A Single Component of Kits Found Not to Infringe the Patent

On February 22, 2017, the Supreme Court of the United States (SCOTUS) issued an opinion about the intersection of international supply chains and federal patent law. The decision followed a purely textual interpretation of the relevant statute. SCOTUS reversed the Federal Circuit by finding that Thermo Fisher Scientific’s Life Technologies unit did not infringe U.S. Patent RE37,984 by shipping a single component of Promega’s patented invention overseas.

While I may not agree with the opinion on policy grounds (because sometimes I want SCOTUS to consider the policies and effects of a decision), it is hard to argue with just interpreting what is written without trying to reconstruct the intent of the statute drafters. Since 1952, the policies underlying the relevant statute have evolved substantially. Patents do not always promote the sciences and useful arts, as indicated in the U.S. Constitution. The policies of 1952 do not necessarily best serve different industries equally in view of modern commerce. For example, the opinion may have a different impact on software and electronic component patents as compared to chemical, genetic and pharmaceutical component patents. Thankfully, most of the trouble that may result to patent owners from this opinion can be avoided with carefully drafted patent claims.

Justice Sotomayor delivered the opinion of the Court in Life Technologies Corp. v. Promega Corp, 580 U. S. ____ (2017). Section 271(f )(1) of the Patent Act of 1952 (35 United States Code) prohibits the supply from the United States (U.S.) of “all or a substantial portion” of the components of a patented invention for combination abroad. Section 271(f)(1) states in its entirety:

“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 [of the patent].”

Promega Corporation sublicensed a patent from another company, Tautz. The patent claims were directed to a toolkit for genetic testing and the patent was owned by Life Technologies Corporation, the petitioner, and its subsidiaries. While a careful understanding of the technology involved is not needed, claim 12 is illustrative of claims from U.S. Patent RE37,984:

12. A kit for performing the method of claim 1 [determining length polymorphisms in a simple or cryptically simple sequence in one or more DNA regions of one or more subjects], comprising:

a) at least one vessel containing an equimolar mixture of primers constituting between 1 and 50 of said primer pairs;

b) a vessel containing a polymerizing enzyme suitable for performing a primer-directed polymerase chain reaction;

c) a vessel containing the deoxynucleotide triphosphates adenosine, guanine, cytosine and thymidine;

d) a vessel containing a buffer solution suitable for performing a polymerase chain reaction, or a concentrate of said buffer solution;

e) a vessel containing a template DNA that has a nucleotide sequence including a simple or cryptically simple sequence for assaying positive performance of the method, wherein each simple or cryptically simple DNA sequence comprises at least one trinucleotide motif.

The question before SCOTUS was whether the supply of a single component of a multicomponent invention — such as part (b) of claim 12 — is an infringing act under 35 U. S. C. §271(f )(1) when shipped abroad and assembled with the rest of the components.

In this instance, one of the kit’s five components, an enzyme known as the Taq polymerase, was manufactured by Life Technologies in the U.S. and then shipped to the United Kingdom, where the four other components were made, for combination there. When Life Technologies began selling the kits outside the licensed fields of use, Promega sued, claiming that patent infringement liability was triggered under §271(f)(1) of the Patent Act. The jury returned a verdict for Promega, but the District Court granted Life Technologies’ motion for judgment as a matter of law, holding that §271(f)(1)’s phrase “all or a substantial portion” did not encompass the supply of a single component of a multicomponent invention. The Federal Circuit reversed. It determined that a single important component could constitute a “substantial portion” of the components of an invention under §271(f)(1) and found the Taq polymerase to be such a component.

SCOTUS held that the supply of a single component of a multicomponent invention for manufacture abroad does not give rise to §271(f)(1) liability. SCOTUS reasoned that Section 271(f)(1)’s phrase “substantial portion” refers to a quantitative measurement. Although the Patent Act itself does not define the term “substantial,” and the term’s ordinary meaning may refer either to qualitative importance or to quantitatively large size, the statutory context points to a quantitative meaning. Neighboring words “all” and “portion” convey a quantitative meaning, and nothing in the neighboring text points to a qualitative interpretation. Thus, SCOTUS went no further and ruled. SCOTUS could have looked at whether the decision would give too much power to patent holders or whether the decision would unfairly favor businesses looking to exploit the language of an otherwise valid patent. Overall, it may be rare for this statute to apply to any patent holder, but it is another of a long list of issues to consider when drafting patent claims and when enforcing patents.

It is worth noting here that, in parsing the statute, the Justices declined to rule on how close to “all” of an invention’s components must be exported in order to be the “substantial portion” that is needed to infringe. Presumably, that determination should be argued to a jury. It is also not clear whether it should be a judge or the jury who answers the question of exactly how many “components” are defined within a patent. Patent owners will want to argue that there are multiple components in the part of an invention shipped overseas. On the other hand, alleged patent infringers may want to include many parts of a patent in one component to avoid assertions of patent infringement. Also, inventors may want to look harder at procuring foreign patents in countries where competitors are likely to repackage or use components of an invention that now is patented only in the U.S.