The government cannot use the Covered Business Methods Review to challenge patent validity
In the United States Supreme Court
Argument: February 19, 2019
Decision: June 10, 2019
Petitioner Brief: Return Mail, Inc.
Respondent Brief: United States Postal Service
Court Below: Federal Circuit Court of Appeals
A private company, Return Mail, has a patent on a method of dealing with undeliverable mail. The United States Postal Service has been using the same method. Return Mail tried to get the Postal Service to license it (pay for it), but that didn’t work. Then Return Mail sued the Postal Service under a particular provision of patent law that is specific to suits against the government. Now the two are having it out over whether the USPS can get the Patent and Trademark Office to review the patent before engaging in litigation.
Infringement vs. Section 1498(a)
When someone infringes on your patent, you can sue for infringement. When the government infringes on your patent, you have to file a different action: a § 1498(a) action. It’s just a different provision. But are the government’s defenses different too?
The America Invents Act (2011) created three types of agency review as alternatives to court proceedings that can move patent disputes along quickly. Parties can use them to challenge the validity of patents. One of them, the “Covered Business Methods Review,” is a patent challenge used by a party after it gets sued for infringement. The USPS wanted to use the CBM Review (challenge the patent before the USPTO) in defense to the suit by Return Mail. This case is about whether the government can avail itself of the CBM Review.
Supreme Court analysis
The CBM Review provision in the America Invents Act says a “person” sued for infringement can use the CBM process. Is the government a person?
The Supreme Court started with a general presumption in its own precedent that the word “person” always means private party but not the government. As if that wasn’t clear enough, there is also a Dictionary Act that Congress passed to help clarify terms that are used often in federal laws. “Person” in the Dictionary Act also discludes the government.
USPS would have had to show a clear indication to the contrary to overcome these presumptions that “person” does not include the government. And, the Court ruled, it did not. The USPS tried to say that the AIA consistently uses the word “person” and consistently refers to the government. But the Court was not convinced; it found no such pattern in the AIA. Next, the USPS tried to say that because government officers can file for patents, they should be able to challenge them just like others. No such congruence, the Court said. Finally, the USPS argued that because the government can be subject to civil liability for infringement just like everyone else, the government should be able to defend against infringement suits just the same. Again, the Court rejected the argument. The 6-member majority believed it makes good sense that Congress would distinguish the government from private parties as far as patent challenges.
Thus, the Court ruled, the government is not a person under the AIA that can avail itself of the CBM Review. The USPS will have to defend the Section 1498 suit in federal court.
