uniform protection for [patents and copyrights] throughout the United States.”

In response, Cooper argues that Florida Prepaid cases control and Allen has not given any reason why Congress’s abrogation powers should be greater for copyrights than for patents. Cooper distinguishes Katz as having relied on two considerations unique to bankruptcy law: first, while bankruptcy jurisdiction is in rem, jurisdiction over copyright claims is in personam, which “does not implicate States’ sovereignty to nearly the same degree as other kinds of jurisdiction,” Katz, 546 U.S. at 362, and second, that unlike the Copyright Clause, the Bankruptcy Clause has a unique Constitutional history that showed that the states had agreed in the plan of the Convention to relinquish their sovereign immunity (namely, to address the “rampant injustice” resulting from States’ refusal to respect each other’s bankruptcy discharge orders, id. at 377).

The Parties’ Arguments Regarding Section 5 of the Fourteenth Amendment

Allen argues that the Fourth Circuit erred by disregarding evidence of state copyright infringement in the legislative record. Allen claims that the CRCA legislative record was “substantially more expansive” that the record examined in connection with the Patent Remedy Act, because the Patent Remedy Act found ten examples of patent infringement cases against states in the last 110 years, while the CRCA found twelve examples of copyright infringement actions against states in the past ten years, and because the Fourth Circuit ignored “extensive testimony and evidence Congress received on the inadequacy of states’ remedies for copyright infringement.”  Allen further argues that CRCA should be distinguished from the Patent Remedy Act because copyright infringement involves “intentionality” not present in patent infringement – namely, to infringe, a defendant must copy the plaintiff’s work, and the act of independent creation, unlike with a patented work, does not infringe. Thus, Allen argues, it is less likely a state would infringe a copyright inadvertently.

Cooper argues that because Congress relied solely on its Article I power in enacting CRCA, consideration of Congress’s power to enforce due process under the Fourteenth Amendment is irrelevant. Cooper further argues that the Fourth Circuit was correct in its finding that the CRCA legislative record did not show a “widespread pattern” of constitutional violations and that Congress failed to tailor the scope of abrogation to reflect its record.  Cooper argues that the legislative record did not identify any constitutional violations at all, because copyright infringement only constitutes a constitutional violation when it violates due process, and to commit a due process violation a defendant must infringe a copyright intentionally (citing Florida Prepaid, 527 U.S. at 645).  The legislative record did not identify any copyright infringement cases involving willful infringement of state actors.

Possible Outcomes and Alternative Remedies

The Florida Prepaid cases were decided along conventional political lines, with the “conservative” justices in the majority.  In Katz the results were similar, although Justice O’Connor crossed over to create the majority that upheld Congress’s abrogation of state sovereign immunity to the bankruptcy laws.  Both Justice Thomas and Chief Justice Roberts dissented in Katz and have likely not changed their views.  Both Justice Ginsburg and Justice Breyer joined the majority in Katz and dissented in Florida Prepaid, and have likely not changed their views either. If this case is similarly decided along political lines, it will most likely result in a 5-4 decision upholding the Fourth Circuit’s decision that the CRCA was not a valid waiver of sovereign immunity.  However, it would only take one “conservative” justice to switch sides in order to distinguish or overrule Florida Prepaid.

If the Supreme Court rules that the CRCA is unconstitutional and upholds state sovereign immunity against copyright claims, what redress do copyright owners have when a state entity is infringing? One possible option is for the copyright owner to file an inverse condemnation claim in state court, seeking just compensation for an unconstitutional “taking” of his property under the Fourteenth Amendment.  However, it is unsettled as to whether a copyright can be protected from government takings.  In a recent decision, the Court of Appeals for the First District of Texas held that a copyright cannot give rise to a viable constitutional takings claim, but acknowledged that there was scarce authority and legal scholars are split on the issue. University of Houston System v. Jim Olive Photography, No. 01-18-00534-cv (Tex. Ct. App. 1st Dist. 2019).  Following this decision, it remains highly uncertain whether an inverse condemnation claim is an effective means for copyright owners to enforce their copyrights against state actors.

