Source: https://www.mcgrathnorth.com/litigation/supreme-court-finds-manufacturer-not-liable-of-patent-infringement-for-constructing-one-component-in-the-u-s-and-remaining-components-overseas/
Timestamp: 2019-04-23 06:44:42+00:00

Document:
On February 22, 2017, the United States Supreme Court addressed whether a manufacturer—who shipped a single component of a multicomponent invention outside the U.S. for assembly abroad—could be held liable for patent infringement under 35 U.S.C. § 271(f)(1) of the Patent Act. In Life Techs. Corp. v. Promega Corp., the Supreme Court chose quantity over quality and held that the supply of a single component cannot constitute a “substantial portion” of an multicomponent invention to trigger patent infringement liability. No. 14-1538, 2017 WL 685531 (U.S. Feb. 22, 2017).
Thus, a manufacturer may be liable for patent infringement under §271(f)(1) for shipping from the U.S. “all or a substantial portion” of the components of a patented invention when those components are assembled abroad. Notably, the Patent Act did not define the phrase “substantial portion” as used in the context of §271(f)(1).
In Life Techs. Corp., Promega was the exclusive licensee to a patent claiming a toolkit for genetic testing. The toolkit was utilized by law enforcement agencies for forensic identification, in addition to clinical and research institutions. Promega sublicensed the toolkit patent to Life Technologies for the worldwide manufacture and sale of the toolkit in limited law enforcement fields of use. Life Technologies manufactured one component—of the five component toolkit—in the United States. That single component was then shipped to Life Technologies’ facility in the United Kingdom where it was combined with the remaining four components of the toolkit. When Life Technologies began selling these kits outside of the licensed fields of use, Promega sued for patent infringement under § 271(f)(1).
The jury returned a willful infringement verdict of $52 million in favor of Promega. The district court, however, granted Life Technologies’ motion for judgment as a matter of law finding that §271(f)(1)’s reference to a “substantial portion of the components” did not embrace the supply of a single component. The U.S. Court of Appeals for the Federal Circuit reversed and reinstated the jury’s verdict. The Federal Circuit noted that the dictionary definition of “substantial” included “important” or “essential.” Thus, in light of expert testimony that the component manufactured in the U.S. was a “major” component of the toolkit, the Federal Circuit concluded the “substantial component” requirement of §271(f)(1) was satisfied.
The Supreme Court’s decision will likely spur further patent litigation, as questions remain over how many and what components may constitute “a substantial portion” to trigger §271(f)(1) liability. Thus, manufacturers and patent owners alike should speak with their patent attorney to determine whether a patent infringement suit can be avoided—or should be brought—if components of a multicomponent patented invention are built in the U.S. Patent applicants with the United States Patent and Trademark Office should also speak with their patent attorney about crafting multiple claim limitations that are more likely to be satisfied by potential infringers. For more information, please see: Life Techs. Corp. v. Promega Corp., No. 14-1538, 2017 WL 685531 (U.S. Feb. 22, 2017).

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