Court Opinion

ID: 9493154
Source: CourtListenerOpinion
Date Created: 2023-08-05 14:59:33.273764+00
Date Added: 2024-06-11T17:55:40.770714
License: Public Domain

PAULINE NEWMAN, Circuit Judge,
concurring in the judgment.
I conclude, as does the panel majority, that Rotee can not enforce its patent against the defendants. However, I reach this conclusion on different grounds. I write separately concerning two aspects of my colleagues’ opinion:
First, the majority opinion necessarily accepts the critical premise that an “offer to sell” made in the United States can constitute patent infringement even when the contemplated sale could not infringe the patent. I do not believe that 35 U.S.C. § 271 is correctly so interpreted. I would decide the case on the straightforward ground that there is no issue of infringement under § 271(a) because, as is undisputed, no offer for sale was made whereby the sale itself could infringe the United States patent, a requirement of 35 U.S.C. § 271(i).
Second, the panel majority’s reliance on the overruled Deepsouth case is inappropriate. In addition, the majority opinion misconstrues the statutory provision, 35 U.S.C. § 271(f), that overruled it.
I

An Infringing “Offer to Sett” Must Be for the Contemplated Sale of an Infringing Product

For purposes of the defendants’ summary judgment motion, and fundamental to this litigation, it is assumed that the system that was offered and intended to be sold to China and installed at the Three Gorges Dam is the same as the “Tower Belt” system that is described and claimed in Rotec’s United States patent. The summary judgment documents describe the activities of the Japanese Mitsubishi company, the French company Potain, and the American C.S. Johnson Company, working together for the purpose of supplying such a system to China. On the principles of summary judgment it is accepted that the described meetings occurred in the United States and elsewhere, including the visit to *1259the United States by representatives of China.
The bid document and the final sales contract were executed outside of the United States. The bid document listed the country of origin for some components as the United States, specifically conveyors, dumpers, and toolkit. The sales contract states the countries of origin of the components as France, Japan, and China, with no component listed as made in the United States. Nor does Rotee assert that any component of the system that was ultimately sold originated in the United States. The panel majority accepts, without discussion, that these premises can satisfy the “offer to sell” provisions of § 271, and thus decides the appeal on peripheral issues such as the admissibility of the evidence of a visit to the United States by representatives of China. However, an offer to sell a device or system whose actual sale can not infringe a United States patent is not an infringing act under § 271.
Before the 1994 amendments to § 271 the law in the United States was that liability for infringement was not incurred by offering to sell a patented invention, but only by its actual manufacture, use, or sale. See, e.g., Laitram Corp. v. Cambridge Wire Cloth Co., 919 F.2d 1579, 1583, 16 USPQ2d 1929, 1932 (Fed.Cir.1990). In implementation of Article 28 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), in 1994 various amendments were made to the United States patent statute-, including the following:
§ 271(a) Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.
§ 271(i) As used in this section, an “offer for sale” or an “offer to sell” by a person other than the patentee, or any designee of the patentee, is that in which the sale will occur before the expiration of the term of the patent.
(Relevant amendments emphasized.) Uruguay Round Agreements Act, Pub.L. No. 103-465 § 533, 108 Stat. 4809, 4988 (1994). Section § 271(i) resolved the issue that is before us. By requiring that the actual sale of the thing offered will occur before the patent expires, the statute makes clear that the sale must be one that will infringe the patent. The question before this panel was answered in the statutory enactment; I would resolve the issue on this ground.
Congress was undoubtedly aware of the litigation and debate of similar questions in European countries. In Kalman v. PCL Packaging (UK) Ltd., 1982 F.S.R. 406 (at 1982 WL 221922), the United Kingdom court held that the statutory “offers to dispose of’ the patented product “must be read as meaning, ‘offers in the United Kingdom to dispose of the product in the United Kingdom.’” See also Benton v. Latour et Fils SA, Transcript: Larking 21 April 1993 (available on Lexis in “UK Cases, Combined Courts” database). In Georg Benkard et al, Patentgesetz, Ge-brauchsmustergesetz, 422-24 (9th ed.1993), the authors discuss whether an offer made in Germany to sell a product outside of Germany constitutes infringement of a German patent, citing various factual situations that have arisen in litigation. The enactment of § 271(i) resolved any uncertainty in the interpretation of § 271(a), for implementation of the TRIPS provision in the United States.
Section 271(a) can not be read in isolation from § 271(i). A statute is construed and applied in a manner that does not render any of its provisions superfluous, contradictory, or illogical. See Mackey v. Lanier Collection Agency & Serv., Inc., 486 U.S. 825, 837, 108 S.Ct. 2182, 100 L.Ed.2d 836 (1988). The purpose of § 271(a) was to permit a patentee to act against threatened infringing sale by establishing a cause of action before actual sale occurred. It is explained that the *1260“main consequence of requiring an actual sale during the patent term in order to make the offer for sale an act of infringement appears to be that the date of infringement will reach back to the date of the original offer.” Thomas L. Irving and Stacy D. Lewis, Proving a Date of Invention and Infringement After GATT/ TRIPS, 22 AIPLA Q.J. 309, 351-52 (Summer/Fall 1994) (the offer for sale will infringe only if the sale will occur before the patent expires).
Thus the patentee need not await an actual sale, and may seek injunctive relief and any damages that may have accrued due to the offer. It is clear, however, that an infringing offer to sell, § 271(a), must be of an item that would infringe the United States patent upon the intended sale, § 271(i). Thus an offer made in the United States, to sell a system all of whose components would be made in foreign countries, for sale,' installation, and use in a foreign country, does not infringe the United .States patent. Rotee has not raised any issue for consideration other than those arising under the provisions of § 271.
II

Deepsouth Has Been Overruled

In Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518, 92 S.Ct. 1700, 32 L.Ed.2d 273 (1972), the Supreme Court confirmed that a United States patent was not infringed when the component parts of a patented machine were sold by the United States manufacturer to foreign buyers who assembled the machine outside of the United States. The Court observed that the law of infringement applied only when the patented machine was made, used, or sold in the United States, and that United States patents do not have extraterritorial effect. Since there, was no direct infringement of the United States patent, the Court held that there could not be contributory infringement by the manufacturer of the component parts.
Congress enacted 35 U.S.C. § 271(f), “responding] to the United States Supreme Court decision in [Deepsouth ], concerning the need for a legislative solution to close a loophole in patent law.” 130 Cong. Rec. 28,069 (1984). See also S.Rep. No. 98-663 at 2 (1984) (describing the legislation as “reversal of Deepsouth decision”). Section 271(f)(2) is invoked by Ro-tee as applying to the situation wherein the defendants offered to provide from the United States the conveyor component of Rotec’s patented system:
§ 271(f)(2) 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.
In the sales contract, C.S. Johnson Company of Illinois had been replaced by Nippon Conveyor Co. of Japan as the provider of the conveyor system. With no remaining component made in the United States the application of § 271(f) was mooted, for no component originating in the United States was included in the system that was sold. However, it is incorrect to read § 271(f) in isolation from § 271(a). Indeed, the correct reading of § 271 includes § 271(f) in harmony with § 271(a) and § 271(i). So important and complex a question as an offer to sell components of a patented device should not be disposed of in dictum. Not only is it dictum, but the panel majority’s reliance on Deepsouth to remove the benefit of the amendment, of § 271(a) from the “loophole” plugged, in *1261§ 271(f) is misguided, for the purpose of § 271(f) was to overrule Deepsouth.