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

Montelongo was a West Point student cadet, 1973-1977, then served in the Army 1977-1996, from which he retired. From June 21, 2001, to March 28, 2005, Montelongo served as a civilian presidential appointee in the Air Force. An Air Force human resources officer advised Montelongo that his time as a cadet could be “bought back” and credited toward an eventual civil service annuity under the Federal Employees Retirement System (FERS), 5 U.S.C. 8401–8479. Montelongo made the small payment to “buy back” his four years at West Point and, in 2017, applied for a FERS annuity. The Office of Personnel Management and the Merit Systems Protection Board concluded, and the Federal Circuit affirmed, that only his time as a presidential appointee (just under four years) counted as creditable civilian service. Montelongo did not satisfy the five-year threshold requirement for a FERS annuity. Montelongo’s cadet time was “military service” that was creditable service under 5 U.S.C. 8411(c)(1) but was not “civilian service” for which section 8410 sets a five-year minimum for annuity qualification. View "Montelongo v. Office of Personnel Management" on Justia Law

In 1983-1984, the Farmers Home Administration issued apartment owners (Appellants) 50-year loans to provide low-income housing under 42 U.S.C. 1485. A promissory note provided that prepayments “may be made at any time at the option of the Borrower.” The mortgage stated that the loan must be used in compliance with the statute and that Appellants must use the property for low-income housing for 20 years before they could prepay and exit the program. The documents were contemporaneously executed and cited each other. The Emergency Low Income Housing Preservation Act of 1987 and Housing and Community Development Act of 1992 provided that borrowers could no longer prepay after the 20-year period but must notify FmHA’s successor, which was to make “reasonable efforts" to extend the low-income use,” 42 U.S.C. 1472(c)(4)(A). If the agreement is not extended, the borrower must attempt to sell the property at fair market value to a nonprofit organization or a public agency. Appellants rejected incentive offers and, in 2009-2010, unsuccessfully marketed their properties for the required period. Facing foreclosure and low occupancy due to high unemployment, Appellants submitted deeds in lieu of foreclosure, then filed suit. The Federal Circuit reinstated certain claims. In transferring deeds to the government, Appellants did not assign away their accrued claims for breach of the prepayment right. The Claims Court properly dismissed a contract-based Fifth Amendment “takings” claim. In entering contracts, the government acts in its commercial capacity and remedies arise from the contracts themselves, rather than from constitutional protections. Appellants can succeed under a theory premised on their property interests in the land and buildings before entering the contracts. View "Callaway Manor Apartments v. United States" on Justia Law

Honeywell’s patent, directed to fluoroalkene compounds used in refrigeration systems and other applications, issued in October 2015 and recites a chain of priority applications dating back to 2002, all of which were incorporated by reference. During prosecution of the patent, Honeywell filed a preliminary amendment that canceled all 20 claims recited in the original application and added 20 new claims directed to different subject matter: automobile air conditioning systems. The Patent Trial and Appeal Board initiated post-grant review proceedings, finding that the claims of the patent were only entitled to a priority date of March 2014—the filing date of the application that led to the patent—rather than the 2002 priority date that would result if the priority chain adequately supported the claims. PGR proceedings are available only for patents having at least one claim with an effective filing date on or after March 16, 2013. There were several prior art references dated from the period between 2002 and 2014. The Federal Circuit vacated the Board’s refusal to grant Honeywell leave to seek a Certificate of Correction to correct the challenged patent. The Board abused its discretion by assuming the authority that 35 U.S.C. 255 expressly delegates to the Director: to determine when a Certificate of Correction is appropriate. View "Honeywell International Inc. v. Arkema Inc." on Justia Law

