Plaintiffs Are No Longer Required To Prove The Existence Of Direct Infringement To Establish Liability For Inducement

On August 31, the U.S. Court of Appeals for the Federal Circuit released its combined en banc opinion in Akamai Technologies, Inc. and The Massachusetts Institute of Technology v. Limelight Networks, Inc. and McKesson Technologies, Inc. v. Epic Systems Corp. Akamai Techs., Inc. v. Limelight Networks, Inc., Nos. 2009-1372, -1380, -1416, -1417, available here. The per curium majority opinion overruled portions of BMC Resources and its progeny and held that a defendant can be liable for induced infringement even if there is no single party (including agents of a party) who performed all the steps in a patented method. In other words, the court held that a party can be liable for induced infringement even in circumstances where it is possible that no one is liable for direct infringement.

Background

Traditionally, "for a party to be liable for direct patent infringement . . . that party must commit all the acts necessary to infringe the patent, either personally or vicariously. In the context of a method claim, that means the accused infringer must perform all the steps of the claimed method." Akamai, slip op. at 12 (internal citations omitted). Under a theory that has become known as "divided infringement," a plaintiff cannot combine the actions of multiple parties in an effort to meet the steps of a method claim unless one party directs or controls the actions of those who perform the remaining steps. In BMC Resources, Inc. v. Paymentech L.P., 498 F.3d 1373 (Fed. Cir. 2007), and with further clarification in Muniauction, Inc. v. Thompson Corp., 532 F.3d 1318 (Fed. Cir. 2008), the combining of multiple actors for direct infringement was approved only in situations where the plaintiff could show that all acts constituting infringement were performed by the accused, an agent of the accused, or another party acting pursuant to the accused infringer's direction or control. See BMC, 498 F.3d at 1381; see also Muniauction, 532 F.3d at 1329.

The recent en banc decision in Akamai and McKesson was a review of two earlier panel decisions related to different articulations of what it means to be under an accused infringer's direction and control. In Akamai, the panel rejected Akamai's theory that the parties (admittedly independent entities whose actions were combined to meet the claimed steps) were acting in concert and, while the parties were not principal and agent, that they knowingly collaborated. In McKesson, the panel rejected McKesson's attempt...