The Court of Appeals for the Federal Circuit reversed the District Court of Delaware’s decision holding Roche Diagnostics Corporation induced infringement of patents covering electrochemiluminescence (“ECL”) immunoassays.
Both the plaintiff Roche and defendant Meso Scale Diagnostics were licensees of the patentee IGEN International, Inc. Roche’s license was subject to a field of use restriction. Roche purchased the impugned patents (among others) from IGEN in 2007.
In 2017, Roche sought a declaration of non-infringement with respect to Meso’s rights, if any, in the impugned patents. Meso counterclaimed for infringement. A jury found, inter alia, (1) that Roche had directly infringed Meso’s rights in one patent and induced infringement of its rights in the other two; and (2) that Roche’s infringement was willful (for the purposes of enhanced damages under 35 U.S.C. § 284). Roche then moved for judgment as a matter of law (“JMOL”).
The District Court dismissed the motion with respect to direct and induced infringement but held that Roche’s infringement was not willful. The District Court’s decision is available here. Both parties appealed to the Federal Circuit.
The Federal Circuit Decision
Judge Prost, writing for the majority of the Federal Circuit, reversed the denial of JMOL on induced infringement because (1) Roche lacked the required intent to induce infringement; and (2) the acts complained of occurred outside the limitation period.
First, the District Court’s grant of JMOL with respect to wilfulness was inconsistent with its denial of JMOL on induced infringement. Induced infringement requires subjective knowledge or wilful blindness “that the induced acts constitute patent infringement.” However, the District Court erred by applying a different standard: that the alleged infringer “knew or should have known” that its actions would induce infringement. Given the District Court’s finding that, “at no time did Roche have a subjective intent to infringe (or induce infringement of) Meso’s patent rights,” because Roche reasonably believed it eliminated any possibility of patent liability by acquiring the patents at issue, the Federal Circuit reversed the judgment of induced infringement.
Second, Roche’s allegedly inducing acts (a press release about “own[ing] the complete patent estate of the [ECL] technology,” a letter encouraging customers to ignore field of use restriction labels, and a decision to stop affixing field of use restriction labels) all occurred in 2007, well before the 6-year limitation period. The Federal Circuit overturned the District Court’s finding that “acts occurring before the damages period could support a finding of inducement if they continued to have an impact and caused third parties” to directly infringe during the limitation period. The Court likened this logic to “saying that the laying of an egg takes place when the egg hatches […].” Liability arose when the acts complained of were committed.
The Federal Circuit also rejected that Roche committed acts of inducement during the limitation period by selling products without field of use restriction labels. The Court emphasized that selling the products without restrictive labels did not necessarily constitute inducement, as the products had both infringing and non-infringing applications.
Given its finding on induced infringement, the Federal Circuit vacated the jury’s damages award and remanded for a new trial on damages.
Judge Newman, in dissent, would have overturned the jury’s verdict in its entirety, as she found that Roche owned the impugned patents after it purchased them from IGEN in 2007. In her view, Meso had acquiesced to Roche’s ownership and use of the patents and could not now assert a different position.
A copy of the Federal Circuit decision can be found here.