Unconstitutionality of S507/ HR400

by Brian Elfman

[1] Under the legislation proposed in S.507/HR400 ('507) there are at least two questions concerning its constitutionality. First, there is a precise question touching directly to demoting the new Commissioner of Patents in '507. Second, there is a broader question of making Article I exclusive grants from out of the present independent agency and into a government-owned private corporation. The first question is considered.

[2] Now under the present 35 U.S.C. 7-3, the President appoints a Commissioner possessing a significant patent background with the advice and consent of the Senate. In '507 our Commissioner's job is broken into four. First the President appoints a Director whom may be of either a significant patent background or significant trademark background and either with the advice and consent of the Senate. In turn, the Director appoints a Commissioner of Patents and a Commissioner of Trademarks. Thus, '507 expressly eliminates Presidential appointment and approval of the Senate, which up to now conferred insusceptibility of the Commissioner against the will of the President.

[3] In 1884, in Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 57, 4 S. Ct. 279, 28 L. Ed. 349, the Supreme Court, . . . said: "The construction placed upon the constitution by the first act of 1790 and the act of 1802, by the men who were contemporary with its formation, many of whom were members of the convention which framed it, is of itself entitled to very great weight, and when it is remembered that the rights thus established have not been disputed during a period of nearly a century, it is almost conclusive." Alfred Bell & Co., Ltd. v. Catalda Fine Arts, Inc. et al. 191 F.2d 99, (2d.Cir. 1951)

[4] In 1899, Mr. Chief Justice Fuller in following an earlier related case, Butterworth v. Hoe, 112 U.S. 50 (1884), held that the Patent Office is independent of the Secretary of the Department of the Interior (now the Department of Commerce) and that the Commissioner of Patents is the highest authority within it. U.S. ex rel. Bernardin v. Duell, 172 U.S. 563, 562-63 (1899). In Duell, Chief Justice Fuller approves Justice Matthews insightful reasoning in his analysis of Article I, Section 8, cl.8, U.S. Constitution. Justice Matthews reasons there was "founded a special branch of technical jurisprudence." and that the Commissioner "[in] deciding patent cases [his job is] essentially judicial in nature." Duell 172 U.S. at 563 quoting Butterworth.

[5] Justice Matthews also found "[I]n every grant of the limited monopoly two interests are involved, that of the public, who are the grantors, and that of the patentee." Id. at 563. Thus, Duell contemplates and settles a paramount constitutional dispute; that the Commissioner is the chief judicial officer of the patent process subservient to none who on behalf of the public, grants patents. In further support of Butterworth, Chief Justice Fuller cited a case on point;

"An [a patent] interference controversy presents all the features of a civil case, a plaintiff, a defendant, and a judge [the Commissioner] and deals with a question judicial . . . [where a finding is] a judgement 'because its effect may be to aid an administrative or executive body in the performance of duties legally imposed upon it by Congress in execution of a power granted by the Constitution.'." Interstate Commerce Commission, 154 U.S. 447 cited in Duell at 564.

[6] As the Commissioner is the chief judicial officer, he is appointed by the President and approved by the Senate " '[A]ny appointee exercising significant authority pursuant to the laws of the United States is an `Officer of the United States,' and must, therefore, be appointed in the manner prescribed by 2, cl. 2, of Article II.' Buckley, 424 U.S. at 126." quoted in Freytag v. CIR, 501 U.S. 868, 883 (1991).

[7] Further, the U.S. Supreme Court has given considerable thought on the point concerning the nature of the public's interest: "A patent by its very nature is affected with a public interest. As recognized by the Constitution, it is a special privilege designed to serve the public purpose of promoting the 'Progress of Science and useful Arts.'". Hazel-Atlas Glass Co. v. Hartford-Empire Co. 322 U.S. 238 (1944)

[8] Thus, not trademarks because they are creations out of Article II. For this reason, the Trademark Office in '507 constitutionally is simply an administrative convenience. Nonetheless, '507 promotes trademarks up to a separate office and demotes the Patent Office down to equality with trademarks. The possession and assertion of patent rights are "issues of great moment to the public." Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238, 246.

[9] In '507, the Director serves at the pleasure of the President, and the Commissioner of Patents serves at the pleasure of the Director. This phrase was given special attention in a case just this year by the U.S. Supreme Court. "For it is quite evident that one who holds his office only during the pleasure of another, cannot be depended upon to maintain an attitude of independence against the latter's will." Ingalls Shipbuilding, Inc., et al. v. Director of WCP, Department of Labor, et al. __ U.S. __, [95-1081] (1997)

Special note to Ingalls: (O'Connor, J., delivered the opinion for a unanimous Court with respect to Parts I and II, and the opinion of the Court with respect to Part III, in which Rehnquist, C.J., and Stevens, Kennedy, Souter, Ginsburg, and Breyer, JJ., joined. Scalia, J., filed an opinion concurring in part and dissenting in part, in which Thomas, J., joined.)

