U.S. Court of Appeals for the Federal Circuit, Bio-Rad Laboratories, Inc. v. International Trade Commission, Docket No. 2020-1475, 2020-1605

 

International Trade

 

ITC

 

Tariff Act of 1930 (Section 337)

 

Import

 

Patent Infringement

 

Induced Infringement

 

Contributory Infringement

 

 

 

In this consolidated appeal, Bio-Rad Laboratories, Inc. (“Bio-Rad”) and 10X Genomics, Inc. (“10X”) each challenge a portion of a decision by the United States International Trade Commission (“Commission”) regarding Bio-Rad’s allegations that 10X violated section 337 of the Tariff Act of 1930, 19 U.S.C. § 1337, by importing into the United States certain microfluidic chips. See Comm’n Opinion, In the Matter of Certain Microfluidic Devices, USITC Inv. No. 337-TA-1068, 2020 WL 225020 (Jan. 10, 2020) (“Commission Opinion”). Specifically, Bio-Rad challenges the Commission’s determination that 10X did not infringe the claims of U.S. Patent 9,500,664 (the “’664 patent”) by importing its “Chip GB.” 10X challenges the Commission’s determination that it infringes the claims of the ’664 patent as well as U.S. Patents 9,636,682 (the “’682 patent”) and 9,649,635 (the “’635 patent”) by importing its “GEM Chips.” For the reasons discussed below, we affirm the Commission’s decision with respect to both appeals.

 

We consolidated the appeals in the nature of cross-appeals. We have jurisdiction under 19 U.S.C. § 1337(c) and 28 U.S.C. § 1295(a)(6).

 

Both parties’ appeals relate to patent infringement, which is a two-step analysis. Packet Intelligence LLC v. NetScout Sys., 965 F.3d 1299, 1306 (Fed. Cir. 2020) (citing Clare v. Chrysler Grp. LLC, 819 F.3d 1323, 1326 (Fed. Cir. 2016)). The first step of the infringement analysis is claim construction, id., which is an issue of law that we review de novo. Linear Tech. Corp. v. ITC, 566 F.3d 1049, 1054 (Fed. Cir. 2009). The second step of the infringement analysis involves a comparison of the accused product to the construed claims, which is an issue of fact that we review for substantial evidence. See Packet Intelligence, 965 F.3d at 1305–06.

 

The compelling factor here is the distinction between “samples” and “reagents.” The ’664 patent consistently makes clear that a sample is not a reagent, beginning with the opening sentences of the introduction section. See ’664 patent col. 1 ll. 26–31 (“Many biomedical applications rely on high-throughput assays of samples combined with reagents. For example, in research and clinical applications, high-throughput genetic tests using target-specific reagents can provide high-quality information about samples . . . .” (emphases added)). The patent goes on to list definitions that lead to the unavoidable conclusion that a compound cannot simultaneously be a sample and a reagent. For example, within the definition of “sample,” the patent states that “a sample is the general subject of interest for a test that analyzes an aspect of the sample, such as an aspect related to at least one analyte that may be present in the sample.” Id. at col. 8 ll. 37–40. Similarly, the term “analyte” is defined as “a component(s) or potential component(s) of a sample that is analyzed in a test.” Id. at col. 9 ll. 1–2. And the term “test” is defined as “a procedure(s) and/or reaction(s) used to characterize a sample, and any signal(s), value(s), data, and/or result(s) obtained from the procedure(s) and/or reaction(s).” Id. at col. 8 ll. 7–9. Thus, the patent describes a relationship between a sample, the analyte(s) it contains, and the test(s) performed to analyze it.

 

In contrast, the patent defines a “reagent” as “a compound, set of compounds, and/or composition that is combined with a sample in order to perform a particular test(s) on the sample.” Id. at col. 9 ll. 19–21 (emphasis added). Thus, a reagent is not a part of a sample, nor is it the same thing as a sample in the context of the patent. The ALJ’s findings reflect a correct determination that, while the term “sample” is defined broadly in the patent, the definition of “sample” is not so broad as to include reagents within its scope.

 

Because we find no error in the claim construction, what remains is the second step of the infringement analysis, which turns on whether the monomer solution in the Chip GB is properly characterized as a sample or as a reagent. We review that fact question for substantial evidence. See Packet Intelligence, 965 F.3d at 1305–06.

 

The Commission adopted the reasoning of the ALJ, which relied on testimony from multiple witnesses that the monomer is a reagent and not a sample. Those witnesses focused on the fact that 10X does not analyze the monomers, but rather uses them to make the gel beads that go into reagent kits. See J.A. 179 (citing testimony from multiple fact and expert witnesses). We also agree with 10X that quality control testing is not the type of testing described in the patent, and it does not change the nature of the monomer. We therefore conclude that substantial evidence supports the ALJ’s finding that the monomer in the Chip GB is not a sample. Accordingly, Bio-Rad has failed to persuade us to overturn the Commission’s finding that the Chip GB does not infringe claims 1 and 14 of the ’664 patent.