Copyright owners may also seek relief pursuant to Ex Parte Young, 209 U.S. 123 (1908), under which private citizens may sue state officials in their official capacities in federal court for prospective relief from ongoing violations of federal law.  However, a plaintiff is limited to injunctive relief and an action may only be maintained for continuing violations – once a violation has ceased, the claim is moot. Ex Parte Young has not been extended to allow claims for retrospective relief. Green v. Mansour, 474 U.S. 64, 68 (1985).


A decision upholding CRCA will subject the states and state-run institutions to copyright infringement liability, and will likely force the states to implement more stringent policies and procedures concerning the use of copyrighted materials. Additionally, states may quickly find themselves named as defendants in copyright litigation where copyright owners have been aware of their ongoing infringing conduct but did not file suit earlier based on the apparent unenforceability of CRCA.  Conversely, a decision striking down CRCA will likely do little to change the status quo, under which CRCA has been effectively unenforceable for decades.

[1] In the Lanham Act case, the Court found that the right to be free from a competitor’s false advertising claims regarding its own products was not a property right protected by the Due Process Clause. College Savings Bank, 527 U.S. at 672-73

We’ve Moved!

We are happy to announce that, effective August 1, 2019, our offices will be located further south on Hudson Street in the landmark Western Union Building located in TriBeCa at:

Powley & Gibson, P.C.
60 Hudson Street
Suite 2203
New York, NY 10013

All other contact information remains the same.
Please update your records to reflect our new address.

Important Notice for Non-US Trademark Owners

Beginning August 3, 2019, all foreign-domiciled trademark applicants, registrants, and parties before the Trademark Trial and Appeal Board (TTAB) are required to be represented by an attorney who is licensed to practice law in the United States.

Any trademark filings in violation of this rule may be rejected or the validity of any potential rights may be jeopardized.

The new rule is intended to increase compliance with U.S. law and USPTO regulations, improve accuracy of trademark submissions, and safeguard the integrity of the U.S. trademark register.
We remain committed to assisting our foreign-domiciled clients and associates with all of their trademark needs. Please contact us with any inquiries.

Iancu v. Brunetti: Scandal and Immorality vs. The First Amendment

By Matthew F. Abbott
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The Trademark Act, 15 U.S.C. § 1502, sets forth several categories of marks that will be refused registration by the U.S. Patent & Trademark Office (“PTO”). In particular, § 1502(a) prohibits registration of marks consisting of “matter which may disparage . . . a person,” as well as marks “consist[ing] of or compris[ing] immoral, deceptive, or scandalous behavior.”  In 2017, the Supreme Court ruled that the statute’s prohibition of “disparaging trademarks” violated the First Amendment because it discriminated on the basis of viewpoint. Matal v. Tam, 582 U.S. __ (2017).  On June 24, 2019, in Iancu & Brunetti, 588 U.S. ___ (2019), the Supreme Court ruled on the portion of § 1502(a) that prohibits “immoral” or “scandalous” marks, holding that this provision also violates the First Amendment because it disfavors certain ideas.

Mr. Brunetti’s Proposed Trademark

Erik Brunetti founded a clothing line that uses the trademark “FUCT.”   When Mr. Brunetti applied for a federal trademark registration for his mark, both the PTO Examining Attorney and the Trademark Trial and Appeal Board (“Board”) rejected it as unregistrable under § 1502(a).   The standard applied by the PTO in evaluating potentially “immoral” or “scandalous” marks is whether “a substantial composite of the general public would find the mark “shocking to the sense of truth, decency or propriety”; “giving offense to the conscience or moral feelings”; “calling out for condemnation”; “disgraceful”; “offensive”; “disreputable”; or “vulgar.” In re Brunetti, 877 F.3d 1330, 1446 (Fed. Cir. 2017).   The PTO Examiner found the mark was “totally vulgar” and therefore unregistrable, and the Board found it additionally to be “highly offensive” and having “decidedly negative sexual connotations.”  The Board found further that Brunetti’s website and products contained “extreme nihilism” and “anti-social behavior” and that in this context, the mark communicated “misogyny, depravity and violence” and was “extremely offensive.”  Following rejection by the Board, Brunetti then challenged the “immoral and scandalous” bar in the U.S. Court of Appeals for the Federal Circuit, which found it violated the First Amendment.  The Supreme Court thereafter granted certiorari.