Gamon owns the 646 and 645 patents, which each claim the ornamental design for a gravity feed dispenser display (a can dispenser). On inter partes review, the Patent Trial and Appeal Board held that Campbell did not demonstrate that the claimed designs of the patents would have been obvious over the Linz and Samways patents. The Federal Circuit vacated in part. Substantial evidence does not support the Board’s finding that Linz is not a proper primary reference. Linz’s design is made to hold a cylindrical object in its display area. Affirming in part, the court noted that Samways has a dual dispensing area, compared to the single dispensing area of the claimed designs, and has a front label area with different dimensions that extends across both dispensing areas. Given these differences, substantial evidence supports the Board’s finding that Samways does not create basically the same visual impression as the claimed designs. View "Campbell Soup Co. v. Gamon Plus, Inc." on Justia Law

Alternative Carbon claimed nearly $20 million in energy tax credits meant for taxpayers who sell alternative fuel mixtures under 26 U.S.C. 6426(e)(1). The Internal Revenue Service determined that Alternative Carbon should not have claimed these credits and demanded repayment, with interest and penalties. Alternative Carbon paid back the government, in part, and then filed a refund suit. The Claims Court decided that Alternative Carbon failed to establish that it properly claimed the credits or that it had reasonable cause to do so and granted the government summary judgment. The Federal Circuit affirmed. Although the product at issue, a feedstock/diesel mixture, was a “liquid fuel,” it was not “sold” by Alternative Carbon; the transaction was more of a transfer for disposal. Alternative Carbon cannot show it had reasonable cause for claiming the alternative fuel mixture credits. View "Alternative Carbon Resources, LLC v. United States" on Justia Law

Sipco’s patent explains communicating information from a previously unconnected, remote device to a central location. Rather than set up a direct communication link, the invention sets up a two-step communication path through intermediate nodes to use the nodes’ already-provided link (e.g., a public-switched telephone network (PSTN)) to the central location. The remote device communicates wirelessly to an intermediate node. For example, a user may wish to replace his bank and credit cards with a remote transmitting unit, having buttons each associated with a bank or credit card. When the user depresses a button, the remote unit transmits the user’s account and PIN information to, for example, the ATM, which then transmits the information over, for example, a PSTN to the central location.The Patent Board found that the patent was not exempt from covered business method (CBM) review under the “technological invention” exception and found five claims patent-ineligible under 35 U.S.C. 101 and unpatentable for obviousness under 35 U.S.C. 103. The Federal Circuit vacated. The Board must consider “whether the claimed subject matter as a whole recites a technological feature that is novel and unobvious over the prior art; and solves a technical problem using a technical solution.” The court reversed the Board’s claim construction of “low power transceiver” and its finding that the patent does not satisfy the second part of the regulation defining “technological invention.” The court remanded for the Board to address section 42.301(b)’s first part. View "Sipco, LLC v. Emerson Electric Co." on Justia Law

Section 515 of the Housing Act of 1949, 42 U.S.C. 1485, authorizes the Department of Agriculture, Farmers Home Administration to loan money to nonprofit entities to provide rental housing for elderly and low- and moderate-income individuals and families. Sonoma, a limited partnership contracted with the government to construct low-income housing in exchange for a $1,261,080 Section 515 loan. In 2010, Sonoma submitted a written request to prepay the balance of its loan. The government denied the request. Sonoma sued for breach of contract, including a claim for a “tax neutralization payment” to offset the negative tax consequences of a lumpsum damages award. The Claims Court awarded Sonoma expectancy damages of $4,223,328 and a tax gross-up award of $3,171,990. The Federal Circuit vacated. The Claims Court clearly erred in using the income from a single tax year to predict the future rates at which each partner would pay taxes. While the government’s breach created the circumstances that require consideration of future income and tax rates, Sonoma is not absolved of its burden of showing an income-tax disparity and justifying any adjustment. View "Sonoma Apartment Associates v. United States" on Justia Law

