Volume and Issue: Vol. 95, No. 3

Overturning Override: Why Executing a Person Sentenced to Death By Judicial Override Violates the Eighth Amendment

INTRODUCTION

Judicial override is a practice by which a judge overrules a sentence decided by a jury. Perhaps the most alarming, infamous, and controversial form of judicial override occurs when a judge overrules a jury’s recommendation for life imprisonment and replaces it with the death penalty. The use of judicial override in capital punishment cases has only ever been allowed in four states: Alabama, Delaware, Florida, and Indiana.[1] As of 2017, all four of these states have officially abandoned the practice. However, thirty-five individuals who were sentenced to death via judicial override remain on death row awaiting execution.[2] Today, their lives hang in the balance as the following constitutional question remains: Does the execution of a person sentenced to death by judicial override violate the Eighth Amendment of the United States Constitution?

This Note argues that executing these thirty-five individuals who were sentenced to death by judicial override would, in fact, be a “cruel and unusual” punishment under the Eighth Amendment and thus unconstitutional. Importantly, this Note is not arguing that the death penalty itself is unconstitutional; rather, the Note’s argument is centered around the specific constitutional issue of execution as the direct result of the pre-2017 practice of judicial override.

This Note’s argument proceeds in the following stages. Part I provides background information regarding the history of judicial override in four different states, a summary of relevant United States Supreme Court precedent, an overview of the Eighth Amendment to the United States Constitution, and the Court’s previous interpretations of the meaning of “cruel and unusual punishments.” Part II asserts that a punishment of death by judicial override is more objectionable than the death penalty itself, emphasizes the importance of jury sentencing, and calls attention to the presence of racial bias in judicial override. Additionally, Part II argues that the execution of a person sentenced to death by judicial override violates the Eighth Amendment under multiple constitutional theories, including living constitutionalism, the moral reading of the Constitution, and originalism. Part III briefly addresses counterarguments concerning adherence to Supreme Court precedent and federalism, and Part V concludes this Note by suggesting two potential solutions to the issue at bar.

          [1].      Michael L. Radelet, Overriding Jury Sentencing Recommendations in Florida Capital Cases: An Update and Possible Half-Requiem, 2011 Mich. St. L. Rev. 793, 794 (2011); Petition for Writ of Certiorari at 5, McMillan v. Alabama, 141 S. Ct. 876 (2020) (No. 20-193).

          [2].      Petition for Writ of Certiorari, supra note 1, at 6.

* Executive Senior Editor, Southern California Law Review, Volume 95; J.D. Candidate 2022, University of Southern California Gould School of Law; B.A. Political Science 2018, University of California, Los Angeles. Thank you to Gonzo for your unwavering support throughout my law school journey. I am also grateful to Professor Rebecca Brown for her guidance during this Note’s development. Finally, thank you to all of the Southern California Law Review editors for spending countless hours on the publication process.

 

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Crack Taxes and The Dangers of Insidious Regulatory Taxes

An unheralded weapon in the War on Drugs can be found in state tax codes: many states impose targeted taxes on individuals for the possession and sale of controlled substances. These “crack taxes” provide state officials with a powerful means of sanctioning individuals without providing those individuals the protections of the criminal law. Further, these taxes largely escape public scrutiny, which can contribute to overregulation and uneven enforcement.

The controlled substance taxes highlight the allure to lawmakers of using tax law to regulate behavior, but also the potential dangers of doing so. Surprisingly, the judiciary has an underappreciated role in creating the allure of regulatory taxes. Because courts apply less scrutiny to taxes than to other types of laws, regulatory taxes get a blank check when challenged, incentivizing their use. Courts must reconfigure the way they approach regulatory taxes to remove the judicially created incentive for insidious regulatory taxes like controlled substance taxes.

Introduction

“ ‘It was going through the mail and the mail lady smelled it and called the police . . . . I’m not ever gonna get out from underneath this, ever, not unless I win the lottery and become a millionaire’ . . . .”[1] The North Carolina woman offering these statements was troubled not by her arrest and charge of attempted drug trafficking, but by the twenty-thousand-dollar tax assessment she received for possessing controlled substances (that is, illegal drugs). North Carolina brings in millions of dollars from its so-called “crack tax”[2] or “Al Capone law”[3] each year,[4] and several other states use similar taxes on the possession and sale of controlled substances to further regulate already criminalized activities.[5]

The idea of taxes as a weapon in the War on Drugs may seem surprising, but perhaps it is predictable that lawmakers wanting to look tough on drugs would co-opt tax law in this way. More surprising though is the underappreciated role courts have in incentivizing lawmakers to enact controlled substance taxes and other regulatory taxes to achieve their goals.

How do courts incentivize the enactment of regulatory taxes? At its core, the answer to this question is a story of veiled consequences of elevating form over substance. Courts have habitually treated tax laws with the utmost respect,[6] resulting in a privileged regime of relaxed judicial scrutiny for taxes.[7] Governments must raise revenue, and taxation is a powerful tool to raise that revenue from whatever members of society lawmakers see fit. Unelected judges, the line of thinking goes, should be hesitant to upset these fundamentally political decisions.[8] This hesitancy has pushed courts to be exceedingly cautious when examining laws labeled “taxes.”

In addition to their revenue-raising role, taxes have also long been recognized as legitimate and powerful tools to regulate behavior.[9] One might expect courts to heighten their scrutiny of taxes with intentional regulatory goals (as opposed to mere revenue-raising taxes) to ensure that the interests of regulated individuals are appropriately considered. However, this is rarely the case, even when the taxes’ revenue goals are insignificant compared with their regulatory goals.[10]

In short, as critics of “tax exceptionalism”—the idea that tax law is categorically different from other areas of law and should be treated so—have long observed and frequently lamented, courts often employ a unique approach to analyzing tax laws.[11] Once a court determines that laws are tax laws, those laws become privileged before the judiciary, even when the laws have intentional regulatory effects.[12] This subtle elevation of form (tax law) over substance (regulatory effects) results in the judicially created incentive for lawmakers to pursue their regulatory goals through taxation rather than through direct regulation: taxes will not face as much scrutiny from courts.[13]

Lawmakers have noticed and responded, using taxes to achieve regulatory goals where other laws might receive more scrutiny from courts.[14] Though this phenomenon may appear benign, it can generate serious harms for individuals, as controlled substance taxes illustrate.[15] By adopting the taxes rather than increasing existing criminal sanctions, lawmakers impose punishment on those possessing and selling controlled substances without running up against legal protections for criminal defendants.[16] Even those people who would be acquitted under the criminal law can still be sanctioned for their behavior through these insidious regulatory taxes.[17] Thus, controlled substance taxes are a potentially powerful and unchecked weapon in the War on Drugs. Given the biased manner in which the War on Drugs has been carried out,[18] skirting protections for individuals is particularly concerning, as tax law becomes a tool of state oppression of overpoliced communities.[19]

