Who hasn’t experienced the hassle of airport security checkpoints? In fact, fewer and fewer of us remember what travel was like before the Department of Homeland Security and TSA required mandatory checkpoints. Back in 2001/2002, an enterprising businessman, Joseph Ambrefe, innovated a security screening checkpoint system. He later filed a patent and was granted a patent for his idea.
Well that patent is now worth $100 Million plus. Plaintiff Ambrefe of SecurityPoint Holdings, Inc. won big against TSA. This is a huge turnaround of events as TSA rejected SecurityPoint’s initial offer to license their technology back in 2002. I’m sure TSA is rethinking that now.
Here’s what’s being written about the case:
On October 22, 2021, the Court of Federal Claims (Court) unsealed a decision awarding contractor SecurityPoint Holdings, Inc. (SecurityPoint) over $100 million in damages for TSA’s infringement of SecurityPoint’s patent No. 6,888,460 (“the ‘460 patent”). The ‘460 patent concerns a system of trays that recycle through security screening checkpoints by use of movable carts, and was first filed with the U.S. Patent and Trademark Office on July 3, 2002 by SecurityPoint CEO Joseph Ambrefe. Ambrefe had offered the TSA a license to use the patent in exchange for the exclusive right to advertise on the trays, but TSA refused the offer.
On May 2, 2011, SecurityPoint filed suit under 28 U.S.C. § 1498(a), which provides patent owners an exclusive remedy for “reasonable and entire compensation” against the United States by action in the Court of Federal Claims when a patented invention is used or manufactured by or for the United States. SecurityPoint alleged that TSA had subsequently used carts, trays, and scanning devices at security checkpoints in a manner that infringed its ‘460 patent in over 400 airports throughout the United States. In support of its claims, SecurityPoint identified TSA internal documentation from 2006, which stated that the agency had “no single TSA standard bin return system,” whereas by 2009, an updated version of the same internal guide spelled out a process for bin return, utilizing “bin carts.” TSA eventually admitted that it had used the patented technology since 2008 in 10 airports, leaving the Court to decide damages. In one of the largest patent infringement awards of its kind, the unsealed decision determined that TSA owed SecurityPoint $103.6 million in royalties from 2008 through the date of the opinion, delay damages, and interest.
This case serves as a reminder to contractor-patent owners that recourse for money damages may be available under 28 U.S.C. § 1498(a) when the U.S. Government infringes, or authorizes another contractor to infringe, the patent owner’s patent.
One company’s patented attempt to mitigate such delays has yielded a giant damages award.
The Court of Federal Claims has awarded a federal contractor over $100 million in damages for patent infringement by the Transportation Security Administration (TSA).
SecurityPoint Holdings, Inc. (“SecurityPoint”) was the plaintiff. It owns a method patent, U.S. Patent No. 6,888,460, for a system of recycling trays through security screening checkpoints by use of movable carts.
As the court noted, the purpose of the patent is to provide:
a cost effective way of providing security trays for a security checkpoint while at the same time generating revenue from the advertising that is contained thereon. Further, the present system provides an efficient system for moving the trays for use and removal after they are used. Security checkpoints are both a time consuming and frustrating part of traveling for frequent fliers and people on vacation alike. The present invention provides a system of speeding up the process of processing people through these checkpoints to decrease the likelihood of delays for travelers. The present invention also has the advantage of increasing passenger flow through checkpoints and increasing traveler satisfaction due to the lack of delays.
The patent application was initially rejected as obvious, but the rejection was overcome by the inclusion of additional language.
The patent discloses a method comprising:
- a. positioning a first tray cart containing trays at the proximate end of a scanning device through which objects may be passed, wherein said scanning device comprises a proximate end and a distal end,
- b. removing a tray from said first tray cart,
- c. passing said tray through said scanning device from said proximate end through to said distal end,
- d. providing a second tray cart at said distal end of said scanning device,
- e. receiving said tray passed through said scanning device in said second tray cart, and
- f. moving said second tray cart to said proximate end of said scanning device so that said trays in said second cart be passed through said scanning device at said proximate end.
Step “f” was the one that was added after the initial rejection.
The patent, which includes the idea of ads on trays, was picked as a “Stupid Patent of the Month” by the Electronic Frontier Foundation.
The patent was issued in 2005. The plaintiff sued in 2011, alleging that the United States,
acting by and through the TSA, operates and controls security screening at security checkpoints at more than four hundred airports throughout the United Sates and utilizes carts, trays, and scanning devices at these checkpoints in a manner that infringes one or more of the claims of the ‘460 patent at all or most of the airports under its control.
28 U.S.C. § 1498(a) provides patent owners an exclusive remedy for “reasonable and entire compensation” against the US government by suing in the Court of Federal Claims.
The US admitted that it had, in fact, infringed the patent at 10 airports since 2008.
The CEO of plaintiff SecurityPoint offered the TSA a license to use the patent in exchange for granting his company the exclusive right to advertise on the trays, but the TSA refused.
Since the US admitted liability, it was just up to the court to determine the amount of damages, which it calculated at $103.6 million.