New Federal Circuit Decision Rules on Divided Patent Infringement of System Claims

While divided patent infringement for method claims has been addressed by a number of recent Federal Circuit decisions,¹ the issue of divided infringement with respect to system claims has been addressed in detail for the first time by the Court in Centillion Data Sys., LLC v. Qwest Comm. Int’l, Inc., No. 2010-1110, -1131, slip op. at 7 (Fed. Cir. Jan. 20, 2011). That is, the Court specifically considered the issue of direct infringement for “using” and “making” of a patented system that includes elements in the possession of more than one actor.

In short, the Court held that, to “use” a system for purposes of direct infringement, a party must put the invention into service, i.e., control the system as a whole and obtain benefit from it. Centillion, slip op. at 8. Applying this holding to a claim covering a system generally comprising a back-end system residing on a service provider’s computer and front-end software residing on the computer of the service provider’s customer, the Court found that the customer “uses” such a system. Id. at 10-11 However, the Court found that, in the circumstances, the service provider does not “use” such a system. Id. at 12-14. The Court went further to hold that the service provider, in the circumstances, also did not “make” such a system. Id. at 15-16.

Download: New Federal Circuit Decision Rules on Divided Patent Infringement of System Claims

¹ The Federal Circuit has held that a patented method cannot be directly infringed through use by multiple actors, unless one actor controls or directs the performance of each step of the patented method that the actor does not itself perform. See, e.g., BMC Resources Inc. v. Paymentech, L.P., 498 F.3d 1373 (Fed. Cir. 2007), Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318, 1328-29 (Fed. Cir. 2008), and Akamai Technologies, Inc. v. Limelight Networks, Inc., 2009-1372, 2009-1380, 2009-1416, 2009-1417, 2010 WL 5151337 (Fed. Cir. Dec. 20, 2010).