Direct infringement under § 271(a) may be established even absent a principal-agent relationship, a contractual arrangement, or a joint enterprise, when an alleged infringer conditions participation or a benefit upon performance of a step and sets the manner or timing of that performance. Here, for example, an accused infringer that instructed its customers on how to perform the remainder of a claimed method using its servers was found to directly infringe the claimed method because the instructions conditioned the use of the servers on the performance and dictated how and when the performance should be completed. “[L]iability under § 271(a) can also be found 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.” It may nevertheless be best to ensure that all method claims can be infringed by a single entity, although certain divided actions may still be attributable to such a single entity.
Background / Facts: Following remand from the Supreme Court and a subsequent panel decision finding no joint tortfeasor liability for direct infringement, the court sitting en banc here has again convened to consider the issue of divided infringement. The patent at bar claims methods for delivering content over the Internet. It is undisputed that the accused infringer performs every step of the claimed method save for the “tagging” step, in which its customers tag the content to be hosted and delivered by the accused infringer’s content delivery network.
Issue(s): Whether section 271(a) is limited solely to principal-agent relationships, contractual arrangements, and joint enterprise, as the vacated panel decision held.
Holding(s): No. “We conclude, on the facts of this case, that liability under § 271(a) can also be found 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.” Here, the accused infringer “conditions its customers’ use of its content delivery network upon its customers’ performance of the tagging and serving steps, and … establishes the manner or timing of its customers’ performance.” In particular, the accused infringer “sends its customer a welcome letter instructing the customer how to use [its] service” and “tells the customer that a Technical Account Manager employed by [the accused infringer] will lead the implementation of [its] services.” Further, the “customers do not merely take [the accused infringer’s] guidance and act independently on their own. Rather, [the accused infringer] establishes the manner and timing of its customers’ performance so that customers can only avail themselves of the service upon their performance of the method steps.”