United States: Supreme Court Docket Report – October 12, 2010

Originally published October 12, 2010

Keywords: Patent Act, patent holders, active inducement

Today the Supreme Court granted certiorari in one case of interest to the business community:

Patent Act—Required State of Mind for a Claim of Active Inducement

Chapter 28 of the United States Patent Act, 35 U.S.C. § 271(b), provides that whoever actively induces infringement of a patent shall be liable as an infringer. The Supreme Court granted certiorari today in Global-Tech Appliances, Inc. v. SEB S.A., No. 10-6, to determine the mental state that must be proven to impose inducement liability under 35 U.S.C. § 271(b).

The Court's resolution of this case will be of considerable interest to patent holders and manufacturers. If the Court holds that a plaintiff must prove that the defendant had actual knowledge of the infringed patent, inducement liability will be more difficult to establish than if the Court adopts a deliberate-indifference standard instead.

Petitioners in this case developed a home-cooking appliance after studying several features of a device that respondent had earlier produced. Petitioners' attorney determined that petitioners' appliance did not infringe any United States patent; however, petitioners did not inform the attorney that they had analyzed respondent's device prior to developing their device. Petitioners sold their appliance to retailers in the United States and abroad. Petitioners learned of respondent's patent when respondent sued a company that had bought the appliance from petitioners. Respondent subsequently sued petitioners directly, alleging that petitioners had induced their customers' infringement of respondent's patent. The jury found in respondent's favor.

On appeal to the Federal Circuit, petitioners argued that they could not be held liable for inducement under § 271(b) because they were not aware of respondent's patent before making and selling their device. In DSU Medical Corp. v. JMS Co., Ltd., 471 F.3d 1293 (Fed. Cir. 2006) (en banc), the Federal Circuit had ruled that the party must have actual knowledge of the patent being infringed to be liable for inducement. And in MGM Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 936 (2005), a copyright case, the Supreme Court concluded that the mental state required for active-inducement infringement was "an affirmative intent that the product be used to infringe." However, in the decision below, the Federal Circuit held that petitioners' "deliberate indifference" as to whether its device infringed a patent was sufficient to impose liability under § 271(b).594 F.3d 1360, 1376–77.

Absent extensions, amicus briefs in support of the petitioners will be due on December 3, 2010, and amicus briefs in support of the respondent will be due on January 3, 2011.

* * * * * * * * * *

In the past week, the Supreme Court invited the Solicitor General to file briefs expressing the views of the United States in the following cases of interest to the business community:

Norfolk Southern Railway Company v. Groves, No. 09-1212: The questions presented involve the definition of "consignee" as used in railroad tariffs and the jurisdiction of courts to interpret railroad tariffs.

Von Saher v. Norton Simon Museum of Art at Pasadena, No. 09-1254: The questions presented ask whether a California statute that extended the statute of limitations applicable to claims for the recovery of property stolen during the Holocaust is either preempted by federal law or unconstitutional.

Laborers District Council Construction Industry Pension Fund v. Omnicare, No. 09-1400: The questions presented concern the pleading burden under the Securities Act § 11, 15 U.S.C. § 77k(a).

Erica P. John Fund, Inc. v. Halliburton Co., No. 09-1403: The questions presented address whether plaintiffs in securities fraud actions must establish loss causation at the class certification stage to invoke the fraud-on-the-market presumption.

Aquino v. Suiza Dairy, Inc., No. 10-74: The question presented asks whether retrospective monetary relief can be ordered against a state (or, in this case, territory) if the relief will not be paid out of the general treasury.

* * * * * * * * * *

In addition to the business cases described above, the Supreme Court granted certiorari today in DePierre v. United States, No. 09-1533, which involves sentencing in cocaine cases. Mayer Brown represents the petitioner in conjunction with the Yale Law School Supreme Court Clinic. Mayer Brown attorneys Andy Pincus and Charles Rothfeld helped found and are co-directors of the Clinic, which provides clients with pro bono representation before the United States Supreme Court.

Please visit us at www.appellate.net.

Copyright 2010. Mayer Brown LLP, Mayer Brown International LLP, Mayer Brown JSM and/or Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. All rights reserved.

Mayer Brown is a global legal services organization comprising legal practices that are separate entities (the Mayer Brown Practices). The Mayer Brown Practices are: Mayer Brown LLP, a limited liability partnership established in the United States; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; Mayer Brown JSM, a Hong Kong partnership, and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.