Tuesday, April 28, 2015

Google vs. The Patent Trolls

Yesterday, Google announced a new Patent Purchase Promotion plan on its Public Policy blog. For two weeks in May, Google will open an experimental web portal through which U.S. patent holders can submit proposals to sell their patents to the search giant this summer. (Patent holders will be granted a license to continue practicing their invention, although Google will assume legal ownership and may also license the patent to others.) Details of the Patent Purchase Program are available at http://www.google.com/patents/licensing/.

Google's stated motive for setting up this program (besides adding to its bulky patent portfolio, of course) is "to remove friction from the patent market." In particular, Deputy General Counsel Allen Lo cited the "bad things" that happen when non-practicing entities (NPEs), or "patent trolls," obtain ownership of patents for the sole purpose of filing profitable patent infringement lawsuits against others.

TV host John Oliver recently offered a scathing takedown of patent troll practices on his HBO program Last Week Tonight, declaring: "At least trolls actually do something: they control bridge access for goats and ask people fun riddles." The 11-minute segment is available on YouTube, and provides sobering facts about the profitability of patent troll litigation and settlements, as well as the chilling effect these practices can have on innovation. These concerns were also the subject of a 2013 book available in the Goodson Law Library, Patent Trolls: Predatory Litigation and the Smothering of Innovation (KF3155 .W38 2013).

Congress has attempted to reform patent litigation in the past, and is currently considering a reform bill in the House (H.R. 9) which addresses some of these complaints. A competing Senate bill is expected in the Senate this week, according to recent remarks by Senator Chuck Grassley (story via Law360). News and analysis of these recent reform efforts can be found in Bloomberg BNA's Intellectual Property Resource Center.

For more library resources on the topic of patent law and litigation, check out the Goodson Law Library research guide to Intellectual Property Law. You’ll find titles like the seminal treatise Chisum on Patents (KF3110 .C4 & online in Lexis Advance). For help locating these or other patent titles, be sure to Ask a Librarian.

Thursday, April 23, 2015

The Next Attorney General

Today, the Senate confirmed Loretta Lynch as the next U.S. Attorney General, by a vote of 56 to 43. This afternoon's vote followed a five-month delay since her nomination by the President, the third-longest gap between nomination and confirmation in Attorney General history. Lynch's confirmation had been stalled in the Senate by a group of legislators who expressed concern for her support of President Obama's executive action on immigration law.

When Ms. Lynch assumes the role of U.S. Attorney General at her swearing-in ceremony next week, she will be the 83rd person to helm the U.S. Department of Justice, and the first African-American woman ever to hold the office. (The next Attorney General also has local roots for Duke Law readers, having been born in Greensboro and raised in Durham. North Carolina Senators Thom Tillis and Richard Burr both stated in February that they would oppose her nomination, and voted no on her confirmation today.)

To learn more about Attorneys General in American history, check out historical biographies of the 82 prior AGs at the Department of Justice website, or Ask a Librarian.

Wednesday, April 8, 2015

ABA Membership Now Free for Law Students

The American Bar Association just announced that law students are now eligible for free membership to the ABA. Membership in the Law Student Division provides students with access to ABA publications, member discounts, and continuing legal education (CLE) materials. Students must be currently enrolled in an ABA-accredited law school. To join, visit www.americanbar.org/abalawstudents or call the ABA Service Center at 800-285-2221.

In addition, Duke Law students might be interested in joining the North Carolina Bar Association, which also provides free registration for currently-enrolled law students. The NCBA membership provides students with free individual accounts to the Fastcase research service (currently also available in a shared IP format through the Goodson Law Library) as well as bar publications and additional membership discounts. To join the NCBA, visit http://www.ncbar.org/members/divisions/law-students.

Planning your legal career in a different state? Visit the ABA's State & Local Bar Associations map to look for student membership information in the state of your choice.

Monday, April 6, 2015

The Day the Taxes Died

Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That the Secretary of the Treasury is hereby directed to cause the immediate destruction of all income-tax returns and any copies thereof, with all statements and records relative thereto, now in possession of the Treasury Department, by reason of "An Act to reduce taxation," and so forth, in effect August twenty-eighth, eighteen hundred and ninety-four.
On this day in 1896, Congress approved House Joint Resolution No. 42, providing for the immediate destruction of income tax returns and records that the Treasury had received. In his 1897 annual report, the Secretary of the Treasury confirmed that the office had delivered all income tax returns and other documents to a specially-appointed committee, which "totally destroyed the same by burning."

As April 15 approaches (see our earlier post for help with locating free or low-cost filing assistance), it's tempting to wish for a world where the Internal Revenue Service is again directed to burn all of its tax returns. But what caused this unusual congressional mandate in the first place? The answer lies in an 1894 statute, found at 28 Stat. 509-71 (HeinOnline view). Section 27 of "An Act to reduce taxation" created a 2% annual income tax on private citizens' gains, income, and property over $4,000, to be collected from 1895 to 1900.

Copy of income tax form 365 (1894),
reprinted in S. Exec. Doc. 53-63.

Treatises like The Federal Income Tax Explained (1894) and United States Income Tax Law Simplified for Businessmen (1895) rushed to explain the new taxation plan, only the second personal income tax in U.S. history (a previous Civil War-era income tax was repealed after the war's conclusion, leaving customs receipts and tariffs as the primary sources of federal revenue).

By early 1895, legal challenges to the income tax had made their way to the U.S. Supreme Court. In Pollock v. Farmers Loan & Trust Co., 158 U.S. 601, the Court invalidated section 27 of the 1894 act as unconstitutional. (Filings from the Supreme Court case can be found in The Making of Modern Law: U.S. Supreme Court Records & Briefs, 1832-1978.)

In response to the controversial Pollock opinion, Congress began to consider a constitutional amendment, which found bipartisan support in 1909. The Sixteenth Amendment, authorizing Congress with the "power to lay and collect taxes on incomes," was ratified in February 1913. A brief history of this seminal time period in federal tax law can be found in a 2013 article by University of Delaware law professor Sheldon D. Pollack, Origins of the Modern Income Tax, 1894-1913. For more information, check out Richard Joseph's 2004 book The Origins of the American Income Tax: The Revenue Act of 1894 and its Aftermath.

While many readers may fantasize about the "good old days" of burnt tax returns as they fill out their 1040s, even today's Internal Revenue Service must fight continued attacks on its legitimacy. A number of quasi-legal arguments against the IRS and payment of income tax have achieved "urban legend" status, to the extent that the IRS debunks them annually in a detailed publication, The Truth About Frivolous Tax Arguments. Among the many debunked anti-tax myths in the 69-page document include a few complaints about the validity of the Sixteenth Amendment, which superseded the Supreme Court's Pollock ruling and laid the foundation for our current income tax system. As the IRS notes, "The constitutionality of the Sixteenth Amendment has invariably been upheld when challenged. Numerous courts have both implicitly and explicitly recognized that the Sixteenth Amendment authorizes a non-apportioned direct income tax on United States citizens and that the federal tax laws are valid as applied." In other words – don't push your luck; this isn't 1896.

To learn more about the history of American income tax, check out the resources in the Goodson Law Library research guide to Federal Tax. In particular, section 1.1 of the Bittker & Lokken treatise Federal Taxation of Income, Estates and Gifts (Tax Collection KF 6335 .B57 1999 & online in WestlawNext) provides a quick overview of the 1894 statute, its invalidation by the U.S. Supreme Court, and the subsequent effort to ratify the Sixteenth Amendment to the U.S. Constitution. For help locating these or other tax-related resources, be sure to Ask a Librarian.