"Induced infringement" (sometimes called "active inducement of infringement" as taken from the statutory language 35 U.S.C. Section 271(b)) is a legal claim that a party with actual knowledge of an issued patent (DSU Med. Corp. v. JSM Co., Ltd., 471 F.3d 1293 (Fed. Cir. 2006) "induced" (i.e., encouraged, lead on, persuaded, and/or taught) another party to infringe the patent in question. According to the Supreme Court, there can be no liability for induced infringement absent direct infringement by a single party.
The case of Eli Lily v. Teva Parenteral Meds (Fed. Cir. 2007) chips away at the "single party" requirement. The case involved a method claim, where in practice, some of the steps of the method were performed by a physician administering treatment to a patient, but at least one step of the method was performed by the patient upon self-administration of folic acid. Thus, there was no "single party" performing all of the steps of the claimed method.
The Federal Circuit held that when the steps of a patented method are divided between more than one actor, a finding of direct infringement simply requires that the collective steps of each actor be attributed to a single entity. Further, from the prior Federal Circuit case of Akamai Technologies, Inc. v. Limelight Networks, infringing steps can be attributed to a single entity when one actor "directs or controls" the activity of other actors.
A party "directs or controls" another if the actor:
i.) "conditions participation in an activity or receipt of a benefit upon performance of at least one step of a patented method"; and
ii.) "establishes the manner or timing of that performance."
The Federal Circuit found that both prongs were satisfied in the present case by the physician -- that is to say, the physician "directed or controlled" the patient to take the folic acid. The physician could refuse to administer the treatment if the patient did not take the folic acid (thus satisfying prong 1); the physician also delineated the time period that patient had to take the folic acid (once a day for seven days; thus satisfying prong 2).
For more information on this case, see the article by Aaron Chaloner at Baker Donelson:
http://www.iam-media.com/reports/detail.aspx?g=22fb5834-ca81-4bc2-b012-7005f76e5a5c
Moral of the story: You may not be able to avoid liability for induced infringement by making different parties perform different steps of a method claim if one actor, who performs some of the steps, "directs or controls" another actor to perform the rest of the steps.
The case of Eli Lily v. Teva Parenteral Meds (Fed. Cir. 2007) chips away at the "single party" requirement. The case involved a method claim, where in practice, some of the steps of the method were performed by a physician administering treatment to a patient, but at least one step of the method was performed by the patient upon self-administration of folic acid. Thus, there was no "single party" performing all of the steps of the claimed method.
The Federal Circuit held that when the steps of a patented method are divided between more than one actor, a finding of direct infringement simply requires that the collective steps of each actor be attributed to a single entity. Further, from the prior Federal Circuit case of Akamai Technologies, Inc. v. Limelight Networks, infringing steps can be attributed to a single entity when one actor "directs or controls" the activity of other actors.
A party "directs or controls" another if the actor:
i.) "conditions participation in an activity or receipt of a benefit upon performance of at least one step of a patented method"; and
ii.) "establishes the manner or timing of that performance."
The Federal Circuit found that both prongs were satisfied in the present case by the physician -- that is to say, the physician "directed or controlled" the patient to take the folic acid. The physician could refuse to administer the treatment if the patient did not take the folic acid (thus satisfying prong 1); the physician also delineated the time period that patient had to take the folic acid (once a day for seven days; thus satisfying prong 2).
For more information on this case, see the article by Aaron Chaloner at Baker Donelson:
http://www.iam-media.com/reports/detail.aspx?g=22fb5834-ca81-4bc2-b012-7005f76e5a5c
Moral of the story: You may not be able to avoid liability for induced infringement by making different parties perform different steps of a method claim if one actor, who performs some of the steps, "directs or controls" another actor to perform the rest of the steps.
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