 

We finally consider the Commission’s determination that Bio-Rad proved the elements of induced and contributory infringement of the ’682 and ’635 patents with respect to the GEM Chips. Induced infringement under 35 U.S.C. § 271(b) requires proof of underlying direct infringement, as well as proof that (1) “the defendant knew of the patent,” (2) the defendant knew or should have known that “the induced acts constitute patent infringement,” and (3) the defendant “possessed specific intent to encourage another’s infringement.” Sanofi, LLC v. Watson Labs. Inc., 875 F.3d 643, 643–44 (Fed. Cir. 2017). Contributory infringement under 35 U.S.C. § 271(c) requires proof that (1) the defendant had “knowledge of the patent in suit,” (2) the defendant had “knowledge of patent infringement,” and (3) the accused product is not a staple article or commodity of commerce suitable for a substantial noninfringing use. Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct. 1920, 1926 (2015). Because inducement and contributory infringement are issues of fact, see, e.g., Barry v. Medtronic, Inc., 914 F.3d 1310, 1334 (Fed. Cir. 2019), we review the Commission’s decisions for substantial evidence. Guangdong, 936 F.3d at 1358–59.

 

(…) At the very least, the ALJ found that 10X was willfully blind to the fact that its technology would infringe Bio-Rad’s patents, and continued to import infringing GEM Chips and engage in infringing activities even after Bio-Rad filed its complaint. ALJ Initial Determination, 2018 WL 5279172, at *75–76.

 

CONCLUSION

We have considered the parties’ remaining arguments but we find them unpersuasive. Accordingly, the decision of the Commission is affirmed.

 

 

 

(U.S. Court of Appeals for the Federal Circuit, May 28, 2021, Bio-Rad Laboratories, Inc. v. International Trade Commission, Docket No. 2020-1475, 2020-1605, Circuit Judge Lourie)

United States Court of Appeals for the Federal Circuit, Comcast Corp. v. United States International Trade Commission, Docket No. 18-1450

 

Import

Software

Customs

ITC

Section 337 of the Tariff Act of 1930

Patent Infringement

Infringement May Occur After Importation

Exclusion Order

Blocking Imports

Cease and Desist Order

 

Appeals from the United States International Trade Commission in Investigation No. 337-TA-1001.

 

Rovi Corporation and Rovi Guides, Inc. (collectively “Rovi”) filed a complaint with the ITC alleging violation of Section 337 of the Tariff Act of 1930. Rovi asserted, inter alia, infringement of claims 1, 2, 14, and 17 of United States Patent No. 8,006,263 (“the ’263 patent”) and claims 1, 3, 5, 9, 10, 14, and 18 of United States Patent No. 8,578,413 (“the ’413 patent”). Rovi stated, and the Commission found, that Comcast’s customers directly infringe the ’263 and ’413 patents by using Comcast’s X1 system. The Commission found that Comcast is in violation of Section 337 by importing the X1 set-top boxes that are used in the infringing system.

 

(…) The administrative law judge (“ALJ”) conducted an investigation and trial, and found violation of Section 337. The ALJ found that the X1 set-top boxes are imported by ARRIS and Technicolor, and that “Comcast is sufficiently involved with the design, manufacture, and importation of the accused products, such that it is an importer for purposes of Section 337.” Final ID at *11. The full Commission affirmed “the Final ID’s findings and conclusion that Comcast imports the X1 STBs into the United States.” Comm. Op. at *7.

 

The full Commission affirmed “the Final ID’s conclusion that the X1 systems meet all of the limitations of the asserted claims” and “Comcast’s customers directly infringed the ’263 and ’413 patents through their use of the X1 systems in the United States.” Id. at *10–11. The Commission stated that “the Final ID’s unreviewed findings also conclude that Comcast induced that infringement,” and that “Comcast also instructs, directs, or advises its customers on how to carry out direct infringement of the asserted claims of the ’263 and ’413 patents with the X1 STBs.” Id. The Commission affirmed that Comcast violated Section 337.

 

The Commission issued a limited exclusion order and cease and desist orders directed to the Comcast respondents. The limited exclusion order excludes importation of the X1 set-top boxes by Comcast (…).

 

Section 337 contemplates that infringement may occur after importation. The statute defines as unlawful “the sale within the United States after importation . . . of articles that—(i) infringe . . . .” The statute thus distinguishes the unfair trade act of importation from infringement by defining as unfair the importation of an article that will infringe, i.e., be sold, “after importation.” Section 337(a)(1)(B)’s “sale . . . after importation” language confirms that the Commission is permitted to focus on post-importation activity to identify the completion of infringement.

 

(…) Wing Shing Pdts. (BVI), Ltd. v. Simatelex Manufactory Co., 479 F.Supp.2d 388, 409–11 (S.D.N.Y. 2007) (“Numerous courts have held that, in contrast to §§ 271 (a) and (c), § 271 (b) applies to extraterritorial conduct.”)

 

(…) Comcast’s inducing activity took place overseas, prior to importation; it took place at importation; and it took place in the United States, after importation.

