In a unanimous and unequivocal opinion, the Supreme Court ruled yesterday that liability for inducement of patent infringement requires that the induced entity itself perform every element of a claim, and thus directly infringe. Limelight Networks, Inc. v. Akamai Techs., Inc., No. 12-786 (June 2, 2014). The Court overruled the Federal Circuit’s decision holding that an entity can be liable for inducement of infringement if it performs some steps of a method claim and induces another entity that it does not direct or control to perform the remaining steps, where no entity directly infringes. The Court’s decision forecloses one theory on which parties had previously relied to attempt to prove liability where steps are performed by multiple entities.

BACKGROUND -

Prior to the Supreme Court’s Akamai decision, a patent owner had two viable theories of infringement for a method claim that recites steps performed by multiple actors. (See our Client Alert (Jan. 10, 2014).) First, the patent owner could show that the accused infringer directed or controlled another entity’s performance of those steps that it did not perform itself and thus was liable for direct infringement under 35 U.S.C. § 271(a). Second, the patent owner could show that the accused infringer induced another entity to perform those steps that it did not perform itself and thus was liable for inducement of infringement under 35 U.S.C. § 271(b), even though the induced entity did not commit direct infringement.