Reaffirming the breadth of the Akamai standard for divided infringement, the US Court of Appeals for the Federal Circuit vacated a summary judgment of non-infringement where two steps of a four-step method for luggage screening were performed by the Transportation Security Administration (TSA) rather than by the defendant. Travel Sentry, Inc. v. Tropp, Case Nos. 16-2386; -2387; -2714; 17-1025 (Fed. Cir., Dec. 19, 2017) (O’Malley, J).
Tropp sued Travel Sentry for patent infringement. Tropp owns patents generally directed to a method for luggage screening that generally includes the following steps:
- Making available to consumers a special lock having a combination lock portion, a master key portion and an associated identification structure
- Marketing the special lock to consumers in a particular manner
- Using the identification structure to signal to a luggage screener to use a master key to open the lock pursuant to an agreement with the luggage screening entity
- The luggage screening entity acting pursuant to a prior agreement to look for the identification structure and, if it is found, to use the master key to open the lock as necessary
Travel Sentry licenses lock systems for airline luggage. Pursuant to a memorandum of understanding between Travel Sentry and TSA, Travel Sentry provides master keys and relevant training materials to TSA, and TSA distributes the keys to baggage-screening areas. TSA screeners identify Travel Sentry bags and use the master keys to open and reclose the bags’ locks. Based on these uncontested facts, the district court granted summary judgment in favor of Travel Sentry on the theory that Travel Sentry did not direct or control any TSA activities. Tropp appealed.
On appeal, the Federal Circuit vacated the summary judgment. Under Akamai, acts may be attributed to an alleged infringer when that infringer (1) conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method, and (2) establishes the manner or timing of that performance (IP Update, Vol. 15, No. 9). The Court held that a reasonable jury could find both prongs of the Akamai test to be satisfied.
Under the first prong, the Federal Circuit defined the “activity” in which TSA sought to participate as “screening luggage that TSA knows can be opened with the passkeys provided by Travel Sentry.” Further, the Court defined “benefits” to include “the ability to open identifiable luggage using a master key, which would obviate the need to break open the lock.” The Court also found the “conditioning” requirement met because TSA must perform the final two claim steps (i.e., identifying Travel Sentry locks and using the master keys to screen the bags as necessary) in order to gain the identified benefits.
Under the second prong, the Court found that a reasonable jury could find that Travel Sentry established the manner or timing of TSA’s performance. The Court relied on Travel Sentry’s entering into the memorandum of understanding with TSA (which set forth steps TSA would need to follow in order to obtain the associated benefits), providing TSA with master keys and instructional materials, establishing and its own identifying mark, maintaining and licensing the trademark to the identifying mark, and controlling the design of the locks and passkeys. The Court therefore vacated the district court’s summary judgment and remanded for further proceedings.
Practice Note: Going forward, fewer divided infringement cases should be amenable to summary judgment, because the Federal Circuit has characterized both prongs of the Akamai test as questions of fact.