 

Comcast argues that it is not an importer of the X1 set-top boxes, in that the importer of record is ARRIS or Technicolor. Comcast states that it does not physically bring the boxes into the United States and it does not exercise any control over the process of importation. The Commission and Rovi respond that Comcast is an importer in terms of Section 337 because Comcast causes the X1 set-top boxes to enter the United States.

 

The Final ID found that the X1 set-top boxes “are so tailored to Comcast’s system and requirements that they would not function within another cable operator’s system.” Final ID at *11. “Further, the software at issue in the heart of this investigation is attributable squarely to Comcast.” Id. The Final ID concluded that “the evidence shows that Comcast is sufficiently involved with the design, manufacture, and importation of the accused products, such that it is an importer for purposes of Section 337.” Id.

 

The Final ID also found that Comcast “requires ARRIS and Technicolor to handle importation formalities, such as fees, documentation, licenses, and regulatory approvals.” Id. The Final ID concluded that “Comcast is sufficiently involved in the importation of the accused products that it satisfies the importation requirement, under 19 U.S.C. § 1337(A)(1)(B).” Final ID at *405.

 

The full Commission concluded that Comcast is an importer of the X1 set-top boxes. The Commission stated that “Section 337, as applied to Comcast’s relevant conduct here, requires importation of articles, proof of direct infringement, and proof of inducement, all of which have been established by the record.

 

The Commission has discretion in selecting a remedy that has a reasonable relation to the unlawful trade practice. See Cisco Systems, Inc. v. U.S. Int’l Trade Comm’n, 873 F.3d 1354, 1363 (Fed. Cir. 2017) (“Blocking imports of articles that induce patent infringement has a reasonable relationship to stopping unlawful trade acts.”).

 

 

(United States Court of Appeals for the Federal Circuit, March 2, 2020, Comcast Corp. v. United States International Trade Commission, Docket No. 18-1450 (18-1653, 18-1667), Circuit Judge Newman)

Global-Tech Appliances, Inc. v. SEB S.A.

Patent infringement: inducement: 35 U. S. C. §271(b);  Held: 1. Induced infringement under §271(b) requires knowledge that the induced acts constitute patent infringement. (a) Section 271(b)’s text—“whoever actively induces infringement of a patent shall be liable as an infringer”—is ambiguous as to the intent needed to impose liability. In referring to a party that “induces infringement,” the provision may require merely that the inducer must lead another to engage in conduct that happens to amount to infringement. On the other hand, the reference to a party that “induces infringement” may also be read to mean that the inducer must persuade another to engage in conduct that the inducer knows is infringement; deliberate indifference to a known risk that a patent exists does not satisfy the knowledge required by §271(b). Nevertheless, the Federal Circuit’s judgment must be affirmed because the evidence in this case was plainly sufficient to support a finding of Pentalpha’s knowledge under the doctrine of willful blindness; although the Courts of Appeals articulate the doctrine of willful blindness in slightly different ways, all agree on two basic requirements. First, the defendant must subjectively believe that there is a high probability that a fact exists. Second, the defendant must take deliberate actions to avoid learning of that fact. These requirements give willful blindness an appropriately limited scope that surpasses recklessness and negligence.  (U.S.S.Ct., 31.05.11, Global-Tech Appliances, Inc. v. SEB S.A., J. Alito).

Incitation à la violation d’un brevet : selon la loi fédérale sur les brevets d’invention, l’incitation à la violation implique la connaissance par l’auteur de l’incitation que les actes objets de l’incitation sont constitutifs de violation du brevet. Le texte de la loi prévoit à cet égard que celui qui incite activement à la violation d’un brevet se rend coupable de violation des droits découlant du brevet. Ce texte de loi est ambigu s’agissant du degré d’intention requis pour imposer responsabilité. En se référant à une partie qui incite à la violation, la loi pourrait seulement signifier que l’incitateur doit conduire un tiers à adopter une conduite qui s’analyse en une violation. D’un autre côté, la référence à une partie qui incite à la violation peut aussi être comprise comme signifiant que l’incitateur doit persuader autrui à s’engager dans une conduite dont l’incitateur connaît la nature de violation du brevet. Une indifférence délibérée à un risque connu qu’un brevet pourrait exister ne suffit pas à satisfaire la connaissance prévue par la loi pour impliquer responsabilité. Quoi qu’il en soit, dans cette affaire, P. doit être condamné pour incitation à la violation d’un brevet. La connaissance prévue par la loi pour impliquer responsabilité est ici donnée sous l’angle de la doctrine d’aveuglement volontaire. Selon cette doctrine, la partie poursuivie doit croire subjectivement à une haute probabilité qu’un fait existe. En second lieu, le poursuivi doit mettre en œuvre des actions délibérées pour éviter d’apprendre ce fait. Ces conditions confèrent à la doctrine d’aveuglement volontaire un cadre limité approprié, qui convient mieux que la doctrine de la responsabilité pour conduite « sans égard » (recklessness) ou pour conduite « négligente » (negligence).