Is There a New Extraterritoriality in Intellectual Property?

Abstract

Intellectual property rights are territorially limited. In the main, these rights do not extend outside of the country who has afforded parties the intellectual property. Instead, they are limited to activities within the country. Or so the theory goes. In the global marketplace, such territorial rights do not map well onto the commercial realities of many companies. Given the global marketplace and the intangible-yet-territorial nature of intellectual property rights, IP has sat squarely in the middle of concerns about extraterritoriality.

The Supreme Court has long articulated the presumption against the extraterritorial application of U.S. law. This is not to say that Congress does not have the power to make U.S. law apply outside of the U.S. territorial boundaries. Nevertheless, extending U.S. law to foreign acts creates a host of complications, particularly the affront to the sovereignty of the country in which the relevant activity is taking place.

In recent years, the Supreme Court has sought to reinvigorate the presumption and harmonize its use across all areas of law. But what has the impact been on intellectual property? Has the Court’s work resulted in a more uniform approach to extraterritoriality across these three IP regimes, or does the law remain fractured? And, if it the law is fractured, could that nevertheless be the correct answer given the unique policies underlying each of these areas of IP?

This Article is the first to comprehensively interrogate the impact of the Supreme Court’s recent interventions in extraterritoriality as it relates to the three traditional forms of intellectual property at the federal level: trademark, copyright, and patent. (Federal-level civil trade secret protection came into force after the Supreme Court’s recent decisions). In this manner, it fills an important gap in the literature because most assessments of the presumption focus only on one area of law.

In reviewing the application of the Supreme Court’s recent jurisprudence in these three areas of intellectual property, the Article concludes that the Supreme Court’s effort to standardize the law of extraterritoriality has failed. The courts’ engagement with the presumption has been, at best, inconsistent. There are times where the courts simply ignore the Court’s recent cases, relying on previous cases and doctrine without pausing to reconsider whether those doctrines survive the Supreme Court’s change in the law. At other times, the courts appear to misapprehend the two-step framework. Such failure is unfortunate because the Supreme Court’s framework affords the opportunity for trans-substantive analyses of extraterritoriality in ways that can inform the development of the law. Additionally, drawing on trademark law, the Article poses a role for comity in extraterritoriality.

Keywords: extraterritoriality, patent, copyright, trademark, intellectual property, morrison, rjr nabisco, kiobel, westerngeco