On June 10, 2019, the Supreme Court held in Return Mail, Inc. v. United States Postal Service that a federal agency is not a “person” under the patent statutes, and thus cannot seek patent validity review under the administrative proceedings established by the America Invents Act (AIA).

In the case, Return Mail Inc. asserted U.S. Patent No. 6,826,548 (’548 patent), directed to a method for processing undeliverable mail, against the United States Postal Service. While the suit was pending, the Postal Service petitioned the Patent Trial and Appeal Board (PTAB or the “Board”) to institute a covered-business-method review (CBM review). The Board concluded that the challenged claims were invalid as directed to patent ineligible subject matter. The Court of Appeals for the Federal Circuit (CAFC) affirmed the Board’s finding of invalidity, also holding that the Government is a “person” eligible to petition for PTAB review.

In a 6-3 decision, the Supreme Court reversed the CAFC and held that “a federal agency is not a ‘person’ who may petition for post-issuance review under the AIA.”  Justice Sotomayor’s opinion notes that the term “person” is not defined in the patent statutes, leading to the application of “longstanding” presumption that a “person” does not include the sovereign government. The Court notes that this is consistent with the Dictionary Act, which defines “person” to include many entities, but not the federal government.

Justice Sotomayor further addressed the Postal Service’s arguments, noting that the AIA and the Patent Act allow for conflicting interpretations of “person,” and that the “person” who can petition for PTAB review can be read as both including and excluding government agencies. In addition, while the Postal Service argued that USPTO’s Manual of Patent Examining Procedure (MPEP) allows “any person,” including government entities, to file an ex parte reexamination request, the Court reasoned that that situation has no direct relevance to AIA post-issuance review proceedings. Finally, the Court stated that it has not created “asymmetry” in disallowing a federal agency to utilize AIA proceedings, since the government already enjoys the benefits of only needing to provide “reasonable and entire compensation” upon infringement, and face lower risks than non-governmental actors. 

With this case, government use of administrative proceedings in front of the PTAB has become limited.

Justice Sotomayor was joined by Chief Justice John Roberts and Justices Clarence Thomas, Samuel Alito, Neil Gorsuch and Brett Kavanaugh. Justice Breyer penned a dissent, in which he found that Congress, when passing the AIA, had intended to include federal agencies as a “person.” Justice Breyer was joined by Justices Ruth Bader Ginsburg and Elena Kagan.

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