Is Induced Patent Infringement Possible without Direct Infringement?

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Beth Z. Shaw, Brake Hughes Bellermann LLP

The Federal Circuit vacated a district court’s grant of summary judgment in Move, Inc. v. Real Estate Alliance Ltd. (REAL) and remanded for a determination on induced infringement. The three judge panel (Chief Judge Rader and Judges Lourie and Moore) held that the district court (although properly following then-existing precedent) failed to conduct an indirect infringement analysis after correctly finding no direct infringement.

Claim 1 of U.S. Patent 5,032,989 at issue is directed to a method for locating available real estate properties using a zoom-enabled map on a computer.

Claim 1 recites:

1.   A method using a computer for locating available real estate properties comprising the steps of:

(a) creating a database of the available real estate properties;

(b)  displaying a map of a desired geographic area;

(c)  selecting a first area having boundaries within the geographic area;

(d)  zooming in on the first area of the displayed map to about the boundaries of the first area to display a higher level of detail than the displayed map;

(e)  displaying the first zoomed area;

(f)  selecting a second area having boundaries within the first zoomed area;

(g)  displaying the second area and a plurality of points within the second area, each point representing the appropriate geographic location of an available real estate property; and

(h) identifying available real estate properties within the database which are located within the second area.

The court held that the district court did not analyze whether Move had knowledge of REAL’s patent and induced users to perform the claim steps that Move did not itself perform. The panel remanded for a determination regarding whether Move is liable for indirect infringement under the standard set forth in Akamai.  That standard requires that the accused inducer – in Move, Inc. Move – knew of the asserted patent and performed or knowingly induced the performance of the steps of the claimed methods, and that all of those steps were in fact performed.

The court emphasized that recently, “sitting en banc in Akamai, we clarified the law on inducement.” The court there explained that all the steps of a claimed method must be performed in order to find induced infringement, but that it is not necessary to prove that all the steps were committed by a single entity. “In so holding, we overruled the holding in BMC that in order for a party to be liable for induced infringement, some other entity must be liable for direct infringement.”

The Federal Circuit agreed with the district court that there was no genuine issue of material fact that Move does not control or direct the performance of each step of the claimed method, specifically steps (c) and (f). The Federal Circuit also held that the district court correctly found that the Move computer does not do the selecting; a user does the selecting, and then the computer merely updates display variables to  reflect the user’s selection, which the Federal Circuit expressly held did not constitute selection in the previous appeal:

Although certain steps of REAL’s claimed method may be performed by individuals using Move’s system, that does not equate to direct infringement or joint direct infringement because Move does not exercise direction or control over users of its websites.”

The district court concluded that because Move, as a single party, was not liable for direct infringement, it could not be liable for joint infringement. Yet, as explained in Akamai, there is no single-entity requirement in the inducement context. Liability under § 271(b) may arise when the steps of a method claim are performed by more than one entity, provided that the other requirements for inducement are met.

The Federal Circuit panel therefore vacated the district court’s grant of summary judgment and remanded for a determination of whether Move is liable for indirect infringement under the standard set forth in Akamai. That standard requires that the accused inducer knew of the asserted patent and performed or knowingly induced the performance of the steps of the claimed methods, and that all of those steps were in fact performed.

One thought on “Is Induced Patent Infringement Possible without Direct Infringement?

  1. Pingback: This Morning’s Supreme Court Developments and Some Resources | The Legal Pulse

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