Yahn-lin (franklin) Chu, Supplemental Jurisdiction Over Foreign Patents: Permissible, So Long as Limitations Apply

• Citation: Vol. 26 No. 1
• Publication year: 2010

SUPPLEMENTAL JURISDICTION OVER FOREIGN PATENTS: PERMISSIBLE, SO LONG AS LIMITATIONS APPLY

INTRODUCTION: SUPPLEMENTAL JURISDICTION OVER FOREIGN PATENTS AND

WHY IT MATTERS

The growing internationalization of patent activity is promoting innovation and facilitating technology transfers on an increasingly globalized level.1 The World Intellectual Property Organization (“WIPO”)2 has reported an increase in the number of patents filed and issued worldwide and a growing trend of applicants filing their applications in multiple nations.3 The internationalization

of patent activity can also be seen in the Patent Cooperation Treaty (“PCT”),4 the Patent Law Treaty,5 and the numerous calls for the streamlining and

harmonization of patent law among different jurisdictions.6 The process of

seeking patent protection and enforcing patent rights is one filled with international considerations.

Notwithstanding growing trends of internationalization in patent activity, it is well recognized that patents are territorial instruments.7 In the United States, this notion of territoriality is rooted in 35 U.S.C. § 154(a)(1), which provides that a U.S. patent conveys “the right to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States.”8 Similarly, 35 U.S.C. § 271

1. Press Release, World Intellectual Prop. Org., World Patent Report Confirms Increasing Internationalization of Innovative Activity (July 31, 2008), available at http://www.wipo.int/pressroom/en/ articles/2008/article_0042.html.

2. WIPO “is a specialized agency of the United Nations. It is dedicated to developing a balanced and

   accessible international intellectual property (IP) system, which rewards creativity, stimulates innovation and contributes to economic development while safeguarding the public interest.” What Is WIPO?, WORLD INTELL. PROP. ORG., http://www.wipo.int/about-wipo/en/what_is_wipo.html (last visited Feb. 2, 2012).

3. Press Release, World Intellectual Prop. Org., supra note 1.

4. Patent Cooperation Treaty, opened for signature June 19, 1970, 28 U.S.T. 7645.

5. Patent Law Treaty, opened for signature June 1, 2000, 2340 U.N.T.S. 3.

6. Mark A. Lemley et al., Divided Infringement Claims, 33 AIPLA Q.J. 255, 283 (2005) (“[I]n an ideal world patent law would be fully harmonized and indeed international, not territorial, in nature.”); see also COMM. ON INTELLECTUAL PROP. RIGHTS IN THE KNOWLEDGE-BASED ECON. ET AL., A PATENT SYSTEM FOR

   THE 21ST CENTURY 8 (Stephen A. Merrill et al. eds., 2004).

7. Teruo Doi, Essay, The Territoriality Principle of Patent Protection and Conflict of Laws: A Review of the Japanese Court Decisions, 26 FORDHAM INT’L L.J. 377, 377 (2003).

8 35 U.S.C. § 154(a)(1) (2006) (emphasis added).

provides that infringement occurs when a party “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.”9 Therefore, “a US patent is enforceable only in the US and its territories. There is no such thing as a global patent.”10 Even under the PCT, international applications filed serve only to initiate separate prosecution procedures in each nation and any patents issued are functionally separate instruments.11 Indeed, every nation maintains its own separate intellectual property regime based on distinct legislative codes.12

However, with the growing trend of internationalization, some have attempted to curtail the territorial nature of patents. On several occasions, both in the United States and abroad, domestic courts have been asked to hear cases involving foreign patents and pass judgment on those foreign instruments.13 In

the United States, the Court of Appeals for the Federal Circuit continues to reject the exercise of supplemental jurisdiction over foreign patents.14 Most recently, the Federal Circuit addressed this issue in Voda v. Cordis Corp.15 After considering comity, judicial economy, convenience, and fairness, the court declined to exercise supplemental jurisdiction over the foreign patents.16

The issue of exercising supplemental jurisdiction over foreign patents is an increasingly difficult problem that requires some resolution. First, as already mentioned, considerations of patent protection for modern innovations are no

1. Id. § 271(a) (emphasis added).

2. Louis Hallenborg et al., Intellectual Property Protection in the Global Economy, in TECHNOLOGICAL INNOVATION: GENERATING ECONOMIC RESULTS 63, 65 (Gary D. Libecap & Marie C. Thursby eds., 2008)

   (footnote omitted).

3. JANICE M. MUELLER, PATENT LAW 540–41 (3d ed. 2009).

4. Robert C. Bird & Subhash C. Jain, The Continuing Challenge of Global Intellectual Property Rights, in THE GLOBAL CHALLENGE OF INTELLECTUAL PROPERTY RIGHTS 3, 4 (Robert C. Bird & Subhash C. Jain eds., 2008).