In September 2010, IntraCellular filed the application leading to the 077 patent. In October 2012, the Patent Office issued a non-final office action including rejections under 35 U.S.C. 103 and 112. Intra-Cellular argued against section 103 rejections without amendment. In April 2013, the Patent Office mailed a final Office action, allowing no claims. In July 2013, on the last day for filing a “reply” to the final Office action without accruing applicant delay, 36 U.S.C. 154(b)(2)(C)(ii), Intra-Cellular responded with “Amendments and Response,” repeating the same arguments and adding a new claim. Nine days later, the Patent Office mailed an Advisory Action: Intra-Cellular’s after-final submission overcame some of the previous rejections but failed to overcome the section 103 rejection for the prior reasons of record. The examiner suggested amending or cancelling certain claims. Ten days later, Intra-Cellular filed its second after-final submission adopting all of those suggestions. A Notice of Allowance was mailed on August 20, 2013. In January 2017, the Patent Office issued a determination that the patent was entitled to 264 days of patent term adjustment ( for agency delays, after subtracting 21 days for applicant delay based on the time it took Intra-Cellular to file its second after-final submission after the response deadline, reasoning that Intra-Cellular’s first after-final submission did not constitute a proper “reply” under 37 CFR 1.704(b). The clock stopped with the second after-final submission, 21 days later. The Federal Circuit affirmed that determination. While timely, Intra-Cellular’ initial response continued to argue the merits of the final rejections, failing to comply with regulatory requirements for what constitutes a proper “reply” to a final Office action. View "Intra-Cellular Therapies, Inc. v. Iancu" on Justia Law

Inspired Development sued KidsEmbrace for breach of contract and other related state law claims in federal district court on the basis of diversity jurisdiction under 28 U.S.C. 1332(a). The dispute involved the purported breach of a patent-licensing agreement by failure to pay outstanding royalties. The district court granted summary judgment in KidsEmbrace’s favor on certain claims. On appeal, the Eleventh Circuit discovered that diversity jurisdiction did not exist. The district court concluded on remand that it retained jurisdiction over the suit based on federal question jurisdiction. The Eleventh Circuit transferred the case to the Federal Circuit, which vacated and remanded for dismissal. The parties’ claims did not arise under the patent laws pursuant to 28 U.S.C. 1338(a). No claims allege a cause of action created by federal patent law. This is a state law contract case for past due royalties. Inspired Development need not demonstrate that KidsEmbrace actually practiced the licensed patents, and the question of infringement is not a “necessary element” of the claim. Finding a federal question here merely because this contract implicates a run-of-the-mill question of infringement or validity would undoubtedly impact the wider balance between state and federal courts. View "Inspired Development Group v. Inspired Products Group, LLC" on Justia Law

The patent term length is 20 years from the effective filing date of the application, 35 U.S.C. 154. Applicants are compensated for three classes of prosecution delay: a “B Delay” generally entitles the applicant to patent term adjustment (PTA) for each day the application is pending beyond three years. Limitations reduce PTA for "time during which the applicant failed to engage in reasonable efforts to conclude prosecution.” Mayo’s 310 application had a November 1999, effective filing date. The PTO issued a final rejection for anticipation (757 patent) in October 2010. In September 2011, Mayo requested continued examination (RCE) arguing that Mayo had priority of invention over the 757 patent. Mayo cancelled certain claims and pursued them in a separate continuation application, which later issued as the 927 patent. In February 2012, an interference was declared. In February 2014, the Board awarded priority to Mayo’s 310 application and canceled the 757 patent. In June 2014, an examiner rejected the 310 application, citing double patenting in view of the 927 patent. Mayo argued that the claims were patentably distinct. The examiner mailed a Notice of Allowance in November 2014. The 310 application issued as the 063 patent in March 2015. The PTO calculated 621 days of PTA, with no B Delay. Mayo claimed 685 days, arguing the examiner’s reopening of prosecution after termination of the interference was not RCE under 35 U.S.C. 154(b)(1)(B)(i). The PTO concluded that RCE time (which is deducted from B Delay) did not end when the interference was declared, but instead when the Notice of Allowance was mailed. The Federal Circuit affirmed, upholding the PTO’s interpretation of “any time consumed by continued examination of the application requested by the applicant under section 132(b),” 35 U.S.C. 154(b)(1)(B)(i). View "Mayo Foundation for Medical Education and Research v. Iancu" on Justia Law