The Government Shutdown’s Impacts on IP

With no agreement between Congressional Republicans and Democrats on a funding bill for fiscal year 2026, the U.S. federal government shut down at 12:01 a.m. Eastern on October 1, 2025. Departments and agencies across the federal government have halted non-essential operations, while hundreds of thousands of federal workers face furlough. This alert explains how intellectual property (IP)-focused agencies, including the Department of Commerce (DOC), the U.S. Patent and Trademark Office (USPTO), and the International Trade Commission (ITC), together with federal courts, are adapting to the shutdown.

Impacts on the USPTO

As a fee-funded agency, the USPTO enjoys more insulation from the effects of shutdowns than most federal agencies. The USPTO has its own funding reserves that allow it to operate after a lapse in appropriations. As of October 1, the USPTO website states: “At present, the USPTO will remain open and fully operational until further notice under operating reserves from the prior year’s fee collections.”

The DOC’s shutdown plan notes, however, that if the USPTO cannot mitigate a lapse in appropriations through its existing funding reserves, most USPTO employees will be furloughed. Given that the Office’s patent and trademark business units operate separately, any available balances may not expire at the same time. It is possible that one unit will continue to operate as normal while the other shuts down. The Office’s shutdown plan covers the expiration of funds for both business units and reflects the bare minimum activities necessary to protect against the actual loss of IP rights.

During the record-breaking 35-day shutdown from December 22, 2018, to January 25, 2019, the Office functioned as normal, although its fee reserves for patent operations were set to run out by early February 2019 and those for trademark operations by April 2019.

In the event of a lapse in appropriations that the USPTO cannot mitigate through its reserve funds, the Office will operate as follows:

Office of the Under Secretary

The Under Secretary of Commerce for Intellectual Property, who also serves as Director of the USPTO, is not subject to furlough, and will provide overall management and direction of functions authorized to continue during the lapse.

Office of Public Engagement

The Office of Public Engagement will not conduct activities.

Office of Patents

The Office of Patents will retain minimal staffing to manage excepted functions, including staff who:

• Review foreign activity
• Process and review newly filed patent applications
• Maintain critical licensing and review functions, including receiving requests for foreign filing licensing, deciding those requests, and issuing such licenses
• Advise on questions concerning Hatch-Waxman matters

Office of Trademarks

The Office of Trademarks will retain minimal staffing, including staff who:

• Oversee foreign activity
• Provide technical and IT support for systems necessary to meet legal obligations to the public and international treaties

Office of Policy and International Affairs

The Office of Policy and International Affairs will retain minimal staffing, including staff who:

• Monitor international activities related to IP protection and enforcement
• Accept correspondence from international IP agencies and support USPTO leadership on international issues

Office of the Chief Administrative Officer

The Office of the Chief Administrative Officer will retain minimal staffing, including staff who:

• Provide agency oversight and coordination for shutdown operations, human capital, and emergency operations
• Advise agency leadership on human resource-related matters, including union concerns, time and attendance matters, and orderly shutdown procedures

Office of the Chief Communications Officer

The Office of the Chief Communications Officer will retain minimal staffing to provide agency communications to stakeholders.

Office of the Chief Financial Officer

The Office of the Chief Financial Officer will retain minimal staffing. Functions of the office that will continue include:

• Processing incoming maintenance fees
• Paying invoices on prior obligations incurred by the USPTO
• Processing budgetary transactions in the USPTO’s financial systems
• Providing contracting officer duties and responsibilities
• Issuing delivery/task orders
• Modifying financial actions
• Analyzing budgetary accounts, amounts, and spending during the furlough
• Providing financial reporting

Office of the Chief Information Officer

The Office of the Chief Information Officer (CIO) will retain minimal staffing, including staff responsible for:

• Maintaining the integrity and security of the USPTO’s information technology network
• Operating the CIO Command Center
• Providing essential incident response management
• Providing emergency responses for IT systems used by the public

Office of the General Counsel

The Office of the General Council (OGC) will provide the minimal level of legal support necessary for excepted activities, including:

• Legal advice incidental to emergency functions
• Legal advice as needed to protect IP and comply with federal mandates

In the event that the lapse continues for an extended period, the OGC may recall personnel as necessary to provide litigation support for cases that cannot be suspended and excepted Department and operating unit functions.