BONG HITS 4 JESUS: the PTO’s Viewpoint-Based Treatment of Immoral or Scandalous Marks

Writing for the majority, Justice Kagan identified the key inquiry as whether the “immoral or scandalous” criterion was viewpoint neutral or viewpoint-based. She had little trouble in concluding that the criterion was impermissibly viewpoint-based.  In particular, she pointed to a number of examples where the PTO has refused to register marks espousing “immoral” or “scandalous” views of certain subjects while allowing marks that express more accepted view of the same subjects.  For example, in regard to the subject of recreational drug use, the PTO refused registration of YOU CAN’T SPELL HEALTHCARE WITHOUT THC (for pain relief medication), MARIJUANA COLA and KO KANE (for beverages), while allowing D.A.R.E. TO RESIST DRUGS AND VIOLENCE and SAY NO TO DRUGS – REALITY IS THE BEST TRIP IN LIFE.  In regard to trademarks associating religious references, the PTO refused AGNUS DEI (for safes) and MADONNA (for wine) while allowing PRAISE THE LORD (for a game) and JESUS DIED FOR YOU (on clothing).  The PTO similarly refused the mark BONG HITS 4 JESUS on the basis that Christians would be morally outraged by a statement that connects Jesus Christ with illegal drug use.

Rejection of the Government’s Statutory Limitation Argument

Justice Kagan rejected the government’s argument that the statute could be subject to a limiting exception that would limit the prohibition to “marks that are offensive [or] shocking to a substantial segment of the public because of their mode of expression independent of any views they may express,” which would effectively limit the refusals to marks that are “vulgar” (i.e., “sexually explicit or profane”).  Justice Kagan held that the statute “covers the universe of immoral and scandalous” – not merely the “mode” of expression, and that limiting the statute in the proposed manner would not be interpreting it but rather creating a new statute.  Consequently, she held that both the “immoral” criterion and the “scandalous” criterion violated the First Amendment.  Her majority opinion was joined by Justices Thomas, Ginsburg, Alito, Gorsuch and Kavanaugh.

Concurring in part and dissenting in part, Justice Sotomayor agreed that the term “immoral” could not be saved, but argued that the term “scandalous” could be limited in the manner proposed by the government. Her opinion was joined by Justice Breyer, and Chief Justice Roberts wrote a separate opinion concurring in part and dissenting in part in which he expressed the same view.  Justice Alito wrote a concurring opinion in which he invited Congress to enact a more precise statute that singles out “vulgar terms that play no real part in the expression of ideas.”

Justice Sotomayor speculated that the floodgates were now open and the PTO will be besieged with applications for highly offensive trademarks. Whether this happens remains to be seen, but in the event that this becomes a significant problem in the eyes of the public or the government, then Congress may see fit to take Justice Alito up on his invitation and take a second try at legislating against “vulgar” marks.

U.S. Supreme Court Determines Government Cannot Challenge Patent for Post Issuance Review under the AIA

Return Mail, Inc. v. United States Postal Services

By Fritz Klantschi
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On June 10, 2019 the United States Supreme Court in Return Mail, Inc. v. United States Postal Service, 868 F.3d 1350 (“Return Mail v. USPS”) held that the federal government is not a “person” able of instituting AIA review proceedings.


