By J. Gibson Lanier, Ph.D.

In what may turn out to be a landmark decision, the Court of Appeals for the Federal Circuit (CAFC) significantly expanded the definition of direct infringement with respect to divided infringement (i.e., the infringement occurs through the action of more than one party).

In Akamai Technologies, Inc. v. Limelight Networks, Inc. (Fed. Cir. 2015) (en banc), on remand from the Supreme Court, the CAFC issued a unanimous decision adding two new situations where a party may be held directly liable as infringing a patent. The case concerns whether Limelight infringed claims to patents owned by Akamai covering methods of delivering content over the internet.  Limelight and Akamai stipulated that Limelight’s customers perform two of the steps of the method.  The question of infringement turned on whether Limelight can be liable despite having not performed all the steps of the claimed method itself.

The Supreme Court had ruled that absent a direct infringer, Limelight could not be liable for indirect infringement under § 271(b).  However, on remand, the CAFC found while Limelight may not be liable for indirect infringement under; it is liable to Akamai for directly infringing the Akamai patents.  The CAFC held that “liability under § 271(a) can also be found when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance.”  Slip op at 5.  The court also held that “where two or more actors form a joint enterprise, all can be charged with the acts of the other, rendering each liable for the steps performed by the other as if each is a single actor.” Slip op at 5.

In rendering this opinion, the CAFC expanded situations where multiple parties may directly infringe a patent beyond principal-agent relationships and contractual arrangements to now include any situation where “all method steps can be attributed to a single entity” or to each participant in a joint enterprise.