Court of Federal Claims Confirms Payment of Maintenance Fees Still Required

August 05, 2014
Post by Blog Staff

A recent decision by the U.S. Court of Federal Claims ("CFC") has upheld the statutorily-mandated maintenance fees required by the USPTO in order to keep issued patents in force. The owner of an issued patent must pay maintenance fees to the USPTO three times during the lives of their issued patents to keep them in force: at three years and 6 months after grant, at seven years and 6 months after grant, and at eleven years and 6 months after grant. If a patent holder fails to pay maintenance fees within six months of the statutory deadlines, their pertinent patent expires.

The plaintiff, Teresa Lucree, failed to pay the third and final maintenance fee due on U.S. Patent No. 5,781,732. As a result, the patent expired after only 12 years—8 years before the anticipated expiration date. After the patent had expired due to non-payment, Lucree filed suit challenging the constitutionality of maintenance fees and Congress's ability to attach conditions to patents that have been issued, asserting that such conditions violate the property interests of patent holders in their patents by enabling the government to take their patents before their expiration date and place them in the public domain. Lucree sought relief for the early expiration of her patent under the Fifth Amendment’s takings clause, which prohibits “private property [from] be[ing] taken for public use, without just compensation.” The government in turn sought dismissal of the suit, arguing that post-issuance conditions, such as maintenance fees, are a constitutional exercise of Congress’s well-settled authority to legislate patent fee requirements.

In granting the motion to dismiss, the CFC noted the broad terms of Article 1, Section 8, Clause 8 of the U.S. Constitution (the "Intellectual Property Clause") granting Congress the authority to pass laws related to the promotion of progress in "science and the useful arts." The CFC concluded that requiring the payment of maintenance fees is at least rationally related to the directives of the Intellectual Property Clause, and therefore constitutional.

The CFC also concluded that the expiration of a patent for failure to pay maintenance fees does not constitute a taking under the Fifth Amendment. The property interest in a patent is subject to the terms and conditions as set by Congress, and early expiration for failing to pay maintenance fees is merely a consequence of failure to meet those conditions.

The full opinion is available here.

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