Justia U.S. Federal Circuit Court of Appeals Opinion Summaries

Articles Posted in Constitutional Law
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Christy applied for a patent on its “ambient air backflushed filter vacuum” invention. The patent claiming that invention issued in 2006. Christy paid the patent's $1,000 issuance fee and the $490 3.5-year, $1,800 7.5-year, and $3,700 11.5-year maintenance fees. Christy and its licensee sued competitors for patent infringement. One competitor filed petitions for inter partes review (IPR). The Federal Circuit affirmed the Patent Trial and Appeal Board’s invalidity decision. Aggrieved by the cancellation of 18 claims of the patent, Christy filed a class-action suit, seeking compensation from the government, with a Fifth Amendment takings claim and, alternatively, an illegal exaction claim, seeking compensation amounting to the issuance and maintenance fees, Christy’s investments made in the technologies, and attorney fees spent in defending the IPR.The Federal Circuit affirmed the dismissal of the suit. The cancellation of patent claims in an IPR does not amount to a compensable taking. Christy’s argument regarding the fees fails because the law requires payment of the fees without regard to any later result of post-issuance proceedings, 35 U.S.C. 41, 151. Christy identifies no statute, regulation, or constitutional provision compelling the fees’ refund if claims are later canceled in post-issuance proceedings. Without showing how the PTO’s actions contravened the Constitution, a statute, or a regulation, Christy cannot state an illegal exaction claim. View "Christy, Inc. v. United States" on Justia Law

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Decker developed the patented inventions while employed at the University of Texas and assigned the patents to UT. Gensetix obtained an exclusive license in the patents. The license agreement provides that, Gensetix must enforce the patents. The parties agreed to cooperate in any infringement suit and that nothing in the agreement would waive UT's sovereign immunity. Gensetix sued Baylor, alleging infringement and requested that UT join as a co-plaintiff. UT declined. Gensetix named UT as an involuntary plaintiff under FRCP 19(a). The district court dismissed, finding that UT is a sovereign state entity, so that the Eleventh Amendment barred joinder of UT, and that the suit could not proceed without UT.The Federal Circuit affirmed in part. UT did not voluntarily invoke federal jurisdiction; the Eleventh Amendment prevents “the indignity of subjecting a State to the coercive process of judicial tribunals” against its will. It is irrelevant that the license agreement requires the initiation of an infringement suit by Gensetix or cooperation by UT. The court erred in dismissing the suit without adequate analysis of Rule 19(b)'s factors: the extent to which a judgment might prejudice the missing required party or the existing parties; the extent to which any prejudice could be lessened; whether a judgment rendered in the required party’s absence would be adequate; and whether the plaintiff would have an adequate remedy if the action were dismissed. View "Gensetix, Inc. v. Baylor College of Medicine" on Justia Law

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Hardy owns land in Newton County, Georgia, through which CGA operated a rail line. CGA’s predecessor acquired interests in Hardy’s parcels through various deeds. In 2013, CGA applied for authority to abandon a portion of its rail line by filing a notice of exemption from formal abandonment proceedings with the Surface Transportation Board (STB). The Foundation requested interim trail use under the National Trail Systems Act, 16 U.S.C. 1247(d). The STB issued a Notice of Interim Trail Use or Abandonment (NITU). In 2016, CGA notified the STB that the map attached to CGA’s notice of exemption was inaccurate and attached a corrected map. The STB accepted CGA’s revised map and modified 2013 NITU “effective on its date of service.” Hardy filed suit, alleging that the 2013 NITU caused takings by preventing CGA’s abandonment of sections of the rail line running through Hardy’s parcels.The Federal Circuit affirmed summary judgment that Hardy has a cognizable property interest; the deeds conveyed easements rather than fee simple estates. The court vacated a holding that the NITU caused a temporary taking of parcels that were erroneously included in the description of the land. In a rails-to-trails case, a taking occurs when a “NITU is issued and state law reversionary interests that would otherwise take effect pursuant to normal abandonment proceedings are forestalled.” The court remanded for determinations of whether or when the Railroad would have abandoned the easements absent the NITU. View "Hardy v. United States" on Justia Law

