United States: Federal Circuit Expands The Definition Of Direct Infringement

On August 13, 2015, the en banc Federal Circuit again addressed the issue of divided infringement of a method claim and expanded the scope of direct infringement under 35 U.S.C. § 271(a) regarding situations when the steps of the patented method are performed by multiple parties. In a rare, unanimous, per curiam en banc decision, the Federal Circuit ruled again in Akamai Technologies, Inc. v. Limelight Networks, Inc. on remand from the Supreme Court, which last year held that there can be no inducement of infringement if there is no underlying act of direct infringement, which requires all steps of a claimed method to be performed by a single actor or legally attributable to a single actor. The Supreme Court did not address the standard for finding direct infringement under 35 U.S.C. § 271(a), since that issue was not presented, but invited the Federal Circuit to do so.

In addressing that issue, the Federal Circuit broadened the pool of actors who can be considered direct infringers, as well as those who can be liable for inducing infringement of a method claim. Specifically, the holding of the en banc court establishes that direct infringement can be found:

  1. "when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance," or
  2. "where two or more actors form a joint enterprise, all can be charged with the acts of the other, rendering each liable for the steps performed by the other as if each is a single actor."

Limelight Networks, slip op. at 5. This new standard is significant because it arguably alters the concept of direct infringement. Since conditioning participation may occur in a variety of ways, including through licensing and other contractual terms, this decision could have wide-ranging implications if it ultimately is upheld and followed.

In the earlier en banc Akamai decision, the Federal Circuit held an entity liable for inducement even if no one has committed an act of direct infringement under § 271(a) because, according to the Federal Circuit, indirect infringement can exist independently of a violation of the statutory provisions set forth therein related to direct infringement. Akamai Techs., Inc. v. Limelight Networks, 692 F. 3d 1301 (Fed. Cir. 2012) (en banc). The Supreme Court rejected this approach, however, holding that inducement must be tied to an underlying act of direct infringement. Limelight Networks v. Akamai Techs., Inc. 134 S. Ct. 2111 (2014). In doing so, Justice Alito, writing for the Court noted that in Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318 (2008), the Federal Circuit had held "that a method's steps have not all been performed as claimed by the patent unless they are all attributable to the same defendant, either because the defendant actually performed those steps or because he directed or controlled others who performed them... . Assuming without deciding that the Federal Circuit's holding in Muniauction is correct, there has simply been no infringement of the method in which respondents have staked out an interest, because the performance of all the patent's steps is not attributable to any one person." The Supreme Court's statement about assuming without deciding about Muniauction's validity led the Federal Circuit to reevaluate the law of direct infringement. The question will be whether, in doing so, it went too far in expanding the range of activities that could be classified as direct infringement. The Supreme Court may well have the opportunity to address that very issue in the appeal that will inevitably be made from the Federal Circuit's en banc decision.

Since the Federal Circuit's opinion may well not be the last round in this case, let us examine the background law and Federal Circuit's analysis in a little more detail. Under 35 U.S.C. § 271(a), "whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent." Direct infringement occurs where all steps of a claimed method are performed by, or attributable to, a single entity. See BMC Res., Inc. v. Paymentech, L.P., 498 F.3d 1373, 1379–81 (Fed. Cir. 2007). If more than one actor is involved in performing the method, "the question is 'whether all method steps can be attributed to a single entity.'" Limelight Networks, slip op. at 6. In the Supreme Court's Limelight decision, the Court reiterated that inducement under 35 U.S.C. § 271(b) requires a single direct infringer: "Similarly, in this case, performance of all the claimed steps cannot be attributed to a single person, so direct infringement never occurred. Limelight cannot be liable for inducing infringement that never came to pass."

Under the Federal Circuit's expanded definition of direct infringement, the performance of method steps by others may be "attributed to a single person" in two "sets of circumstances: (i) where that entity directs or controls others' performance, and (ii) where the actors form a joint enterprise." Limelight Networks, slip op. at 4. In the past, the Federal Circuit has held an actor liable for infringement if it acts through an agent, or if it contracts with another to perform one or more of the steps of the claim. However, the Federal Circuit expanded the requirements, concluding that direct infringement can also be established (i) "when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance," or (ii) "where two or more actors form a joint enterprise, all can be charged with the acts of the other, rendering each liable for the steps performed by the other as if each is a single actor." Id. at 5. Quoting the Restatement (Second) of Torts, the court stated that a joint enterprise requires proof of:

  1. an agreement, express or implied, among the members of the group;
  2. a common purpose to be carried out by the group;
  3. a community of pecuniary interest in that purpose, among the members; and
  4. an equal right to a voice in the direction of the enterprise, which gives an equal right of control.

Limelight Networks, slip op. at 5-6. Whether a joint enterprise exists is a question of fact, and is a question for a jury.

Following the Federal Circuit's decision in Muniauction, many patent claims directed to methods were difficult to assert due to issues of divided infringement. A party could not be held liable if it did not perform even one of the steps of a claimed method, or if the steps of the method could not be attributed to the party. Thus, for example, two companies who together performed all the steps of a claim but separately did not, or a company who had its customers perform at least one step, could not be held liable for direct infringement or inducement. This was a significant defense to infringement and often was dispositive of a case at an early stage.

Now, however, patent owners and potential defendants need to reevaluate these claims anew and determine if the patented method is being performed and if all of the steps may be attributable to a single actor under the new Limelight standard. Under the current ruling, many more companies will be subject to potential liability for direct infringement, even if they only perform some of the steps of the claimed method. Moreover, since the nature of the inquiry into the relationship between the parties is now more liberal and highly fact based, it will now be more difficult for a defendant to prevail on a divided infringement defense, certainly at the summary judgment phase of a case. Indeed, at least one district court has already applied the new Limelight standard to a method of administering a chemotherapy drug, finding that the doctor prescribing the drug was a direct infringer even though the patient actually carried out one of the method steps. Eli Lilly & Co., v. Teva Parenteral Medicines, Inc. 10-cv-01376-TWP-DKL (S.D. Ind. Aug. 25, 2015). With this finding of direct infringement, the court found that the defendant drug companies induced the infringement through its product instructions.

But we stress again that the unanimous en banc opinion by the Federal Circuit may not—and we suspect will not—be the end of the road, however. We expect that Limelight will petition the Supreme Court to overturn the Federal Circuit's expanded definition of direct infringement and we expect that many amici will also weigh in with their views about the Federal Circuit's new approach.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions