As a form of direct infringement, joint infringement is grounded in the Federal Circuit’s 2007 decision in BMC Resources Inc. v. Paymentech L.P., 498 F.3d 1373 (Fed. Cir. 2007). Prior to BMC Resources, when proving direct infringement of a claim, a patentee had to identify a single actor who performed or used each and every step or element of a claimed process or product. Where alleged infringement was in fact the activity of several actors, none of the actors was liable for direct infringement. In BMC Resources, however, the scope of direct infringement was expanded to include certain instances of combined action. In particular, where a claim is infringed by the activity of several actors and there is a single actor who exercises direction or control over every step of the process, the “mastermind” actor is a direct infringer of the process, even though the actor may not have actually performed all, or any, of the process steps.
The Golden Hour appeal stemmed from a patent infringement suit by Golden Hour against defendants emsCharts and Softtech. The defendants were software companies that had partnered to market a single software package integrating their separately-designed software. In its suit, Golden Hour alleged that the integrated package jointly infringed one of its patents, and that emsCharts was the mastermind behind the infringement. Although the jury found for Golden Hour, the verdict was overturned after emsCharts moved for judgment as a matter of law (JMOL) on the ground that emsCharts neither directed nor controlled Softtech. Golden Hour appealed the JMOL.
In a 2-1 decision, a Federal Circuit panel affirmed the district court’s JMOL. Writing for the majority, Judge Dyk summarily concluded that the evidence presented at trial was insufficient for the jury to infer emsChart’s control or direction of Softtech. The majority saw “no need for extended discussion of this issue.” In dissent, Judge Newman strongly opposed the JMOL, characterizing the defendants’ partnership as a “collaborat[ion] to practice every limitation of the claims.”
The Golden Hour decision reminds patentees that although joint infringement is a valid theory of direct infringement, it can be difficult to prove. Not all collaborative activity will result in joint infringement— competitors may collude in an arm’s-length transaction to infringe a claim yet escape liability for patent infringement. Furthermore, the legal bounds of joint infringement are not well-established. Since BMC Resources, the Federal Circuit has decided a joint infringement issue in only two cases: Golden Hour and Muniauction Inc. v. Thomson Corp., 532 F.3d 1318 (Fed. Cir. 2008). What passes for direction or control today may not in the future.
Patent practitioners are well-advised to pursue claims that can only be infringed by a single actor. Claims should be drafted with an eye towards potential litigation. Given the current shortcomings of joint infringement, a more promising route to recovering damages for patent infringement remains traditional direct infringement by a single actor. Drafting single-actor claims, however, is not always a simple matter. Inventions in some fields routinely involve multiple actors. For example, network-based inventions typically depend on the flow of information from one user to another, and that information may be operated on or used by various intermediaries. However, as the Federal Circuit stated in BMC Resources, “[a] patentee can usually structure a claim to capture infringement by a single party,” and courts will not restructure an ill-conceived claim. When dealing with inventions involving multiple actors, patent practitioners thus should try to frame the claims to focus on a single actor who participates in the entire process. Returning to the example of network-based inventions, a data processing invention may be claimed as a central server controlling the flow of information, or a broader, patentable genus directed to a single-user process may be claimed in addition to a narrower species directed to a multi-user process.
Sometimes, however, an invention cannot be claimed without involving multiple actors, or a single-actor claim will not always capture how the invention will be actually practiced. As an example of the latter, a potential infringer practicing much of a patented machining process may outsource certain steps of the process, such as a CAD design step or an electroplating step, to a third-party vendor. When contemplating patent enforcement on grounds of joint infringement, patent applicants should keep in mind the requirement of direction or control. Contractors and suppliers of a potential infringer are more likely than business partners or customers to be under the infringer’s direction or control, and their activity may be used to show joint infringement. On the other hand, the activity of the infringer’s customers or its business partners, as in Golden Hour, should be omitted from the claims because, under current legal guidelines, its inclusion may allow the infringer to evade joint infringement.