When Congress passed the Leahy-Smith America Invents Act in 2011, it was meant in part to protect people who were being unfairly sued for infringement of business method patents. Perhaps for that reason, the Act specified that a “person” in that situation could request a covered business method review by the Patent Trial and Appeal Board. This administrative review covers only the business method at issue and is meant to quickly resolve the question of the patent’s validity.
Is a government agency a “person”? That was the question before the U.S. Supreme Court in regard to the Leahy-Smith America Invents Act.
The case before the court involved a small technology company called Return Mail Inc. It developed technology that could process returned and undeliverable mail using a system of optical scanners, computer databases and other processes.
In 2006, Return Mail began talks with the United States Postal Service. It sought to license its technology to the USPS, but later the agency announced that it had developed its own system for handling returned and undeliverable mail.
Return Mail notified the USPS that the agency’s system, “OneCode ACS,” infringed on its patent. The postal service reacted by challenging Return Mail’s patent.
The U.S. Patent and Trademark Office upheld the validity of the patent. Return Mail then sued the USPS for patent infringement.
While that infringement case was in process, the USPS asked for a covered business method review under the Leahy-Smith America Invents Act. This review was completed by the Patent Trial Appeal Board, and it invalidated the patent.
Return Mail petitioned to the U.S. Court of Appeals for the Federal Circuit, arguing that the covered business method review the USPS had requested was not what Congress had had in mind when it passed the Leahy-Smith America Invents Act. Moreover, it argued that the USPS is not a person, and the Act only grants such a review to people.
The Federal Circuit court affirmed the Patent Trial Appeal Board’s invalidation of the patent, so Return Mail appealed to the U.S. Supreme Court.
A six-member majority of the high court. led by Justice Sonia Sotomayor, ruled that government agencies are not “people” for the purposes of the Leahy-Smith America Invents Act.
It’s true that there were some conflicting uses of the term “person” in the Act, along with some wording that implied that government actors might be included. However, the majority decided that those references were not enough to overcome a legal presumption that Congress did not mean to include government agencies in the definition of “person.”
This ruling will serve to limit the situations in which someone accused of patent infringement may seek a covered business method review.