The harms of these taxes do not stop with those cavalierly imposed on individuals. Regulatory taxes like controlled substance taxes also impose stealth costs on society because they are less effective than their direct regulation alternatives.[20] For example, controlled substance taxes are often burdensome laws for tax authorities to administer, making the taxes a costly alternative to laws directly regulating controlled substances, which are enforced by those more familiar with the substances.[21] Further highlighting the insidious nature of these taxes, they also obscure the total amount of regulation that an activity is subject to by remaining out of public view, leading to harmful overregulation that is difficult to address.[22]

Despite the dangers of regulatory taxes like controlled substance taxes, these insidious taxes have gone largely unnoticed in the tax literature. Rather, tax scholars have focused on the relative substantive strengths of taxation versus direct regulation when analyzing the best options for achieving regulatory goals.[23] Literature regarding the related phenomena of fines and civil forfeiture laws has not considered the unique situation of tax laws before the courts.[24] In short, the role of judicial deference regimes in tilting the scales toward regulatory taxes and the resulting consequences for individuals and society are underappreciated. This Article is the first to home in on these issues,[25] analyzing them and demonstrating how courts should take them into account to correct for the inadvertent judicial incentive for lawmakers to enact insidious regulatory taxes.

Courts can remove this incentive and head off future insidious regulatory taxes by recognizing the potential for these taxes to exist and placing such taxes under more scrutiny when exposed.[26] This Article builds on scholarly developments in modern tax expenditure analysis—which explores the role of taxes as a tool for achieving regulatory goals[27]—to propose an analytical framework for uncovering insidious regulatory taxes. A comparatively weak tax law passed to take advantage of the privileged judicial scrutiny regime for taxes is an insidious regulatory tax, and, once that tax is uncovered through the proposed analysis, a court should scrutinize the tax as it would a similar direct regulation.

Controlled substance taxes offer a prime example of insidious regulatory taxes and their dangers, but not all regulatory taxes are insidious. Regulatory taxes like carbon taxes that are more effective than their direct regulation counterparts are substantively justified and do not raise the concerns associated with insidious regulatory taxes.[28] However, as regulatory taxes continue to become more prevalent,[29] the proposed framework will become more crucial to aid courts in separating the insidious regulatory taxes in need of heightened scrutiny from the unobjectionable ones.

The Article proceeds in three parts. Part I provides background on controlled substance taxes and the judicial privilege granted to all types of taxes. The resulting allure of regulatory taxes can be too much for lawmakers to ignore, resulting in the enactment of insidious regulatory taxes like controlled substance taxes. Part II then details the dangers of insidious regulatory taxes in more depth, exposing the problems created by the judiciary’s current approach to taxes. Finally, Part III fleshes out the proposed framework for analyzing tax laws to remove the judicially created incentive for insidious regulatory taxes, using the controlled substance taxes as a case study to illustrate the framework’s operation.

          [1].      Michael Hennessey, Inside the North Carolina Law Requiring Drug Dealers to Pay Taxes, myfox8.com (May 10, 2019, 10:21 AM), https://myfox8.com/news/inside-the-north-carolina-law-requiring-drug-dealers-to-pay-taxes [https://perma.cc/DT5B-NDPS].

          [2].      See Jeremy M. Vaida, The Altered State of American Drug Taxes, 68 Tax Law. 761, 787 (2015).

          [3].      See Anne Barnard, In Taxing Illegal Drugs, the Trouble Comes in Collecting, N.Y. Times (Jan. 24, 2008), https://www.nytimes.com/2008/01/24/nyregion/24drugs.html [https://perma.cc/PMS5-YBU
7] (quoting an associate of the Federation of Tax Administrators describing the taxes as hearkening to “the Al Capone model”); Christopher Paul Sorrow, The New Al Capone Laws and the Double Jeopardy Implications of Taxing Illegal Drugs, 4 S. Cal. Interdisc. L.J. 323, 323 (1995); Christina Joyce, Expanding the War Against Drugs: Taxing Marijuana and Controlled Substances, 12 Hamline J. Pub. L. & Pol’y 231, 239 (1991).

          [4].      See N.C. Dep’t of Revenue, Statistical Abstract of North Carolina Taxes 2019 tbl. 15 (2019) (showing tax revenues ranging from approximately $6.5 million to approximately $11.5 million for fiscal years 2005 through 2019 from the state’s controlled substance tax, which includes taxes on illicit liquors in addition to illicit drugs).

          [5].      See infra note 34.

          [6].      See infra Section I.B.

          [7].      See, e.g., Eric Kades, Drawing the Line Between Taxes and Takings: The Continuous Burdens Principle, and Its Broader Application, 97 Nw. U. L. Rev. 189, 192 (2002) (“At times, judges and legal commentators have declared that Congress’ power to tax is beyond constitutional review.”).

          [8].      See Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519, 531-32 (2012) (“We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders.”). As Justice Felix Frankfurter articulated,

[Governments] need the amplest scope for energy and individuality in dealing with the myriad problems created by our complex industrial civilization. They need wide latitude in devising ways and means for paying the bills of society and in using taxation as an instrument of social policy. Taxation is never palatable, and its exercise should not be subjected to finicky or pedantic arguments based on abstractions.

Felix Frankfurter, The Public and Its Government 48-49 (1930).

          [9].      See infra note 30.

        [10].      See infra Section I.B.

        [11].      See, e.g., Alice G. Abreu & Richard K. Greenstein, Tax: Different, Not Exceptional, 71 Admin. L. Rev. 663, 663-64 (2019) (surveying tax exceptionalism scholarship and arguing that tax is not different in kind from other types of law and should not be analyzed as though it were); Paul L. Caron, Tax Myopia, or Mamas Don’t Let Your Babies Grow Up to Be Tax Lawyers, 13 Va. Tax Rev. 517, 518-31 (1994) (highlighting and criticizing the perception that tax law is different from other areas of law).

        [12].      See, e.g., Gillian E. Metzger, To Tax, to Spend, to Regulate, 126 Harv. L. Rev. 83, 90 (2012). Part of the opinion from Department of Revenue of Montana v. Kurth Ranch illuminates this claim. While observing that taxes are subject to constitutional constraints, as are criminal fines and civil penalties, the Court notes demanding constraints for criminal sanctions and relatively trivial constraints for taxes, even if those taxes fall on the same criminal activities as the criminal sanctions do. Dep’t of Revenue of Mont. v. Kurth Ranch, 511 U.S. 767, 778 (1994).

        [13].      See infra Section I.B.

