Casenote Return Mail, Inc. v. United States Postal Service et al., 139 S.Ct. 1853 (2019).

by: Krishna P. Gohel

In 2011, Congress enacted the Leahy-Smith America Invents Act (AIA) that created the Patent Trial and Appeal Board (Patent Board), which reviews challenges brought by a “person” regarding the validity of a patent post-issuance. The Patent Board reviews such challenges through one of three adjudicatory administrative review proceedings that were established by the AIA: (1) “inter partes review,” (2) “post-grant review,” and (3) “covered-business-method (CBM) review.” The Board then either confirms or cancels the patent claims. The question before the Court was whether a federal agency is a “person” capable of initiating AIA review proceedings. The Court held that it is not. 

Return Mail, Inc. (Return Mail) owns a patent claiming a method for processing undeliverable mail. In 2003, the United States Postal Service (USPS) explored the possibility of licensing Return Mail’s invention, but the parties never reached an agreement. In 2006, USPS introduced an enhanced service to process undeliverable mail, which Return Mail claimed infringed upon its patent. USPS petitioned for ex parte reexamination of Return Mail’s patent, another avenue that predates the AIA authorizing the USPTO to reconsider the validity of a patent that it previously allowed. For ex parte reexamination, “any person at any time” can cite to the USPTO certain prior art that may affect the “patentability of any claim of a particular patent” and additionally request that the USPTO reexamine the patent claim on that basis. When a party petitions for ex parte reexamination, that party does not participate in the reexamination itself. However, when a party initiates an AIA review proceeding, because all three are adjudicatory, the party participates in the reexamination process. 

The USPTO confirmed Return Mail’s patent’s validity. Return Mail subsequently sued USPS and sought compensation for the unauthorized use of its invention. USPS again petitioned to USPTO to review Return Mail’s patent, but this time USPS sought CBM review. The Patent Board agreed with USPS and concluded that the subject matter of the patent was ineligible to be patented and the Court of Appeals for the Federal Circuit affirmed.

The Supreme Court reversed. Because there is no express definition of “person” in the patent statutes, the Court turned to the longstanding interpretive presumption that “person” does not include a sovereign. Therefore, the Court reasoned that “person” excludes a federal agency, like USPS. The Court noted that this presumption reflects the common usage of the word “person.” Furthermore, the Court explained the Dictionary Act provides that the word “person” includes companies, firms, etc., but notably absent from that list is the Federal Government. The Court recognized that this presumption is not a solid rule of exclusion but noted that in order for the said presumption to be discarded, USPS must make an affirmative showing of statutory intent to include the Federal Government as a “person.” USPS set forth three reasons to show congressional intent to include the Federal Government as “persons” in AIA proceedings: (1) the Federal Government is recognized as a “person” in other patent statutes, (2) the Federal Government has a long history of participation in the patent system, and (3) it would be unfair to disallow the Federal Government to participate in AIA proceedings, while allowing civilians to do so. The Court rejected all three arguments.

The outcome of this case is ultimately limited in scope, by shutting the door to AIA proceedings for federal agencies. Businesses that have patented their business methods are shielded from AIA proceedings brought by such federal agencies, which could potentially save significant amounts of time, money, and effort.

However, the main impact this case has on the business world is anticipating how patent cases will be addressed by the modern Supreme Court. The majority treated the AIA as just another federal statute, whereas the dissent swayed more toward interpreting the AIA with the backdrop of the history of patent law and its purpose. Return Mail, slip op. at 5-6 (Breyer, J., dissenting) (discussing that Congress enacted the AIA to make the patent system more efficient and robust. He argues that this congressional intent should be taken into consideration when evaluating the language of the AIA). This case is another step in the modern Supreme Court’s journey to (re)writing the patent law regime of our country, thus impacting current and future businesses as they navigate the waters of innovation and growth. To read the full case, click here.