Docket No. 12-786
Supreme Court of the United States
June 2, 2014
Brief Summary: Liability for inducement (§271(b)) must be predicated on direct infringement (“under §271(a) or any other statutory provision”).
Summary: Akamai is the exclusive licensee of a patent related to methods for delivering electronic data using a content delivery network (CDN) that Limelight was accused of infringing. The DC found Limelight did not infringe because it carries out all but one of the claimed steps while its customers perform the remaining step (“tagging”) and Limelight does not control or direct its customers tagging. An FC panel affirmed that decision based on its subsequent Muniauction decision (FC 2008; explaining that an accused infringer who performs some of the steps of a method patent and encourages others to perform the rest could be liable for inducement of infringement (§271(b)) even if no one was liable for direct infringement (which requires a single party to perform every step of a claimed method) as long as the accused infringer was found to exercise or control its customers performance of the remaining steps), finding that neither an “agency relationship” or contractual relationship obligating the customer to perform the steps Limelight did not. However, on review en banc, the FC found that the “evidence could support a judgment in [respondents’] favor on a theory of induced infringement” even though “no one would be liable as a direct infringer”. Certiorari was granted and the arguments heard on April 30, 2014. The SC disagreed with the en banc FC decision, and held that “[a] defendant is not liable for inducing infringement under §271(b) when no one has directly infringed under §271(a) or any other statutory provision.” Akamai argued that “principles from tort law and criminal aiding and abetting doctrine, as well as patent law principles in existence before the 1952 Patent Act, support the Federal Circuit’s reading of the statute” but the SC was not persuaded. It found that the FC “fundamentally misunderstands what it means to infringe a method patent”, its view would require “two parallel bodies of infringement law” (one for direct and one for inducement), and “Congress knows how to impose inducement liability predicated on non-infringing conduct when it wishes to do so” (referring to §271(f)(1) as illustrative of this point: 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.) Thus, the SC held that liability for inducement (§271(b)) must be predicated on direct infringement (“under §271(a) or any other statutory provision”).