Chapter Eight – Infringement

Chapter eight discusses the enforcement of patent rights through suits for patent infringement.  Without the ability to enforce patent rights against infringers there would be no incentive to seek patents, and thus no incentive to disclose discoveries to the public.  As a result, the Patent Act gives several causes of action against both direct and indirect infringers.

In order to determine whether a patent has been infringed, the precise scope of the patent’s claims must be determined in a process called claim construction.  As you will see, claim construction is often the focal point of an infringement case, and the district court’s claim construction is often appealed–and almost as often reversed by the Court of Appeals for the Federal Circuit.   As you read these cases, it may be helpful to go back to the patents at issue and retrace the claim construction rationale of the district and appellate courts.

 

Updates

  1. In Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 2060 (2011) the Supreme Court affirmed the Court of Appeals for the Federal Circuit, holding that the “knowledge” requirement of 271(b) may be satisfied by “willful blindness”, but not by “deliberate indifference” (as the Federal Circuit had held) and on the facts in the case the defendant’s conduct met the correct legal test.  The Supreme Court held that willful blindness exists when two requirements are met.  First, “the defendant must subjectively believe that there is a high probability that a fact exists.”  Global-Tech, 131 S. Ct at 2070.  Second, “the defendant must take deliberate actions to avoid learning of that fact.”  Id.

The Court explained that “T]hese requirements give willful blindness an appropriately limited scope that surpasses recklessness and negligence….  Under this formulation, a willfully blind defendant is one who takes deliberate actions to avoid confirming a high probability of wrongdoing and who can almost be said to have actually known the critical facts.”  Id. at 2070-71. “By contrast, a reckless defendant is one who merely knows of a substantial and unjustified risk of such wrongdoing, see ALI, Model Penal Code §2.02(2)(c) (1985), and a negligent defendant is one who should have known of a similar risk but, in fact, did not, see §2.02(2)(d).” Id. at 2071.

The facts of the case were that the plaintiff-patentee-respondent SEB invented and received a patent for a deep fryer.  Sunbeam, an appliance manufacturer, asked petitioner Pentalpha, a Hong Kong home appliance maker and wholly owned subsidiary of petitioner Global-Tech Appliances, Inc., to supply Sunbeam with deep fryers meeting certain specifications.  Pentalpha purchased an SEB fryer that was made for sale in a foreign market and thus lacked U. S. patent markings, copied all but the fryer’s cosmetic features, and retained an attorney to conduct a right-to-use study without telling him it had copied directly from SEB’s design.  Failing to locate SEB’s patent, the attorney issued an opinion letter stating that Pentalpha’s deep fryer did not infringe any of the patents that he had found.  Pentalpha then started selling its fryers to Sunbeam, which resold them in this country under its own trademarks at a price that undercut SEB’s.

After settling a patent infringement suit against Sunbeam, SEB sued Pentalpha, asserting that it had contravened 35 U.S.C. § 271(b) by actively inducing Sunbeam and the other purchasers of Pentalpha fryers to sell or offer to sell them in violation of SEB’s patent rights. The jury found for SEB on the induced infringement theory, and the District Court entered judgment for SEB. Affirming, the Federal Circuit stated that induced infringement under § 271(b) requires a showing that the alleged infringer knew or should have known that his actions would induce actual infringements; declared that this showing includes proof that the alleged infringer knew of the patent; held that, although there was no direct evidence that Pentalpha knew of SEB’s patent before it received notice of the Sunbeam suit, there was adequate proof that it deliberately disregarded a known risk that SEB had a protective patent; and said that such disregard is not different from, but a form of, actual knowledge.

  1. Note 7 following the Al-Site v. VSIcase notes that there are advantages and disadvantages to using functional language under § 112 ¶ 6.  The case of Ergo Licensing, LLC v. CareFusion 303, Inc.demonstrates a significant disadvantage, namely that the courts, including the Federal Circuit, commonly hold functional language to be indefinite even in close cases.  Ergo Licensing, LLC v. CareFusion 303, Inc., ___ F.3d ___ (Fed. Cir. Mar. 26, 2012); also see Christa J. Laser, A Definite Claim on Claim Indefiniteness: An Empirical Study Of Definiteness Cases Of The Past Decade With A Focus On The Federal Circuit And The Insolubly Ambiguous Standard, 10 Chi.-Kent J. Intell. Prop. 25, 37 (2010) (“Of final Federal Circuit decisions, claims with means-plus-function issues were slightly more often held indefinite than not indefinite”).  In reaction to this trend, the number of patents using “means for” language has steadily decreased over the past five decades.  Dennis Crouch, Means-Plus-Function Claims, Patently-O (Jan. 6, 2010), http://www.patentlyo.com/patent/2010/01/means-plus-function-claims.html.
  2. Active inducement of multiple parties.  Traditionally, active inducement under § 271(b) required knowing inducement to infringe together with actual infringement by another party under § 271(a).  This standard made proof of active inducement impossible if the actual infringement was carried out by multiple parties, which is most common in cases involving method patents.  In a narrowly divided decision the Federal Circuit replaced this standard with a looser one, which requires that the defendant (1) knew of the patent (2) induced the performance of the steps or limitations of the patent and (3) those steps were performed.  Akamai Techs., Inc. v. Limelight Networks, Inc., ___ F.3d ___, slip op. at 35 (Fed. Cir. Aug. 31, 2012) (en banc).  Thus, active inducement no longer requires an underlying act of direct infringement by a single entity.  Id.  One dissent, authored by Judge Linn and joined by three other judges, argued that the majority, contrary to Congressional intent and Supreme Court precedent, effectively rewrote § 271(b), ignoring the well-established understanding that Congress defined infringement in § 271(a).  Id. at 2-3 (Linn, J., dissenting).  Judge Newman dissented separately, arguing that neither the majority’s new standard nor the four judge dissent’s “single entity rule” is the correct result.  Id. at 2-3 (Newman, J., dissenting).  Instead, she thought the rule should be that infringement may occur “when all of the claimed steps are performed, whether by a single  entity or more than one entity, whether by direction or control, or jointly, or in collaboration or interaction.” Id. at 16.

 

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