Can the U.S. Government Be Liable for Patent Infringement?

The answer is “Yes” because the U.S. government has waived sovereign immunity for claims of patent infringement.  This means the U.S. government can be sued for patent infringement in at least some instances.  However, special rules and certain limitations apply as explained in 28 U.S.C. § 1498, which states, in part:

(a) Whenever an invention described in and covered by a patent of the United States is used or manufactured by or for the United States without license of the owner thereof or lawful right to use or manufacture the same, the owner’s remedy shall be by action against the United States in the United States Court of Federal Claims for the recovery of his reasonable and entire compensation for such use and manufacture.

As a result, patent infringement lawsuits against the United States government, are not brought in Federal district courts but rather in the Court of Federal Claims, which is a special court “authorized to hear primarily money claims founded upon the Constitution, federal statutes, executive regulations, or contracts, express or implied in fact, with the United States.”  See  Further, a patent owner cannot sue a federal contractor who made the allegedly infringing product or performed the allegedly infringing method, but instead, must sue the U.S. government.  Note, however, the U.S. government’s contract with the federal contractor may require the contractor to indemnify the government for liability and costs.

Relying on the U.S. government’s waiver of sovereign immunity, Iris Corporation Berhard (“Iris”) sued the United States in the Court of Federal Claims alleging infringement of Iris’s patent, U.S. Patent No. 6,111,506 (“the ‘506 patent”), which covers a method for manufacturing electronic passports.

Specifically, among other limitations, Claim 1 of the ‘506 patent requires

forming a contactless communication insert unit by electrically connecting an integrated circuit including a microprocessor, a controller, a memory unit, a radio frequency input/output device and an antenna, and disposing a metal ring to surround the integrated circuit

(emphasis added).  During claim construction, the U.S. government proposed the term “integrated circuit” should be construed to “mean that an antenna is part of the integrated circuit.”  In contrast, “Iris argued that the plain language of the claim supported a reading that one must connect the integrated circuit and an antenna.”  In particular, Iris’s argument relies on reading the claim language to allow electrically connecting an integrated circuit and an antenna rather than reading “and an antenna” as referring to the last item in the list of items included in the integrated circuit.

The Court of Federal Claims agreed with the U.S. government, reasoning that the plain language of the claim “expressly defines the components of the integrated circuit, including an antenna, and not what the integrated circuit is connected to.”  The Court of Federal Claims further explained that “[w]hile it is possible that ‘and’ could indicate a pair of items that will connect, in this case the foregoing use of ‘including’ indicates that ‘and’ is a conjunction concluding a list.”

After construing the asserted claims to require that the claimed integrated circuit includes an antenna, the Court of Federal claims granted the U.S. government’s motion for summary judgment of non-infringement because Iris did not allege the integrated circuit in the accused devices included an antenna.  Iris had only alleged that the inserts “connect[] an antenna via the [input/output] area of the [integrated circuit.]”  Iris appealed to the Court of Appeals for the Federal Circuit.

In its appeal, Iris argued the Court of Federal Claims erred in its claim construction in requiring “integrated circuit” to include an antenna.  The Federal Circuit reviewed the claim construction de novo, agreeing with the Court of Federal Claims “that there is no need to look further than the plain language of the claim here to read the antenna as being a component of the integrated circuit, not a separate element to which the integrated circuit attaches.”  The term “and would appear before the ‘input/output’ device’ if the input/output device was the last in the list of components” included in the claimed integrated circuit.  Further, the Federal Circuit found that the figures and specification support the Court of Federal Claim’s claim construction.  In addition, the prosecution history included a hand-labelled figure apparently indicating the antenna is part of the integrated circuit.  Finally, the Federal Circuit found the extrinsic evidence contradictory to the plain language of the claim but discounted that evidence as did the Court of Federal Claims.  As a result, the Federal Circuit found the Court of Federal Claim’s claim construction was not erroneous and affirmed the grant of summary judgment of noninfringement.

While the U.S. government was not found to have infringed the ‘506 patent, it is possible to bring patent infringement claims against the U.S. government.