Federal Circuit Addresses When Activities are Undertaken “for the U.S.” Under 28 U.S.C. § 1498(a)

October 21, 2014


What This Means to You

  • If an invention is used or manufactured “for the United States,” a patentee’s sole remedy for infringement is an action against the government.
  • When the government requires the performance of quasi-governmental functions, such actions are undertaken “for the United States,” as they are undertaken “for the benefit of the Government and with the authorization and consent of the Government.”


Overview

In IRIS Corp. v. Japan Airlines Corp., the U.S. Court of Appeals for the Federal Circuit (Federal Circuit) addressed when allegedly infringing acts are carried out “for the United States,” such that, pursuant to 28 U.S.C. § 1498, a patentee’s sole remedy is an action against the U.S. in the U.S. Court of Federal Claims. The Federal Circuit held: “When the government requires private parties to perform quasi-governmental functions, such as this one, there can be no question that those actions are undertaken ‘for the benefit of the government.’”

Background

IRIS sued Japan Airlines, alleging that it infringed IRIS’s “Security Identification Document” patent by “using … electronic passports in the processing and/or boarding of passengers … at … [Japan Airlines] services passenger check-in facilities throughout the United States.” Japan Airlines examined passports in order to comply with federal laws, including the Enhanced Border Security Act and the Visa Entry Reform Act of 2002.

Japan Airlines moved to dismiss IRIS’s suit. It argued, among other things, that it inspected passports “for the United States,” so IRIS’s exclusive remedy was an action against the United States under 28 U.S.C. § 1498(a). In relevant parts, 28 U.S.C. § 1498(a) provides:

  • “Whenever an invention described in and covered by a patent ... is used or manufactured by or for the United States … , the owner’s remedy shall be by action against the United States in the United States Court of Federal Claims”; and
  • “[T]he use or manufacture of an invention described in and covered by a patent … for the Government and with the authorization or consent of the Government, shall be construed as use or manufacture for the United States.”

Decision Analysis

In short order, the Federal Circuit affirmed the district court’s decision to dismiss IRIS’s lawsuit. The Federal Circuit reasoned (1) the government had expressly authorized or consented to Japan Airlines’ checking of passports, as such activities were required by federal law, and (2) such activities were undertaken “for the United States,” as the government directly benefited (e.g., through improved detection of fraudulent passports and enhanced border security). The Federal Circuit’s decision was reinforced by counsel for the United States, who appeared at oral argument and “unequivocally stated” that suit under § 1498 was appropriate.

Takeaways

  • If allegedly infringing activities are required quasi-governmental functions, e.g., checking passports, such activities may fall within 28 U.S.C. § 1498(a) as undertaken “for the United States.” In such a case, a patentee’s sole remedy is a suit against the U.S.
  • If you are trying to prove that use or manufacture was undertaken “for the United States” and therefore falls within 28 U.S.C. § 1498(a), it helps when the United States appears on your behalf and states, “This is use ‘for the Government.’ ... We do think that suit under 1498(a) is appropriate.”