On February 22, 2017, the U.S. Supreme Court held that the supply of a single component of a multicomponent invention for manufacture abroad does not give rise to liability under Section 271(f)(1) of the Patent Act, which prohibits the supply from the U.S. of “all or a substantial portion of the components of a patented invention” for combination abroad. In reaching its unanimous decision, the Court analyzed whether the term “substantial” referred to a qualitative or quantitative measure of components used in the invention.
The case at issue, Life Technologies Corp. et al. v. Promega Corp., stems from the sublicense of the patent by Promega Corporation to Life Technologies for the manufacture and sale of genetic testing kits. Life Technologies manufactured one of the five components in the U.S. where it was then shipped to the U.K. to be combined with the other four U.K. manufactured components of the kit. Promega brought suit against Life Technologies on the grounds that Life Technologies had infringed the patent by selling the kits outside the licensed fields of use to clinical and research markets. Promega alleged that Life Technologies’ supply of the U.S. component to the U.K. manufacturing facilities triggered liability under Section 271(f)(1). The jury returned a verdict in favor of Promega, however, the trial court granted Life Technologies’ motion for judgment as a matter of law, finding that Section 271(f)(1)’s mention of “a substantial portion of the components” does not cover the export of a single component of a multicomponent invention. The appellate court reversed the trial court’s judgment finding that based upon the dictionary definition of the word “substantial”, the U.S. made component is a significant component of the testing kit and therefore found that Section 271(f)(1) can apply to a single component of a multicomponent invention.
The Supreme Court reversed and remanded the appellate court’s decision, concluding that although the term “substantial” is not defined in the Patent Act and could therefore refer to either the qualitative significance or the quantitative amount of the component, the context to which the term appears indicates the meaning is quantitative. In reaching its decision, the Court examined the phrase “all or a substantial portion of the components of a patented invention” and noted that a qualitative interpretation of “substantial” would not make sense as it would render the phrase “of the components” superfluous. Once it came to the conclusion the term “substantial” is a quantitative measure, the Court went on to find that a single component cannot meet the statute because the text uses the plural word “components” and ultimately concluded that supplying a single, commodity component of a multicomponent invention from the U.S. is not an infringing act.
Justice Sotomayor delivered the opinion of the Court, framing the matter as a case that “concerns the intersection of international supply chains and federal patent law.” The Supreme Court’s decision provides welcome news for manufacturers that supply commodities that are assembled into kits abroad as it effectively limits the exposure to liability for worldwide sales.