In a recent decision in the US (Riverbed Technology, Inc. v. Silver
Peak Systems, Inc.), a company was found
liable for indirect patent infringement even though the infringing
features of its product were disabled when the product was sold. In
the post-sale period, customers enabled the infringing features.
This was enough for the court to find the company liable for
This case arose between two rivals in the wide area network
market - Riverbed and Silver Peak. Riverbed sued Silver Peak for
infringement of a number of US patents. Silver Peak counterclaimed,
alleging infringement of three US patents. A jury trial eventually
returned a verdict in favour of Silver Peak. Silver Peak asserted
indirect infringement against Riverbed with respect to two
patents. Specifically, the jury concluded that Riverbed
"contributorily infringed" one of the patents and
"induced infringement" of the other.
Riverbed challenged these conclusions, arguing that there was
insufficient evidence of customer use of the accused features in
the United States. Riverbed pointed out that the feature of its
product that was allegedly infringing - a feature known as
SDR-Adaptive - was disabled before the product was sold to
consumers in the US. No-one disputed that fact. However, through
user forums on the Riverbed website, as well as product manuals
issued by Riverbed, consumers were taught how to enable and use
The court reviewed this surrounding evidence and concluded:
"In sum, Silver Peak has offered evidence of Riverbed's
high sales volume, an instruction manual describing how to activate
SDR-A, and several blog entries on Riverbed's U.S. support
forum from people who used their Riverbed devices with SDR-A
enabled. Taken together, this circumstantial evidence is
sufficient..." Riverbed was found to have indirectly infringed
the Silver Peak patents.
Lessons for business? Canadian companies selling into the US
should be aware that sales of their products may form the basis for
liability in the US if used by customers in the US in infringing
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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A recent Saskatchewan Court of Queen's Bench decision allowed a court-appointed receiver to sell and transfer intellectual property rights free and clear of encumbrances, finding that a license to use improvements of an invention was a contractual interest and not a property interest.
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