Supreme Court Quotes Spiderman's 'Great Power, Great Responsibility' Line In Rejecting Royalties On Expired Patent

from the good-news dept

Earlier this year, we noted that the Supreme Court was hearing an important case on the public domain in Kimble v. Marvel, concerning whether or not Marvel/Disney needed to keep paying royalties to the patent holder of an invention to make a Spider-Man toy that could shoot webs. Marvel had purchased the patent from the inventor, with an agreement to pay royalties back to him. After the patent expired, Marvel stopped paying. The inventor argued that the contract had no such stipulation. Marvel/Disney argued that you don't have to pay royalties for something that is in the public domain. Yes, this was a case where Disney was arguing in favor of a stronger public domain, odd as that may be.

The Supreme Court ruled on the case today and did, in fact, protect the public domain, saying that Marvel doesn't need to pay. Specifically, the Court rejected a request to overturn a previous ruling (the "Brulotte" case) that said that you cannot charge royalties on an expired patent. The majority decision was written by Justice Kagan (who has shown, in the past, to understand these issues pretty clearly). It was a 6 to 3 ruling, with Alito, Roberts and Thomas dissenting.

As Kagan notes:

Patents endow their holders with certain superpowers, but only for a limited time. In crafting the patent laws, Congress struck a balance between fostering innovation and ensuring public access to discoveries. While a patent lasts, the patentee possesses exclusive rights to the patented article—rights he may sell or license for royalty payments if he so chooses.... But a patent typically expires 20 years from the day the application for it was filed.... And when the patent expires, the patentee’s prerogatives expire too, and the right to make or use the article, free from all restriction, passes to the public.

In the end, the ruling more or less comes down to the fact that the Supreme Court already ruled one way in Brulotte and there is no compelling reason to overturn that ruling. And, more importantly, in the wake of Brulotte, Congress had many opportunities to change the law if it felt the Court got things wrong -- and did not. And that leads to Kagan's closing line, in which she cites Spider-Man itself:

What we can decide, we can undecide. But stare decisis teaches that we should exercise that authority sparingly. Cf. S. Lee and S. Ditko, Amazing Fantasy No. 15: “Spider-Man,” p. 13 (1962) (“[I]n this world, with great power there must also come—great responsibility”). Finding many reasons for staying the stare decisis course and no "special justification" for departing from it, we decline Kimble’s invitation to overrule Brulotte.

Of course, that "great power, great responsibility" argument could also be applied directly to the patent system itself, but so few people actually recognize that. The dissent argument is really kind of bizarre. It argues that the majority is engaging in "policymaking" — but then most of its own argument is entirely in the policy realm, itself. It focuses on the claim that allowing licenses to go beyond patent expiry could be a good thing, since it could lower patent licensing fees by extending them over a longer period of time. That's not really an issue for the Supreme Court to be discussing, though, and is purely a policy question.

Filed Under: brulotte, kimble, patent expiration, patents, public domain, supreme court
Companies: disney, marvel