Page 14 - Intellectual Property Disputes

"Infringement" During the Patent Application Process

35 USC 271 defines infringement of a patent as follows:

[e]xcept as otherwise provided in this title, whoever without authority makes, uses, offers to sell,
or sells any patented invention, within the United States or imports into the United States any
patented invention during the term of the patent therefor, infringes the patent.

[w]hoever actively induces infringement of a patent shall be liable as an infringer.

[w]hoever offers to sell or sells within the United States or imports into the United States a
component of a patented machine, manufacture, combination, or composition, or a material or
apparatus for use in practicing a patented process, constituting a material part of the invention,
knowing the same to be especially made or especially adapted for use in an infringement of such
patent, and not a staple article or commodity of commerce suitable for substantial non-infringing
use, shall be liable as a contributory infringer. fn 13

Patent applicants have limited recourse against those guilty of "infringing" conduct committed while the
patent is pending but prior to its issuance, even if the "infringer" is on actual notice of the pending patent
claim. "If the would-be infringer stops all activities once the patent issues, then the infringer would seem
to be free from any liability, at least from patent theories. If the would-be infringer intends to continue
his acts after the patent issues, then the knowing infringer may temper his pre-issuance actions in an
effort to avoid potentially enhanced damages from post-issuance infringement." fn 14

Addressing this issue in Gustafson, Inc. v. Intersystems Industrial Products, Inc., Chief Judge Markey
considered it obvious that a party cannot be held liable for "infringement" and, thus, not for "willful"
infringement, of a nonexistent patent (that is, no damages are payable on products manufactured and
sold before the patent is issued). Whether an act is "willful" is, by definition, a question of the actor’s
intent, the answer to which must be inferred from all the circumstances. Hence, a party cannot be found
to have "willfully" infringed a patent of which the party had no knowledge, nor is there a universal rule
that to avoid willfulness one must cease manufacture of a product immediately upon learning of a
patent, upon receipt of a patentee’s charge of infringement, or upon the filing of suit. fn 15 The Patent
Statute provides a narrow exception to pre-issuance damages in which a patent holder may obtain a
reasonable royalty from an infringer prior to the issuance of the patent if it can be proven the infringer
had actual notice of the published patent application and the infringer makes, uses, offers for sale, or
sells in the United States the invention as claimed in the published patent application or imports such an
invention into the United States. fn 16

fn 13 35 USC 271 (Effective December 8, 2003).

fn 14 Michael A. Shimokaji, "Inducement and Contributory Infringement Theories to Regulate Pre-Patent Issuance Activity," 1997,
https://ipmall.law.unh.edu/sites/default/files/hosted_resources/IDEA/14.Shimokaji97.pdf.

fn 15 Gustafson, Inc. v. Intersystems Indus. Prods., Inc., 897 F.2d 508 (5th Cir. 1990).

fn 16 35 USC 154(d).

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