        [14].      See Michael S. Kirsch, Alternative Sanctions and the Federal Tax Law: Symbols, Shaming, and Social Norm Management as a Substitute for Effective Tax Policy, 89 Iowa L. Rev. 863, 865–66 (2004) (describing how federal tax laws are used for regulatory goals); Stanley S. Surrey & Paul R. McDaniel, The Tax Expenditure Concept: Current Developments and Emerging Issues, 20 B.C. L. Rev. 225, 247 (1979) (describing how taxes have been used when direct regulations might be unconstitutional or difficult to enact). See generally R.A. Lee, A History of Regulatory Taxation (1973). Lee examines a number of federal taxes with regulatory effects in his work. In describing the historical context and creation of each tax, Lee uncovers the statements of many members of Congress demonstrating their understanding that they could achieve their goals in a less constitutionally suspect manner by using the taxes instead of direct regulations. For example, in detailing a proposed federal tax on grain futures in 1921, Lee describes a discussion in which Congressman Marvin Jones opined that “if that approach [of direct regulation] were used . . . ‘a constitutional question might arise’ but the Supreme Court had ‘allowed us to go a long ways in the taxing power,’ so he believed this was the ‘wiser method.’ ” Id. at 73. In a later passage, Lee describes a 1937 House Ways and Means Committee Report as finding that “ ‘the law is well settled’ that a regulatory tax, although controlling a subject reserved to state jurisdiction, would be valid ‘if it appears on its face to be a revenue measure.’ ” Id. at 182.

        [15].      See infra Part II.

        [16].      See infra notes 117-22 and accompanying text.

        [17].      See, e.g., Barnard, supra note 3 (reporting comments of a tax administrator recognizing the potential for the taxes to impose punishment when criminal sanctions cannot); Robert E. Tomasson, 21 States Imposing Drug Tax and Then Fining the Evaders, N.Y. Times (Dec. 23, 1990), https://www.
nytimes.com/1990/12/23/us/21-states-imposing-drug-tax-and-then-fining-the-evaders.html [https://per
ma.cc/VD68-HAJF] (reporting on controlled substance taxes as effective tools in combatting illegal drug sales because of their ability to avoid the protections afforded to criminal defendants).

        [18].      See authorities cited infra note 125.

        [19].      Indeed, the taxes are often enforced only against individuals charged with violations of criminal controlled substance laws. See authorities cited infra note 57.

        [20].      See infra Section II.B.

        [21].      See infra Section III.A.2.

        [22].      See infra Section II.C.

        [23].      See, e.g., Stanley S. Surrey, Pathways to Tax Reform: The Concept of Tax Expenditures 148-54 (1973) (discussing tax expenditures and the choice between taxation and spending programs); Surrey & McDaniel, supra note 14, at 227-28 (same); David A. Weisbach & Jacob Nussim, The Integration of Tax and Spending Programs, 113 Yale L.J. 955, 959-64 (2004) (same); Eric J. Toder, Tax Cuts or Spending—Does It Make a Difference?, 53 Nat’l Tax J. 361, 361-63 (2000) (same); Edward A. Zelinsky, James Madison and Public Choice at Gucci Gulch: A Procedural Defense of Tax Expenditures and Tax Institutions, 102 Yale L.J. 1165, 1165-67 (1993) (same); Eric M. Zolt, Deterrence Via Taxation: A Critical Analysis of Tax Penalty Provisions, 37 UCLA L. Rev. 343, 348 (1989) (same).

        [24].      See, e.g., Ariel Jurow Kleiman, Nonmarket Criminal Justice Fees, 72 Hastings L.J. 517, 520 (2021) (detailing similar issues surrounding criminal fees); Beth A. Colgan, Fines, Fees, and Forfeitures, 18 Criminology, Crim. Just., L. & Soc’y 22, 28 (2017) (detailing the use of fines, fees, and forfeitures as sanctions for criminalized activities); Suellen M. Wolfe, Recovery from Halper: The Pain from Additions to Tax Is Not the Sting of Punishment, 25 Hofstra L. Rev. 161, 197 (1996) (detailing similar issues surrounding civil forfeiture laws); Kenneth Mann, Punitive Civil Sanctions: The Middleground Between Criminal and Civil Law, 101 Yale L.J. 1795, 1799-1800, 1802, 1870 (1992) (observing the harms of failing to provide protections for individuals subject to civil state sanctions); Marc B. Stahl, Asset Forfeiture, Burdens of Proof and the War on Drugs, 83 J. Crim. L. & Criminology 274, 274-79 (1992) (critiquing civil forfeiture laws).

        [25].      As far back as 1979, Stanley Surrey, former Assistant Secretary of the Treasury for Tax Policy, predicted that “Congress, by inserting spending programs in the tax law, essentially has forced the courts to apply to tax law the legal provisions hitherto imposed on direct spending.” Stanley S. Surrey, Tax Expenditure Analysis: The Concept and Its Uses, 1 Can. Tax’n 3, 9 (1979) [hereinafter Surrey, Tax Expenditure Analysis]; see also Surrey, supra note 23, at 46-47; Surrey & McDaniel, supra note 14, at 246. Though this prediction seemed based on Surrey’s conclusion that “tax expenditures”—the normatively unnecessary provisions of tax law designed to achieve regulatory results—should not be entitled to the privilege given to revenue-raising tax provisions, Surrey and others since have not fully analyzed the issue of judicial scrutiny of regulatory taxes and its implications. This Article fills that void.

                   As an aside, Surrey’s prediction may have come true in some cases regarding special tax breaks offered in lieu of direct spending. See, e.g., Espinoza v. Mont. Dep’t of Revenue, 140 S. Ct. 2246, 2260-61 (2020) (holding tax credits for education to the same level of scrutiny under the Free Exercise Clause as direct spending measures); Mueller v. Allen, 463 U.S. 388, 393-404 (1983) (holding tax breaks to the same level of scrutiny under the Establishment Clause as direct spending measures). However, surely Surrey would be surprised to find that his prediction has largely failed to materialize in the case of tax laws used in lieu of direct regulations. Rather, courts have continued to privilege tax laws regardless of the regulatory effects those taxes might have.

        [26].      See infra Section III.A.4.

        [27].      See generally Weisbach & Nussim, supra note 23 (laying the foundation for modern tax expenditure analysis, which focuses on the comparative institutional competencies of taxes and direct spending measures); see also infra notes 151-62 and accompanying text.

        [28].      See generally Shi-Ling Hsu, The Case for a Carbon Tax: Getting past Our Hang-Ups to Effective Climate Policy (2011) (comparing economic, social, administrative, and political merits of carbon taxes versus direct regulations and concluding that a tax would be the most effective policy); Reuven S. Avi-Yonah & David M. Uhlmann, Combating Global Climate Change: Why a Carbon Tax Is a Better Response to Global Warming than Cap and Trade, 28 Stan. Envtl. L.J. 3, 6-8 (2009) (similar).

