February 23, 2017
To infringe a United States patent, the accused activity must take place in the United States. That infringing activity generally includes making, using, selling, or offering to sell an invention covered by a U.S. patent. The U.S. Patent Code offers limited remedies to patent owners where infringing activity occurs on foreign soil, if at least some of the infringing activity is supported by activity performed in the United States. One such remedy is provided by 35 U.S.C. § 271(f)(1), which reads as follows:
Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.
That is, § 271(f) gives a U.S. patent owner a remedy against a party that actively induces the combination of components in a manner that results in an infringing product, even where that combination occurs outside of the United States. However, the statute only applies where “all or a substantial portion of the components of a patented invention” are supplied from within the United States.
In the recent case of Life Technologies Corp. v. Promega Corp., the U.S. Supreme Court addressed this statutory provision. In particular, the Court considered whether the supply of a single component can qualify as “all or a substantial portion of the components of a patented invention” sufficient to invoke infringement under § 271(f)(1). The Court held that it cannot.
The facts of the case are relatively straightforward. The respondent and patentee, Promega Corporation, was the exclusive licensee of U.S. Reissue Patent No. RE 37,984. The ’984 patent claims a toolkit that takes small samples of genetic material and generates DNA profiles for forensic identification. It was undisputed that the claims required a kit with five discrete components, including a special enzyme known as Taq polymerase and four other components.
The petitioner and accused infringer, Life Technologies Corporation, manufactured genetic test kits pursuant to a sublicense of the ’984 patent from Promega. Life Technologies manufactured all but one of the five patented components in the United Kingdom, but it made the Taq polymerase enzyme within the United States and subsequently shipped this enzyme to the U.K. Once the enzyme reached the U.K., Life Technologies combined this enzyme with the other four components to form the allegedly infringing kit. When Life Technologies began selling the kits outside the terms of its sublicense, Promega filed suit. Promega alleged that Life Technologies supplied the patented Taq polymerase component from the U.S. and actively induced its combination with the other four components in a manner that infringed the ’984 patent under § 271(f).
It was undisputed that the Taq polymerase component was the only component that Life Technologies supplied from the U.S. Thus, the issue hinged on whether the supply of a single component of a multi-component patented item could fall within the reach of § 271(f)(1).
After a trial, the jury returned a verdict in favor of the patent owner Promega, finding that Life Technologies had willfully infringed the ’984 patent. The district court then granted Life Technologies’ motion for judgment as a matter of law, holding that § 271(f)(1) did not embrace the supply of a single component. On appeal, the Federal Circuit reversed the district court’s ruling, holding that there are circumstances where a single component could constitute a “substantial” portion of the components of a patented invention. The Federal Circuit relied on a dictionary definition that defined the term “substantial” to mean “important” or “essential,” and concluded that a single component could indeed be a “substantial portion of the components” of the patented invention if that single component was important.
The Supreme Court granted certiorari to answer the question of whether the supply of a single component of a multicomponent invention could be considered an infringing act under § 271(f)(1). As noted above, the Supreme Court held that it could not, and reinstated the district court’s judgment in favor of the defendant.
In arriving at its conclusion, the Court first addressed whether the term “substantial,” as it is used in the statute, should be given a quantitative or qualitative definition. The Court entertained the arguments of Life Technologies and the reasoning of the Federal Circuit and acknowledged that the statutory term “substantial” is ambiguous, and taken in isolation, might refer to qualitative value, such as an “important” portion of the patented invention as the Federal Circuit held. However, when viewed in the context of the other language of the statute, it was clear that “substantial” points to a quantitative meaning. The Court noted that the statutory terms that neighbored the word “substantial”—namely “all” and “portion”—both convey a quantitative meaning, and that there was no other language in the statute that suggested a qualitative definition. The Court also noted that a qualitative interpretation would render the statutory phrase “of the components” meaningless, and that if the lawmakers truly intended the statute to have a qualitative meaning, the more natural language to use would have simply referred to “a substantial portion of a patented invention,” and not to “a substantial portion of the components of a patented invention” (emphasis added).
The Court declined to adopt Promega’s suggestion of adopting a case-specific approach, whereby juries would decide on a case-by-case basis whether the components at issue constitute a “substantial portion” under either a qualitative or quantitative test. The Court reasoned that it is the job of the courts to resolve such ambiguities, and that tasking juries with such an interpretation of statutory language on an ad hoc basis would only compound the issue.
Having concluded that the term “substantial portion” referred to a quantitative measurement, the Court then addressed whether, as a matter of law, a single component can ever constitute a “substantial portion” so as to trigger liability under § 271(f)(1). The Court answered that it could not. The Court reasoned that the statute itself consistently referred to “components” in the plural, which suggests that a single component could not, by itself, constitute a “substantial portion” of the components of a patented invention. The Court compared this use of the plural in § 271(f)(1) with the language of § 271(f)(2), which considers it infringement to supply a single component of a patented invention, if that component is “especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use.” Notably, § 271(f)(2) refers to “any component” in the singular, thus the Court reasoned that when Congress referred to “components” plural, it meant plural, and when it referred to “component” singular, it meant singular. According to the Court, reading § 271(f)(1) to cover any single component would undermine the express reference in § 271(f)(2) to a single component that “especially made or especially adapted for use in the invention.”
Finally, the Court referred to the history of § 271(f) as support for its conclusion that supply of a single component cannot constitute infringement under § 271(f)(1). However, in a concurring opinion, Justices Alito and Thomas disagreed with the majority’s reasoning on this particular point, stating that the history of § 271(f) sheds no light on the issue. The concurrence also noted that while the Life Technologies decision makes clear that the supply of a single component, by itself, cannot constitute infringement under § 271(f)(1), it does not address the issue of how many components are necessary in order for the statute to apply.
This ruling is quite significant, but the overall impact of the ruling is relatively narrow. The ruling only applies to situations where each of the following is true:
(1) the infringing product is assembled from multiple components that are combined entirely outside of the United States;
(2) the assembled infringing product is not subsequently imported, used, sold, or offered for sale within the United States;
(3) the assembled infringing product includes only a single component that was supplied from the United States; and
(4) that single component is a staple article or commodity of commerce is suitable for substantial non-infringing use (otherwise § 271(f)(2) would apply).
Where any of these factors are not present, the Life Technologies decision would not be directly applicable, and the patent owner may still have a remedy against infringing parties. The Court did not answer the question of whether infringement liability would lie with the shipment of, for example, two or three of the components.
For more information on this ruling, please contact Fitch Even partner Michael J. Krautner, author of this alert.
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