What is a patent?

A patent is a grant by a government of the right to exclude others from the manufacture, sale, offer to sell, or unauthorized use (i.e., an unlicensed use) of the invention described and claimed in the patent. In the United States, Congress is authorized to enact laws “[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”[1] Title 35 of the United States Code governs all aspects of patent law in the United States.

A United States patent must include a written description of the invention that enables a person having ordinary skill in the art (or “PHOSITA”) to both make and use the invention. A PHOSITA is a fictional person considered to have a normal skillset and knowledge in the technical field of the patent. A patent also includes drawings illustrating the invention and concludes with one or more claims that particularly point out and distinctly claim the invention. United States patent law requires that the patent distinctly point out and claim the invention to provide notice to the public regarding the scope of protection in exchange for the patent owner getting exclusive use as granted by the patent.

What is patent infringement?

Patent infringement occurs whenever someone – whether an individual or business – “without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor.”[2] This is known as “direct infringement.”

Other types of infringement include “induced infringement”[3] and “contributory infringement.”[4] Induced infringement occurs when a party asks or “induces” another to commit direct infringement. For example, someone may be liable for induced infringement if they pay a manufacturer to make a patented invention. Contributory infringement occurs when a party manufactures or imports a key or material component of an invention, knowing that the component is to be used to infringe a patent and is unsuitable for substantial noninfringing use.

Can an Imported Product Infringe on my Patent?

Absolutely. As noted in the section above describing patent infringement, imports are mentioned several times. For example, 35 USC §271(a) explicitly states that anyone who “without authority … imports into the United States any patented invention during the term of the patent therefor, infringes the patent.”[5] In other words, if a party imports a product that practices the invention into the United States while the patent is in force and the party does not have a license from the patent owner, then the party is liable for patent infringement.

Examples of Imported Products Infringing a United States Patent

Listed below are just a few examples of imported products that infringe a United States Patent. A review of case decisions of the United States Court of Appeal for the Federal Circuit, known as the Federal Circuit, or decisions of the United States International Trade Commission (ITC) will yield many more.

In Mayborn Group, Ltd. v. International Trade Commission, the Federal Circuit upheld a finding of the ITC that a product imported by Mayborn Group, Ltd. infringed United States Patent No. 8,028,850 owned by Alfay Designs, Inc., et al., for “a self-anchoring beverage container that prevents spills by anchoring the container to a surface by means of a ‘flexible nonporous base member adapted to seal to a reference surface.'” Consequently, the Federal Circuit upheld a general exclusion order barring the importation of the infringing items.[6]

In Comcast et al. v. International Trade Commission, the Federal Circuit upheld a finding by the ITC that Comcast customers using devices imported by Comcast and others infringed certain claims of United States Patent Nos. 8,006,263 and 8,578,413 owned by Rovi Corporation and Rovi Guides, Inc. for “an inter-active television program guide system for remote access to television programs.” The ITC had issued a limited exclusion order, which was upheld by the Federal Circuit in its decision.[7]

As a final example among many others, in Guangdong Alison Hi-Tech Co. v. International Trade Commission, the Federal Circuit upheld a finding by the ITC that certain imports by Guandong Alison Hi-Tech Co. infringed claims of “United States Patent No. 7,078,359, owned by domestic manufacturer Aspen Aerogels, Inc.” for aerogel composite products, which are “very light materials with excellent insulating properties.” The ITC issued a limited exclusion order barring importation that was upheld by the Federal Circuit decision.[8]

Enforcing Your Patent Against Infringing Imports

There are two basic methods of enforcing your patent against infringing imports: 1) a cease and desist letter; and 2) litigation. A cease and desist letter is by far the least expensive way to enforce your patent – if it works, that is. The risk of sending a cease and desist letter, however, is that if not properly written, it may trigger the infringing party to file what is known as a “declaratory judgment action,” which asks the Court to declare your patent invalid, their import to be noninfringing, or both. Oftentimes this means you will end up fighting a lawsuit far from home because the infringer will choose to file their lawsuit in a location convenient for them but very inconvenient for you. In such litigation, however, you would be able to file claims for infringement of your patent and litigate that claim as part of the lawsuit.

Alternatively, an infringer may choose to ask the United States Patent and Trademark Office (USPTO) to review the validity of your patent in a procedure known as an inter partes review or IPR. In an IPR proceeding, the infringer will provide the USPTO with what is known as “prior art,” which consists of anything in the public domain, including other patents, books, magazine articles, journal articles, etc., before the filing date of the application from which your patent issued. You and the infringer will then argue the merits of the validity of your patent considering the newly provided prior art documents.

Sometimes, the parties will make oral arguments, but typically the arguments are made through written briefs. In addition to the prior art references, often there will be expert opinion reports and deposition testimony provided to the USPTO. The most significant benefit of the IPR procedure is it generally takes less time than litigation in Federal District Court to yield a decision on the validity of your patent.