[10] Now Congress made the Patent Office an agency of the Department of Commerce since about 1982. (Citations omitted) Indeed the Board of Patent Interferences and Appeals (BPIA) operates in accordance with APA, Title 5. "The authority of Congress, in creating quasi-legislative or quasi-judicial agencies, to require them to act in discharge of their duties independently of executive control cannot well be doubted. Ingalls Shipbuilding, Inc., et al. v. Director of WCP, Department of Labor, et al. _ U.S. _, [95-1081](1997)

[11] It is precisely the "attitude of independence" Justice O'Connor writes in Ingalls, above, upon which Chief Justice Fuller predicated his conclusion in Duell, "we find no such encroachment of one department on the domain of another as to justify us in holding the act in question unconstitutional" Duell at 564. There can be no doubt that '507 overrules Duell. The '507 Commissioner of Patents serves at the pleasure of the Director rather as an "officer of the United States" decreed in Freytag.

[12] However, Congress makes no express reference to Duell in '507 and therefore the effects of overruling Duell is perhaps inadvertent. That is besides the point. No one would argue that the Framers intended anything other than the Chief Examiner be an "officer of the United States", Freytag above. Nor could anyone advance the notion that the Commissioner does not exercise "significant authority" Id. ('507 maintains the same appeal process. Also take note that the Patent Board of Appeals and Interferences designates "administrative patent judges.")

[13] The patent statute, enacted April 10, 1790, 1 Stat. 109, provided that patents should issue only if the Secretary of State, Secretary of War and the Attorney General, or any two of them "shall deem the invention or discovery sufficiently useful and important"; the applicant for a patent was obliged to file a specification "so particular" as "to distinguish the invention or discovery from other things before known and used . . ."; the patent was to constitute prima facie evidence that the patentee was "the first and true inventor or . . . discoverer . . . of the thing so specified." quoted in Alfred Bell & Co., Ltd. v. Catalda Fine Arts, Inc. et al. 191 F.2d 99, (2d.Cir. 1951)

[14] Please note in the foregoing passage the presence of the phrase "first and true inventor". In '507, this express intention of our Framers is collaterally attacked with prior user rights and reexaminations. Furthermore, the first chief examiner of the 1790 patent statute was Thomas Jefferson.

"No American among his contemporaries or his successors has achieved a greater reputation as an opponent of monopoly than Thomas Jefferson. Yet he not merely sanctioned, he eloquently advocated the form of monopoly represented in patents. I cite his commentary on an early act of Congress, presumably that of 1790, in the administration of which he collaborated with Henry Knox, Secretary of War, and Edmund Randolph, Attorney General.

'An act of Congress authorizing the issue of patents for new discoveries has given a spring to invention beyond my conception. Being an instrument of granting the patents, I am acquainted with their discoveries. . . . . 'In the arts, and especially in the mechanical arts, many ingenious improvements are made in consequence of the patent-right giving exclusive use of them for 14 years. 'Certainly an inventor ought to be allowed a right to the benefit of his invention for some certain time. Nobody wishes more than I do that ingenuity should receive liberal encouragement.'" Thomas Jefferson quoted by Commissioner of Patents; Hearings before the Temporary National Economic Committee (1939-41).

[15] The law proposed in '507 is in total contravention of Freytag because the Commissioner does exercise significant authority. Conversely, the organizational scheme of the Commissioner being appointed by the Director is in total contravention of Duell. Manifestly the Commissioner is wholly subservient to the will of the President and Director as concluded in Ingalls Shipbuilding, that one who holds his office only during the pleasure of another, cannot be depended upon. Thus, Freytag, Duell, and Ingalls stand for the proposition that '507 results in the principle of encroachment of the Executive Branch, Chief Justice Fuller established in Duell.

[16] Finally, the legal reasons in support of '507 are founded on international commerce and "efficiency", which have nothing to do with Article I. Likewise, '507 has no support in precedent. Our Framers would have disapproved of '507. And the United States Supreme Court will disapprove of '507 as unconstitutional.

*This is a part (1) of an unchecked abridged version of a letter in draft for the Senate Judiciary Committee in support of the unconstitutionality of, and the opposition to, S.507/HR400.*

(c) Copyrights 1997, granted when cited with author and notice for personal use.

Brian Elfman,
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Alameda, CA 94501
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