Majority opinion
The majority opinion by Justice Elena Kagan began by explaining how the US patent system reflects a congressional "balance between fostering innovation and ensuring public access to discoveries." Consequently, once the statutory term of the patent monopoly ends, "the right to make or use the article, free from all restriction, passes to the public."[7]
The Court elaborated the point:
"In case after case, the Court has construed those laws to preclude measures that restrict free access to formerly patented, as well as unpatentable, inventions. In one line of cases, we have struck down state statutes with that consequence. By virtue of federal law, we reasoned, 'an article on which the patent has expired,' like an unpatentable article, 'is in the public domain and may be made and sold by whoever chooses to do so.' In a related line of decisions, we have deemed unenforceable private contract provisions limiting free use of such inventions. . . .[F]or example, we determined that a manufacturer could not agree to refrain from challenging a patent's validity. Allowing even a single company to restrict its use of an expired or invalid patent, we explained, 'would deprive ... the consuming public of the advantage to be derived' from free exploitation of the discovery. And to permit such a result, whether or not authorized 'by express contract,' would impermissibly undermine the patent laws.[8]"
"Brulotte was brewed in the same barrel," the Court said. Agreements under which patent royalties must be paid after the patent expires "conflict with patent law's policy of establishing a 'post-expiration . . . public domain' in which every person can make free use of a formerly patented product."[9]
Brulotte is no bar to business arrangements to defer payment or create joint enterprises, the Court observed. Nonetheless, "Kimble asks us to abandon Brulotte in favor of 'flexible, case-by-case analysis' of post-expiration royalty clauses 'under the rule of reason,' " as under the antitrust laws. But the antitrust approach requires courts to undertake a complex analysis "taking into account a variety of factors, including specific information about the relevant business, its condition before and after the [practice] was imposed, and the [practice's] history, nature, and effect. . . a full-fledged economic inquiry into the definition of the market, barriers to entry, and the like."[10]
Putting aside for the moment the merits and demerits of taking an antitrust approach to the issue, the court turned to the role of stare decisis, acknowledging that sometimes it "means sticking to some wrong decisions." The reason for that is that usually it is "more important that the applicable rule of law be settled than that it be settled right." Moreover:
"Overruling precedent is never a small matter. Stare decisis—in English, the idea that today's Court should stand by yesterday's decisions—is a foundation stone of the rule of law. Application of that doctrine, although not an inexorable command, is the preferred course because it promotes the evenhanded, predictable, and consistent development of legal principles, fosters reliance on judicial decisions, and contributes to the actual and perceived integrity of the judicial process. It also reduces incentives for challenging settled precedents, saving parties and courts the expense of endless relitigation.[11]"
Therefore, for the courts to reverse course there must be a "special, justification" over and beyond just a belief that the precedent was wrongly decided. This is especially true for statutes, as in this case: For "critics of our ruling can take their objections across the street, and Congress can correct any mistake it sees." Moreover, in this case, "Congress has spurned multiple opportunities to reverse Brulotte"—50 years or more during which Congress repeatedly amended the patent laws without disturbing Brulotte and it even "rebuffed bills that would have replaced Brulotte 's per se rule with the same antitrust-style analysis Kimble now urges."[12]
The Court then returned to the patent policy issues it had described earlier. They reinforced the reasons for following stare decisis here and not disturbing the Brulotte precedent.
"First, Brulotte's statutory and doctrinal underpinnings have not eroded over time." There was no change in the law, by judicial or congressional action. "[T]he core feature of the patent laws on which Brulotte relied remains just the same. . . .Brulotte, then, is not the kind of doctrinal dinosaur or legal last-man-standing for which we sometimes depart from stare decisis." To the contrary, overruling Brulotte could undermine other case law and thus "unsettle stable law."[13]
Second, contrary to the critics, "nothing about Brulotte has proved unworkable." The ease of determining whether a license call for royalty payments after patent expiration "appears in still sharper relief when compared to Kimble's proposed alternative. Recall that he wants courts to employ antitrust law's rule of reason to identify and invalidate those post-expiration royalty clauses with anti-competitive consequences." That procedure requires an "elaborate inquiry" that "produces notoriously high litigation costs and unpredictable results." For that reason, "trading in Brulotte for the rule of reason would make the law less, not more, workable than it is now."[14]
According to Kimble, the Court states, post-expiration royalties are not anticompetitive; they are procompetitive. They lead to lower royalty rates during the patent term, which leads to lower consumer prices. Also, more companies can afford the cheaper licenses, fostering competition among the licensees. Even assuming that this is true, the Court responded, it misconceives the basis for Brulotte. "If Brulotte were an antitrust rather than a patent case, we might [decide] as Kimble would like." But this is a patent case—a patent misuse case. It rests on patent policy. "Congress had made a judgment: that the day after a patent lapses, the formerly protected invention must be available to all for free." The "choice of what patent policy should be" lies with Congress.[15]
Finally, the Court insisted: "In adhering to our precedent as against such complaints, we promote the rule-of-law values to which courts must attend while leaving matters of public policy to Congress."[16] The Court concluded with a literary flourish, by quoting from Amazing Fantasy #15, the source of one of the most famous themes of Spider-Man—with great power comes great responsibility.
