When the Supremes reverse the decision of a lower court, the law that governs the conduct of you, me, and everyone else in the country on the day after the decision is different than it was on the day before the decision. So the Supreme Court changes the law, right?
Not so fast.
First, some background. For most of the 20th century, Encyclopedia Britannica was the authoritive reference for, well, just about everything. Then the Internet happened and the bottom dropped out of the encyclopedia market. You can’t even buy an English language print version anymore. Encyclopedia Britannica saw the writing on the wall years ago and developed a digital encyclopedia and a new multimedia database search system to implement the new encyclopedia.
Encyclopedia Britannica hired the giant Washington law firm of Dickstein Shapiro to file patent applications for its new technology. In 1993, Dickstein Shapiro filed an application that contained a crucial error, which rendered the resulting patents invalid and unenforceable.
Oops.
That smells like legal malpractice, folks. But nobody knew it at the time.
In 2006 Encyclopedia Britannica sued several defendants for patent infringement. Dickstein Shapiro’s error was discovered and Encyclopedia Britannica lost the infringement litigation. Encyclopedia Britannica then sued Dickstein Shapiro for legal malpractice. To succeed in the patent malpractice case, Encyclopedia Britannica had to show that absent the malpractice, Encyclopedia Britannica would have won the infringement litigation.
In the meantime, the Supreme Court decided the 2014 case of Alice v CLS Bank that killed most software and computer patents.
In 2015, the malpractice trial court found that Encyclopedia Britannica’s 1993 computer and software inventions were unpatentable under the Supreme Court’s Alice decision. Encyclopedia Britannica’s patents would have been unenforceable, had the law been interpreted correctly in 2006, and Encyclopedia Britannica was not able to show that it would have won the infringement litigation. The result is that Encyclopedia Britannica lost the malpractice lawsuit based on a Supreme Court decision that occurred 21 years AFTER the malpractice occurred.
To answer our original question: when the Supreme Court decides a case, the law does not change. The Supreme Court merely recognizes what the law was all along, even if everyone else followed the incorrect interpretation of the law for decades.
By the way, Dickstein Shapiro collapsed and went out of business in February, 2016.
— Robert Yarbrough, Esq.