        [29].      See, e.g., Lucy Dadayan, Tax Pol’y Ctr., Are States Betting on Sin? The Murky Future of State Taxation 3-4 (2019), https://www.taxpolicycenter.org/publications/are-states-betting-sin-murky-future-state-taxation/full [https://perma.cc/K6AX-5D4C] (reporting upward trends in the imposition of “sin taxes” on unwanted behaviors); Rachelle Holmes Perkins, Salience and Sin: Designing Taxes in the New Sin Era, 2014 BYU L. Rev. 143, 145 (2014) (describing increasing use of sin taxes).

*      Associate Professor, University of Richmond School of Law. For their helpful thoughts and comments, I would like to thank my outstanding colleagues at the University of Richmond and the participants in the 2019 Junior Tax Scholars Workshop, the 2019 Junior Faculty Forum, and the 2021 AALS New Voices in Taxation program. I owe specific thanks to Aravind Boddupalli, Beth Colgan, Erin Collins, Jim Gibson, Ari Glogower, Mary Heen, Dick Kaplan, Ariel Jurow Kleiman, Corinna Lain, Sarah Lawsky, Ruth Mason, Lukely Norris, Tracey Roberts, Erin Scharff, and Allison Tait. I am indebted to Chris Marple, Tyler Moses, and Whitney Nelson for their excellent assistance with research.     

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The Role of State Attorneys General In Improving Prescription Drug Affordability

Impact litigation initiated by state attorneys general has played an important role in advancing public health goals in contexts as diverse as tobacco control, opioids, and healthcare antitrust. State attorneys general also play a critical role in helping governors and legislatures advance health policies by giving input into their drafting and defending them against legal challenges. State attorneys general have entered the prescription drug affordability arena in both these ways—for example, by initiating lawsuits relating to price fixing by generic drug manufacturers and defending state laws requiring disclosures of pharmaceutical prices. Yet the scope of their collective efforts is not well understood, and little is known about factors that facilitate and hinder them in their pursuit of policy objectives relating to drug affordability. In this Article, we report findings from an empirical study of state attorney general activities relating to pharmaceutical pricing. Drawing from key informant interviews with attorneys working on drug pricing issues as well as a scoping review, we report on how state attorneys general are working to address the problem of drug affordability, how they make decisions about resource investments in this area, what positions state attorneys general to be effective change agents in this space, and what challenges they confront in this work. We situate our results within the broader literature on state attorneys general as policy actors, and we suggest measures that could extend their capacity to successfully tackle the complex issues that give rise to unaffordable drugs.

Introduction

Prescription drug affordability has risen to the very top of the policy agenda for lawmakers and the public. Even during the peak of the COVID-19 pandemic in January 2021, a national poll ranked taking action to lower prescription drug prices as Americans’ second-highest domestic policy priority, with eighty-seven percent of participants rating the issue “extremely important.”[1] Nearly one in four Americans reports difficulty affording their prescription medications, and patients may respond by delaying filling their prescriptions, cutting pills in half, or skipping doses.[2] Despite partisan divisions among voters in many areas of health policy, a bipartisan supermajority of Americans—nearly four in five—believes that prescription drug costs are “unreasonable.”[3]

Notwithstanding both this bipartisan support and pledges by leaders of both parties to take action on the issue following the 2016 election,[4] few substantive reforms have become law at the federal level in recent years, either through legislation or regulation.[5] Rather, states have become the locus of policy action on prescription drug costs. States’ interest in this area arises not only because high drug prices harm consumers, but also because state budgets are directly affected when drug costs for the Medicaid program or state employee health plans rise. Unlike the federal government, states face special financial pressures due to requirements that they balance their budgets.[6] Since 2017, 166 prescription drug pricing bills have become law in forty-eight states, tackling everything from price transparency to regulation of pharmacy benefit managers (PBM) to drug affordability boards.[7] State legislatures are even taking inspiration from bold proposals being introduced at the federal level by considering bills that would adopt international reference pricing approaches within their own states.[8] Despite this energetic activity, state legislative interventions adopted to date have had only modest impacts on drug pricing.[9]

There has been little scholarly attention paid to the drug affordability activities of another state-level policy actor with an important role to play: offices of state attorneys general (AGs).[10] State AGs are important players both in using affirmative tools, including litigation, to advance important policy goals and in defending states against the inevitable legal challenges to state legislative efforts on prescription drug affordability.[11] Past examples of state AG involvement in critical public health issues, including tobacco control and the opioid epidemic,[12] suggest that state AG litigation can be a powerful force in combating business practices that cause health harms. In many states, AGs also have a critical role to play in providing advice to legislatures trying to make progress on drug pricing amidst ever-present threats of lawsuits challenging their enactments. Building on their past experiences, as well as a successful history of addressing high drug prices using healthcare fraud-and-abuse statutes, state AG offices have recently expanded their activities in the drug affordability space to include a variety of interesting, creative approaches leveraging state and federal antitrust laws, state consumer protection laws, emergency price-gouging statutes, and other authorities.

In this Article, we report findings from an empirical study of state AG activities relating to pharmaceutical pricing. Few empirical analyses of state AGs’ activities have been conducted,[13] and to our knowledge, this is the first to focus on drug pricing. Through key informant interviews with attorneys working on drug pricing issues within state AG offices as well as a scoping review, we sought to learn more about how state AGs are addressing the problem of prescription drug affordability, how they make decisions about resource investments in this area, what positions state AGs to be effective change agents in this space, and what challenges they confront in this work. We situate our results within the broader literature on state AGs as policy actors, and we suggest measures that could extend their capacity to successfully tackle the complex issues that give rise to overpriced drugs.

Part I of this Article surveys the existing literature on the role of state AGs, considering key elements of their institutional role and exploring how those elements were instantiated in specific activities in the health context. Part II presents the methods we used in conducting this project. Part III presents the results of our analysis, including the major activities of state AGs in the prescription drug affordability space and key findings relating to how they carry out this work and the factors that empower and constrain them. Part IV reflects on these results, and Part V offers recommendations for strengthening state AGs’ role in this important area.

          [1].      Politico & Harv. T.H. Chan Sch. of Pub. Health, The American Public’s Priorities for the New President and Congress, Politico & Harv. T.H. Chan Sch. of Pub. Health 2 (2021).

          [2].      Ashley Kirzinger, Lunna Lopes, Bryan Wu, & Mollyann Brodie, KFF Health Tracking Poll—February 2019: Prescription Drugs, Kaiser Fam. Found. (Mar. 1, 2019), http://www.kff.org/health-reform/poll-finding/kff-health-tracking-poll-february-2019-prescription-drugs [http://perma.cc/H75W-RSS2].

