The US Court of Appeals for the Federal Circuit reversed a district court’s dismissal of direct and indirect infringement claims, finding that plaintiff had properly alleged direct infringement even though defendant did not manufacture both components of the accused product, and that plaintiff’s induced infringement allegations were sufficient to plausibly allege that defendant intended that consumers would infringe the asserted patent. Lifetime Indus., Inc. v. Trim-Lok, Inc., Case No. 17-1096 (Fed. Cir., Sept. 7, 2017) (Lourie, J).

Lifetime sued Trim-Lok for direct and indirect infringement of Lifetime’s patent covering a two-part seal for use in an RV. The claims of the asserted patent required a product in which a seal is installed on an RV. According to Lifetime’s complaint, two Lifetime engineers with knowledge of the asserted patent recently left Lifetime and joined Trim-Lok. After hiring Lifetime’s former employees, Trim-Lok began offering an allegedly infringing two-part seal. Lifetime also alleged that it discovered a Trim-Lok two-part seal installed on an RV at a Forest River manufacturing plant. As part of its direct infringement allegations, Lifetime alleged that a Trim-Lok employee visited the Forest River plant and directly installed the Trim-Lok two-part seal on an RV. For its induced infringement allegations, Lifetime alleged that Trim-Lok influenced Forest River to include the Trim-Lok two-part seal on its RVs, and that Trim-Lok’s employees assisted in the installation of the Trim-Lok seal.

The district court dismissed Lifetime’s direct infringement counts because the asserted claims required both a two-part seal and an RV, and Trim-Lok did not manufacture an RV. The court determined that Trim-Lok’s installation of its seal on a Forest River RV could only establish liability for indirect infringement, since the seal was only a component of the claimed product. Moreover, the district court dismissed the claims of induced infringement because Lifetime had not alleged any facts from which intent to infringe could be inferred. Lifetime appealed.

The Federal Circuit reversed. With respect to direct infringement, the Court found that “commercial manufacture is not the only way that a combination can infringe,” explaining that Lifetime’s allegations that Trim-Lok installed a two-part seal on an RV were sufficient to plead that Trim-Lok made an infringing seal-RV combination.

As for induced infringement, the Federal Circuit found that Lifetime pled sufficient facts to infer that Trim-Lok intended to induce Forest River to infringe the asserted patent. Lifetime had alleged that its former employees knew of the seal design and recently joined Trim-Lok, that Trim-Lok directed or assisted the installation of an infringing seal onto the Forest River RV, and that Trim-Lok had never made or sold an infringing seal before the former Lifetime employees joined the company. Based on these facts, the Court found that intent to induce could be inferred.