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Water levels in Eagle Lake, near Vicksburg, are controlled by the Muddy Bayou Control Structure, part of the Army Corps of Engineers’ Mississippi River flood control program. Eagle Lake's predictable water levels allowed the plaintiffs to build piers, boathouses, and docks. In 2010, the Corps determined that “sand boils” threatened the stability of the nearby Mississippi River Mainline Levee, a component of the same flood-control program. Unusually wet weather in 2011 exacerbated the problem. The Corps declared an emergency, finding that the rise in nearby water levels threatened the structural integrity of the levee and “that the likelihood of breach was over 95%.” The Corps decided to flood Eagle Lake to reduce pressures along the levee. Because of that action, the levee did not breach. A breach would have resulted in widespread flooding affecting “about a million acres and possibly between four thousand to six thousand homes and businesses.” The damage to the plaintiffs’ properties would have exceeded the damage caused by raising the lake level. The plaintiffs sued, seeking compensation. The Federal Circuit reversed the Claims Court’s finding that the government was liable and award of $168,000 in compensatory damages. The relative benefits doctrine bars liability. The plaintiffs were better off as a result of the Corps’ actions. If the government had not raised the water level, the levee would almost certainly have breached, and the plaintiffs would have suffered more damage. View "Alford v. United States" on Justia Law

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Caquelin's land was subject to a railroad easement. The Surface Transportation Board granted the railroad permission to abandon the line unless the process (16 U.S.C. 1247(d)) for considering the use of the easement for a public recreational trail was invoked. That process was invoked. The Board issued a Notice of Interim Trail Use or Abandonment (NITU), preventing effectuation of the abandonment approval and blocking the ending of the easement for 180 days, during which the railroad could try to reach an agreement with two entities that expressed interest in the easement for trail use. The NITU expired without such an agreement. The railroad completed its abandonment three months later.Caquelin sued, alleging that a taking occurred when the government, by issuing the NITU, prevented the termination of the easement during the 180-day period. Following a remand, the Claims Court again held that a taking had occurred. The Federal Circuit affirmed, rejecting the contention that the multi-factor approach adopted for government-created flooding in the Supreme Court’s 2012 “Arkansas Game” decision displaced the categorical-taking analysis adopted in Federal Circuit precedents for a NITU that blocks termination of an easement. The categorical taking analysis is applicable even when that NITU expires without a trail-use agreement. A NITU does not effect a taking if, even without a NITU, the railroad would not have abandoned its line during the period of the NITU. Here, the evidence permits a finding that abandonment would have occurred during the NITU period if the NITU had not issued. View "Caquelin v. United States" on Justia Law

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In 1999, the Taylors purchased land near a New Mexico Air Force base to raise calves. The Air Force began flying training missions over the land, sometimes “no more than 20 feet . . . off the deck.” In 2008, the Taylors granted Wind Energy an exclusive five-year option for an easement on the Taylors’ property, for “wind resource evaluation, wind energy development, energy transmission and related wind energy development uses.” In 2012, Air Force employees suggested to Wind Energy that the FAA would not issue a “No Hazard” designation for the air space above the Taylors’ land, which would be “fatal to the construction of planned wind turbines.” Wind Energy exercised its contractual right to terminate the agreement.The Taylors sued, claiming that the Air Force’s informal advice to Wind Energy caused a regulatory taking of their property interest in their contract and that the flyovers effected a physical taking. The Federal Circuit affirmed the dismissal of the complaint. Wind Energy’s termination was not a breach of the agreement so the Taylors had no property right in the continuation of that agreement nor did they have any investment-backed expectations. Any advice given by Air Force employees did not amount to an FAA denial. The Taylors did not provide factual allegations of how the flights “directly, immediately, and substantially interfere” with their quiet enjoyment and use of the land View "Taylor v. United States" on Justia Law

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In 2019, the Federal Circuit (Arthrex) held that the appointment of the APJs by the Secretary of Commerce, 35 U.S.C. 6(a), violated the Appointments Clause. The Patent and Trademark Office and Cisco argued that the Federal Circuit erred in extending Arthrex beyond the context of inter partes reviews to an appeal from a decision of the Patent Trial and Appeal Board in an inter partes reexamination. They claimed that administrative patent judges (APJs) should be deemed constitutionally appointed officers at least when it comes to their duties reviewing appeals of inter partes reexaminations.The Federal Circuit rejected the argument. The fact that an inferior officer on occasion performs duties that may be performed by an employee not subject to the Appointments Clause does not transform his status under the Constitution. Courts should look not only to the authority exercised in the case but to all of the appointee’s duties when assessing an Appointments Clause challenge. An APJs’ duties include both conducting inter partes reviews and reviewing appeals of inter partes reexaminations. Although no discovery is held and no trial conducted in inter partes reexaminations, the proceedings are otherwise similar. The Director’s authority over the Board’s decisions is not meaningfully greater in the context of inter partes reexaminations than in inter partes reviews. View "Virnetx Inc. v. Cisco Systems, Inc." on Justia Law

