The Heightened Standard of Proving Induced Infringement
Roche Diagnostics Corporation v. Meso Scale Diagnostics, LLC, Appeal No. 21-1609, the Federal Circuit held that a finding of induced infringement requires knowledge that the induced acts constitute patent infringement, which can be established by a finding of ‘willful blindness,’ a standard of limited scope that exceeds recklessness and negligence.
In 1995, Meso was formed as part of a research agreement with Igen International. The agreement granted Meso an exclusive worldwide license to all technology developed during the research. In 2003, Roche acquired a license from Igen to operate in the field of “human patient diagnostics.” That same year, BioVeris took ownership of the patents from Ingen. In 2007, Roche acquired BioVeris and began instructing its customers to ignore the field restriction labels. In 2010, Meso sued, alleging that Roche breached the 2003 deal by violating the field restriction. The district court determined Meso was not a party to the 2003 agreement and that only BioVeris could enforce the field restriction.
In 2017, Roche brought suit seeking a declaratory judgment that it did not infringe Meso’s patent rights arising out of the 1995 license agreement. Meso counterclaimed for patent infringement. At trial, the jury found that Meso had an exclusive right to the asserted patent claims and that Roche both directly infringed Meso’s patent rights and induced infringement. The district court denied Roche’s post-trial motions challenging infringement, induced infringement and damages. However, it granted Roche’s motion regarding willfulness, denying Meso’s motion for enhanced damages. The district court also rendered a non-infringement decision with respect to three additional patents on the ground that Meso waived compulsory infringement counterclaims as to those patents.
The Federal Circuit affirmed the finding of direct infringement, reversed the finding of induced infringement, vacated the damages award, and remanded for a new trial on damages.
The Federal Circuit found that, in denying Roche’s motion regarding inducing infringement, the district court incorrectly applied a negligence standard rather than requiring specific intent. The Federal Circuit highlighted that the district court erroneously ruled that specific intent requires that the accused infringer “knew or should have known his actions would induce actual infringement.” The Federal Circuit noted the similarity between the intent standard for willfulness and inducement, and found that the district court’s ruling contradicted its own express finding that Roche subjectively believed it was not infringing or inducing infringement.
The Federal Circuit further found that the alleged acts of inducement occurred outside the patent damages limitation period. The district court had relied on a concept of continuing impact; however, the Federal Circuit was wary of this concept. The Federal Circuit stated that, even if this concept was sound, Meso failed to demonstrate acts of inducement occurring prior to the damages limitation period that actually led to acts of direct infringement within the damages limitation period.
The Federal Circuit also vacated the district court’s non-infringement decision regarding the three additional patents. The court found the compulsory counterclaim rule barred future claims, but that it did not authorize rendering an adverse judgment on declaratory judgment claims simply because of a failure to assert compulsory counterclaims. The court vacated and remanded for appropriate disposition of properly pled declaratory judgment claims.
Judge Newman dissented, arguing that because Meso did not have a license to the asserted patent claims, both induced infringement and direct infringement should have been reversed.
“Pliable” Language Results in “Resilient” Patent Claims
Niazi Licensing Corporation v. St. Jude Medical S.C., Inc., Appeal No. 21-1864, the Federal Circuit held that providing examples in the claim language and written description may make descriptive terms definite.
Niaizi sued St. Jude for infringement of its patent related to a catheter for cannulating the coronary sinus without significant manipulation. Niaizi alleged that St. Jude both directly infringed and induced infringement. The district court determined that all but one of the asserted claims were invalid as indefinite. Niaizi appealed the district court’s determinations as to indefiniteness, induced infringement, and sanctions.
The Federal Circuit reversed the district court’s finding that the terms “resilient” and “pliable” rendered Niazi’s claims indefinite. The court applied the Nautilus test established by the Supreme Court to determine whether the use of descriptive terms (i.e., “resilient” and “pliable”) resulted in a claim that “fail[s] to inform, with reasonable certainty, those skilled in the art about the scope of the invention.”
For the term “resilient,” the court found that the claim language and written description provided sufficient guidance to convey to a person of ordinary skill that a resilient outer catheter referred to one that has shape memory and stiffness such that it can return to its original shape. Further, the claims provided examples of resilient materials of which the outer catheter could be made (e.g., “braided silastic”).
While there was less guidance for the term “pliable,” the court still found that the written description provided numerous examples of a “pliable” inner catheter. For example, the claims required “an inner, pliable catheter slidably disposed in the outer catheter.” Further, the specification stated that the pliable inner catheter was “constructed of a more pliable, soft material such as silicone” without “longitudinal braiding, which makes it extremely flexible and able to conform to various shapes.” Thus, the court found that, when read in light of the intrinsic evidence, a person of ordinary skill in the art would understand the scope of the claims and the meaning of the terms “resilient” and “pliable” with reasonable certainty. The court affirmed the district court’s determination as to induced infringement and entry of evidentiary sanctions.
Notice Letters and Communications May Form a Basis for Personal Jurisdiction
Apple Inc. v. Zipit Wireless, Inc., Appeal No. 21-1760, the Federal Circuit held that notice letters and related communications may be sufficient to establish personal jurisdiction within a given forum.
California Plaintiff, Apple Inc. (“Apple”) sued Zipit Wireless, Inc. (Zipit) for patent infringement in the Northern District of California. Zipit was a Delaware corporation with a principal place of business and all of its 14 employees in South Carolina.
In 2013, Zipit contacted Apple (domiciled in the Northern District of California) regarding the possibility of Apple buying or licensing the patents-in-suit from Zipit. Over the course of three years, the parties exchanged several rounds of correspondence, phone calls, and met in person twice at Apple’s headquarters in the Northern District.
In June 2020, Zipit sued Apple in the Northern District of Georgia, accusing Apple of infringing the patents-in-suit. Nine days later, Apple filed a complaint in the Northern District of California, seeking a declaratory judgment of noninfringement of the patents-in-suit. Zipit moved to dismiss Apple’s complaint for lack of personal jurisdiction. In February 2021, the district court granted Zipit’s motion and dismissed Apple’s complaint, holding that it lacked specific personal jurisdiction over Zipit. The district court held that, while Apple established that the contact between the parties was sufficient to establish personal jurisdiction, exercise of jurisdiction would be unreasonable because Zipit’s contacts with California were all related to the attempted resolution of the dispute regarding the patents-in-suit.
On appeal, the Federal Circuit disagreed that the exercise of personal jurisdiction would be unreasonable. The Federal Circuit explained that there is no bright-line rule prohibiting the exercise of personal jurisdiction based only on cease-and-desist letters and related in-person discussions. Rather, the Federal Circuit explained that courts consider a “variety of interests” in determining whether exercise of jurisdiction would be reasonable. These interests include (1) the burden on the defendant, (2) the forum state’s interest in adjudicating the dispute, (3) the plaintiff’s interest in obtaining relief, (4) the interstate judicial system’s interest in efficient resolution of controversies, and (5) the shared interest in furthering fundamental substantive social policies.
The Federal Circuit found Zipit failed to meet its burden of presenting a compelling case that jurisdiction would have been unreasonable, reversed the district court’s judgment, and remanded the case for further proceedings.
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