Kara Sears
The patent system is designed to encourage innovation by providing inventors with a monopoly over their inventions for a limited period. However, in the United States, the government can use or authorize the use of any patented invention without the consent of the patent owner, according to 28 USC 1498. This means that the government can effectively ignore patent law if it chooses to do so. While patent owners can sue the government for reasonable and entire compensation under 28 USC 1498, they cannot prevent the government from using their patented invention in the first place. This ability of the government to use patented inventions without consent has been a concern for some, who believe it could restrict the ability of member governments to authorize contractors to use patented inventions.
| Characteristics | Values |
|---|---|
| Can the government ignore patent law? | Yes |
| Can the patent owner deny the government the right to use their patent? | No |
| Can the patent owner sue the government for using their patent? | Yes |
| Can the patent owner ask for compensation from the government? | Yes |
| Can the government use a patent without the owner's consent? | Yes |
| Can the government authorize contractors to infringe a patent? | Yes |
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What You'll Learn
The US government can use your patent without your permission
In the United States, the government can use your patent without your permission. This is a form of government immunity from patent claims, and it is codified in US law at 28 USC § 1498(a). This statute gives the federal government the right to use patented inventions without the patent holder's consent, while still paying the patent holder "reasonable and entire compensation", which is usually set at ten percent of sales or less. This law applies to federal agencies and third-party government contractors, and the government is not obligated to negotiate with the patent holder beforehand.
While the US government can use your patent without your permission, there are some options for recourse. Patent holders can sue the government for "recovery of reasonable and entire compensation for such use and manufacture". However, recourse for infringement is limited, and the jurisdiction may be restricted to the Court of Federal Claims.
In addition, the US government can prevent you from using your patent and can force you to give it to others. This has happened in the past, such as during World War I when the military took all patents relevant to wireless technology and put them in a mandatory licensing pool. Patent holders received royalties, and this led to innovations such as the mass production of vacuum tubes and a national FM radio network.
The best way to prevent the government from using your patent may be to avoid inventing things that would be of interest to them. Alternatively, you could keep your invention a trade secret, only revealing it to trusted individuals under non-disclosure agreements. If the secret leaks to the government, you can sue the leakers, but not the government.
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You can sue the government for using your patent
While it is not possible to stop the US government from using your patent, you can sue the government for using your patent and recover reasonable and entire compensation for such use and manufacture. The Eleventh Amendment of the U.S. Constitution provides immunity to the State Government of the U.S. against any patent infringement lawsuit. However, it is still possible to sue state entities in Federal Court for an injunction.
The statute explains that an owner whose patent has been infringed by the United States Government can sue the Government for recovery of his entire compensation or at least reasonable compensation. The compensation will cover the owner's damages and lost profits. The compensation may even include reasonable fees for expert witnesses and attorneys if the owner is an independent inventor or a non-profit organization or an entity with an employee base of up to 500 at any time during the 5-year period preceding the use or manufacture by or for the U.S. Government.
In 2016, SecurityPoint Holdings sued the Transportation Security Administration, alleging that the TSA infringed on its patent for a cart used to transport security screening trays. The TSA didn’t dispute that it had duplicated SecurityPoint’s design. Instead, it took the position that the cart system could be implemented by any skilled artisan, thus rendering the patent obvious and void. However, the judge ultimately found that while the invention was simple and was composed of a combination of simple items, that it was only a simple design in hindsight, and thus wasn’t obvious. The argument for the non-obviousness of the patent was bolstered by the fact that using the cart system resulted in an 80% increase in efficiency, which quickly led the TSA to implement the system nationwide.
It is important to note that patent infringement lawsuits can cost millions of dollars, and some patent owners rely on third-party litigation funding. This funding involves an arrangement in which someone who is not named in a lawsuit provides funding to a plaintiff (typically the patent owner) or law firm in exchange for a portion of the proceeds from the lawsuit if it is successful.
