Case: 19-1738    Document: 66     Page: 1   Filed: 08/24/2020




   United States Court of Appeals
       for the Federal Circuit
                  ______________________

 CHRISTY, INC., ON BEHALF OF ITSELF AND ALL
       OTHERS SIMILARLY SITUATED,
                Plaintiff-Appellant

                             v.

                    UNITED STATES,
                    Defendant-Appellee
                  ______________________

                        2019-1738
                  ______________________

    Appeal from the United States Court of Federal Claims
 in No. 1:18-cv-00657-MMS, Chief Judge Margaret M.
 Sweeney.
                 ______________________

                 Decided: August 24, 2020
                  ______________________

     JAMES F. MCDONOUGH, III, Heninger Garrison Davis,
 LLC, Atlanta, GA, for plaintiff-appellant. Also represented
 by JONATHAN ROBERT MILLER; TIMOTHY C. DAVIS, Birming-
 ham, AL.

     SCOTT R. MCINTOSH, Appellate Staff, Civil Division,
 United States Department of Justice, Washington, DC, for
 defendant-appellee. Also represented by ETHAN P. DAVIS,
 GARY LEE HAUSKEN; SARAH E. CRAVEN, MICHAEL S.
 FORMAN, THOMAS W. KRAUSE, Office of the Solicitor, United
 States Patent and Trademark Office, Alexandria, VA.
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 2                             CHRISTY, INC.   v. UNITED STATES



                  ______________________

     Before LOURIE, REYNA, and HUGHES, Circuit Judges.
 HUGHES, Circuit Judge.
     Christy, Inc. asserts that the United States owes it just
 compensation for the Patent Trial and Appeal Board’s can-
 cellation of claims 1–18 of Christy’s patent, U.S. Patent
 No. 7,082,640, in two inter partes reviews. Because the
 cancellation of a patent in an inter partes review does not
 grant the patentee any compensable claim against the
 United States, we affirm the Court of Federal Claims’s dis-
 missal of the case for failure to state a claim.
                               I
     Christy applied for a patent on its “ambient air back-
 flushed filter vacuum” invention in 2003. The ’640 patent,
 which claims that invention, issued in 2006. As required
 by law, Christy paid the $1,000 issuance fee. Over the en-
 suing years, Christy paid the necessary $490 3.5-year,
 $1,800 7.5-year, and $3,700 11.5-year maintenance fees for
 the patent—in October 2009, January 2014, and Janu-
 ary 2018, respectively.
     In 2014, Christy and its licensee, CDC Larue Indus-
 tries, Inc., sued two competitors for patent infringement.
 See CDC Larue Indus., Inc v. Black & Decker (U.S.) Inc.,
 No. 14-CV-0286-CVE-FHM (N.D. Okla.). One of those
 competitors then filed two petitions for inter partes review
 of the ’640 patent. The Board’s final written decisions
 across those inter partes reviews found claims 1–18 un-
 patentable; dependent claims 19–20 were not challenged in
 the proceedings and remained valid. See Black & Decker
 (U.S.) Inc. v. Christy, Inc., No. IPR2015-00468, 2016 WL
 3382465 (P.T.A.B. June 17, 2016); Black & Decker (U.S.)
 Inc. v. Christy, Inc., No. IPR2015-00472, 2016 WL 3382466
 (P.T.A.B. June 17, 2016). We summarily affirmed the
 Board’s invalidity decision in IPR2015-00468 and
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 CHRISTY, INC.   v. UNITED STATES                           3



 dismissed Christy’s appeal of the Board’s decision in
 IPR2015-00472 as moot. See Christy, Inc. v. Black &
 Decker (U.S.), Inc., No. 2016-2499, 696 F. App’x 1020 (Fed.
 Cir. Sept. 7, 2017) (mem.) (per curiam); Christy, Inc. v.
 Black & Decker (U.S.), Inc., No. 2016-2498, 696 F. App’x
 1020 (Fed. Cir. Sept. 7, 2017) (mem.) (per curiam).
     Aggrieved by the cancellation of its first 18 claims of
 the ’640 patent, Christy filed a class-action suit in the
 Court of Federal Claims. The suit raised six claims for
 compensation from the government: a Fifth Amendment
 takings claim, four claims based on contractual theories,
 and an illegal exaction claim raised in the alternative to
 the takings claim. Christy sought compensation amount-
 ing to the ’640 patent’s “issuance and maintenance fees,
 [Christy’s] investments made in the patented technologies,
 the attorney fees [Christy] spent in defending the [inter
 partes review proceedings] that invalidated the claims, and
 the value of the patent claims themselves . . . includ[ing]
 expected royalties and other payments related to use of the
 patents[], in an amount to be determined at trial.” J.A. 72–
 73 ¶ 107 (emphasis removed).
     The government swiftly moved to dismiss all claims for
 both lack of subject matter jurisdiction and failure to state
 a claim. The court granted the government’s motion, with
 various grounds for dismissing each count. 1 See generally
 Christy, Inc. v. United States, 141 Fed. Cl. 641 (2019) (De-
 cision). Over the government’s challenge, the court found
 that it had jurisdiction to consider the takings claim. De-
 cision at 657. Yet the court found that Christy did not state
 a claim for relief on the merits. Id. at 660. The court rea-
 soned that the cancellation of patent claims in an inter



