by Dennis Crouch
A new class-action lawsuit has been filed against the U.S. Government alleging damages suffered by “patent holders whose property was taken by the USPTO without compensation in violation of the Fifth Amendment of the Constitution.” Christy, Inc. v. USA, 18-cv-00657 (Ct. Fed. Clms. 2018) (2018-05-09-1-Complaint).
The basic story here begins with the USPTO’s “public (and shocking) admission” that the AIA Trials are targeted toward patents that were “erroneously granted in the first instance” — i.e., the USPTO erred in issuing the patents and that is why the AIA trials are now necessary. The problem though is that the erroneous issuance lead to a granted property right with the potential for substantial royalty income, substantial payments of maintenance and other USPTO fees, and often substantial costs involved with the AIA-trial. In my mind, only claim with potential here is that of paid fees based upon an erroneous grant. The complaint explains:
The USPTO’s invalidation of the Plaintiff’s and Class member’s patent claims was a taking without just compensation in violation of the Fifth Amendment of the Constitution. The compensation due here includes, but is not limited to, expected royalties and other payments related to use of the patents. This case additionally seeks damages for the Defendant’s breach of contract by failing to maintain in force the subject patent claims for the terms prescribed in the patent grants for the relevant claims, including the recovery of attorney fees expended defending those same patents in post-grant proceedings, any investments made in the inventions underlying those patents, any expected royalties or payments related to the patents, and all fees paid to the Defendant for the issuance of those patents. In the alternative, the case seeks to recover fees that were paid by inventors and patent owners to the USPTO, such fees having been exacted from Plaintiff and Class members through the AIA—according to the Defendant, these patents were issued erroneously by the USPTO in the first instance and thus all fees should be returned to the Plaintiff and Class members.
Id. Note here that, although the Supreme Court in Oil States did not bestow patents with full grandeur private property rights — the Court was clear that patents should continue to be treated as property protected by the Due Process and Takings Clauses of the U.S. Constitution.
[O]ur decision should not be misconstrued as suggesting that patents are not property for purposes of the Due Process Clause or the Takings Clause.
Oil States Energy Servs., LLC v. Greene’s Energy Grp., LLC, 200 L. Ed. 2d 671 (Supreme Court 2018). Overall, it is in interesting idea for a lawsuit, but it lacks precedential support. Its best shot is to focus on the retroactive impact of IPR/CBM decisions on pre-AIA patents. For those cases, the IPR regime was not pre-baked into the implied contract.