Postal Service Ordered to Pay PayMaster For Use Of Patented Money Order Forms

Case: Paymaster Technologies, Inc. v. United States, Case No. 05-5025, -5029 (Fed. Cir. 5/4/06)

The One Sentence Summary: The United States Postal Service (USPS) infringed Paymaster's patent for money order form sets.


What They Were Fighting About: The government claimed that its money order form sets did not infringe Paymaster's patent because the invention should be limited to include only form sets that contain multiple sheets and ink that permeates through the back surface of the top sheet.

Federal Circuit Holdings:

One claim disclosed a "form set . . . comprising . . . at least one negotiable instrument sheet." Other claims disclosed form sets that specifically contained additional sheets. Applying conventional claim construction of "comprising," the former claim described a set of forms that may include only one negotiable instrument sheet, so long as it included another form. While the preferred embodiment of the invention described a form set with multiple sheets, the invention was not limited to the preferred embodiment.

The claim limitation to ink that "permeates through the sheet from said printed front surface to said back surface" did not require ink permeation through the back surface. Constructing the limitation as requiring only penetration of the ink to the back surface, not through the sheet, was supported by language that referred to the ink going "through the sheet" not "through the back of the sheet." That construction was also supported by the disclosure in the written description that the ink permeates from the upper sheet to (not through) the lower surface of the top sheet and the dictionary definition of "to" as meaning "as far as" as opposed to "through."

The royalty base should not include money orders that did not infringe due to imperfect production of the accused forms.

Affirms royalty rate of 3.5%. The USPS' purchase of 1.5 billion money order forms indicated commercial success even though the evidence regarding profitability was mixed.