What goes around, comes around: how Indian Tribes can profit in the aftermath of Seminole Tribe and Florida Prepaid.

• Jurisdiction: United States
• Date: 01 January 2009
• Author: Bryar, Jeremiah A.

INTRODUCTION I. PATENT LAW II. EXPERIMENTAL USE EXCEPTION III. STATE SOVEREIGN IMMUNITY IV. TRIBAL SOVEREIGNTY V. TRIBAL SOVEREIGN IMMUNITY VI. DISCUSSION CONCLUSION INTRODUCTION

The Bureau of Indian Affairs, a federal agency, directly services approximately 1.5 million American Indians who reside on approximately fifty-six million acres of reservation land across the United States. (1) Of this number, in 2001, 403,714 were employed and nearly one-third of this number lived below the poverty line. (2) The average health, life expectancy, and education of Indians also lag behind the rest of America. The infant mortality rate is markedly higher than the rest of the population at 8.3 deaths per thousand as apposed to 6.9 for the rest of the population of the United States. (3) The death rate due to intentional self harm for Indians is 2.6% contrasted with 1.3% for Whites and 0.7% for Blacks. (4) The Indian's average life expectancy of 73.5 years is still lower than the rest of the nation. (5) With regard to the educational status of Indians living on reservations, only 11% of Indians have completed undergraduate or professional degrees, whereas 24.4% of the United States population has completed one or both degrees. (6)

Interestingly, the numbers above show some improvement in Indian life in the near past. For example, the number of Indians who are enrolled in universities or colleges increased 26% between 1990 and 2000. (7) Further, the infant mortality rate in 1955 was 62.7 per 1000 births (whereas it was 8.3 as of 2000). (8) It is clear, however, from this incomplete listing of statistics, that many Indians still live in dire circumstances.

All is not lost for American Indian tribes. This article presents one possible solution to the issue of Indian poverty: the creation of sovereign chartered research groups that would be shielded by tribal sovereign immunity. In reaching this conclusion, this paper will begin with an overview of patent law, state sovereign immunity, tribal sovereign status, and tribal sovereign immunity. Finally, it will end with a discussion of how tribes can take advantage of their sovereign status to start research groups that could, potentially, bring greater investment potential and wealth into the tribes.

1. PATENT LAW

   The body of patent law finds its origins in the U.S. Constitution. Specifically, Article I, section 8, clause 8, grants Congress the power to enact legislation that would promote the advancement of science and the arts by granting limited monopolies on their respective works. (9) The exact wording is as follows:

   The Congress shall have power ... To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries[.] (10) The most current major legislative work intended to protect the discoveries of inventors was embodied in 1952 as the Patent Act. It laid out the vast majority of what is, today, considered to be patent law. It exists in Title 35 of the U.S. Code and is implemented in Title 37 of the Code of Federal Regulations. The main section that is the most relevant to this discussion is 35 U.S.C. [section] 271. This section relates to the definition of infringement and the partial text is reproduced here:

   (a) Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.

   (b) Whoever actively induces infringement of a patent shall be liable as an infringer.

   (c) Whoever offers to sell or sells within the United States or imports into the United States a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer.

   (d) No patent owner otherwise entitled to relief for infringement or contributory infringement of a patent shall be denied relief or deemed guilty of misuse or illegal extension of the patent right by reason of his having done one or more of the following: (1) derived revenue from acts which if performed by another without his consent would constitute contributory infringement of the patent; (2) licensed or authorized another to perform acts which if performed without his consent would constitute contributory infringement of the patent; (3) sought to enforce his patent rights against infringement or contributory infringement; (4) refused to license or use any rights to the patent; or (5) conditioned the license of any rights to the patent or the sale of the patented product on the acquisition of a license to rights in another patent or purchase of a separate product, unless, in view of the circumstances, the patent owner has market power in the relevant market for the patent or patented product on which the license or sale is conditioned. (11)

   The term of the contemporary patent is twenty years from the filing date of its application. (12) This gives a tremendous financial advantage to the patent owner who controls the manufacture or development of the patented invention for a long period of time. However, there are exceptions to that patent owner's ability to seek redress for infringement of his intellectual property rights.

2. EXPERIMENTAL USE EXCEPTION

   At this time, it is prudent to take a moment to discuss the experimental use exception. The experimental use exception has been crafted mostly out of case law. (13) It is exceedingly narrow and largely only covers those uses that are for philosophical inquiries. (14) The commercial use of a patented idea, even if done by a non-profit research institution, is still infringement and cannot be availed of this protection-therein lies the rub. (15) Many of the projects that universities and other research entities undertake exceed that of mere philosophical inquiry. (16) Indeed, many of these projects are for eventual commercialization, which was the reason for the funding in the first place. (17) It is in this light that sovereign immunity protection becomes such a crucial component of state chartered research institutions.

   Although not about state chartered research organizations, the Roche v. Bolar (18) case had significant impact on the experimental use policy of the United States. In this case, Bolar was a manufacturer of generic drugs and was interested in creating a generic alternative to the brand name Dalmane drug. (19) In order to do so, Bolar used one of the patented Dalmane chemical compounds prior to the expiration of the patent. (20) Bolar did this to compare the efficacy of their generic compound to the patented compound. (21) Once Roche got wind of this activity, they sued Bolar for patent infringement. (22) To the dismay of Bolar, the court found that the activity was entirely commercial and therefore Bolar was unable to avail itself of the protections of the experimental use doctrine. (23)

   Congress was not pleased with the result of this case. Therefore, to protect the interests of generic drug manufacturers in experimentation prior to the expiration of the patent holder's rights, Congress enacted [section] 271(e)(1). (24) The text of this addition is as follows:

   It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention (other than a new animal drug or veterinary biological product (as those terms are used in the Federal Food, Drug, and Cosmetic Act and the Act of March 4, 1913) which is primarily manufactured using recombinant DNA, recombinant RNA, hybridoma technology, or other processes involving site specific genetic manipulation techniques) solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products. (25) Following Roche, the next important case with regard to the experimental use exception is Madey v. Duke University. (26) In Madey, the plaintiff was a professor who was let go from his position by the defendant Duke University. (27) However, the university continued to use inventions covered by two patents that the plaintiff owned. (28) The plaintiff, displeased with the ongoing activities of the university, filed suit for patent infringement. (29) The university argued that its use was protected by the experimental use exception as it was merely using the patents for research purposes and that it was a nonprofit organization; the district court held in favor of the university. (30) However, to the dismay and horror of many research organizations, the appellate court reversed, finding for the plaintiff. (31) In doing so, it countered that the experimental use exception was extremely narrow and only meant for "satisfy[ing] idle curiosity or for strictly philosophical enquiry." (32) The court went on the say that although many projects are initially completed for purely research oriented goals, they move on to feeding lucrative businesses. (33) The exact related quote is as follows:

   [R]egardless...