Fed. Circ. Clarifies Infringement Liability For Contractors

Performance of a government contract often requires use of patented processes and products, which may not be owned by or licensed to the United States or the performing contractor. Section 1498 of Title 28 of the U.S. Code establishes an exclusive remedy for patent owners to obtain just compensation when the United States or its contractors infringe their patents, while also shielding contractors from infringement liability and ensuring private patent rights do not obstruct government operations. Under that statutory framework, when a contractor performing work "for the Government and with authorization or consent of the Government" is accused of patent infringement, § 1498 generally shields the contractor from liability and provides that any infringement action must be brought as a claim for money damages against the United States in the Court of Federal Claims.