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Legal Update

US Supreme Court Issues Decision in Life Technologies Corp. v. Promega Corp.

23 February 2017
Mayer Brown Legal Update

On February 22, 2017, the United States Supreme Court issued a decision in Life Technologies Corp. v. Promega Corp., No. 14-1538, addressing whether a party who supplies a single component of a multicomponent invention for manufacture abroad can be held liable under Section 271(f)(1) of the Patent Act. The Court held that a single component does not constitute a “substantial portion” of the invention’s components and thus cannot give rise to liability under Section 271(f)(1).

Background

In an effort to curb efforts to circumvent US patent protection, the Patent Act imposes liability for infringement on anyone who supplies “all or a substantial portion” of a patented invention’s components from the United States for combination overseas. Section 271(f)(1) provides:

Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.

In this case, the underlying patent claimed a toolkit for genetic testing. The toolkit would be used to take small samples of genetic material in the form of nucleotide sequences that make up DNA and then synthesize multiple copies of a particular nucleotide sequence. The parties agreed that the patent recited five components. Accused infringer, Life Technologies, manufactured only one component in the United States and manufactured the remaining components in the United Kingdom.

The jury returned a verdict that Life Technologies willfully infringed. Life Technologies moved for judgment as a matter of law, contending that Section 271(f)(1) did not apply because the phrase “all or a substantial portion” does not encompass the supply of a single component of a multicomponent invention. The district court granted Life Technologies’ motion. The US Court of Appeals for the Federal Circuit reversed and reinstated the jury’s verdict, concluding that the dictionary definition of “substantial” is “important” or “essential,” such that a single component can be a “substantial portion of the components.” The Federal Circuit relied on expert testimony that the component manufactured in the United States was a “main” and “major” component of the kits.

US Supreme Court: One Component Is Not a “Substantial Portion”

The Court explained that the threshold determination is whether “a substantial portion … refers to a quantitative or qualitative measurement.” The Court found that the Patent Act does not define the term “substantial.” Thus, the Court turned to the term’s “ordinary meaning,” which it found could refer to qualitative importance or to quantitatively large size. However, in examining the context in which “substantial” appears, the Court noted that “all” and “portion” convey a quantitative meaning and that the neighboring text does not support a qualitative interpretation. Further, a qualitative interpretation would render the phrase “of the components” unnecessary.

The Court rejected Promega’s request to adopt a “case-specific approach,” such that satisfaction of either a qualitative or quantitative test would suffice. The Court reasoned that considering qualitative, relative importance would not help resolve close cases. Rather, the use of the plural term “components” indicates that multiple components are required. Moreover, Section 271(f)(2), governing contributory infringement, refers to a singular form—“any component.” Thus, reading Section 271(f)(1) to cover any single component would undermine Section 271(f)(2)’s reference to a single component “especially made or especially adapted for use in the invention.”

Further, the Court addressed the history of Section 271(f), which was enacted in response to the Court’s decision in Deepsouth Packing v. Laitram Corp., 406 U.S. 518 (1972). In Deepsouth, the Court held that it was “not an infringement to make or use a patented product outside of the United States.”

The Court expressly stated that it was not defining “how close to ‘all’ of the components ‘a substantial portion’ must be” but simply that a single component does not suffice.

Concurrence in Part and in Judgment by Justices Alito and Thomas

Justices Alito and Thomas, excepted themselves from a discussion of the “genesis” of the statute. They additionally pointed out that the Court’s opinion did not explain how to determine when a multiplicity of components met the statutory test beyond saying that one component is not enough. They explained that they do not read the Court’s opinion “to suggest that any number greater than one is sufficient.” Chief Justice Roberts did not participate in the decision.

Implications of the Decision

The opinion leaves open how to determine what a “substantial portion” is for multicomponent inventions, especially given the conclusion that a “substantial portion” has a quantitative, not a qualitative meaning. Significantly, the parties to the case agreed that the patented invention was made up of only five components, so the Court did “not consider how to identify the ‘components’ of a patent or whether and how that inquiry relates to the elements of a patent claim.” Moving forward, litigants will likely dispute what constitutes a “component” in view of the asserted patent claims. Further, patent prosecutors will carefully consider how to parse claim language so that multiple claim limitations are more likely to be satisfied.

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