In a closely followed patent case, the Federal Circuit, sitting en banc, ruled that 35 U.S.C. Section 271(f) does not apply to method claims. The claim at issue was to a method of heart stimulation using implantable cardioverter defibrillators ("ICDs"). The accused infringer shipped the ICDs abroad where they were implanted and used in the patented method. In ruling that 35 U.S.C. Section 271(f) does not apply to method claims, the court overruled an earlier panel's decision in Union Carbide Chemicals & Plastics Technology Corp. v. Shell Oil Co., 425 F.3d 1366 (Fed. Cir. 2005).

The Court's Analysis

Title 35 U.S.C. Section 271(f) is designed to prevent potential infringers from avoiding liability by manufacturing in the United States -- and shipping to foreign countries -- components of a product that if combined in the United States would infringe a United States patent. Section 271(f)(1) states that, "[w]hoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such a manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer." (emphasis added). Section 271(f)(2) has similar language.

The Federal Circuit recognized that although Section 271(f) uses the phrase "patented invention," and that 35 U.S.C. Section 101 defines "invention" to include "any new and useful process, machine, manufacture or composition of matter," this did not necessarily mean that Section 271(f) covers method claims. Instead, the court stated that the phrase "patented invention" as used in Section 271(f) must be construed in the context of Section 271(f) and its legislative history. Such an exercise, according to the court, "leads us to . . . the conclusion . . . that Section 271(f) does not encompass method patents."

In interpreting Section 271(f), the court noted that "it is critical to recall what a 'patented invention' consists of when method patents are at issue." A distinction exists between a claim to a process, which consists of a series of intangible acts or steps, and a claim to a product, device, or apparatus, all of which are tangible items. According to the court, "this fundamental distinction . . . is critical to the meaning of the statute and dooms Cardiac's argument [i.e., that Section 271(f) applies to method claims] on this issue." As the court stated, a "component" is "a constituent part," "element," or "ingredient." In contrast, a method patent consists of a series of acts or steps. Thus, method patents do not have "components."

The court further noted that the language of Section 271(c) undercuts any argument that the term "component" as used in Section 271(f) applies to an apparatus that is used in a claimed method. Section 271(c) contrasts "a component of a patented machine, manufacture, combination, or composition" from a "material or apparatus for use in practicing a patented process." According to the court, this language evinced Congress's intent that a "component" was separate and distinct from a "material or apparatus for use in practicing a patented process." The court further noted that Section 271(f) requires that the "component" be "supplied." The ordinary meaning of supply means to "provide" or "furnish," which implies the transfer of a physical object. According to the court, "[s]upplying an intangible step is . . . a physical impossibility."

The court then explained that its holding was fully consistent with the legislative history of Section 271(f). In promulgating Section 271(f), Congress intended to overturn the holding in Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518, 527, 531 (1972), which held that "the shipment of unassembled components of [a] deveining machine did not constitute patent infringement." Congress' focus was to fix this loophole regarding patented products, and the legislative history "is almost completely devoid of any reference to the protection of method patents."

Repudiation of Union Carbide

The court briefly addressed its previous holding, Union Carbide, 425 F.3d at 1378-80, where it held that "§ 271(f) governs method/process inventions." In Union Carbide, the court held that Section 271(f) was applicable to the exportation of a catalyst which was used in a patented method, referring to the catalyst as a "component" of the method. The court overruled Union Carbide "to the extent that it conflicts with [the court's] holding today."

Impact of the Decision

Even if an accused infringer's product can only be used for a single purpose, one which directly infringes all of the steps of a patented method or process when used, the accused infringer cannot be held liable for infringement of that patented method or process under Section 271(f) if it manufactures the product in the United States and then ships it abroad to be used in a foreign country. The accused infringer could even send the product with specific instructions on how to use it to infringe the method patent, but it still cannot be liable for infringement under Section 271(f).

Thus, when deciding to draft method claims, patent applicants should keep in mind who prospective infringers may be. If an applicant's competitor is known for shipping a substantial amount of its products internationally rather selling them domestically, a patent that contains only method claims may not reach such activity.

This Client Alert does not address the remaining sections of the Cardiac Pacemakers decision that were not decided en banc. If you have any questions or wish to discuss how this decision will impact your company, please contact your attorney at Brinks Hofer Gilson & Lione.

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