          [3].      Id.

          [4].      Stacie B. Dusetzina & Michelle M. Mello, Drug Pricing Reform in 2021—Going Big or Going Bipartisan?, JAMA Health F. (July 8, 2021), http://jamanetwork.com/journals/jama-health-forum/
fullarticle/2781947 [http://perma.cc/397H-9M5N].

          [5].      Rachel E. Sachs, The Rhetorical Transformations and Policy Failures of Prescription Drug Pricing Reform Under the Trump Administration, 46 J. Health Pol., Pol’y & L. 1053 (2021). Some small reforms that would attempt to eliminate anticompetitive abuses, such as the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act, did become law. See Further Consolidated Appropriations Act, 2020 § 610, 21 U.S.C. § 355-2; U.S. Food & Drug Admin., Access to Product Samples: The CREATES Act (2020), http://www.fda.gov/‌drugs/‌guidance-compliance-regulatory-infor
mation/access-product-samples-creates-act [http://perma.cc/YZ2B-QJ7T].

          [6].      See, e.g., David Gamage, Preventing State Budget Crises: Managing the Fiscal Volatility Problem, 98 Calif. L. Rev. 749, 755 (2010).

          [7].      Trish Riley, Celebrating Five Years of State Action to Lower Drug Prices, Nat’l Acad. for St. Health Pol’y (May 18, 2021), http://www.nashp.org/celebrating-five-years-of-state-action-to-lowe
r-drug-prices [http://perma.cc/8YJZ-L7PW].

          [8].      Lev Facher, States Still Can’t Import Drugs from Canada. Now, Many are Seeking to Import Canadian Prices, STAT (Feb. 18, 2021), http://www.statnews.com/2021/02/18/states-canada-drug-pric
es [http://perma.cc/AW6E-VLT9].

          [9].      Michelle M. Mello & Trish Riley, To Address Drug Affordability, Grab the Low-Hanging Fruit, JAMA Health F. (Feb. 25, 2021), http://jamanetwork.com/journals/jama-health-forum/fullart
icle/2777036 [http://perma.cc/E5FD-N6RW] (summarizing data on recent price increases). For a discussion of legal limitations on what states can regulate in the drug affordability space, see infra note 237 and accompanying text.

        [10].      Hereinafter, we use the term “AGs” to refer both to the state’s top attorney and to the attorneys who staff the AG’s office.

        [11].      See, e.g., Ass’n for Accessible Meds. v. Frosh, 887 F.3d 664, 666 (4th Cir. 2018) (invalidating a Maryland statute regulating excessive price increases for essential off-patent and generic drugs).

        [12].      See infra Part I for discussions of these specific examples.

        [13].      See infra Part I for discussions of these specific examples. Danielle Keats Citron, The Privacy Policymaking of State Attorneys General, 92 Notre Dame L. Rev. 747, 751–52 (2016) (analyzing interview data and documentary evidence obtained from Freedom of Information Act requests to study how AGs are working on data privacy issues). Most empirical work has analyzed predictors of AGs’ participation in multistate litigation. Colin Provost, An Integrated Model of U.S. State Attorney General Behavior in Multi-State Litigation, 10 St. Pol. & Pol’y Q. 1, 2–3 (2010) [hereinafter Provost, Integrated Model]; Colin Provost, The Politics of Consumer Protection: Explaining State Attorney General Participation in Multi-State Lawsuits, 59 Pol. Res. Q. 609, 612 (2006) [hereinafter Provost, Politics of Consumer Protection]; Colin Provost, State Attorneys General, Entrepreneurship, and Consumer Protection in the New Federalism, 33 Publius 37, 43–44 (2003) [hereinafter Provost, Entrepreneurship]; Joseph F. Zimmerman, Interstate Cooperation: The Roles of the State Attorneys General, 28 Publius 71, 72–73 (1998); Thomas A. Schmeling, Stag Hunting with the State AG: Anti-Tobacco Litigation and the Emergence of Cooperation Among State Attorneys General, 25 Law & Pol’y 429, 430–31 (2003). A few studies have modeled predictors of states’ decisions to join amicus briefs. See Shane A. Gleason, The Dynamics of Legal Networks: State Attorney General Amicus Brief Coalition Formation, 39 Just. Sys. J. 253, 254 (2018); Margaret H. Lemos & Kevin M. Quinn, Litigating State Interests: Attorneys General as Amici, 90 N.Y.U. L. Rev. 1229, 1242–43 (2015); Cornell W. Clayton, Law, Politics and the New Federalism: State Attorneys General as National Policymakers, 56 Rev. Pol. 525, 544–48 (1994); Thomas R. Morris, States Before the U.S. Supreme Court: State Attorneys General as Amicus Curiae, 70 Judicature 298, 301–02 (1987). Other studies have analyzed characteristics of cases in which states have enforced federal consumer protection statutes, see, e.g., Amy Widman & Prentiss Cox, State Attorneys General’s Use of Concurrent Public Enforcement Authority in Federal Consumer Protection Laws, 33 Cardozo L. Rev. 53, 54–55 (2011); state AGs’ decisions to bring nonpharmaceutical healthcare antitrust suits in the 1970s and early 1980s, see, e.g., Ronald C. Lippincott, Redressing the Imbalanced Political Market for Health Policy: A Role for the State Attorney General?, 9 J. Health Pol., Pol’y & L. 389, 391 (1984); strategies employed in consumer-protection lawsuits, see, e.g., Prentiss Cox, Amy Widman & Mark Totten, Strategies of Public UDAP Enforcement, 55 Harv. J. on Legis. 37, 79–85 (2018); and changes in the types of lawsuits AGs have brought over time, see e.g., Paul Nolette & Colin Provost, Change and Continuity in the Role of State Attorneys General in the Obama and Trump Administrations, 48 Publius 469, 471–73 (2018).

* Mello is a Professor of Law at Stanford Law School; Professor in the Department of Health Policy at Stanford University School of Medicine; and a faculty affiliate of the Freeman Spogli Institute for International Studies, Stanford University; Ph.D., University of North Carolina at Chapel Hill; J.D., Yale Law School; M.Phil., University of Oxford; A.B., Stanford University. Grant funding from the Arnold Ventures is gratefully acknowledged. The funder had no role in the design of the study or the drafting or revision of the manuscript. Mello discloses expert witness fees received from law firms representing generic drug company plaintiffs in a pharmaceutical antitrust lawsuit; Mello and Sachs disclose receiving consulting fees from the National Academy for State Health Policy for authoring reports on policy strategies to regulate prescription drug prices; Mello reports serving as a consultant to CVS Caremark and, after the period in which work reported in this Article was conducted, as an expert witness on behalf of a health insurer suing a pharmaceutical company over alleged off-label promotion (no fees yet received for either engagement); and Sachs reports receiving honoraria for her participation on the Institute for Clinical and Economic Review’s independent Midwest Comparative Effectiveness Public Advisory Council and West Health’s Council for Informed Drug Spending Analysis. The authors extend their thanks to the attorneys who participated in this study and to Katie Siler, Taryn Marks, Heather Joy, Camila Strassle, Quinn Walker, and Corissa Paris for research assistance. For their thoughtful comments and suggestions in developing this Article, the authors would like to thank Margaret Lemos and the scholars who participated in workshops at Washington University in St. Louis School of Law and Johns Hopkins Bloomberg School of Public Health.

