Is the government a “person” who may file a petition to institute post-grant proceedings under the America Invents Act (AIA)? The Supreme Court will decide the issue after granting certiorari in United States v. Return Mail, Inc.
The issue is more than esoteric, as the federal government holds a large patent portfolio. While the case involved a Covered Business Method (CMB) proceeding under the AIA, the Court could issue a decision that would affect the government’s ability to initiate any AIA proceeding, says Eric Arnell, an associate in Leydig’s Frankfurt, Germany, office.
“The term ‘person’ is used throughout the AIA, so if the Court decides the federal government is indeed a “person” under the act, a broad ruling would apply to inter partes review and post-grant review proceedings as well,” he says.
The federal government had petitioned the Patent Trial and Appeal Board for a CMB review of Return Mail’s patent for a system and method of processing return mail.
Return Mail sought the high court’s review after adverse decisions in a CMB proceeding and the U.S. Court of Appeals for the Federal Circuit.
Neither the federal government nor Return Mail raised the issue of whether the government has standing as a “person” under the AIA in either the CBM proceeding or on appeal. Instead, the issue was raised sua sponte by the Federal Circuit, which concluded, “[t]he AIA does not appear to use the term ‘person’ to exclude the government in other provisions” and, therefore, the use of the term “person” in AIA § 18(a)(1)(B) regarding CMB proceedings also does not exclude the government.
In a thorough and lengthy dissent, Judge Pauline Newman asserted, “[t]he law is clear that when a statute uses the term ‘person,’ it is presumed that Congress intended to exclude the [G]overnment.” Accordingly, although the AIA says the petitioner can be any person who is not the patent owner, “The government is not a ‘person’ to whom the post-grant procedures of the AIA are available.”
In addition to her statutory construction argument, Newman also reasoned that including the government as a “person” would undermine one of the core aspects of the AIA.
“The estoppel provision is the backbone of the AIA, for it is through estoppel that the AIA achieves its purpose of expeditious and economical resolution of patent disputes without resort to the courts,” Newman wrote. The majority’s position “would grant the United States the benefit of post-grant challenge in the PTO, but would omit the statute’s estoppel against raising the same challenge in court.”
The Court may find this outcome to be both unintended and unfair, says Robert Wittmann, a shareholder in Leydig’s Chicago office.
“While a private party is estopped in district court from pursuing invalidity claims which it brought or could have brought in an AIA proceeding, the government is essentially immune from this restriction,” Wittmann notes. “The Court may not be inclined to afford such a windfall for the federal government at the expense of private litigants.”