On Wednesday, December 13, 2006, the Federal Circuit
resolved a split in authority over the standard for proving
inducement of patent infringement. Previously, competing
panels of the Federal Circuit had issued contrary opinions: in
one case, the Federal Circuit held that intent to infringe was
required to prove inducement, while, in another, the Federal
Circuit held that only intent to cause the acts constituting
infringement was required. Compare Manville Sales Corp. v.
Paramount Systems, Inc., 917 F.2d 544, 554 (Fed. Cir. 1990)
with Hewlett-Packard Co. v. Bausch & Lomb, Inc., 909 F.2d 1464
(Fed. Cir. 1990). In DSU Medical Corp. v. JMS Co., Ltd., Case No.
04-1620, the Federal Circuit adopting the stricter standard,
holding that intent to infringe, i.e., "specific intent," is the
proper benchmark. This portion of the opinion was designated
en banc, while the remainder was issued by the original three judge
Under section 271(b), "[w]hoever actively induces infringement
of a patent shall be liable as an infringer." 35 U.S.C. § 271(b).
While a party is traditionally liable for so-called direct patent
infringement only when it makes, uses, sells, offers for sale
or imports an infringing product into the United States, or
supplies substantial components of that product for export
from the United States, section 271(b) extends the reach of
U.S. patent laws, imposing liability for the direct infringement
of others. Inducement is a particularly important theory
in markets where product development and sales involve
a combination of U.S. and international activities. Patent
plaintiffs have used inducement doctrines to reach a variety of
Under the standard adopted in DSU, plaintiffs will have to
adduce evidence of culpable conduct, directed to encouraging
another's direct infringement, not merely that the inducer had
knowledge of the direct infringer's activities. This means that
the alleged inducer must have knowledge of the patent and
must also believe that the induced activities are infringing.
This highlights the utility of opinion letters, which may assist
in negating the specific intent element of inducement. Indeed, in DSU, the panel found that there was sufficient evidence to
support the jury's verdict of no inducement where there was
evidence that the defendant had obtained opinion letters
advising it that the accused product did not infringe.
The opinion in DSU also provides further protection for
corporate officers at an accused company. As a pressure
tactic, patent plaintiffs may bring claims of inducement against
such officers personally for approving sales of the accused
activities. Under DSU, plaintiffs must show specific intent by
any officer-defendant to induce infringement, making such
claims more difficult to prove.
For further information, please contact:
Charlene M. Morrow, Patent Litigation Partner
Heather N. Mewes, Patent Litigation Associate
David M. Lacy Kusters, Patent Litigation Associate
This update is intended by Fenwick & West LLP to summarize
recent developments in the law. It is not intended, and should
not be regarded, as legal advice. Readers who have particular
questions about these issues should seek advice of counsel.
© 2006 Fenwick & West LLP. All Rights Reserved.