Multi-Party Infringement of Method

Claims

Moderator: Allan Colquhoun, Elan IP, Canada

Robert S. Frank Jr., Choate Hall & Stewart, USA

Dr. Felix Klopmeier, Lang & Rahmann, Germany

Schedule

I. Introduction

II. Brief summary of relevant legal principles

• In the United States

• In Europe and Germany

III. Examples of claims

• Including fact patterns and how they would be treated in each jurisdiction

IV. Questions

• Former Managing Partner and Chairman at Choate Hall & Stewart

• Practice focus includes intellectual property, commercial, antitrust and varied business disputes

• Mr. Frank has numerous recognitions including:

• 2012 Boston Lawyer of the Year by Best Lawyer

• Best Lawyers in America and Massachusetts Super Lawyers Top 100 by Chambers USA

• World’s Leading Patent Litigator by IAM 250

• World’s Leading Patent Practitioner by IAM Patent 1000 and an “IP Star” by Managing

Intellectual Property

• Lead counsel for Akamai Technologies in patent infringement case with a verdict in favor of Akamai

in the amount of more than $45 million; the largest verdict in Massachusetts in 2008.

• Lead US counsel for all civil claims arising out of Hewlett-Packard’s acquisition of Autonomy

Corporation, plc.

• Represented Eastman Kodak in what was then the largest patent infringement case in history of the

United States. He was responsible for Kodak’s successful defense against Polaroid’s claim that

Kodak willfully infringed seven Polaroid patents.

• Graduate of Harvard Law School

Robert S. Frank Jr. Partner

Choate Hall & Stewart

United States

Speaker Biographies

• 8 years experience at Lang & Rahmann

• Practice focus includes intellectual property and unfair competition law specialized in the

conduction of patent infringement and patent nullity proceedings

• Leader of the Interlaw "Affinity Group" NextGen E/ME/A

• Board member of the Association of Intellectual Property Firms (AIPF)

• Education

• 2003 Law Degree from the University of Düsseldorf

• 2008 Admitted to the German Bar

• 2008 (Dr. jur.)

• 2011 LL.M. – Intellectual Property and Unfair Competition Law

Dr. Felix Klopmeier Managing Partner

Lang & Rahmann

Germany

Speaker Biographies

by any measure

CHOATE HALL & STEWART LLP choate.com

AIPF CONFERENCE - September 16, 2016

Akamai v. Limelight and the

Law of “Divided Infringement”

CHOATE HALL & STEWART LLP

The Basic Principle And The Question

The Principle: Under U.S. law, a method claim is not infringed

unless all steps of the claim are performed by one

person/entity

• or are attributable to one person/entity.

The Question: Where all claims of a method patent are performed,

some by A and one or more by B, in what

circumstances will B’s conduct be attributed to A,

thus making A an infringer?

6

CHOATE HALL & STEWART LLP

19. A content delivery service, comprising:

replicating a set of page objects [e.g., pictures and video] across a wide area network of content servers managed by a domain other than a content provider domain [the Content Delivery Network; e.g., Akamai];

for a given page normally served from the content provider domain, tagging the embedded objects of the page [e.g., the pictures and video] so that requests for the page objects resolve [flow to] to the domain [of the Content Delivery Network] instead of the content provider domain;

responsive to a request for the given page received at the content provider domain, serving the given page from the content provider domain; and

serving at least one embedded object of the given page from a given content server in the domain [of the Content Delivery Network] instead of from the content provider domain.

7

Akamai’s U.S. Patent No. 6,108,703 Claim 19

CHOATE HALL & STEWART LLP

The Facts Of Akamai v. Limelight

• Akamai (patent holder) and Limelight (alleged infringer) are competing content delivery networks.

• Limelight: – In order for Limelight’s business to work, content providers (e.g., CNN) had to (a) “tag”

objects (pictures, video) so that requests by Internet users for the object would effectively be directed to Limelight (not the content provider) and (b) serve pages containing the tags to the Internet user.

– If the customer performed those steps, Limelight would deliver the content provider’s objects to the Internet user for the content provider; otherwise, it would not.

