United States - The Territorial Scope of Patent Protection
Several recent cases have addressed the territorial scope of United States patents.
In order to be held as an infringer of a United States patent under 35 USC 271(a), it is necessary during the life of the patent to have made, used, offered to sell or sold what is claimed in the patent within the United States or to have imported the patented invention into the United States.
In these days of inventions relating to telecommunications and the internet, what is meant by saying that infringement must be within the United States can cause difficulties. In NTP Inc. V. Research in Motion Ltd. the Federal Circuit held that in a claim directed to a "system" the requirement had been met by an electronic mail system (the BlackBerry system) in which one of the components of the system was located outside the United States. However, method claims were found not to be infringed. The defendant’s system had three components: a hand held unit that can receive e-mail, e-mail redirector software and access to a nation-wide wireless network. The second component was located in Canada. On this basis, the court concluded that the claimed system was being "used" in the United States by customers in the United States and that there was infringement under 35 USC 271(a). So far as the method claims were concerned, since not all of the steps were being carried out in the United States, there was no use within the country and hence no infringement.
Section 35 USC 271(f), provides that it is an act of infringement to supply or cause to be supplied in or from the United States any component of a patented invention that is especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use, where such component is uncombined in whole or in part, knowing that such component is so made or adapted and intending that such component will be combined outside of the United States in a manner that would infringe the patent if such combination occurred within the United States.
In two cases involving Microsoft, Eolas Technologies Inc. v. Microsoft Corp. and AT&T Corp. v. Microsoft Corp, it was held that, where software is supplied on a disk that is incorporated into a product made abroad, the software can be regarded as being a component of an assembled computer containing such program for the purposes of this section. In the second case, a majority of the Federal Circuit (Judge Rader dissenting) also held that duplication abroad of the software sent from the United States constituted an act of "supply" falling within the scope of the statute. The primary rationale was that, in the technology in question (the Windows® operating system), supply often involved an act of generating a copy so that for software components the act of copying is subsumed in the act of supplying.
For some time there was a debate as to whether 35 USC 271(f) could apply to process claims since it was not clear what might constitute a “component” of a process claim. In the Microsoft cases, it was pointed out that the statute provided no basis for distinguishing between different types of patents and in Union Carbide Chemicals & Plastics v. Shell Oil Company it was held that supply of a catalyst from the United States for use abroad in a process covered by a U.S. patent could constitute supply of a “component of a patented invention” and so fall within the statutory prohibition.
There has been little case law in the United States on what is now becoming a hot topic internationally, namely that of international exhaustion of patent rights. Ever since the 19th century, the first sale doctrine has made it clear that, unless the original sale of a patented article was subject to some lawful restriction on its use, the patent owner could not enforce the patent against a subsequent purchaser or user of the patented article. Little thought was given to whether this also applied if the first sale was outside the United States. It appears that the doctrine may only apply when the first sale took place in the United States. In Jazz Photo Corp. v. ITC and its companion case Fuji Photo Film Co, v. Jazz Photo Corp, both relating to the repair of camera bodies in China, some of the cameras having been sold originally in the United States and some outside of it, the Federal Circuit, apparently sua sponte, held that United States patent rights are not exhausted by products of foreign provenance. To invoke the protection of the first sale doctrine, the authorized first sale must have occurred in the United States.
Under 35 USC 272, certain acts that would otherwise be infringements are excused if (a) they take place on any vessel, aircraft or vehicle of a foreign country that grants reciprocal provisions to the United States, (b) the ship, aircraft or vehicle is present in the United States only temporarily or accidentally, (c) the invention is used exclusively for the needs of the vessel, aircraft or vehicle, and (d) is not offered for sale or sold in or used for the manufacture of anything to be sold in or exported from the United States. The meaning of this provision came before the Federal Circuit for the first time in National Steel Car Ltd. v. Canadian Pacific Railway Ltd. Relying on the definition of vehicle in 1 USC 4 (the word "vehicle" includes every description of carriage or other artificial contrivance used or capable of being used as a means of transportation on land), the court found that an individual railroad flat car (as opposed to the train of which it is a part) should be considered as a vehicle for the purposes of this section so that its temporary presence in the United States might not constitute infringement of a U.S. patent, notwithstanding that the flat cars were expected to spend more than fifty percent of their working lives in the United States. The key issue was that the cars would be used primarily in international commerce (carrying lumber from Canada to the United States), it being noted that the rationale behind 35 USC 272 was the avoidance of imposing unreasonable inhibitions on international trade.