     1   The court found the contract-based claims non-
 meritorious; Christy does not argue that the court erred in
 that decision, so we address it no further.
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 4                              CHRISTY, INC.   v. UNITED STATES



 partes review did not amount to a compensable taking of
 Christy’s property interest. Id.
      In contrast, the court held that it did not have jurisdic-
 tion to consider the illegal exaction claim. Decision at 668.
 It held that a statute granting authority to the U.S. Patent
 and Trademark Office to refund mistakenly excessive pa-
 tent-related fees displaced Tucker Act jurisdiction over
 those fees. Id. at 667–68; see 35 U.S.C. § 42(d). The court
 addressed the merits of the illegal exaction claim in the al-
 ternative, however, finding that Christy’s issuance and
 maintenance fees paid for the ’640 patent “were owed at
 the time they were paid, and as such, were not fees paid by
 mistake.”      Decision at 668 (quoting In re Patent
 No. 7,061,177, 2006 WL 4559506, at *1 (Comm’r Pat.
 Oct. 17, 2006)). Because “the government did not require
 Christy to pay” any of the other alleged damages “to a third
 party on the government’s behalf, or even to be paid at all,”
 the court found Christy’s theory that these damages were
 illegally exacted “devoid of merit.” Decision at 669.
     Christy timely appealed; we have jurisdiction under
 28 U.S.C. §1295(a)(3).
     We review whether Tucker Act jurisdiction exists
 “without deference to the decision of the trial court.” In re
 United States, 463 F.3d 1328, 1334 (Fed. Cir. 2006). We
 similarly review de novo the trial court’s dismissal of tak-
 ings claims and illegal exaction claims for failure to state a
 claim. See, e.g., Piszel v. United States, 833 F.3d 1366, 1373
 (Fed. Cir. 2016).
                               II
     Christy argues that the Court of Federal Claims erred
 in three ways: by (1) finding that Christy failed to state a
 compensable takings claim based on the cancellation of
 claims 1–18 of the ’640 patent; (2) finding that the court
 lacked subject matter jurisdiction over Christy’s illegal ex-
 action claim; and (3) finding that Christy failed to state a
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 CHRISTY, INC.   v. UNITED STATES                           5



 plausible illegal exaction claim. The government concedes
 that the Court of Federal Claims erred in finding that it
 lacked subject matter jurisdiction over Christy’s illegal ex-
 action claim but argues for the first time on appeal that the
 court lacked jurisdiction over Christy’s takings claim.
     Shortly after this case’s oral argument, we issued
 Golden v. United States, 955 F.3d 981 (Fed. Cir. 2020),
 which straightforwardly resolves two of the three issues
 raised here.
     First, Golden disposes of the government’s argument
 that the Court of Federal Claims lacked jurisdiction over
 Christy’s takings claim. Golden rejected the government’s
 indistinguishable argument that the Court of Federal
 Claims lacks jurisdiction over a takings claim arising from
 the cancellation of patent claims in an inter partes review.
 See 955 F.3d at 989 (“[W]e reject the government’s argu-
 ment that the [America Invents Act, which enacted the in-
 ter partes review process] displaced Tucker Act jurisdiction
 over Golden’s IPR-based takings claims.”). As the govern-
 ment concedes in its Fed. R. App. P. 28(j) letter discussing
 Golden, that decision forecloses the government’s jurisdic-
 tional argument here. Appellee’s Citation of Suppl. Auth.,
 Christy, Inc. v. United States, No. 2019-1738 (Fed. Cir.
 Apr. 17, 2020), ECF No. 62. As a result, the Court of Fed-
 eral Claims correctly held that it had subject matter juris-
 diction over Christy’s takings claim.
     Second, Golden also confirms that Christy failed to
 state a plausible claim for a taking based on the cancella-
 tion of the ’640 patent. Golden held that “cancellation of
 patent claims in [an] inter partes review cannot be a taking
 under the Fifth Amendment.” Golden, 955 F.3d at 989 n.7.
 The Court of Federal Claims therefore correctly held that
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 6                              CHRISTY, INC.   v. UNITED STATES