Federal District Court Litigation Proceedings

The second option to enforce a patent is to initiate litigation against the infringer. The patent owner chooses the jurisdiction to file the lawsuit, and the District Court located in the selected jurisdiction thereby decides factual matters, including infringement. The Court may order an injunction that excludes the infringing article from further import.

As with a declaratory judgment action, the infringer frequently asserts a counterclaim challenging the patent's validity. The infringer may also raise defenses, such as:

• Noninfringement,
• Fraud or inequitable conduct (e.g., breach of the duty of candor before the USPTO),
• Laches (e.g., the patent owner waited too long or had an unreasonable delay in bringing a lawsuit),
• Pre-existing license established by equitable estoppel (e.g., the patent owner lured the infringer into thinking they had approval to commit the act the patent owner is now calling infringement), and
• Patent misuse (e.g., the patent owner forced customers to pay royalties on an expired patent or products not protected by a patent). [9]

Before commencing litigation in District Court, a patent owner will investigate issues such as validity and infringement. Such investigation includes a review of the USPTO prosecution record of the patent, known as a “file history.” The file history review determines whether any statements made during the examination of the patent application would preclude a finding of infringement, known as “file history estoppel.”

Stated otherwise, during the examination process, also known as patent prosecution, the patent attorney provides detailed remarks arguing why the USPTO should grant a patent. Such arguments often include statements that distinguish prior art references from the claimed invention. Those statements may also characterize or differentiate the patented invention from the infringing import. Thus, estoppel is created, which may prevent a finding of infringement against the import. In other words, a court may prevent or stop the patent owner from making assertions of infringement because it would go back on his or her word.

Assuming after the investigation the patent is valid and infringed, the patent owner will prepare a complaint, including a request for a jury trial, and file it in the District Court located in the proper venue to hear the case. A proper venue is typically where the infringing act occurred or where the infringer's business is located. The patent owner will then serve the complaint upon the infringer to provide notice of the lawsuit.

Often, the patent owner will file a motion for an injunction requesting the Court enter an order forbidding the sale or offer to sell the infringing product. The infringer will have twenty-one days to file an answer to the complaint. The answer will typically deny infringement and assert some or all defenses mentioned above.

Afterward, the Court will hold a scheduling conference that addresses various dates by which the parties must take specific actions. Such dates will include, for example, close of discovery, disclosure of expert witnesses, and a date for trial.

During discovery, each party provides written questions, called interrogatories, to the other party. The parties also provide written statements, called requests for admission, which require the opposing party to admit or deny specific statements. The parties also present requests to produce any document relevant to the facts at issue.

Depositions are also a key component in discovery. Depositions are out-of-court oral testimony that is reduced to a written transcript for later use. In patent litigation, the parties will often take depositions from the expert witnesses, the patent attorney who wrote the patent application, any patent attorney involved in prosecuting the application before the USPTO, the parties themselves, and anyone else with knowledge of the facts at issue.

Additionally, should there be a dispute between the parties regarding interpreting the claims, the Court will hold a “Claim Construction Hearing” (or Markman hearing).[10] In a Markman hearing, each party presents arguments about how the Court should interpret each claim. The Court decides how to interpret the claims and will issue an order governing the meaning of the claims for the remainder of the proceeding.

Finally, the parties will often file summary judgment motions. A summary judgment is a judgment entered by the Court for one party against another without a full trial. If the Court does not grant summary judgment and the suit remains unsettled, the case proceeds to trial.

Litigation at the International Trade Commission

Another litigation avenue for the patent owner[11] is to seek an exclusion order from the ITC pursuant to section 337 of the Tariff Act of 1930.[12] Section 337 provides a patent owner with another forum to litigate infringement of their patent of products that “are made, produced, processed, or mined under, or by means of, a process covered by the claims of a valid and enforceable United States patent.”[13]

An ITC case is known as an “investigation.” Money damages are not available in an ITC investigation. Nevertheless, section 337 provides that the legal remedies available to the patent owner in an ITC investigation are “in addition” to other remedies available under the law, including seeking damages in a Federal District Court lawsuit.

