State Accountability for Violations of Intellectual Property Rights: How to “Fix” Florida Prepaid (And How Not To)

In its Florida Prepaid and College Savings Bank decisions of two terms ago, the Supreme Court raised significant barriers to Congress\u27s ability to subject the states to damages liability in federal intellectual property suits. These decisions provoked extensive academic commentary and have also sparked efforts in Congress and at the U.S. Patent and Trademark Office to amend the federal intellectual property laws to ensure that state governments will remain accountable for violations of federal rights. This article explores how such legislation might best be shaped in order to withstand constitutional challenge. Satisfactory treatment of the issue requires examination of a diverse array of difficult questions, ranging from murky corners of procedural due process and takings jurisprudence, to qualified immunity, the unconstitutional conditions doctrine, and U.S. obligations under international treaties and trade agreements. Very broadly, the article advances three broad conclusions. First, notwithstanding the Court\u27s rejection in Florida Prepaid of one particular statute purporting to abrogate state sovereign immunity in patent disputes, a more limited abrogation strategy might yet succeed. In particular, we conclude that Congress could very probably restrict abrogation to cases of non-negligent state infringements of intellectual property rights in circumstances where the state can be shown to provide inadequate remedies. We also observe, however, that such an approach is unlikely to accomplish much of what Florida Prepaid\u27s critics would like. Second, a much-discussed proposal that states be required to waive all of their sovereign immunity from intellectual property suits in order to receive any federal protection for their own works and inventions is unlikely to pass constitutional muster, although if Congress remains attracted to a conditional waiver strategy, it might have some avenues open to it. Third, given the continuing availability of injunctive relief, the United States may presently be in substantial compliance with its international treaty obligations notwithstanding the Court\u27s decisions. But if Congress wishes to provide foreign intellectual property holders with damages remedies against the states, attempts to ground abrogation on the Treaty Power or via qui tam suits will probably prove unconstitutional