Here's one we've been waiting to drop, but when it did, we were tied up so couldn't get to it quickly.
Yes, it's a patent case. But as we explained here, a case that property mavens should be following because it deals with what is "property," and where an owner goes to resolve disputes about that property.
In Oil States Energy Services, LLC v. Greene's Energy Group, LLC, No. 16-713 (Apr. 24, 2018), the Court's majority held that patents are a form of "public property" (more like a government-created entitlement), and thus Congress can withhold the usual Article III tribunal and a jury when the validity of that property is challenged. In an opinion by Justice Thomas (joined by everyone but the Chief Justice and Justice Gorsuch), the Court held that "inter partes review," under which the Patent and Trademark Office administratively reconsiders (and may cancel) previously-issued patents, does not run afoul of the Constitution because a patent is a "public right," and therefore more like a grant of a franchise than classic common law property:
Inter partes review falls squarely within the public-rights doctrine. This Court has recognized, and the parties do not dispute, that the decision to grant a patent is a matter involving public rights—specifically, the grant of a public franchise. Inter partes review is simply a reconsideration of that grant, and Congress has permissibly re-served the PTO’s authority to conduct that reconsideration. Thus, the PTO can do so without violating Article III.
Slip op. at 6-7. Thus, inter partes review isn't really like a challenge to the patent, but more like a "second look at an earlier administrative grant of a patent." Slip op. at 8. This is like the situation in which Congress grants a franchise for a private operator to collect a toll on a bridge and reserves the right to revoke or amend that franchise. When it does so, according to the majority, Congress need not use an Article III court. A patent holder's rights are derived from statute, and thus can be limited.
What the King gives, the King can take away on the King's terms.
Yes, patents are "private property," but that property is "only a specific form of property right -- a public franchise." Slip op. at 10. These are a different kind of property right than takings mavens are used to dealing with (property rights expressly recognized in the Fifth and Fourteenth Amendments), a distinction which the majority recognized:
Finally, our decision should not be misconstrued as suggesting that patents are not property for purposes of the Due Process Clause or the Takings Clause. See, e.g., Florida Prepaid Postsecondary Ed. Expense Bd. v. College Savings Bank, 527 U. S. 627, 642 (1999); James v. Campbell, 104 U. S. 356, 358 (1882).
Slip op. at 17.
This means that the question presented in a parallel case in which the Court recently denied cert, is still open. In Brott v. United States, No. 17-712, the property owner challenged the constitutionality of requiring property owners with big takings claims against the federal government to pursue compensation in the non-Article III, non-jury Court of Federal Claims. The court denied review in Brott and a companion case raising the same issue, but as we know, a denial of cert isn't conclusive of the issue presented.
Three Justices (Breyer, Ginsburg, and Sotomayor) filed a short concurring opinion to note that "the Court’s opinion should not be read to say that matters involving private rights may never be adjudicated other than by Article III courts, say, sometimes by agencies." Concurring op. at 1. In short, "we three think that even takings claims involving private rights can be relegated by Congress to non-Article III tribunals."
Justice Gorsuch, joined by Chief Justice Roberts dissented in a very readable opinion arguing that under English common law, patents were dealt with by the courts, not the Privy Council, and that the Founders understood this. Judges, not the executive's own officers, should resolve these type of claims:
No doubt this efficient scheme is well intended. But can there be any doubt that it also represents a retreat from the promise of judicial independence? Or that when an independent Judiciary gives ground to bureaucrats in the adjudication of cases, the losers will often prove the unpopular and vulnerable? Powerful interests are capable of amassing armies of lobbyists and lawyers to influence (and even capture) politically accountable bureaucracies. But what about everyone else?Of course, all this invites the question: how do we know which cases independent judges must hear? The Constitution’s original public meaning supplies the key, for the Constitution cannot secure the people’s liberty any less today than it did the day it was ratified.
Dissent at 3.
Thus, Oil States tells us that there are at least six Justices who might be open to a Brott claim down the road, because public rights like patents and franchises are different in history and in kind from private rights (classic property like land and stuff).
Our final thought: the petitioners must have understood -- as did the Brott petitioners -- that this was a very uphill fight. Asking the courts to overturn an elaborate (and in the case of the Tucker Act, an entrenched and well-oiled) scheme by tribunals that look a lot like "courts," is going to be daunting. Knowing nothing else, it cannot be much of a surprise when the courts uphold the status quo.
But that doesn't mean the status quo is right, or conforms to the Constitution. Thus, we think that the issue in Brott -- whether takings claims against the federal government can be assigned to the Article I CFC, without a jury -- is still up for grabs. So, as always, stay tuned. The next few years are going to be interesting.
Oil States Energy Services, LLC v. Greene's Energy Group, LLC, No. 16-712 (Apr. 24, 2018)