In an ITC proceeding, the patent owner files a complaint alleging infringement and asking for the ITC to issue an order excluding the infringing import from the United States. Such complaints must be more detailed in their allegations and statement of facts than a District Court complaint, which only requires “notice pleading.” For example, the ITC states:

When a complaint is based upon the alleged infringement of certain intellectual property rights, the Commission's Rules require that the complaint be accompanied by specified background materials relating to the rights asserted. See Rule 210.12(c)-(g), 19 C.F.R. § 210.12(c)-(g). For example, in patent-based cases, the Rules require that a certified prosecution history accompany the complaint for each asserted patent and copies of the technical references cited in the prosecution histories of each asserted patent. Additionally, the complainant must submit copies of license agreements if the complaint relies on license agreements to establish standing, or the complaint relies on license agreements to support contentions that a domestic injury as defined in Section 337(a)(3) exists, or is in the process of being established as the result of domestic activities of one or more licensees. See Rule 210.12(a)(9)(iv), 19 C.F.R. § 210.12(a)(9)(iv).[14]

As noted, such a complaint must allege injury to a domestic industry. To show injury, the complaining party must satisfy a technical prong and an economic prong. Discussion of the proof required to meet these two prongs is complex and beyond the scope of this article. The requirements vary from case to case and must be investigated on that basis and considering ITC decisions and precedent of appeals.

After the ITC receives the complaint, the Office of Unfair Import Investigations (OUII) reviews the complaint for sufficiency and compliance with the ITC rules. The OUII recommends the ITC on whether to initiate an investigation or dismiss the complaint.

If an investigation commences, then the ITC publishes a notice in the Federal Register. The ITC then assigns the investigation to an Administrative Law Judge (ALJ) who serves as factfinder, rules on motions, and presides over hearings. Additionally, though not in every investigation, the OUII may appoint an attorney known as the “Staff” to serve as an independent party to the investigation with full participation rights.

Upon conclusion of the discovery process and any hearings, the ALJ makes a recommendation, called an initial determination, whether the patent owner has proven to the Commission the allegations in the complaint.[15] The Commission can accept the ALJ's initial determination and issue a final determination along with an exclusion order and cease and desist order. Alternatively, the Commission can reject the findings of the ALJ in a final determination.

An ITC investigation is known as an in rem action; that is, an action against the import itself and not the infringer. When the ITC issues an exclusion order, the United States Customs & Border Protection will enforce the order by detaining imports subject to the exclusion order at the entry point of the United States border.

Exclusion orders fall into two categories: 1) limited and 2) general. A limited exclusion order is directed to specific imports by specific importers. The importers may have participated in the ITC investigation and contested patent validity or infringement or argued any other defenses mentioned above. A general exclusion order would bar any entity from importing an infringing product, regardless of the entity's awareness of the patent at issue or of the ITC investigation.

There are several advantages to pursuing an infringement claim at the ITC. First, ITC investigations generally conclude within about 18 months after filing the complaint; in contrast, a Federal District Court case can take more than two years to finish. Second, the exclusion order applies nationwide. And third, it is often easier to obtain a temporary exclusion order in an ITC investigation than obtain an injunction from the District Court in an infringement lawsuit for money damages.

Conclusion

United States law provides a patent owner with several paths to protect their intellectual property. If you believe someone is infringing your patent, you should immediately seek the help of legal counsel. It is important to remember that a patent owner can enforce patents for the length of the patent term plus six years under the infringement lawsuit statute of limitations.  Failure to promptly act once you become aware of an infringement, however, can jeopardize your ability to obtain relief from the Federal Courts or the ITC due to the defense of the equitable doctrine of laches.

If you discover someone infringing your patent, act promptly to secure legal counsel and discuss your various options to stop the infringement.

How We Can Help

Gallium Law has significant patentexperience. We would be happy to assist you in strengthening and protecting your patent portfolio and increasing the value of your business. Please call us at 651-256-9480 or fill out this Contact Form to speak with us before it's too late.

*The information provided in this article is not legal advice and should not be relied on as such. The content of this article is for informational purposes only and is meant as a starting point in your search for answers to your legal questions.

[1] United States Constitution, Art. I, §8, Clause 3.

[2] United States Code, Title 35, §271(a)

[3] United States Code, Title 35, §271(b)

[4] United States Code, Title 35, §271(c)

[5] Furthermore, 35 USC §271(c) provides that anyone who “imports into the United States a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer.”

[6] United States Court for the Federal Circuit, Case No. 19-2077.Opinion.7-16-2020_1619887

[7] United States Court for the Federal Circuit, Case No. 18-1450.Opinion.3-2-2020_1543049

[8] United States Court for the Federal Circuit, Case No. 18-2042.Opinion.8-27-2019

[9] Laches is an equitable doctrine that, briefly stated, provides that if someone “sits” on their rights and knowingly allows an infringing party to continue to infringe while investing, for example, in manufacturing equipment or establishment of sales forces or open stores, may be barred from obtaining relief for the infringement.

[10] Also known as a “Markman hearing.” See Markman v. Westview Instruments, Inc., 517 United States 370 (1996)

[11] Foreign owners of US intellectual property may also take advantage of section 337 proceedings.

[12] United States Code, Title 19, § 1337

[13] 19 U.S.C. § 1337(a)(1)(B)(ii) (2006)

[14] https://www.usitc.gov/frequently_asked_questions

[15] The Commission consists of six Presidential appointees.