I recently listened to the Federalist Society’s ScotusCast debate among Mark Lemley, Richard Epstein, Fred Von Lohmann, and Scott Kieff (in order of presentation), moderated by Adam Mossoff, on the issue of patent exhaustion after the Supreme Court’s Quanta v. LG decision. The discussion is timely, particularly given the recent CVSG on the somewhat related issue of copyright exhaustion for imports (i.e., foreign “first sales”) in Costco v. Omega. But I’m mostly interested here in commenting on the form of public discourse that this kind of on-line debate represents, and why we can’t have it in our national or local political debates for elected offices and policymaking.
This was what I would call “high art” in debate, at least at the outset. Not only are these very sophisticated academics/lawyers and great public speakers, they were given significant, uninterrupted time – almost fifteen minutes each – to present their initial arguments before engaging in a much faster-paced and interactive Q&A session. The debate was also preceded by neutral factual information that placed the issues in context, and certainly was helpful for anyone coming to the issues new. The debate lasted for almost an hour and a half on a single topic, and the subsequent discussion was incredibly cogent and far-reaching (marred only by occasional talking over each other, reminiscent of the McLaughlin Group even if more insightful and trenchant).
For anyone who would be willing to spend that much time listening to law professors talk on abstruse issues, the result would certainly be substantial edification or a remarkable introduction to the policy and legal concerns that make intellectual property law a fascinating area. This is true even if the listeners might not at the end know where to come down, either because they lack enough practical experience to form socio-political judgments on the issues or can’t adequately correlate their own predilections and experience to the particular speakers positions to decide which one’s views to rely on as a proxy.
It’s not that I don’t think that exhaustion is important. But I could not help comparing this debate to the public debates during the recent Presidential campaign and feeling totally jipped. In the context of Presidential debates, even fifteen minutes of uninterrupted presentation time would be wholly inadequate to address any particular question having dramatic national and international significance. And at best we get a few debates on different days where the candidates can address a few issues for a few minutes. Most of the time, we are treated to so-called “neutral” questions, evasive short answers, no real follow-up by the media to require that the question be answered, and no in depth treatment of anything. Is there some reason the campaigns or the media don’t believe we are entitled to sustained treatment of particular issues and an answer to questions that really highlight where the differences are? The sustained time allowed to each presenter to discuss a single issues highlighted by the exhaustion debate made the debaters’ positions, the issues, and the differences much clearer than a continuous stream of short statements and critical (often irrelevant) interchanges.
So I started wondering whether we could get something like this format going on national TV for health care, Afghanistan, the global warming bill, etc. I really would like the Presidential candidates next time around to be able to engage on issues in something more than a sound-bite – and for the media to actually test them on it. But perhaps that is asking too much of candidates and of the media. They need to keep track of hundreds of issues, and the candidates need to do so in a way that won’t lock them in or alienate voters, and the media need access that the candidates will only provide with favorable (or at least not terribly critical) coverage. So being honest and extremely careful and detailed simply may be incompatible with the job descriptions.
But is it asking too much of the public to want these kinds of debates and media approaches, to demand that candidates at least designate their proxies to be able to engage in the issues at this level of detail, and to look elsewhere if the mainstream media doesn’t provide it? But where else will such information be provided? Law professors may be willing to do this (and for free), but candidates aren’t going to volunteer for ScotusCast. And as for the public, we may be so saturated with fifteen second image advertisements that no one in their right mind would listen to an hour of erudite discussion of a single issue, much less ten of them, in order to form their political beliefs.
Well, I can’t leave it just on the process. The substance of the debate was fascinating. Lemley initially focused on the difference between patent versus contract remedies (as violation of the contractual requirements should in theory remit you to a less powerful contract remedy), jurisdiction (both in regard to federal or state courts and in regard to the ability to sue downstream parties who are not in privity), and antitrust and misuse (in regard to contracting around or beyond the default rules of exhaustion). Epstein initially discussed the advantages of contracting around exhaustion , including being able to price discriminate (increasing overall demand and use) by charging downstream users without forcing upstream sellers to pay a uniform royalty, and noted that if transaction costs are significant the transactions simply won’t happen so there is nothing to worry about. Von Lohmann initially identified reasons why exhaustion was important and servitudes in chattels have been prohibited: (1) reducing information costs (and need for notice); (2) independent repair/replacement; (3) secondary markets; (4) impacts on innovation when secondary markets/use restrictions are not prohibited; and (5) (sometimes) social welfare reducing price discrimination. He also asked whether patent holders after Quanta can define unauthorized sales to avoid triggering exhaustion, and whether courts will in the future enforce such restrictions (or permit infringement actions) against unauthorized downstream secondary purchasers. Kieff initially focused on the presumption (not immutable requirement) of freedom to use the purchased good and absence of adhesion in the contracts for selling less than all rights, and the benefits of freedom to contract. From there, the interchange entwined historic case law in real property, intellectual property, and antitrust, and exceptionally cogent (and differing) views of market behaviors (and their normal benefits and costs), and the perennial favorite of whether downstream benefits and sequential innovation will harm upstream production incentives. I won’t try to summarize the interchanges further – it really is worth hearing (except for the short frolic and detour to mention the Bilski case on patentable subject matter and the fear of Supreme Court action, as a point on which three of them apparently could agree but which is not elaborated).
Some of the distinctions highlighted in the exchanges go to how we view customers and their preferences and abilities, particularly how sophisticated we think the general public is (as distinguished from business entities), especially in regard to contracting behaviors and who those people choose to contract with, which returned the discussion to privity of contract and the different remedies of contract and property. So this returns us to the process issue of whether the public can engage this level of discourse and understanding in their market behaviors , and whether the real debate is over paternalism. Does the public need more protection from (and more freedom from the costs of) contractual decisions of upstream sophisticated parties? Ultimately, it will be our political representatives who decide – but a position on patent exhaustion or a position on the kind of judges to nominate in regard to patent exhaustion (cf. abortion) will NOT be a question about which any Presidential candidate is ever likely to be asked in a debate.