Where Tribal Sovereignty Hits the Washington Road

Recent Cases Highlight the Continuing Confusion Over Tribal Sovereignty

When NAIPEC was formed in 2009 as the Native American Inventors Association, (NAIA) its aim was to support innovation in Tribal business, through the lens of intellectual property (IP) protection and strategy. Recently Tribal Sovereignty has become another area of focus for NAIPEC.

NAIA’s transition to the Native American Intellectual Property Enterprise Council (NAIPEC) in 2010 marked an important recognition of the role that intellectual property could play in creating new economic opportunities for Native Americans. As the landscape of IP flowed over national and international borders with global corporations pursuing IP strategies that saw no borders, the role of the sovereignty of Native American peoples in the United States of America has garnered much attention in recent months after two marquee law cases came to somewhat interesting conclusions.

Early in 2017 NAIPEC spun off a for-profit arm, to provide Native American Tribes strategic support in the acquisition, monetization and management of Intellectual Property portfolios. NDN IP PARTNERS, LLC (NDN) will assist tribes in acquiring patents and other intellectual properties, and support Tribes in leveraging patent ownership, utilizing tribal sovereignty, and by providing broad IP strategic management support.

The most recent case that NDN has been instrumental in involves the transfer of patents owned by Prowire LLC, who sued Apple in March, alleging the iPad 4 infringed one of its patents. The lawsuit alleges that Apple’s iPad infringes a patent on inductors used in circuits and was initially filed in Delaware federal court.

The patent was ultimately transferred to MEC Resources LLC, on Aug. 17, a company owned by The Three Affiliated Tribes of the Fort Berthold Reservation, North Dakota, the official name for the Mandan, Hidatsa and Arikara Nation.

The transfer took place three weeks before Allergan PLC assigned six of its patents for the best-selling eye drug Restasis to the Saint Regis Mohawk Tribe in an attempt to use the tribe’s sovereign immunity to shield the patents from review at the Patent Trial and Appeal Board.

RPX Corp., a defensive patent group, highlighted the transfer in its newsletter, stating,

“While [a recent judicial order] describes MEC Resources as a North Dakota citizen, the entity is in fact registered as a foreign LLC, as it is owned and operated by the Mandan, Hidatsa, and Arikara Nation,” RPX wrote in its newsletter.

David Petite, Chair of NAIPEC, said that, “Like any other sovereign entity, Native American Tribes, and the businesses they own, have a special status under U.S. law. We are talking to a number of other Tribes about their IP acquisition strategy, and believe this can represent a significant departure from more recent Tribal enterprises that often revolve around gaming and U.S. government contracting work.”

The America Invents Act, signed into law by Pres. Obama in 2011, put into place new procedures for challenging patents at the United States Patent and Trademark Office (USPTO). Many smaller companies have found themselves faced with costs that can often exceed $200,000 to defend their patents, and many small companies, and individual inventors, have not been able to find the resources to fight such actions. Transferring patents to Native-Owned businesses and Tribes, is seen as a way to offset some of these actions.

But Democratic U.S. Senator Claire McCaskill (MO) has drafted a bill stating that tribal sovereign immunity cannot be used to block U.S. Patent and Trademark Office review of a patent. While it is unclear as to how she has justified such a specific ‘carve-out’ against  long-standing precepts on the status of sovereignty for Native Americans, it does indicate that, perhaps once again, Native Americans will begin to see how their status is viewed by the U.S. Federal Government. As Pres. George W. Bush famously said in 2004, when asked about the nature of Tribal Sovereignty, “the relationship between the federal government and tribes is one between sovereign entities.”

Apparently Sen. McCaskill has other ideas.