Posted on August 18, 2023
Hello, everyone! I’m J.D. Houvener, your host of the Bold Today Show, where you, the inventor, entrepreneur, or business owner, can get your daily inspiration to make the world a better place. Alright, we’re in the middle of our 10-part litigation series focusing on patent litigation. Just yesterday, we delved into the primary statute covering direct infringement. Today, we’re discussing what’s called induced infringement, a mechanism that arose in a case resembling a supply chain, where a defendant attempted to circumvent the rules and create a loophole in the infringement statute.
Now, under 35 USC 271(B), inducement is still a valid vehicle to hold the defendant liable for infringement, even if they weren’t directly involved in the infringement. Consider a scenario where a tire manufacturer produces most of the tire in China, and the treads are assembled to the main rubber part in the US by a third party. Party A distributes the raw materials to Party B in the US, having knowledge of the patent, and ships the parts, inducing Party B to be the direct infringer. When these components are combined and sold to the public or a retailer, infringement occurs. The patent holder or assigned company can go after both Party B and Party A for direct infringement.
Certain elements need to be shown, with one of the most critical being actual direct infringement. For instance, if Party B never sells that tire or never combines the elements into the patented piece, there is no infringement and no underlying liability. The plaintiff must still demonstrate these core elements, but if they can establish that Party B made, used, sold, or imported anything covered by the patent claims, everyone in that chain of title or chain of command is likely to be held liable.
If this is an interesting subject for you and you have an issued patent, or if you’re in the early phase with new ideas, and you want more information about your enforcement options, give us a call.
