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Infringement under 35 U.S.C.S. § 271(a) is not necessarily precluded even though a component of a patented system is located outside the United States. However, the effect of the extraterritorial component may be different for different infringing acts. Not only will the analysis differ for different types of infringing acts, it will also differ as the result of differences between different types of claims.
Inventors Thomas J. Campana, Jr.; Michael P. Ponschke; and Gary F. Thelen (collectively "Campana") developed an electronic mail system that was claimed in the '960, '670, '172, '451, and '592 patents. Campana’s particular innovation was to integrate existing electronic mail systems with radio frequency wireless communication networks. The said patents were now owned by NTP, Inc. (“NTP”). In November 2001, NTP filed suit against Research In Motion, Ltd. (“RIM”), the seller of the accused BlackBerry system – a system which allowed out-of-office users to continue to receive and send electronic mail, communications, using a small wireless device. NTP alleged that over forty system and method claims from its several patents-in-suit had been infringed by various configurations of the BlackBerry system. According to NTP, RIM had infringed its patents by making, using, selling, offering to sell and importing to the United States products and services, including the Defendant's BlackBerry TM products and their related software. The jury ruled in favor of NTP, finding direct, induced, and contributory infringement by RIM on all asserted claims of the patents-in-suit. The jury also found that the infringement was willful. Adopting a reasonable royalty rate of 5.7%, the jury awarded damages to NTP in the amount of approximately $23 million. Denying RIM’s motion for judgment as a matter of law, the district court entered final judgment in favor of NTP, and awarded monetary damages. The court also entered a permanent injunction against RIM, enjoining it from further manufacture, use, importation, and/or sale of all accused BlackBerry systems, software, and handhelds. RIM appealed, arguing that the district court erred in its claim constructions, and under the correct claim constructions RIM's products did not infringe. Moreover, RIM argued that because the Blackberry Relay was located in Canada, as a matter of law, RIM cannot be held liable for infringement under 35 U.S.C. § 271. RIM further argued that the jury verdict of infringement lacked substantial evidence, and thus, the district court should have granted RIM’s motion for judgment as a matter of law of non-infringement.
Was the act of using, offering to sell, or selling of a patented invention an infringement under section 271(a) if a component or step of the patented invention was located or performed abroad?
Yes, with regard to the asserted system claims. No, with regard to the asserted method claims.
The court held that infringement under section 271(a) was not necessarily precluded even though a component of a patented system was located outside the United States. However, the effect of the extraterritorial component may be different for different infringing acts. In this case, the court held that the use of a claimed system under section 271(a) was the place at which the system as a whole is put into service, i.e., the place where control of the system was exercised and beneficial use of the system obtained. Based on this interpretation of section 271(a), it was proper for the jury to have found that use of NTP's asserted system claims occurred within the United States. The court noted that RIM’s customers located within the United States controlled the transmission of the originated information and also benefited from such an exchange of information. Thus, the location of the Relay in Canada did not, as a matter of law, preclude infringement of the asserted system claims in this case. However, the court reached a different conclusion with regard to NTP’s asserted method claims. The court noted that under section 271(a), the concept of “use” of a patented method or process was fundamentally different from the use of a patented system or device. According to the court, a process was nothing more than the sequence of actions of which it was comprised, the use of a process necessarily involved doing or performing each of the steps recited; thus, a process cannot be used “within” the United States as required by section 271(a) unless each of the steps was performed within the country. In the present case, each of the asserted method claims recited a step that utilized an “interface” or “interface switch,” which was only satisfied by the use of RIM’s Relay located in Canada. Therefore, as a matter of law, these claimed methods could not be infringed by use of RIM’s system.