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Belief a Patent is Invalid is No Defense

Belief a Patent is Invalid is No Defense

In its May 26, 2015 decision, the United States Supreme Court held that a defendant’s belief regarding patent validity is not a defense to a claim of induced infringement.  Commil USA, LLC v. Cisco Systems, Inc., No. 13-896 (Sup. Ct. 2015). 

Commil USA, LLC sued Cisco Systems, Inc. in 2007 for patent infringement, claiming that Cisco had both directly infringed Commil’s patent and had induced others to infringe the patent.  Commil’s patent is for a method of implementing short-range wireless networks.  Cisco makes and sells wireless networking equipment and was sued for infringement of the patent for making and using such equipment, and for inducing others to infringe the patent by selling the infringing equipment for them to use.  The jury concluded that Cisco directly infringed the patent.  During the trial, Cisco defended the induced infringement claim by arguing that it had a good-faith belief that the patent was invalid.  This issue was appealed and ultimately was the issue considered by the Supreme Court.  Specifically, the issue considered by the Court was whether or not a good-faith belief that a patent is invalid is a defense to a claim of induced patent infringement.

The Patent Act, 35 U.S.C.§ 271 states:  (a) Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent; (b) Whoever actively induces infringement of a patent shall be liable as an infringer; and (c) Whoever offers to sell or sells within the United States or imports into the United States a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially adapted for use in an infringement of such  patent, and not a staple article or commodity of commerce suitable for substantial non-infringing use, shall be liable as a contributory infringer.

The Supreme Court noted that for direct infringement under Section (a) of the Patent Act, the defendant’s mental state is irrelevant, but liability for inducing infringement and contributory infringement attaches only if the defendant knew of the patent and that the induced acts constitute patent infringement (citing Global-Tech, 563 U.S., at ___ (slip op., at 5, n.2 and at 10); Aro Mfg. Co. v. Convertible Top Replacement Co., 377 U.S. 476, 488 (1964)).  Accordingly, a defendant must know that the induced acts constitute patent infringement in order to be liable for actively inducing infringement under the statute.

However, the Supreme Court clarified in Commil that the knowledge or awareness element of induced infringement concerns infringement, which is a different issue than validity.  Invalidity is not a defense to infringement, but a defense to liability.  The Patent Act treats infringement and validity as separate issues, bearing different burdens, different presumptions, and different evidence.  As a result, the Court reasoned that these issues (validity and infringement) should be considered separately and a belief regarding patent validity is therefore not a defense to an induced infringement claim.

The full decision can be found here http://www.supremecourt.gov/opinions/14pdf/13-896_l53m.pdf

 

DISCLAIMER: The information provided is for general informational purposes only. This post is not updated to account for changes in the law and should not be considered tax or legal advice. This article is not intended to create an attorney-client relationship. You should consult with legal and/or financial advisors for legal and tax advice tailored to your specific circumstances.

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