The decision centered around Section 18(a)(1)(B) of the America Invents Act (“AIA”), concerning Covered Business Method (CBM) patents, and reads “[a] person may not file a petition for a transitional proceeding with respect to a covered business method patent unless the person or the person’s real party in interest or privy has been sued for infringement of the patent or has been charged with infringement under that patent” (emphasis added). Return Mail, Inc. had sued the U.S. Postal Service in the U.S. Court of Federal Claims (“USCFC”) alleging infringement of its patent, and, in turn, the USPS challenged Return Mail’s patent under the AIA. A prior blog post on this site discussed the background of the case in further detail.

Supreme Court Decision

Justice Sotomayor delivered the opinion of the Court in a 6-3 decision. The Court held that, unless there is an express definition of the term “person” in the patent statutes, the courts must proceed with the presumption that the government is not a person, absent an affirmative showing to the contrary.

The USPS made three arguments that the Court addressed.

  1. 1. The USPS argued that AIA post-issuance review proceedings must include the government because other references in the patent statutes appear to do so. The Court however found that at least 18 references to “persons” in the Patent Act and the AIA showed no clear trend that the term “person” included the government.


  1. 2. Next, the USPS argued that, because the government has a longstanding history with the patent system, Congress must have intended to allow the government access to the AIA post-issuance reviews. The USPS and the dissent by Justice Breyer both noted that since 1981 the Patent Office treated federal agencies as “persons” who may request an ex parte reexamination. The majority however countered that they might take account of this “executive interpretation” if they were determining whether Congress meant to include the government as a “person” for purposes of the ex parte reexamination procedures. The Court also noted, even assuming the government may petition for ex parte reexamination, there are differences between an ex parte reexamination and an AIA proceeding such that there are good reasons why Congress might have authorized the government to request a “hands-off” ex parte reexamination but not be a party to a full-blown adversarial proceeding of an AIA review proceeding. The Court found there to be no “settled” meaning of the term “person” with respect to the AIA review proceedings and the Manual of Patent Examining Procedures (“MPEP”) does not justify putting aside the presumptive meaning of “person.”


  1. 3. Finally, the USPS argued that it must be a “person” because, like other infringers, it is subject to civil liability and can assert a defense of patent invalidity. The Court held however that, unlike a private party, the government faces lower risks in an USCFC trial because it cannot be subject to an injunction and there are legal limits on the damages that can be ordered. Since the USPS faces a lower risk, the Court found it is reasonable for Congress to treat federal agencies differently, even though the burden of proof for invalidity is greater at the USCFC (clear and convincing standard) than for an AIA proceeding (preponderance of the evidence). Also, excluding federal agencies from using the AIA review proceedings avoids the “awkward situation” of having a civilian patent owner defend its patent against one federal agency overseen by another government agency, the PTAB.


The Court held that a federal agency, such as the USPS, is not a person who may petition review under the AIA post-issuance proceedings. The decision of the U.S. Court of Appeals for the Federal Circuit was therefore reversed and the case remanded.  It can be argued, however, that it would be more efficient for the PTAB to hear validity claims in cases where a federal agency is sued for patent infringement, as opposed to the USCFC, which is the only court in which the government can be sued for patent infringement.  Congress may decide to amend the AIA to include the federal government as a “person” and address the estoppel provisions of the AIA to include the USCFC along with the ITC and civil actions.

The Return Mail decision does not address the ability of government contractors petitioning the PTAB to institute an AIA review proceeding to protect their interests. Government contractors have done so in the past.  Whether a government contractor can intervene will depend, in part, on whether the government contract that procured the alleged infringing product included a patent indemnity clause.

Finally, the language the Court used with respect to ex parte reexaminations may foreshadow the prospect that the federal government is not a person under 35 U.S.C. §301(a) which provides that “[a] person at any time may cite to the Office in writing . . .  prior art . . . which that person believes to have a bearing on the patentability of any claim of a particular patent,” and therefore cannot request an ex parte reexamination proceeding.