Supreme Court to Consider Mental State to Induce Patent Infringement
The United States Supreme Court granted certiorari in Global-Tech Appliances Inc. v. SEB S.A. on October 12, 2010, thereby agreeing to consider the case concerning the level of intent required for a claim of active inducement of patent infringement under 35 USC § 271(b). The question presented in the case is:
Whether the legal standard for the state of mind element of a claim for actively inducing infringement under 35 USC § 271 (b) is “deliberate indifference of a known risk” that an infringement may occur, as the Court of Appeals for the Federal Circuit held, or “purposeful, culpable expression and conduct” to encourage an infringement, as this Court taught in MGM Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 937, 125 S. Ct. 2764, 2780, 162 L. Ed. 2d 781, 801 (2005)?
Section 271(b) of Title 35 of the United States Code states, “Whoever actively induces infringement of a patent shall be liable as an infringer.” The statute does not, however, define the level of intent necessary for active inducement of infringement. In the lower court decision, the Federal Circuit held that “inducement requires a showing of specific intent to encourage another’s infringement.” SEB S.A. v. Montgomery Ward & Co., Inc., 594 F.3d 1360, 1376 (Fed. Cir. 2010) (quoting Broadcom Corp. v. Qualcomm Inc., 543 F.3d 683, 699 (Fed.Cir. 2008)) (internal quotation marks removed). The court noted that “‘specific intent’ in the civil context is not so narrow as to allow an accused wrongdoer to actively disregard a known risk that an element of the offense exists.” Id.
In SEB, there was no evidence that the accused infringer had actual knowledge of the patent. Nonetheless, the court stated:
As just explained, a claim for inducement is viable even where the patentee has not produced direct evidence that the accused infringer actually knew of the patent-in-suit. This case shows such an instance. The record contains adequate evidence to support a conclusion that Pentalpha deliberately disregarded a known risk that SEB had a protective patent.
Id. at 1377. Furthermore, the court held:
This opinion does not purport to establish the outer limits of the type of knowledge needed for inducement. … This court does not set those boundaries now, just as it did not set them in [a previous case]. Here the record establishes sufficient support for the conclusion that Pentalpha deliberately ignored the risk that SEB had a patent that covered its deep fryer. Thus, the jury’s finding of inducement is justified, and the damage award, even if it was based on inducement alone, stands.
Id. at 1378. As noted above, the Supreme Court summarizes the Federal Circuit’s holding as finding a standard deliberate indifference of a known risk that an infringement may occur for the state of mind element of a claim for actively inducing infringement under 35 USC § 271 (b).
The Supreme Court previously considered the state of mind element of inducement of infringement within the copyright context in Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913 (2005). In Metro-Goldwyn-Mayer, the Court premised liability on “purposeful, culpable expression and conduct.” Metro-Goldwyn-Mayer, 545 U.S. at 915. The Court reached this standard by drawing not only on copyright law, but also on patent law. Thus, while Metro-Goldwyn-Mayer is not directly on point, it is informative in the patent context. Nonetheless, the Federal Circuit in SEB did not consider Metro-Goldwyn-Mayer in its decision.
The Supreme Court will now consider the potential conflict between the holdings of SEB and Metro-Goldwyn-Mayer within the context of the legal standard for the state of mind element of a claim for actively inducing patent infringement under 35 USC § 271(b).