National Association of Boards of Pharmacy v. Board of Regents of the University System of Georgia

March 31, 2011 – Blog Post

The U.S. Court of Appeals for the 11th Circuit recently ruled that Congress does not have the authority to subject states to liability for copyright infringement. In this ruling, National Association of Boards of Pharmacy v. Board of Regents of the University System of Georgia, the court weighed arguments based in the state’s sovereign immunity under the Eleventh Amendment against arguments based in Congress’s powers to establish copyright and patent laws under Article I § 8 cl. 8 and to enforce the due process clause by appropriate legislation under the Fourteenth Amendment.

In this case, the National Association of Boards of Pharmacy (NABP) held copyrights in multiple choice questions on pharmacist licensure examinations. NABP became aware that a professor at the University of Georgia was using some of these copyright-protected exam questions, and NABP and the university entered a settlement agreement the following year. However, in 2007, NABP again learned that the same professor was again using its copyright-protected questions. NABP brought a copyright infringement suit against the university, a state organization, who moved to dismiss pursuant to the state’s Eleventh Amendment immunity from suit from citizens of another state. After an amended complaint from NABP and further motions to dismiss, the district court ultimately dismissed the case.

The 11th Circuit affirmed the dismissal. The court initially discussed a premature notice of appeal from NABP as well as NABP’s claims against individuals related to the alleged infringement. Then the court turned to issues related to the university’s sovereign immunity, first addressing the inability of Congress’s Article I § 8 cl. 8 powers to override state sovereign immunity and then explaining that NABP had not challenged the district court’s ruling that due process had been satisfied.

Citing Seminole Tribe of Fla. v. Florida, 517 U.S. 44 (1996), the court found that “Congress may abrogate state sovereign immunity when it (1) ‘unequivocally expresse[s] its intent to abrogate the immunity’ through a ‘clear legislative statement,’ and (2) acts ‘pursuant to a valid exercise of [constitutional] power.’” Finding that the statute clearly expressed intent to abrogate immunity, the 11th Circuit then examined whether Article I § 8 cl. 8 gave Congress the constitutional power to abrogate sovereign immunity. Because the Supreme Court had previously decided in Seminole Tribe and in Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 U.S. 627 (1999) (with respect to patent rights) that Article I powers generally did not allow Congress to make exceptions to state sovereign immunity, the 11th Circuit ruled that Congress could not statutorily subject the states to copyright liability prohibited by the Eleventh Amendment. NABP cited Central Virginia Community College v. Katz, 546 U.S. 356 (2006) as an example of an Article I power (there, the Bankruptcy Clause) that enabled Congress to abrogate state sovereign immunity, but the court characterized the ruling in Katz as narrow and distinguished Katz from the present case because bankruptcy jurisdiction is “principally in rem jurisdiction.”

The court also rejected NABP’s argument that the Fourteenth Amendment justified Congress’s attempted abrogation of state sovereign immunity. While §§ 1 and 5 of the Fourteenth Amendment grant Congress the right to abrogate immunity for violations of due process either by way of private remedy or of prophylactic legislation, the court found that no actual due process violation was alleged here and that the statute exposing states to possible copyright liability was not prophylactic. The district court had found that the post-deprivation procedures allowed NABP were adequate under the circumstances, and NABP did not challenge the adequacy of those procedures.

Patent and copyright holders should be aware that, when seeking damages against a state entity, they may be required to use the post-deprivation procedures of the state and not judicial actions. If they can show a violation of due process of law, meaning that they had no opportunity to be heard through state post-deprivation proceedings, then they may bring a due process challenge in court. Where they have a choice, intellectual property owners may therefore wish to target individuals or private companies in any efforts to enforce their rights in the U.S. State organizations such as state universities are immune to suit for both monetary damages and for injunctive relief.