           †      Riley is a former Executive Director of the National Academy for State Health Policy; M.S., University of Maine.

           ‡      Sachs is the Treiman Professor of Law, Washington University in St. Louis School of Law; J.D., Harvard Law School; M.P.H., Harvard School of Public Health; A.B., Princeton University.

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Provisional Assumptions

In courtrooms, the law often asks individuals to ignore information—carefully, purposely—that otherwise feels important. Juries, for example, are often asked to disregard information about a variety of facts, from prior convictions to settlement negotiations. But legal literature and psychology research has shown us that it is difficult for jurors to follow these instructions and cabin their curiosity about different facts in a case. Jurors have difficulty suppressing their thoughts; they rebel against admonitions; they create story-based hypotheses that are resistant to change.

To help align these evidence exclusions with empirical realities, this Article introduces an original tool: a provisional assumption. A provisional assumption would ask jurors not to ignore information but to assume certain information about subjects for which evidence is inadmissible; for instance, to assume that a civil defendant has no insurance against liability or that a criminal defendant has no prior criminal record. Drawing from psychological theories that explain why people rebel against admonitions, such as mental control and reactance, I test provisional assumptions using two experimental studies. Leveraging the context of insurance and its inadmissibility in tort cases, the results suggest that this approach would allow jurors to focus on the facts that matter. Provisional assumptions appear to hold promise as a portable intervention applicable in boardrooms and interview suites as well as courtrooms, and as a model of procedural innovation informed by interdisciplinary research.

Introduction

In July 1987, Steve Terry was playing catch with his two sons when the ball landed in a tree.[1] When Terry tried to reach for the ball with a pole, he struck an improperly installed power line and was electrocuted, causing him severe injury.[2] Four years later, a jury awarded more than $5 million to Terry, but the utility company, Plateau Electric Cooperative, moved for a mistrial.[3] Its argument: the jury had heard something forbidden.

Plateau believed that Terry’s attorney had improperly prejudiced the jurors by eliciting testimony that mentioned in passing that the utility company owned insurance,[4] and it brought affidavits from three jurors mentioning what other jurors had said: that the utility company’s “insurance carrier would not miss” $5 million,[5] that “the corporation always ‘gets over on the individual and I am not going to let it happen this time,’ ”[6] and that “sometimes ‘you just have to break the law.’ ”[7]

To the appeals court, these statements went beyond the “life experiences”[8] jurors are “encouraged . . . to rely upon”[9] into “an astonishing amount of extraneous prejudicial information.”[10] Even though it might be “common knowledge” that Plateau, as a utility company, had liability insurance,[11] to the judge on appeal, that “argument beg[ged] the question: What would the verdict have been had there been no insurance, with that fact being made known to the jury?”[12]

This Article seeks to unpack that question. Terry’s case is just one illustration of how insurance status can generate assumptions about a party’s ability to pay damages and its responsibility. But such assumptions occur across other subjects of litigation, from car accidents[13] to medical malpractice[14] to corporate indemnification.[15]

By excluding information about a party’s insurance status—or their lack thereof—federal[16] and state[17] rules of evidence, alongside their early common law underpinnings,[18] attempt to reduce bias and confusion among jurors. And in an attempt to make this exclusion effective, courts instruct jurors either to disregard insurance status if it slips out during the trial or to only regard it for a particular purpose.[19] These admonitions rest on the assumptions that jurors can disregard inadmissible information that enters the courtroom, that they can consider a piece of evidence for one purpose but not for others, and that they can prevent speculation about inadmissible information.[20]

Yet, we know these assumptions can be fictive. In other evidentiary situations in which jurors encounter admonitions from a judge, the admonition frequently fails. For instance, notwithstanding instructions to ignore information about a defendant’s criminal record, jurors are more likely to think that defendants with prior convictions are guiltier.[21] Jurors also incorporate information from the news into their deliberative processes, despite the presence of admonitions.[22] This pretrial publicity can lead to harsher treatment of criminal defendants,[23] even if jurors believe they are being unbiased.[24]

Perhaps courts could exert extra effort in “blindfolding,” ensuring that inadmissible information is not mentioned at all, by incentivizing parties to create comprehensive motions in limine that exclude evidence and sanctioning violations of the motion.[25] But even if inadmissible information were to be perfectly hidden or “blindfolded” from jurors, in actuality, jurors might use their everyday stereotypes to construct their narrative of the case, as in Terry v. Plateau Electric Cooperative.[26] They also might speculate about missing information, to the detriment of focusing on the facts at hand.[27] The problem remains: How do we prevent people from their own speculation, if telling them not to consider information—that is, an admonition—might make them more likely to do it?

In this Article, I use the evidentiary limitations on the admissibility of insurance as a springboard to help understand how we might reduce juror speculation and to offer an alternative to jury admonitions. I suggest that courts should consider providing a provisional assumption for jurors, that is, request that jurors assume a particular piece of information when making their determination. I theorize that such provisional assumptions will reduce the inadmissible information’s salience and allow individuals to focus on the facts that courts deem most important.

To investigate whether provisional assumptions could work, I use a pair of survey experiments relating to the admissibility of insurance in trials. The experiments ask mock jurors in an online study to assume that neither the plaintiff nor the defendant has insurance, comparing them to another group of mock jurors who are simply given a standard jury instruction that says generally that insurance should not be considered. I find that those jurors asked to provisionally assume no insurance are less likely to be interested in the plaintiff’s insurance and may award less damages to the plaintiff. And I find potential evidence that these results are robust under uncertainty.

By accounting for the psychology of jury decision-making, the provisional assumption intervention aligns legal theories with human psychology, while yielding several policy-relevant benefits. First, allowing jurors to assume facts about insurance allows them to concentrate on the questions that matter to the law and prevents jurors from making assumptions that might be inconsistent with those of the other jurors or the objectives of the evidentiary rule at hand. Second, a provisional assumption is a solution whose simple implementation generates minimal bias to either party. Third, this procedural innovation is behaviorally informed but does not treat jurors in a patronizing fashion. Providing jurors with a provisional assumption might displace the assumptions they have—and also displace our own assumptions about how jurors behave.

