Source: https://www.glaserweil.com/news-resources/insights/ip-file/life-technologies-v-promega-supreme-court-limits-infringement-liability-und
Timestamp: 2019-04-22 04:47:37+00:00

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In Life Technologies, Promega was the exclusive licensee of a patent claiming a genetic testing kit, which comprised five components. Life Technologies sold a similar genetic testing kit with five components. It manufactured all but one component in the United Kingdom. It manufactured the fifth component in the United States, which it shipped to its facility in the United Kingdom to assemble with the other four components and then sold worldwide. Promega sued Life Technologies for patent infringement under §271(f)(1), which prohibits the supply from the United States of “all or a substantial portion of the components of a patented invention” to be combined abroad.
Only the second issue was before the Supreme Court. To determine whether the supply of a single component of a multicomponent invention is an infringement under §271(f)(1), the Court considered the statutory language. It first concluded that “substantial” has a quantitative rather than qualitative meaning because the neighboring terms “all” and “portion” convey a quantitative meaning. It found that a qualitative meaning would render the phrase “of the components” unnecessary. It also rejected Promega and the Federal Circuit’s relative importance argument because any single component of most inventions is required to make the invention work.
Next, the Court concluded that, under the quantitative meaning, a single component can never constitute a “substantial portion” to trigger liability under §271(f)(1). The Court found such interpretation is consistent with the use of “components” in the plural. Further, §271(f)(2) deals with liability for supplying “any component” of an invention that is not a staple article or commodity suitable for substantial noninfringing use. Thus, reading §271(f)(1) to refer to more than one component gives each of §271(f)(1) and §271(f)(2) its unique applications. Although on the facts of this case, one out of five components is not substantial enough, the Court did not provide guidance as to “how close to ‘all’ of the components ‘a substantial portion’ must be[,]” leaving the parties and lower courts to figure out what constitutes “substantial portion of the components” under §271(f)(1) in other situations.
Although the Court’s analysis did not rely on, or even mention, the general rule against extraterritorial reach of patent law, the Court recognized the implications of its decision on international trade, as modern manufacturing often involves in a chain of suppliers located in different countries. Indeed, this ruling limits the reach of §271(f)(1) by requiring an infringer to supply a quantitatively substantial portion of the components from the U.S. Further, based on the Court’s reasoning, if the only component being supplied by a domestic manufacturer is a “staple article or commodity of commerce suitable for substantial noninfringing use,” then there would be no liability regardless of whether or not it was “substantial” under the circumstances due to the distinction between §271(f)(1) and §271(f)(2).
The Court reversed the Federal Circuit judgment and remanded the case for further proceedings consistent with its opinion. By giving no consideration to the relative importance of any single component, the decision also narrows the rights of patent owners. Under the ruling, a supplier could escape liability under §271(f)(1) by supplying a single, yet very important, component for assembling overseas.
 Life Tech. v. Promega, No. 14-1538, Slip Op. at 1.
 Id. at 2. The five components were (1) a primer mix, (2) a DNA polymerase, (3) a nucleotides mix, (4) a buffer, and (5) a control. Id.
 Id. at 2-3. The fifth component made in the U.S. was the DNA polymerase.
 Promega Corp. v. Life Techs. Corp., 773 F.3d 1338, 1351 (Fed. Cir. 2014), rev'd and remanded, No. 14-1538, 2017 WL 685531 (Feb. 22, 2017).
 Life Tech. v. Promega, No. 14-1538, Slip Op. at 5-6.
Whoever without authority supplies or causes to be supplied in or from the United States any component of a patented invention that is especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use, where such component is uncombined in whole or in part, knowing that such component is so made or adapted and intending that such component will be combined outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.
 Life Tech. v. Promega, No. 14-1538, Slip Op. at 9.
 The first sentence of the opinion states “This case concerns the intersection of international supply chains and federal patent law.” Id. at 1.
As a more general matter, moreover, we cannot accept Promega’s suggestion that the Court adopt a different analytical framework entirely—one that accounts for both the quantitative and qualitative aspects of the compo­nents. Promega reads §271(f )(1) to mean that the answer to whether a given portion of the components is “substan­tial” depends not only on the number of components in­volved but also on their qualitative importance to the invention overall. At first blush, there is some appeal to the idea that, in close cases, a subjective analysis of the qualitative importance of a component may help deter­mine whether it is a “substantial portion” of the compo­nents of a patent. But, for the reasons discussed above, the statute’s structure provides little support for a qualita­tive interpretation of the term.

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