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GIP purchased property from a steel mill’s bankruptcy estate, omitting the “Eastern Excluded Property” (EEP). GIP purchased some personal property located on the EEP, which contains two piles comprising slag (a steel manufacturing byproduct), kish (a byproduct of a blast furnace operation), and scrap. Each pile occupied more than 10 acres and was more than 80 feet high. GIP's "Itemization of Excluded Item from Sale” referred to: “All by-products of production other than kish and 420,000 cubic yards of slag” on the EEP “with a reasonable period of time to remove such items.” The EPA began investigating contaminants leaching from the piles. While GIP was negotiating for the separation of recoverable metals, the EPA decided to reduce the size of the piles. In 2009-2013, EPA contractors recovered and sold 245,890 tons of material and recovered and used 92,500 cubic yards of slag onsite for environmental remediation; they processed approximately 50% of the piles, spending about $14.5 million, about a million more than income from sales. The EPA compacted the materials to minimize leachate, leaving further remediation to state environmental authorities. GIP did not attempt its own recovery operation during the EPA remediation.GIP sued, alleging “takings” of the slag, kish, and scrap. The trial court awarded GIP $755,494 for the slag but awarded zero damages for the kish and scrap. The Federal Circuit vacated in part. GIP had no claim to any particular subset of slag. The trial court erred in finding that the EPA somehow prevented GIP from recovering its full allotment of slag; GIP cannot establish a cognizable property interest in the slag that was recovered. The court affirmed in part. GIP’s unreliable calculations left the trial court without competent evidence relating to a critical component of the damages calculation with respect to the kish and scrap. View "Gadsden Industrial Park, LLC v. United States" on Justia Law

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The 1961 National Housing Act provided financial incentives to private developers to build low-income housing, including below-market mortgages insured by HUD. Participating developers had limited ability to increase rents while HUD insured the mortgage. The mortgage term was 40 years but developers could prepay their mortgages after 20 years and convert to market-rate housing. The 1988-1990 Preservation Statutes eliminated the prepayment option, 12 U.S.C. 4101. The 1996 Housing Opportunity Program Extension Act restored prepayment rights to developers still in the program.Four “first wave plaintiffs” (FWPs) owned their properties before the Preservation Statutes and sold after their enactment, consistent with the 1990 Low-Income Housing Preservation and Resident Homeownership Act (LIHPRHA) to organizations that preserved the rent restrictions. One FWP owned its property before the Preservation Statutes and remained in the program, obtaining HUD financial incentives in exchange for abiding by the restrictions for the property's "remaining useful life.” The final FWP (Casa) purchased its property in 1991 and sold pursuant to LIHPRHA. The FWPs alleged regulatory taking. The Claims Court applied the “Penn Central” three-factor test and rejected the claims on summary judgment.The Federal Circuit affirmed with respect to Casa, a sophisticated investor that voluntarily purchased its property with knowledge that it had no prepayment option and had no reasonable investment-backed expectation. The court otherwise vacated. The character of the governmental action and the investment-backed expectations weighed against summary judgment and the Claims Court did not consider certain genuine issues of fact regarding the calculations of economic impact. View "Anaheim Gardens, L.P. v. United States" on Justia Law

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The plaintiffs own land abutting a railroad right-of-way that was long ago granted to, and for decades used by, the Railway in Dade County, Florida. When the Railway abandoned the right-of-way for rail use, full rights to the underlying land, unencumbered by the easement, would have reverted to whoever owned such rights, had there been no overriding governmental action. However, the Railway successfully petitioned the Surface Transportation Board to have the railroad corridor turned into a recreational trail under the National Trails System Act Amendments, 16 U.S.C. 1247(d).The landowners sued, alleging that the agency’s conversion of the right-of-way into a recreational trail constituted a taking of their rights in the corridor land abutting their properties and that the government must pay just compensation for that taking. To establish their ownership of the corridor land, the plaintiffs relied on Florida's “centerline presumption,” which provides that when a road or other corridor forms the boundary of a landowner’s parcel, that landowner owns the fee interest in the abutting corridor land up to the corridor’s centerline, absent clear evidence to the contrary. The trial court ruled in favor of the government. The Federal Circuit reversed. The centerline presumption applies to railroad rights-of-way and the plats at issue do not clearly express the intent required to avoid application of the centerline presumption. View "Castillo v. United States" on Justia Law