This Article proceeds in three parts. Part I lays out the historical and functional importance of the evidence rules underlying the exclusion of insurance status from jury consideration. It then addresses how courts have dealt with the exclusion in practice. Part I also shows how jury instructions fall short  of eliminating forbidden information by illustrating the disconnect between evidentiary exclusions and empirical realities via classic examples in social psychology and jury studies.

Part II contains two original studies. It imagines what an ideal intervention would look like and introduces the provisional assumption as a psychology-based intervention, consistent with legal intuitions about evidence. It then describes and reports on the results of two original survey experiments that demonstrate the first-ever use of this intervention.

Lastly, Part III explores the implications of these studies for juror decision-making and legal decision-making generally. To be sure, the frequency of civil jury trials has steadily diminished over time. Still, understanding how jurors speculate might have parallels to other situations in which the law asks people to not consider certain information. I address several potential objections to the implementation of the provisional assumption and argue that implementation of psychological innovations helps to conform the underlying rationale of the law with legal actors’ expectations.

          [1].      Terry v. Plateau Elec. Coop., 825 S.W.2d 418, 420 (Tenn. Ct. App. 1991).

          [2].      Id.

          [3].      Id. at 419, 421.

          [4].      Id. at 421.

          [5].      Id.

          [6].      Id. at 422.

          [7].      Id. at 421–22.

          [8].      Id. at 423.

          [9].      Id.

        [10].      Id. Under Rule 606 of the Federal Rules of Evidence, juror testimony may not be used to impeach a verdict unless “extraneous prejudicial information was improperly brought to the jury’s attention” or “an outside influence was improperly brought to bear on any juror.” Fed. R. Evid. 606(b); see also Warger v. Shauers, 574 U.S. 40, 48 (2014).

        [11].      Terry, 825 S.W.2d at 423.

        [12].      Id.

        [13].      See, e.g., Valerie P. Hans & Nicole Vadino, Whipped by Whiplash? The Challenges of Jury Communication in Lawsuits Involving Connective Tissue Injury, 67 Tenn. L. Rev. 569, 581 (2000); Tim A. Baker, Sizing Up Settlement: How Much Do the Merits of a Dispute Really Matter?, 24 Harv. Negot. L. Rev. 253, 257–58 (2019).

        [14].      See Lauren Gailey, “I’m Sorry” as Evidence? Why the Federal Rules of Evidence Should Include a New Specialized Relevance Rule to Protect Physicians, 82 Def. Couns. J. 172, 181 (2015).

        [15].      See Baker, supra note 13, at 257.

        [16].      See Fed. R. Evid. 411.

        [17].      See, e.g., 6 Jack B. Weinstein & Margaret A. Berger, Weinstein’s Federal Evidence art. IV (Mark S. Brodin ed., 2d ed. 1997).

        [18].      See Banks McDowell, The Collateral Source Rule—The American Medical Association and Tort Reform, 24 Washburn L.J. 205, 205 (1985).

        [19].      See Justin Sevier, Evidence Law and Empirical Psychology, in Philosophical Foundations of Evidence Law 349, 356–57 (Christian Dahlman, Alex Stein & Giovanni Tuzet eds., 2021).

        [20].      See Shari Seidman Diamond & Neil Vidmar, Jury Room Ruminations on Forbidden Topics, 87 Va. L. Rev. 1857, 1864–66 (2001); Sevier, supra note 19, at 356–58.

        [21].      See Roselle L. Wissler & Michael J. Saks, On the Inefficacy of Limiting Instructions: When Jurors Use Prior Conviction Evidence to Decide on Guilt, 9 Law & Hum. Behav. 37, 41–43 (1985); David Crump, Does Impeachment by Conviction Create Undue Prejudice? An Experiment and an Analysis, 53 Akron L. Rev. 1, 16 (2019). The effect of prior convictions on liability extends to civil contexts. See Kathryn Stanchi & Deirdre Bowen, This Is Your Sword: How Damaging Are Prior Convictions to Plaintiffs in Civil Trials?, 89 Wash. L. Rev. 901, 927–29 (2014). Although information about prior convictions might be admitted to undermine a defendant’s credibility, it also appears to increase her liability in the jury’s eyes. See Sarah Tanford & Michele Cox, The Effects of Impeachment Evidence and Limiting Instructions on Individual and Group Decision Making, 12 Law & Hum. Behav. 477, 488 (1988).

        [22].      See, e.g., Stanley Sue, Ronald E. Smith & Renee Gilbert, Biasing Effects of Pretrial Publicity on Judicial Decisions, 2 J. Crim. Just. 163, 170 (1974); Geoffrey P. Kramer, Norbert L. Kerr & John S. Carroll, Pretrial Publicity, Judicial Remedies, and Jury Bias, 14 Law & Hum. Behav. 409, 431 (1990); Gary Moran & Brian L. Cutler, The Prejudicial Impact of Pretrial Publicity, 21 J. Applied Soc. Psych. 345, 360 (1991).

        [23].      See Nancy Mehrkens Steblay, Jasmina Besirevic, Solomon M. Fulero & Belia Jimenez-Lorente, The Effects of Pretrial Publicity on Juror Verdicts: A Meta-Analytic Review, 23 Law & Hum. Behav. 219, 229 (1999); Kramer et al., supra note 22, at 431; Moran & Cutler, supra note 22, at 360.

        [24].      See Moran & Cutler, supra note 22, at 362.

        [25].      See Diamond & Vidmar, supra note 20, at 1863–64.

        [26].      Terry v. Plateau Elec. Coop, 825 S.W.2d 418, 421–23 (Tenn. Ct. App. 1991); see, e.g., Shari Seidman Diamond & Jonathan D. Casper, Blindfolding the Jury to Verdict Consequences: Damages, Experts, and the Civil Jury, 26 Law & Soc’y Rev. 513, 516 (1992); Diamond & Vidmar, supra note 20, at 1861.

        [27].      See Diamond & Vidmar, supra note 20, at 1864–65.

* Sharswood Fellow, the University of Pennsylvania Carey Law School. J.D., Harvard Law School (2017); Ph.D., Harvard University (2020). Many thanks to David Abrams, Kim Ferzan, Jill Fisch, Jonah Gelbach, Chris Hampson, David Hoffman, Jon Klick, Sandy Mayson, Serena Mayeri, Gideon Parchomovsky, Tess Wilkinson-Ryan, and Maggie Wittlin, and workshop participants at Albany, Brooklyn, Columbia, Chapman, Chicago, Duke, Florida State, Fordham, George Washington, Georgia State, Minnesota, Texas A&M and Wyoming law schools, as well as conference participants at SEALS and the Inaugural Workshop for Asian American and Pacific Islander Women in the Legal Academy, for comments and conversations.

