Induced Infringement in Patent Litigation: Implications of Commil USA v. Cisco Sys. Inc.

Description

On May 26, 2015, the Supreme Court held in Commil USA, LLC v. Cisco Sys, Inc. that a defendant’s good-faith belief that a patent is invalid is not a defense to induced infringement under 35 U.S.C. § 271(b). The Supreme Court’s decision overturned the Federal Circuit’s holding that “evidence of an accused inducer’s good-faith belief of invalidity may negate the requisite intent for induced infringement.”

In the majority opinion, Justice Kennedy noted that invalidity is not a defense to infringement. Rather it is a defense to liability and a good-faith belief of invalidity does not negate the statutory requirement that the accused “actively induces infringement.” As the Supreme Court explained a few years ago in Global-Tech v. SEB (U.S., 2011), “actively induces infringement” means the accused knew of the patent and knew the induced acts were infringing.

Among the challenges the decision raises, the Court recognized that its decision could encourage litigation by patent trolls or NPEs. But the Supreme Court emphasized that protection from trolls needed to come from the district courts’ vigilance on stopping frivolous litigation claims. The Court also noted that the Patent Act provides other avenues for raising invalidity challenges, including inter partes review and reexamination.

One strategy for patent holders is to leverage opinions of counsel. Under the Federal Circuit’s now-overturned Commil decision, companies were able to rely on an opinion of counsel to show a good-faith belief in a patent’s invalidity, thereby disproving intent to infringe. Now, opinions of counsel will have to shift focus from invalidity of a patent to non-infringement.

Listen as our authoritative panel of patent attorneys examines the Supreme Court’s Commil decision and the implications of the decision for induced infringement, discussing the practical issues for companies seeking to contain their patent liability risk. The panel will outline steps that counsel to patent owners should take to protect IP rights.