IP Law Daily Supplying single component of DNA-testing kit for manufacture abroad did not infringe
Wednesday, February 22, 2017

Supplying single component of DNA-testing kit for manufacture abroad did not infringe

By Thomas Long, J.D.

Supplying a single commodity component of a multicomponent DNA-testing kit from the United States for manufacture abroad did not give rise to liability for patent infringement under 35 U.S.C. §271(f)(1), the U.S. Supreme Court has held. A single component could not satisfy the "substantial portion" element of Section 271(f)(1), which referred to a quantitative measurement. The Court reversed and remanded a decision of the U.S. Court of Appeals for the Federal Circuit holding that life sciences companies Life Technologies, Applied Biosystems, LLC, and Invitrogen IP Holdings, Inc. (collectively, "LifeTech") could have infringed a patent for a genetic testing kit, licensed by Promega Corp. The decision was written by Justice Sotomayor and was joined by Justices Kennedy, Ginsburg, Breyer, and Kagan. Justices Thomas and Alito joined the decision except for a portion relating to legislative history. Chief Justice Roberts did not take part in the decision, having withdrawn from the case after oral argument due to a potential conflict of interest (Life Technologies Corp. v. Promega Corp., February 22, 2017, Sotomayor, S.).

Accused product. LifeTech manufactured a key component of genetic testing kits—a certain enzyme used to synthetize chains of DNA, known as the Taq polymerase—in the United States. LifeTech then shipped that component to its facility in the United Kingdom for incorporation into its kits, which were sold worldwide, including in the United States. The product’s four other components were made in the United Kingdom.

Patent-in-suit. Promega Corp. was the exclusive licensee of U.S. Patent No. RE 37,984 ("Tautz"), which related to genetic testing kits. Promega sublicensed the Tautz patent to LifeTech for the manufacture and sale of kits used in certain law enforcement fields. When LifeTech began selling the kits outside the licensed fields of use—specifically, to the clinical and research markets—Promega filed suit against LifeTech, accusing it of violating Section 271(f)(1), which prohibited the supply from the United States of "all or a substantial portion of the components of a patented invention" for combination abroad.

District court proceedings. The validity of the Tautz patent was upheld at trial, and the jury found LifeTech liable for infringement. The district court then granted LifeTech’s motion for a finding of noninfringement as a matter of law, holding that LifeTech did not infringe the Tautz patent because no other party was involved in LifeTech’s assembly of the accused kits, and LifeTech supplied only a single commodity component of the kits from the United States.

Federal Circuit’s holding. On appeal, the Federal Circuit reversed the noninfringement ruling. The appellate court concluded that no third party was required in order to state an infringement claim under Section 271(f)(1), based on its interpretation of the term "induce" as meaning "to bring about, to cause." Also, the Federal Circuit held that a party may be liable under Section 271(f)(1) for supplying or causing to be supplied a single component for combination outside the United States. The appellate court also determined that there was evidence in the record to support the jury’s finding that the polymerase supplied by LifeTech was a "substantial portion" of the patented invention, for purposes of Section 271(f)(1).

Question under review. In its petition for certiorari, LifeTech presented two questions: (1) whether the Federal Circuit erred in holding that a single entity can "actively induce" itself to infringe a patent under 35 USC §271(f)(1); and (2) whether the Federal Circuit erred in holding that supplying a single, commodity component of a multi-component invention from the United States is an infringing act under 35 USC §271(f)(1), exposing the manufacturer to liability for all worldwide sales. The grant of review was limited to the second question.

Single component—"substantial portion" requirement. The Supreme Court held that the supply of a single component of a multicomponent invention is not an infringing act under 35 U.S.C. §271(f )(1). First, the Court determined that Section 271(f)(1)’s requirement of a "substantial portion" of the components of a patented invention referred to a quantitative, rather than a qualitative, measurement. Promega’s argument that the Taq polymerase constituted a "substantial portion," due to its importance to the invention, was rejected. In the Court’s view, although the ordinary meaning of "substantial" was ambiguous, the context in which the term appeared in the statute pointed to a quantitative meaning. The neighboring terms "all" and "portion" conveyed a quantitative meaning. In addition, the phrase "substantial portion" was modified by "of the components of a patented invention." If "substantial" had a qualitative meaning, it would be more natural to omit reference to "the components," the Court reasoned.

Next, the Court decided that, as a matter of law, a single component could never constitute a "substantial portion" triggering liability under Section 271(f)(1). The statutory text consistently referred to "components" in the plural, indicating that multiple components constituted the substantial portion. In addition, this interpretation allowed Section 271(f)(1) to function in tandem with its companion provision, Section 271(f)(2), which covered the unauthorized supply of any component of a patented invention that was "especially made or especially adapted for use in the invention and not a staple article or commodity of commerce," for a use that would constitute patent infringement.

Accordingly, the Federal Circuit’s decision was reversed, and the case was remanded for further proceedings.

Concurring opinion. Writing separately, Justice Alito (joined by Justice Thomas) noted that he did not read the majority opinion to suggest that any number greater than one was sufficient to trigger liability under Section 271(f)(1).

"In other words, today’s opinion establishes that more than one component is necessary, but does not address how much more," Justice Alito stated.

The case is No. 14-1538.

Attorneys: Carter G. Phillips (Sidley Austin LLP) for Life Technologies Corp. Seth P. Waxman (Wilmer Cutler Pickering Hale and Dorr LLP) for Promega Corp.

Companies: Life Technologies Corp.; Promega Corp.

MainStory: TopStory Patent

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