Supreme Court Rules that "Willful Blindness" is Sufficient for Inducement of Patent Infringement
In a near unanimous, 8 to 1, decision today, the Supreme Court held that induced infringement under 35 U.S.C. § 271(b) requires knowledge that the induced acts constitute patent infringement but such knowledge need not rise to the level of actual knowledge. Global-Tech Appliances, Inc. v. SEB S.A., No. 10-6 (U.S. Sup. Ct. May 31, 2011) (found here).
Instead of an actual knowledge requirement, the Court adopted the criminal doctrine of “willful blindness” and held that a defendant is liable for induced infringement if it (1) subjectively believed that there is a high probability that the acts it induces infringe a patent; and (2) took deliberate actions to avoid learning of that infringement. Willful blindness, the Court held, has a “limited scope that surpasses recklessness and negligence” and that a willfully blind defendant “is one who takes deliberate actions to avoid confirming a high probability of wrongdoing and can almost be said to have actually known the critical facts.”
Our earlier posts on the Global-Tech case, which detail the facts of the case and the Federal Circuit’s decision can be found here, here and here. In short, the Federal Circuit held that inducement liability requires only a “deliberate indifference” to a known risk that a patent exists. The Supreme Court rejected this holding as flawed because it permits a finding of knowledge where there is merely a “known risk” that the induced acts are infringing and because the “deliberate indifference” standard did “not require active efforts by an inducer to avoid knowing about the infringing nature of the activities.”
While the Supreme Court overturned the Federal Circuit’s deliberate indifference standard, it affirmed the result on the grounds that the evidence was more than sufficient for a jury to find that the accused infringer met the willful blindness standard.Specifically, the Court pointed out that the infringer, Pentalpha:
- Copied the patentee’s “cool-touch” deep fryer;
- Believed that the patentee’s product embodied advanced technology, as shown by its decision to copy all but the cosmetic features of the deep fryer;
- Copied an overseas model of the patented deep fryer with the awareness that it would not bear U.S. patent markings;
- Failed to inform the attorney from whom it sought a right-to-use opinion that it had copied the deep fryer. The Court stated that it “cannot fathom” what motive Pentalpha might have had for withholding this information from its attorney.
Despite the result in Global-Tech, most plaintiffs asserting an inducement claim will still have to meet the higher standard of proving that a defendant had actual knowledge that the acts it induced constitute patent infringement. Except in extreme cases like Global-Tech -- where an accused infringer copies a competitor’s product and takes active steps to avoid finding out if the product is patented -- the willful blindness standard will be difficult to meet. As the Supreme Court pointed out, willful blindness requires more than reckless or negligent conduct, and evidence that an accused infringer subjectively believed that there was a high probability that it was inducing patent infringement will be difficult to obtain. If Pentalpha itself, for example, had just told its right-to-use attorney that it had copied a competitor’s product or even if it had copied a U.S. model of the deep fryer that had no patent markings, it may have escaped liability. Thus, it is likely that cases of inducement liability in the absence of proof of actual knowledge of the infringing nature of the induced acts will be few and far between.
One last note -- the one dissenting Justice was Justice Kennedy, who is almost always in the majority because of his status as the swing-vote in most cases. Global-Tech is the rare case where he not only wrote a dissent, but he couldn't get any other justice to join him.
