Federal Circuit Expands Potential Liability for Inducing Infringement of Patented Methods
On Friday, August 31, the en banc Federal Circuit decided the cases of Akamai Technologies, Inc. v. Limelight Networks, Inc. and McKesson Technologies, Inc. v. Epic Systems Corp., expanding the situations in which a defendant could potentially be held liable for inducing infringement of a patented method. It is well established that, to directly infringe a patented method, a single infringer must perform each of the method's steps, either personally, or through another entity acting under the infringer's control. Prior to Friday's decision, this requirement was also extended to induced infringement. That is, before the Federal Circuit decided Akamai and McKesson, a defendant could only be liable for inducing infringement of a patented method if the defendant actively induced a single entity to perform all of the method's steps. On Friday, the Federal Circuit changed that rule, holding "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."
While the Federal Circuit eliminated the requirement of showing that a single entity was induced to perform all of the steps in a patented method, it did not disturb the other requirements for a claim of inducing infringement. In particular, to establish that a defendant should be held liable for inducing infringement, it is necessary to show that the defendant had specific intent to cause infringement, not simply to cause the method to be performed. As a result, in cases where a defendant does not know that performing a method is an infringement, and does not willfully blind himself or herself to the existence of infringement despite knowing that there is a high probability that the infringement exists, the defendant still will not be liable for inducing infringement.
Going forward, the practical impact of this decision is that it will make it possible to use patents to protect certain types of methods which had heretofore been effectively excluded from the patent system by the single entity rule. This change will be particularly significant with respect to patents protecting software inventions deployed in networked environments (e.g., methods of using cloud based resources in combination with local systems) and business methods in which multiple entities work together to achieve a goal.A copy of the decision can be found here.