Invention Submission Corporation loses appeal
Invention Submission Corporation recently lost an appeal of a district court’s dismissal of ISC’s lawsuit against the PTO regarding the PTO’s “invention promotion scams” media campaign.
“In January 2002, the Patent and Trademark Office (”PTO”) launched a media campaign to counter invention promotion scams. The print advertisements featured an inventor named Edward Lewis, along with text that identified him by name and read, “I spent $13,000 and three years ‘spinning my wheels’ with a company that promised my idea would make lots of money. They were right. It made lots of money . . . for them. I haven’t seen a penny.” The advertisement ended with a general statement about avoiding “invention promotion scams” and contact information for the PTO. A journalist for a cable television network, who saw the PTO’s advertisements, interviewed Lewis and published a story revealing that Lewis was referring in the advertisements to his relationship with Invention Submission, a business engaged in assisting inventors with obtaining patents. The article revealed that Lewis had filed a complaint with the PTO in August 2001 that was “being processed.” The article also revealed that Invention Submission was one of several companies investigated by the FTC in the 1990s “for misrepresentation in patent marketing schemes.” The article concluded with Invention Submission’s response that it did nothing wrong and that its representations and commercials misled neither Lewis nor anyone else.”
After the cable television network program reporting on Mr. Lewis’ case mentioned Invention Submission Corporation by name, ISC sued the Patent Office under the Administrative Procedure Act (”APA”) “alleging that the PTO’s advertising campaign was aimed at Invention Submission to penalize it and ultimately to put it out of business.”
“Invention Submission claimed that the campaign was an illegal final agency action that was arbitrary and capricious and exceeded any statutory authority conferred on the PTO.”
“The PTO filed a motion to dismiss Invention Submission’s complaint under Federal Rule of Civil Procedure 12(b)(1), and the district court granted the motion to dismiss.”
ISC appealed. On appeal, the 4th Circuit concluded that “the district court did not have subject matter jurisdiction over the case and remanded it “with instructions to dismiss this case under Federal Rule of Civil Procedure 12(b)(1).””
“After the case was remanded to the district court and the district court had dismissed the case under Rule 12(b)(1), Invention Submission filed a motion to vacate the dismissal order and for leave to amend its complaint to allege jurisdiction under the McAnnulty doctrine. The district court, relying on the scope of our mandate on remand, denied Invention Submission’s motion and reaffirmed its dismissal under Rule 12(b)(1). In addition, the court observed that to reopen the case at that point in time “would defeat notions of judicial economy and finality.””
Invention Submission appealed the district court’s order denying its motion to vacate and for leave to amend its complaint.
The appellate court, this time, found that “the district court was bound by the mandate of this court to dismiss this case for lack of subject matter jurisdiction” and affirmed the district court’s dismissal of the case.
A copy of the Order can be found here: http://pacer.ca4.uscourts.gov/opinion.pdf/042295.P.pdf
