Supreme Court Holds that Government Agencies May Not Use AIA Proceedings to Challenge Patents

On June 10, 2019 the United States Supreme Court held in Return Mail, Inc. v. United States Postal Service, 587 U.S. ____ (2019) that agencies of the federal government cannot challenge the validity of a patent via USPTO post-issuance procedures implemented pursuant to the America Invents Act.  Federal agencies, therefore, can no longer avail themselves of inter partes review (IPR), post grant review (PGR), or covered business method review (CBM) procedures before the USPTO’s Patent Trial and Appeal Board.

Specifically, the Court analyzed the statutory framework authorizing IPRs which provides that only “a person” may petition for IPR, PGR, or CBM review of a patent.  Slip. Op. at 6-7.

After setting forth various canons of statutory construction, reviewing the interpretation of the term “person” in other statutes, and analyzing the context and history of the AIA, the Court concluded that the government is not a “person” as that term is used in the AIA.  Slip. Op. at 17-18.  Accordingly, the Court decided that the government is not authorized by statute to petition for AIA review.  Slip. Op. at 17-18. 

Of note, the Court explicitly left open the question of whether a government agency is a “person” authorized to file a request for ex parte reexamination at the USPTO.  Slip Op. at 14 (“Even assuming that the Government may petition for ex parte reexamination, ex parte reexamination is a fundamentally different process than an AIA post-issuance review proceeding.”)  Ex parte reexamination procedures are also used to challenge a patent’s validity but differ in many material respects from AIA reviews.  For example, they allow for virtually no requester participation post-filing, are initially handled by a patent examiner, not an Administrative Patent Judge, and generally take several years to complete.  Nevertheless, for the time being, it appears that government agencies may continue to challenge patents via the ex parte reexamination process.

Return Mail also raises additional questions including: (1) whether parties in privity with a government agency will likewise be barred from filing AIA petitions; (2) the retroactive effect of this decision on pending or decided AIA proceedings; and (3) the extent to which this rule will extend to other sovereign entities, such as state governments.  This last question may prove interesting considering the decision issued by the Federal Circuit on June 14, 2019, finding that sovereign immunity does not apply in inter partes review.  Regents of the University of Minnesota v. LSI Corp., No. 18-1559.  Patents owned by governmental entities will be subject to AIA proceedings while such governmental entities may now be unable to avail themselves of AIA proceedings.

This decision is of particular relevance to companies that frequently contract with the federal government.  If a contractor supplies products to the government that are accused of infringing a third-party’s patent, this decision may make it more difficult to invalidate that patent.  Conversely, companies whose rights are being infringed by the federal government will now face one less obstacle to recovery.

For additional information regarding AIA procedures, including IPRs, PGRs, and CBMs, and ex parte reexamination procedures please contact Clint Brannon.