Office of Equal Employment Opportunity

The Office of Equal Employment Opportunity will not conduct activities.

Patent Trial and Appeal Board

The Patent Trial and Appeal Board will retain a minimum level of staff, including those responsible for the following functions:

• Contested cases that require orders signed by judges and entered to preserve party rights
• Evidentiary rulings for depositions and other discovery proceedings
• Contested proceedings scheduled on a pre-set independent of the USPTO’s closing
• Emergency motions
• Stay orders

Trademark Trial and Appeal Board

The Trademark Trial and Appeal Board will retain a minimum level of staffing, including those responsible for the following functions:

• Contested cases that require orders signed by judges and entered to preserve party rights
• Evidentiary rulings for depositions and other discovery proceedings
• Contested proceedings scheduled on a pre-set independent of the USPTO’s closing
• Emergency motions
• Stay orders

Office of Government Affairs and Oversight

The Office of Government Affairs and Oversight will retain minimal staff, including those tasked with monitoring Congressional activities related to the USPTO and responding to requests from Congress related to IP rights and the USPTO’s status during the furlough.

Takeaways

If you have outstanding business at the USPTO, such as unfiled applications or looming deadlines, there is no need to fret just yet. The USPTO likely will remain operational for at least some time after the shutdown. In the event of a closure of the office for a full day, the event would be treated like a federal holiday, extending filing deadlines to the next business day. See 37 C.F.R. §§ 1.7, 1.9(h).

Impacts on federal courts and the ITC

Federal courts

Like certain activities before the USPTO, the duration of the shutdown drives the impact on federal district courts. Although district courts are considered an essential branch of government and generally remain operational, the courts likely will prioritize criminal proceedings and emergency civil matters to uphold constitutional mandates. Federal district courts often have a reserve of funds from prior-year appropriations or court fees that can sustain basic functions for a limited time.

Patent infringement litigation, however, may be considered non-essential civil litigation, subjecting it to delays or even temporary stays. The impact is most acute in cases involving federal agencies whose attorneys are furloughed as non-essential personnel. As the shutdown drags on, as seen during the 2018-2019 shutdown, when some districts froze dockets involving the government and exhausted stopgap measures, the ripple effects can extend far beyond resolution, clogging calendars and straining access to justice.

On October 1, 2025, the United States Court of Appeals for the Federal Circuit published a notice consistent with the anticipated impacts on district courts. Namely, the Federal Circuit will work as normal, using its fee authority and no-year appropriations. When operations exhaust those funds, the court will reduce its operations to those required by the Anti-Deficiency Act. At present, however, the Federal Circuit has instructed that, absent further order of the court, all scheduled arguments will proceed as scheduled regardless of any lapse in appropriations, and all filing deadlines remain in effect.

International Trade Commission

The shutdown has immediate impacts on Section 337 investigations pending before the ITC because it largely halts the ITC’s operations, including those of the Administrative Law Judges (ALJs) and the Office of Unfair Import Investigations. Notably, only President-appointed and Senate-confirmed Commissioners are allowed to work without pay until funds have been appropriated. Anticipating the latest shutdown, the ITC updated its “Contingency Plan for an Orderly Shutdown of Operations” in late September. That plan shows that the ITC needs about a half day to complete shut down activities. In no uncertain terms, the plan specifies that “[i]nvestigative activities … under… Section 337 of the Tariff Act” will “cease during a lapse” in appropriations. Be aware, however, that “[d]uring any period in which the Commission is closed, deadlines for filing documents” are extended only to the “first business day after the end of the closure.”

Takeaways

Litigations may veer off schedule depending on the available funds and the length of the shutdown. Expect specific courts to provide guidance in specific cases. Parties involved in Section 337 investigations will be expected to continue prosecuting them, where feasible, but expect ALJs to adjust key investigation milestones, such as evidentiary hearings and target dates, depending on the stage of the investigation.