Just the Facts

Submitted by patentadmin on Sun, 03/27/2011 - 22:02

As any reader of our highly informative, yet readable and even witty book Essentials Of Intellectual Property is aware, infringement of a patent may be “direct” or “indirect.” Direct infringement occurs when the accused party “makes, offers to make, sells, offers to sell, uses, or imports” the patented invention. Indirect infringement, which comes in two flavors, “contributory infringement” and “inducing infringement,” is not so simple.

“[W]hoever sells an apparatus for use in practicing a patented [invention], knowing it to be ‘especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer’.” “A noninfringing use is ‘substantial’ when it is ‘not unusual, far-fetched, illusory, impractical, occasional, aberrant or experimental’.”

“Whoever actively induces infringement of a patent shall be liable as an infringer. To establish liability [for inducing infringement], a patent holder must prove that once the defendants knew of the patent, they actively and knowingly aided and abetted another’s direct infringement.”

The law relating to indirect infringement is relatively well-settled and clear. The application of the law, to the facts of a given case, is not so clear. (Tyco Healthcare Group LP v. Biolitec, Inc. et al.)

Tyco sued Biolitec, alleging, among other things, indirect infringement of five patents directed to the medical use of lasers for endovenous treatments. Three models of laser console, bare tip laser fibers, and “various procedure kits” were identified as the allegedly infringing products. Biolitec argued that each of these products was used by its customers for substantial, noninfringing uses and offered evidence showing that the products had been approved by the Food and Drug Administration (FDA) for “numerous different applications,” including the treatment of “spider veins,” the excision of “cutaneous lesions,” the “debridement of damaged tissue from wounds,” and a host of other, stomach-churning uses. Both parties moved for summary judgment.

Tyco now had the burden of responding to this evidence. In this regard, Tyco miscalculated badly. Rather than introducing any evidence that the accused products were not suited to the uses identified by Biolitec, Tyco sought to establish that “Biolitec sold those [products] to physicians who only use them for endovenous ablation.” This argument was unavailing. “[Tyco] cites no case, and the Court has located none, holding that where a defendant sells a ‘staple article’ to a narrow clientele which, in turn, uses the product to engage in infringing activities, the defendant has engaged in contributory infringement.” Summary judgment of no contributory infringement GRANTED. Score one for Biolitec.

Having failed to establish contributory infringement by Biolitec, Tyco tried for “inducement,” relying on Biolitec’s “Instructions For Use” of the accused products. In this, Tyco was on the right track. “[C]ourts have found the requisite intent can be inferred from certain types of actions, for example, ‘advertising an infringing use or instructing how to engage in an infringing use’.” Alas for Tyco, good law; bad facts. The medical result of following the Instructions was ambiguous. Presented with a question of material fact as to whether the Instructions inevitably resulted in infringement, the Court denied both parties’ summary judgment motions as to inducement to infringe. A tie.

With Biolitec ahead by a score of one win, no losses and one tie, the parties moved on to the final question – limitation of damages. Biolitec sought an order that, should it lose at trial, its “damages shall be limited to those based on any specific acts of infringement that [Tyco] proves at trial.” This one went to Tyco. “The principle on which Biolitec relies is applicable to a claim of indirect infringement where the plaintiff seeks to establish damages under a ‘lost profits’ theory. The principle, however, does not apply to a claim of indirect infringement where the plaintiff seeks to establish damages under a ‘reasonable royalty’ theory.”

So, no decision yet. The parties are tied with a record of one win, one loss and one tie each.

THE LESSON TO BE LEARNED: In a summary judgment motion, argument is not enough – evidence is required.

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