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The government can infringe on a patent for national security
In the United States, the government can infringe upon a patent in the interest of national security. The Invention Secrecy Act of 1951 allows the government to classify ideas and patents under "Secrecy Orders", which restrict public knowledge of them. If a patent is deemed to have national security implications, the government can prevent its development and restrict the inventor from discussing the technology with anyone.
The decision to classify inventions under the Invention Secrecy Act is made by "defense agencies", which include the Army, Navy, Air Force, National Security Agency, Department of Energy, Department of Homeland Security, NASA, and the Justice Department. These agencies can request that certain inventions be kept secret, and patent holders can appeal these decisions. However, the power to rescind secrecy orders remains with the agencies that made the initial request.
While patent holders can sue the government for compensation under 28 USC 1498, it is difficult for inventors to prove harm under the Invention Secrecy Act due to their inability to disclose the invention. Disclosure of inventions or ideas restricted by a Secrecy Order can lead to arrest and imprisonment.
The government's ability to infringe upon patents in the interest of national security is not unique to the United States. Other countries may rely on special national interest or security exceptions to prevent patents from being used against their interests.
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The government can use patents developed with government funds
In the United States, the government can use patents developed with government funds. The government has the right to use patents for inventions developed under federally sponsored research and development (R&D) at universities, nonprofit organizations, and small business organizations. The rights to these patents are determined by the terms of the funding agreement, and the organization must follow the prescribed procedure set forth in the funding agreement to obtain the title.
The Bayh-Dole Act controls the allocation of intellectual property rights in inventions developed using federal funding. The act was passed to make it easier for universities, nonprofit organizations, and small business organizations to obtain titles to patents developed with federal funding. As a result, all funding agreements with such organizations must give them the right to obtain the title to any invention conceived or first reduced to practice under the funding agreement.
The federal government funds almost 50% of the national R&D effort through government-owned research facilities, research grants to universities, and procurement contracts with private industry. This significant funding results in the federal government holding the most United States patent rights. It is estimated that the government has title to over 30,000 patents and files several thousand new applications annually.
While the government has the right to use patents developed with government funds, there are some limitations. For example, the government cannot infringe on a patent without providing reasonable and entire compensation to the owner, as per 28 USC 1498. Additionally, the government may be limited by working requirements or special national interest or security exceptions in other countries.
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The government can infringe on a patent for public health
In the United States, it is not possible to stop the federal government from using your patent. US patent holders are denied this remedy, and while other governments rely on working requirements or special national interest or security exceptions, every country has some means to prevent the blocking of patents.
The main reason to design a patent system is to promote innovations in almost all fields of technology and ensure welfare to the population worldwide from those innovations. Various international conventions, like the UDHR in Article 27(2) and ICESCR in Article 15 (1)(c), link IPRs and human rights and provide the basis for human rights. The intended beneficiary of the underlying Patents Act is society, which is expected to benefit from dynamic innovation-based competition between market players. Patent monopolies are granted to innovators with the hope that they will disclose something inventive and of industrial value to the public.
In the case of Novartis AG v. Union of India & Others (2013), the Supreme Court rejected Novartis's application for exclusive rights for their drug Gleevec. This decision was marked as a premium on decisions of public health and pharma patent laws. The court ruled that there should be enhanced efficiency in new inventions to patent an already existing drug. This decision adversely affected the availability of affordable medicines in lower-middle-income countries such as India.
The Doha Declaration outlines the rights of the government for the compulsory licensing of patents. The TRIPS Agreement also authorizes the member countries of the WTO to provide compulsory licensing, including government use licensing in respect of patents, which authorizes any person other than the patent holder to use the patent. This provision can only be used in cases of extreme emergency or urgency.
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Frequently asked questions
No, the government cannot ignore patent law. However, the government can infringe on patents and authorize its contractors to do the same.
No, you cannot deny the government the right to use your patent. However, you can sue them for "recovery of [your] reasonable and entire compensation for such use and manufacture".
Section 1498 is a statute that allows the government to infringe on patents and authorize its contractors to do the same. It also provides the patent owner with a remedy in the form of a compensation action against the government.
