This case deals with standards for direct infringement, joint infringement, and inducement when claims require multiple parties to perform actions.
A representative independent claim of Tropp’s patent that he is alleging that Travel Sentry infringed upon is reproduced below.
1. A method of improving airline luggage inspection by a luggage screening entity, comprising:
making available to consumers a special lock having a combination lock portion and a master key lock portion, the master key lock portion for receiving a master key that can open the master key lock portion of this special lock, the special lock designed to be applied to an individual piece of airline luggage, the special lock also having an identification structure associated therewith that matches an identification structure previously provided to the luggage screening entity, which special lock the luggage screening entity has agreed to process in accordance with a special procedure,
marketing the special lock to the consumers in a manner that conveys to the consumers that the special lock will be subjected by the luggage screening entity to the special procedure,
the identification structure signaling to a luggage screener of the luggage screening entity who is screening luggage that the luggage screening entity has agreed to subject the special lock associated with the identification structure to the special procedure and that the luggage screening entity has a master key that opens the special lock, and
the luggage screening entity acting pursuant to a prior agreement to look for the identification structure while screening luggage and, upon finding said identification structure on an individual piece of luggage, to use the master key previously provided to the luggage screening entity to, if necessary, open the individual piece of luggage.
Subsequent to 9/11, the Transportation Security Adminstration (TSA) was given the authority to screen all unchecked airline luggage. Therefore, TSA advised travels with checked luggage to leave their checked luggage unlocked, so their locks would not have to be broken.
In response to the new authority granted to TSA, Tropp filed the ‘537 patent and ‘729 patent which disclose an improved method of airline luggage screening using a dual-access lock, where TSA would be given a master key of locks with identifying marks. Tropp further created locks to large retailers with a trademarked red flame logo on them, to identify the locks to TSA agents. Tropp further entered into an agreement with TSA to use the master locks to open the locks with the red flame logo inscribed. Travel Sentry also created a system with locks that had a red diamond logo on them with a master key.
Much of the court of appeals discussion on this case was directed towards a three page Memorandum of Understanding (MOU) between Travel Sentry and TSA. The MOU states that Travel Sentry will supply TSA with master keys to open checked baggage secured with the red diamond logo.
The district court in this case granted Travel Sentry’s motion for summary judgment of non-infringement. The courts reasoned that Travel Sentry did not direct or control TSA to perform the screening step that is required to be taken by a screening entity during a luggage check. The district court further held that “in the absence of showing that any entity has directly infringed Tropp’s patents, any claim by him against Travel Sentry for indirect infringement fails as a matter of law.”
The court of appeals, held that for a theory of direct infringement to establish liability for direct infringement of a claimed method or process under 35 U.S.C. § 271(a), a patentee must prove that each and every step of the method or process was performed. BMC, 498 F.3d at 1378; Muniauction, 532 F.3d at 1328. In cases in which more than one entity performs the steps of a claimed method or process, a party is liable for direct infringement only if that party exercises “control or direction” over the performance of each step of the claim, including those that the party does not itself perform. Golden Hour Data Sys., Inc. v. emsCharts, Inc., 614 F.3d 1367, 381 (Fed. Cir. 2010). Using this standard, the COA held that Travel Sentry did not control or direct the performance of each step of the claimed method because it is clear from the MOU that Travel Sentry neither controls nor directs TSA’s performance of the screening step, as TSA remains free to decide in the course of its screening whether or not it will use the master keys to open a Travel Sentry certify lock and TSA will only make “good faith efforts” to use the Travel Sentry system when practicable.
However, the COA held that the district court legally erred in its analysis of indirect infringement, and remanded the case based on this issue. The COA reasoned that indirect infringement in the inducement context may arise when the steps of a method claim re performed by one entity, provided that the other requirements for inducement are met. The COA held that the district court did not analyze whether Travel Sentry had knowledge of Tropp’s patent and induced others to perform the claim steps that Travel Sentry did not itself perform.
AUSTIN PATENT ATTORNEY TAKE-A-WAYS:
1) Do not write claims that require multiple parties to perform actions. By writing claims that require the TSA to perform additional actions, Tropp barred himself from any direct infringement theories of infringement. Further, by having multiple parties perform the actions Tropp lost some leverage he may have gained for settling the case.
2) Although Tropp’s patent is directed towards exactly the same methods and systems as performed by Travel Sentry it appears by including the term “Acting towards an prior agreement” will be hard to prove infringement in this case, specifically the term “agreement.” However, a court could find that the MOU provided enough support for an “Agreement,” but it is unlikely that a court will determine that an outside party created an agreement that requires TSA to perform actions dealing with the safety of passengers.