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IP Alert
IP Alert: Federal Circuit Issues En Banc Opinion on “Multiple Actor” Infringement

September 4, 2012

On August 31, 2012, the Court of Appeals for the Federal Circuit issued an en banc decision in Akamai Technologies v. Limelight Networks, Inc. The Akamai case clarifies the law on “multiple actor” infringement of method claims, holding that to prove inducement of infringement of a claimed method, it is not necessary to show that a single actor performed all of the claimed steps. Instead, an accused infringer is now liable for inducement of infringement by inducing one or more actors to collectively perform the steps of a patented method. The case was decided by a narrow majority of the en banc Federal Circuit.

The Akamai decision was a consolidated appeal from two separate district court cases, Akamai Technologies v. Limelight Networks and McKesson Technologies v. Epic Systems. In the first case, defendant Limelight was accused of performing all but one of the steps of Akamai’s claimed method of delivering web content. The last step was performed by Limelight’s customers, who performed this step pursuant to Limelight’s instructions. In the McKesson case, the claimed method related to initiating communications between healthcare providers and patients. Defendant Epic Systems did not perform any steps of McKesson’s claimed method, but provided software that was alleged to allow patients and healthcare providers to collectively perform the steps of the claimed method. In both cases, the defendants were found not to infringe the asserted patents in the district courts because there was no single actor that performed all the steps of the claimed methods.

Under the law, inducement of infringement occurs when someone “actively induces infringement of a patent.” In an earlier panel decision, BMC Resources, Inc. v. Paymentech, L.P., the court had held that induced infringement under 35 U.S.C. 271(b) required proof of direct infringement of the claim by a single actor. On en banc review, the Akamai court overruled the holding of BMC Resources that required proof that a single actor performed all the steps of the claim. The court reasoned that the “single actor” requirement stated in BMC Resources was not supported by past precedent, Congressional intent, or sound patent policy. To the contrary, reasoned the court, a patentee is damaged equally by the inducement of infringement, whether the inducer causes a single party to perform the patented method, or performs part of the method unilaterally and induces another to perform the remaining steps of the method, or causes multiple parties to collectively perform the method. Accordingly, the court held that “all the steps of a claimed method must be performed in order to find induced infringement, but that it is not necessary to prove that all the steps were committed by a single entity.”

After Akamai, a plaintiff can establish inducement of infringement by showing that the accused infringer induced the performance of all of the steps of the claimed method or performed some of the steps itself and induced others to perform the remaining steps. The plaintiff must establish the requisite knowledge under the earlier Supreme Court decision in Global-Tech Appliances, Inc. v. SEB S.A. (See our corresponding alert here.)

Notably, the court did not address the law of direct infringement of a method claim. The court remarked that to infringe a method claim, “the accused infringer must perform all the steps of the claimed method, either personally or through another acting under his direction or control.” The court expressly declined to address the multiple actor issue as concerns direct infringement.

The Akamai decision is significant both to parties alleging and to parties defending against claims of patent infringement. The case also is important for parties conducting freedom-to-operate studies.

For questions about the Akamai case, please contact Fitch Even attorney Paul B. Henkelmann, the author of this alert.

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