This Article examines the implications of the Eli Lilly case—and international investment law (IIL) more generally—for the operation of an international intellectual property (IP) regime that functions along the lines of the “neo-federalist” model developed by Professors Dinwoodie and Dreyfuss. The neo-federalist model involves a world in which the international IP regime grants national political communities substantial discretion to pursue their own visions of the normatively proper balance between the rights of IP creators and of those who seek to use it. Importantly, that discretion involves the ability to alter the existing normative balance in either the direction of more or fewer rights for IP creators. Under this view, the international IP regime is not, and should not be construed, either as a universal and comprehensive IP “code,” nor as a one-way ratchet that only permits member-state experimentation in favor of IP creators. Yet, that sort of systemic rigidity is precisely what the claimant in Eli Lilly sought to impose through the IIL regime. While it is true that the claimant, Eli Lilly, lost its case, a close reading of the award, along with an appreciation of the dynamics of IIL, suggests that substantial danger remains. Using Eli Lilly as a case study, this Article explores the challenges that the IIL system poses for the realization of the neo-federalist vision.
