Editor’s note. As this blog focuses on Government contract developments, we are interested in the decisions issued by the Federal Circuit. Although we don’t generally comment on that court’s patent decisions in which the Government is not a party, this week’s important decisions from the Supreme Court regarding Federal Circuit patent cases deserve to be highlighted here. Our colleague, Steve Baskin, provided this timely analysis.

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The Limelight Decision

The Federal Circuit had expanded the theory of induced infringement by allowing a patentee to allege liability for induced infringement if multiple parties committed the steps in a method patent claim. But the Supreme’s Court recently issued decision in Limelight Networks, Inc. v. Akamai Technologies reverses the Federal Circuit’s expansion, and makes clear that induced infringement requires that a single party commit all steps in a method patent claim.

The Supreme Court’s Limelight decision restricts a patent holder’s ability to allege infringement. Specifically, a patent holder will now need to show that a single actor (e.g., an accused infringer or one of its clients) actually performs each of the steps in any asserted method claims. In other words, a patent holder will no longer be able to premise infringement on the combined acts of an infringer and/or infringer’s client(s). This is significant because each of the method claims in the asserted patent requires the step of “initiating a request for desired information from the plurality of data sources,” and a plain reading of this term would suggest that, to the extent this step is performed, it is performed by the infringer’s clients, not the infringer itself. As a result, a patent holder will not likely be able to argue infringement of similar method claims under any straightforward theory of infringement.

In addition, because the Supreme Court’s Limelight decision excludes theories of infringement that rely on the combined acts of multiple actors, an attorney should be able to leverage the decision to head off attempts by a patent holder to subject an alleged infringer’s clients to burdensome discovery requests. In particular, unless a patent holder can clearly articulate an infringement theory in which an alleged infringer’s clients directly infringe these method claims, one will be able to argue that discovery for the clients is irrelevant to their theory of infringement. Note, however, that an alleged infringer may still try to premise any such discovery on alleged direct infringement by its clients on the “use” of systems that allegedly infringe system claims of the asserted patent.

The Supreme Court’s Nautilus Decision

Under the patent laws, the claims of a patent must “conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which [the applicant] regards as the invention.” 35 U.S.C. § 112, ¶ 2. The failure to meet this statutory requirement renders a patent invalid as being “indefinite.” For years, the Federal Circuit had held that the test for showing that a patent was indefinite was whether the claims were “insolubly ambiguous”—a very high standard for proving indefiniteness and a burden that few patent challengers could meet. In its Nautilus, Inc. v. Biosig Instruments, Inc. decision, the Supreme Court rejected the Federal Circuit’s “insolubly ambiguous” standard as too restrictive, and instead stated that 35 U.S.C. § 112, ¶ 2, requires “that a patent’s claims, viewed in light of the specification and prosecution history, inform those skilled in the art about the scope of the invention with reasonable certainty.” According to the Supreme Court’s decision, a patent is invalid as indefinite if its claims, read in light of the patent specification and prosecution history, fail to inform a person of ordinary skill in the art about the scope of the invention.