 

A Closer Look at the PTAB Operation

Prior to the passage of the America Invents Act (“AIA”) in 2011,[1] allegedly low-quality patents were allowed to proliferate. Many of these low-quality patents contributed little to innovation because holders of these patents did not practice the technologies they had exclusive rights over. Rather, these patent holders used the patents to challenge actually productive patents owned by operating companies. Unfortunately, there are only two ways to challenge such low-quality patents: through federal court litigation or administrative patent opposition mechanisms.

In light of these problems, Congress passed the AIA and empowered the United States Patent Trademark Office (“USPTO”) to reevaluate and revoke previously issued patents through the creation of the Patent Trial and Appeal Board (“PTAB”).[2] The goal of these post-grant administrative proceedings is to serve as an efficient alternative to district court litigation and to lower the cost of invalidating low-value patents.[3] Despite Congress’s best intentions, there is still much uncertainty regarding these cancellation procedures. Contrary to congressional expectations, the U.S. patent system ranking dropped consecutively from first to tenth to thirteenth in its patent protection ranking between 2017 and 2018, receiving the lowest score in patent opposition out of all developed countries’ post-grant opposition mechanisms.[4] Such downward trend raises the question: Are these subpar ratings merely a result of the new tribunal’s growing pains which will soon subside, or do they indicate a systemic flaw of the U.S. patent opposition system?

Out of the new PTAB’s proceedings, inter partes review (“IPR”), a process by which the PTAB reconsiders or cancels previously issued patents, has been exceedingly popular for patent challengers. This Note analyzes over 11,000 PTAB proceedings across different industries and technologies, and attempts to evaluate the PTAB’s run over its eight-year life in order to provide an empirical perspective on whether the PTAB has gone too far invalidating patents.

This Note will inform the debate over how well the PTAB is working by looking at: (1) its treatment of Non-practicing Entities (“NPEs”) and Patent Assertion Entities (“PAEs”); (2) serial IPR petitions; and (3) concurrent litigation. All three areas will be analyzed across different industries using original empirical data. The data will show that while Congress has mostly achieved its intended goals of making patent opposition litigation faster and cheaper at the PTAB, there are unintended consequences of the PTAB mechanisms.

As I will describe in greater detail below, the specific findings are the following:

       First, the PTAB has largely succeeded in providing an additional avenue to raise invalidity challenges against NPEs and PAEs, especially in the information technology (“IT”) sector. However, there has also been an alarming rise in invalidity petitions aimed at actual operational companies, a trend across industries but especially in the biosciences. Among PTAB invalidity proceedings against NPEs/PAEs, 52% of them are against patents related to the IT industry whereas only 6% are against patents in life science;

Second, among 11,909 PTAB petitions filed, there are 7,074 unique patents addressed. In other words, 41% of the time the PTAB looks at a petition, the Board had already seen the same patent challenged some other way in another petition. On a per-patent basis, 32% of the patents have been challenged more than once. Such serial petition problems also exist across industries. The problem is the most prevalent within the IT industry. In fact, 36% of the patents addressing software technologies are challenged more than once, whereas 30% of the patents addressing biosciences are challenged more than once;

Third, the PTAB mechanisms are used in unintended ways by certain entities.[5] For example, almost one in five patents in front of the PTAB, 19% to be precise, faces multiple invalidation petitions brought by the same challengers.

Fourth, while the institution rate is decreasing across industries, petitions against software patents are instituted at the highest rate of 75%, whereas petitions against bioscience patents are instituted at the rate of 68%;

Fifth, the heightened concerns on the invalidity rate of PTAB petitions (most commentators report a rate of around 80%) could be misleading because the overall rate of petitions being held partially or entirely invalid out of all petitions filed is only 22%. The 80% invalidity rate is calculated by dividing petitions that are held partially or entirely invalid by petitions that received final written decision; however, the majority of petitions filed do not ever receive a final written decision;

Last, patent challengers who resort to invalidating patents at the PTAB are highly likely to have parallel lawsuits against the same patents, as 83% of the PTAB petitions have a co-pending district court case.

In Part I, I will introduce the U.S. patent system, the history and purpose of the AIA, and the PTAB. I will discuss the popularity of one specific PTAB proceeding IPR and present both sides of the debate around IPRs, the USPTO director’s discretion, and the Supreme Court’s scrutiny over the PTAB in recent years. In Part II, I will describe the study design, which includes its data source and data structure. In Part III, I will expand upon the findings and review how the PTAB operations have changed under different directors. At the end, I will conclude my analysis.

 

 

          [1].      35 U.S.C. §§ 311–319. In September 2012, petitions for inter partes review first became available. Id.

          [2].      See id. § 6(b).

          [3].      H.R. Rep. No. 112-98, pt. 1, at 39–40, 48 (2011), as reprinted in 2011 U.S.C.C.A.N. 67, 69, 78 (discussing that post grant reviews were intended to be “quick and cost effective alternatives to litigation”).

          [4].      See U.S. Chamber of Com., Glob. Innovation Pol’y Ctr., U.S. Chamber International IP Index 7–9 (6th ed. 2018), http://globalipcenter.wpengine.com/wp-content/uploads/
2018/02/GIPC_IP_Index_2018.pdf [https://perma.cc/NH7B-MW29] (commenting that the change is primarily driven by relative weakness in patentability requirements and patent opposition and noting that all other EU countries patent opposition system scored higher than that of the United States). In 2020, the U.S. IP system ranking went back up according to the 2020 International IP Index. See U.S. Chamber of Com., Glob. Innovation Pol’y Ctr., U.S. Chamber International IP Index 38 (8th ed. 2020), https://www.uschamber.com/assets/documents/023881_gipc_ip_index_2020_fullreport_final.pdf [https:
//perma.cc/Y2KQ-9NH2].

          [5].      Subcomm. on Intell. Prop., Innovation in America: How Congress Can Make Our Patent System STRONGER, Comm. on Judiciary (Sept. 11, 2019, 2:30 PM), https://www.judiciary.senate.gov/
meetings/innovation-in-america-how-congress-can-make-our-patent-system-stronger [https://perma.cc/
KW4C-2M2J] (broadcasted at 1:53; Senator Tillis urging Director Iancu to make administrative changes to the PTAB). 

*      Executive Editor, Southern California Law Review, Volume 95; J.D. Candidate 2022, University of Southern California Gould School of Law; B.S. Mechanical Engineering, B.S. Earth Science, Rice University. I would like to thank Yoko Hongyu Li for her invaluable guidance on data gathering and software programming. To my parents Xiao and Wei, thank you for encouraging me in all my pursuits and inspiring me to follow my dreams. Finally, many thanks to editors at Southern California Law Review who made this process a breeze.

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