August 19th, 2010
The United States Constitution states that “the Congress shall have power to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” U.S. Const. Art. I, Sec. 8, Cl. 8. These principles were codified in U.S. patent law which made it illegal to infringe the claims of a patent. 35 U.S.C. 271(a). A person can also be found guilty of contributory infringement under U.S. patent law through the sale of a component especially adapted for infringing use. 35 U.S.C. 271(c). In addition, certain actions can be deemed to “induce” patent infringement 35 U.S.C. 271(b), which recites “whoever actively induces infringement of a patent shall be liable as an infringer.” While this clause appears on its face to be straight forward, there has been considerable litigation and academic work relating to what is meant by “inducement of infringement.” Thus, not only the infringer, but also one who induces the infringement can be held liable under U.S. patent law. However, infringement under 35 U.S.C. 271(a) must be proven for one to be held liable for either contributory infringement or inducement of infringement. In other words, patent infringement must be proven first before contributory infringement or inducement can be admitted.
In addition, “inducement requires evidence of culpable conduct, directed to encouraging another's infringement, not merely that the inducer had knowledge of the direct infringer's activities.” DSU Med. Corp. v. JMS Co., 471 F.3d 1293, 1306 (Fed. Cir. 2006). Thus under DSU, knowledge of the patent was required for a showing of inducement. For example corporate officers who aid and abet in their corporation’s infringement may be held liable for inducement of infringement under 35 U.S.C. 271(b). Wordtech Sys. v. Integrated Networks Solutions, Inc., 2010 U.S. App. LEXIS 12260, 17 (Fed. Cir. June 16, 2010).
In 2010, the Federal Circuit broadened the standard for inducement of infringement by extending liability to cases where the alleged infringer had no knowledge of the patent in suit and instead found liability for inducement of infringement where the defendant deliberately disregarded the risk that a patent may exist. SEB S.A. v. Montgomery Ward & Co., 594 F.3d 1360, 1377 (Fed. Cir. 2010), (hereinafter SEB). In particular the SEB Court found that the defendant hired an attorney to conduct a right-to-use analysis, but failed to tell his attorney that his product was based on a competitor’s similar product. Id.
Thus, corporations can not automatically disregard the potential for inducement of infringement when they are merely unaware of the actual patent. SEB therefore emphasizes the importance of conducting patent clearance or right-to-use searches and have opinions rendered on the results.