 the cancellation of Christy’s patent claims in an inter
 partes review was not a Fifth Amendment taking. 2
     Since the government has conceded that the Court of
 Federal Claims properly exercised jurisdiction over
 Christy’s illegal exaction claim, we last address whether
 the court erred in finding that Christy failed to state a
 plausible claim of an illegal exaction. An illegal exaction
 occurs when money is “improperly paid, exacted, or taken
 from the claimant in contravention of the Constitution, a
 statute, or a regulation.” Norman v. United States,
 429 F.3d 1081, 1095 (Fed. Cir. 2005) (quoting Eastport S.S.
 Corp. v. United States, 372 F.2d 1002, 1007 (Ct. Cl. 1967)
 (en banc)). Given that the Board did not violate Christy’s
 Fifth Amendment rights by canceling its patent claims,
 Christy asserts no constitutional provision, statute, or reg-
 ulation that the PTO violated by failing to refund Christy’s
 issuance and maintenance fee payments for the ’640 pa-
 tent. Instead, Christy is left to contend that the PTO’s re-
 quiring Christy to pay issuance and maintenance fees for
 the ’640 patent was in error, and therefore the fees should
 be refunded. See Appellant’s Reply Br. 12–15. According



     2   Because Golden indisputably and indistinguisha-
 bly binds our conclusion that the cancellation of patent
 claims in an inter partes review does not engender a tak-
 ing, we need not address Christy’s argument that Celgene
 Corp. v. Peter, 931 F.3d 1342 (Fed. Cir. 2019), cert. denied,
 No. 19-1074, 2020 WL 3405867 (U.S. June 22, 2020), does
 not control this case. Christy perplexingly relies on Golden
 to suggest that Celgene does not bind our decision “because
 the [t]akings issue was not properly before the Celgene
 Court in the first place.” Appellant’s Resp. to Appellee’s
 Citation of Suppl. Auth. at 1, Christy, Inc. v. United States,
 No. 2019-1738 (Fed. Cir. Apr. 21, 2020), ECF No. 63. But
 Golden itself held that Celgene controlled its outcome.
 Golden, 955 F.3d at 989.
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 CHRISTY, INC.   v. UNITED STATES                              7



 to Christy, the cancellation of patent claims in an inter
 partes review amounts to an admission that the PTO erred
 in allowing the issuance of the claims. See id. at 13–14 (cit-
 ing Celgene, 931 F.3d at 1361). Christy maintains that this
 supposed error was the “the sole and direct cause of Christy
 paying [these] fees,” id. at 14, and that allowing the gov-
 ernment to “charge fees for . . . making errors” is “unjust.”
 Id. at 15.
      Christy’s argument fails because the law requires pay-
 ment of these issuance and maintenance fees without re-
 gard to any later result of post-issuance proceedings, see,
 e.g., 35 U.S.C. §§ 41, 151. Christy identifies no statute, reg-
 ulation, or constitutional provision compelling the fees’ re-
 fund if claims are later canceled in post-issuance
 proceedings. Without showing how the PTO’s actions “con-
 travene[ed] . . . the Constitution, a statute, or a regula-
 tion,” Christy cannot state a claim for an illegal exaction.
 Norman, 429 F.3d at 1095. That Christy finds the legal
 scheme dictating patent issuance and maintenance fees
 “unjust” raises a policy question properly addressed to Con-
 gress or the PTO, for Congress has the authority to set the
 terms of the patent right, see U.S. Const. art. I, § 8, cl. 8, 3
 and to delegate that authority to the PTO in appropriate
 circumstances, see, e.g., Aqua Prods., Inc. v. Matal,
 872 F.3d 1290, 1330 (Fed. Cir. 2017) (en banc) (“There are
 dozens of very specific grants of rulemaking authority by



     3   See Oil States Energy Servs., LLC v. Greene’s En-
 ergy Grp., LLC, 138 S. Ct. 1365, 1375 (2018) (citing
 Wheaton v. Peters, 33 U.S. 591, 663–64 (1834), which holds
 that “[n]o one can deny that when the legislature are about
 to vest an exclusive right in an author or an inventor, they
 have the power to prescribe the conditions on which such
 right shall be enjoyed; and that no one can avail himself of
 such right who does not substantially comply with the req-
 uisitions of the law”).
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 8                             CHRISTY, INC.   v. UNITED STATES



 Congress to the [PTO].”). Christy’s payment of standard
 issuance and maintenance fees—and the PTO’s refusal to
 refund the fees after 18 of Christy’s 20 claims in the
 ’640 patent were canceled—did not stem from any mistake
 or impropriety by the PTO, but followed the requirements
 of the law. The PTO did not collect fees in excess of its
 statutory authority, and therefore did not illegally exact
 those fees. We affirm the Court of Federal Claims’s dismis-
 sal of Christy’s illegal exaction claim.
                             III
     We have considered the parties’ remaining arguments
 and find them unpersuasive. Because Christy did not state
 a plausible claim that the cancellation of its patent claims
 caused a taking or an illegal exaction, we affirm the judg-
 ment of the Court of Federal Claims dismissing its case.
                        AFFIRMED
