On June 10, 2019 in a 6-to-3 decision, Return Mail v. United States Postal Service, No. 17–1594, the U.S. Supreme Court decided that, based on principles of statutory interpretation, a federal agency is not a “person” that may challenge patent validity before the Patent Trial and Appeal Board (PTAB) under the procedures established by the 2011 America Invents Act (AIA).

After Return Mail filed a lawsuit against the U.S. Postal Service (USPS) alleging patent infringement of U.S. Patent No. 6,826,548, the USPS filed a petition seeking a covered business method (CBM) review in the PTAB. The PTAB instituted review and decided that the ’548 patent was invalid for claiming ineligible subject matter under 35 U.S.C. §101 and Alice Corp. v. CLS Bank International, 573 U.S. 208 (2014). Return Mail appealed the PTAB decision to the U.S. Court of Appeals for the Federal Circuit, and the Federal Circuit affirmed, holding that the government is a “person” that may petition for CBM review.

The Supreme Court framed the question before it as “whether the government is a ‘person’ capable of instituting the three AIA review proceedings,” and reversing the Federal Circuit, concluded that the answer is no. The Court reasoned that the patent statutes do not define the term “person,” and that, absent an express statutory definition, there is a long-standing interpretive presumption that “person” does not include the government. The Court further reasoned that the USPS failed to displace this presumption, despite a number of competing statutory interpretation principles, including the fact that federal agencies have a long history of participating in the patent system. The Court also tallied “at least 18 different places” where the Patent Act and the AIA use the term “person,” but concluded “there is no clear trend” as to whether the government is included or excluded in the term’s meaning. As Justice Sonia Sotomayor cleverly put it in rejecting the USPS’ arguments, “None delivers.”

The dissenting justices emphasized the lower burden of proof for challenging patent validity in the PTAB versus in federal court — preponderance of the evidence versus clear and convincing evidence. But the Supreme Court was not sympathetic to this disparity: “The USPS lacks only the additional tool of petitioning for the initiation of an administrative proceeding before the Patent Office under the AIA, a process separate from defending an infringement suit.”

Of Note

In addition to providing a primer on multiple canons of statutory presumption and their relative weights, the Supreme Court’s Return Mail decision serves as a reminder that the Court continues to decide patent law questions based on general legal principles applicable to all areas of law rather than principles unique to patent law.

Bottom Line

Although the United States and its agencies may be sued for patent infringement, the federal government may not — unlike other defendants accused of patent infringement — turn to the PTAB to challenge patent validity, despite the AIA’s clear purpose of providing another mechanism to do so.