5. E.g., Voda v. Cordis Corp., 476 F.3d 887 (Fed. Cir. 2007) (seeking enforcement of European, British, Canadian, French, and German patents in the United States); Mars Inc. v. Kabushiki-Kaisha Nippon Conlux, 24 F.3d 1368 (Fed. Cir. 1994) (seeking enforcement of Japanese patents in the United States); Stein Assocs.,

   Inc. v. Heat & Control, Inc., 748 F.2d 653 (Fed. Cir. 1984) (seeking enforcement of British patents in the United States); Tokyo Chiho Saibansho [Tokyo Dist. Ct.] Oct. 16, 2003, Heisei 15 (wa) no. 1943 (Japan), available at http://www.courts.go.jp/hanrei/pdf/F4341569E2231E6E49256E2F0024C48E.pdf (seeking enforcement of U.S. patents in Japan).

6. Voda, 476 F.3d at 905.

15 Id. at 889–91.

1. Id. at 900–05. The four factors of comity, judicial economy, convenience, and fairness are collectively known as the Gibbs factors. Newport Ltd. v. Sears, Roebuck & Co., 941 F.2d 302, 308 (5th Cir. 1991); see also infra Part I.

   longer geographically confined.17 Instead, technological advancements often have widespread global impact. Inventions in the United States are frequently patented in foreign countries as well.18 The process of innovation can benefit greatly from having greater patent harmonization, or uniform substantive and procedural requirements, throughout various nations.19 Patent harmonization helps to reduce uncertainties in patent validity, claim scope, and rights granted by a patent when an invention is filed and issued in multiple nations.20 Uniformity among patent regimes allows multinational corporations to reduce the cost of evaluating various laws,21 to obtain faster and better validity decisions,22 and to make better decisions on building and using their patent portfolios.23

   
   

   However, currently there is no consensus in international law, either through treaties or customs, resolving the issue presented in Voda.24 Different tribunals have taken different approaches on whether their domestic courts can exercise jurisdiction and pass judgment on another nation’s patents. For

   example, the Netherlands routinely hears foreign patent claims and continues to do so.25 Conversely, in 2006, the European Court of Justice ended its long- standing practice of hearing claims relating to foreign patents.26 Commentators have also taken various positions on the issues of patent law harmonization and the extent of extraterritoriality in U.S. patents.27 While some advocate for the

   
   

2. Press Release, World Intellectual Prop. Org., supra note 1.

3. See id.

4. See Suzanne Harrison, Will Patent Harmonization Increase Corporate ROI?, GATHERING2.0 (July 30, 2009), http://gathering2.wordpress.com/2009/07/30/will-patent-harmonization-increase-corporate-roi.

5. Id.

6. Timothy R. Holbrook, Extraterritoriality in U.S. Patent Law, 49 WM. & MARY L. REV. 2119, 2125 (2008).

7. Harrison, supra note 19.

8. Id.

9. Patent Law Harmonization: What Happened?, WIPO MAG., June 2006, at 18, 19, available at http:// www.wipo.int/export/sites/www/wipo_magazine/en/pdf/2006/wipo_pub_121_2006_03.pdf.

10. Gretchen Ann Bender, Clash of the Titans: The Territoriality of Patent Law vs. the European Union,

    40 IDEA 49, 49 (2000).

11. Case C-4/03, Gesellshaft für Antriebstechnik mbH & Co. KG v. Lamellen und Kupplungsbau Beteiligungs KG, 2006 E.C.R. I-6509, I-6534.

12. Donald S. Chisum, Normative and Empirical Territoriality in Intellectual Property: Lessons from Patent Law, 37 VA. J. INT’L L. 603, 616 (1997) (promoting extraterritoriality); Edwin D. Garlepp, An Analysis of the Patentee’s New Exclusive Right To “Offer to Sell,” 81 J. PAT. & TRADEMARK OFF. SOC’Y 315, 325–27

    (1999) (promoting territoriality); Timothy R. Holbrook, Territoriality Waning? Patent Infringement for Offering in the United States To Sell an Invention Abroad, 37 U.C. DAVIS L. REV. 701, 758–59 (2004) (promoting a balance of extraterritoriality and strict territoriality).

    
    

    liberal extension of extraterritoriality, others advocate for strict territoriality.28 The former group generally emphasizes the advantages of patent law harmonization.29 The latter group has argued that various benefits may result from growing nations developing their own intellectual property regimes rather

    than automatically mimicking the laws of the European Union or the United States.30 The scattered treatment of this issue among courts and scholars alike makes it worthwhile to explore the issue of supplemental jurisdiction over foreign patents and to dissect the Voda decision.

    
    

    The issue of exercising supplemental jurisdiction is important not only for harmonizing international patent law but also for establishing coherent domestic law in the United States. In recent years, the Federal Circuit’s struggle with the territorial nature of patents has become more pronounced. In

    NTP, Inc. v. Research in Motion, LTD.,31 the court held that patent

    infringement could occur within the United States even if part of the patented device is physically located abroad.32 In MEMC Electronic Materials, Inc. v. Mitsubishi Materials Silicon Corp.,33 the court allowed a foreign manufacturer to avoid direct patent infringement liability by selling products through an overseas intermediary before reselling the products in the United...