– The content provider paid a fee for the content delivery service.

– Limelight gave the customer the tag that the customer had to use in order to avail itself of the Limelight service, taught the customer how to use the tag, and provided technical support to the customer.

Did this constitute “direction or control”?

8

CHOATE HALL & STEWART LLP

Akamai v. Limelight The Litigation History

February 2008: Trial -- jury verdict for Akamai - $45M.

First motion for JMOL denied.

Second motion for JMOL granted.

Fed. Cir. Panel: JMOL for Limelight

affirmed.

Fed. Cir. En Banc Review: New trial for

possible infringement under 35 U.S.C.

§271(b) (induced infringement). Direct

infringement under §271(a) not addressed.

9

CHOATE HALL & STEWART LLP

Akamai v. Limelight The Litigation History (Cont’d)

U.S. Supreme Court: Reversed as to

Section 271(b) (induced infringement)

Fed. Cir. may have “too

narrowly circumscribed the

scope of §271(a).”

Fed. Cir. Panel: JMOL for Limelight

affirmed under prior Fed. Cir. precedent.

Fed. Cir. En Banc Review: Reversed; jury

verdict reinstated.

Fed. Cir. Panel: Jury verdict affirmed on

other issues.

Judgment entered.

10

But:

July 2016:

CHOATE HALL & STEWART LLP

Akamai v. Limelight The En Banc Federal Circuit Decision

• “Direct infringement … occurs when all steps of a claimed method

are performed by, or attributable to, a single entity.”

• “An entity is responsible for others’ performance of method steps

in two sets of circumstances:

(1) where the entity directs or controls others’ performance,

and

(2) where the actors form a joint enterprise.”

797 F.3d 1020 (Fed. Cir. 2015)

11

CHOATE HALL & STEWART LLP

Akamai v. Limelight Direction Or Control

“Direction or control” exists where:

OLD:

NEW:

1. The “other” has a contractual obligation to perform the step(s) not performed by the defendant.

2. The “other” acted as the agent of the defendant.

3. “We conclude … that liability under § 271(a) can

also be found when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance.”

797 F.3d at 1023

4. The performance of a claim step by another can otherwise properly be attributed to the defendant. [What does this mean?]

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CHOATE HALL & STEWART LLP

Akamai v. Limelight Joint Enterprise

“Alternatively, where two or more actors form a joint enterprise, all

can be charged with the acts of the other, rendering each liable for

the steps performed by the other as if each is a single actor.”

* * *

(1) an agreement, express or implied, among the members of the group;

(2) a common purpose to be carried out by the group;

(3) a community of pecuniary interest in that purpose, among the members;

and

(4) an equal right to a voice in the direction of the enterprise, which gives an

equal right of control.”

13

CHOATE HALL & STEWART LLP

The Facts Of Akamai v. Limelight As

Described By The Federal Circuit

“Limelight establishes the manner and timing of its customer’s performance so that customers can only avail themselves of the service upon their performance of the method steps.”

1. Limelight conditions its customers’ use of its content delivery network upon its

customers’ performance of the tagging and serving steps.

2. Limelight gives the customer the tag that the customer is to use when it wants Limelight to deliver content, and Limelight teaches the customer how to use the Limelight service.

3. Limelight’s contract makes the customer responsible for using Limelight’s processes when tagging content so as to enable delivery by Limelight.

4. Limelight’s contract requires its customer to provide “all cooperation reasonably necessary for [Limelight] to implement” its content delivery service.

5. Limelight’s engineers continuously engage with customers.

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Multi-party infringement of method claims

German / European view

I. Introduction: direct / indirect infringements

II. Germany:

direct infringements, § 9 Patent Code

indirect infringements, § 10 Patent Code

III. Europe:

Artt. 25, 26 Agreement on a Unified Patent Court

IV. Classification of Multiple infringers

IV. What‘s next: UPC after Brexit

Claims and Fact Scenarios for Discussion

• Discuss general claim language, problems with the claim, issues relating to multi-party infringement

• Discuss questions or variations on facts

• U.S. and European perspectives

Facts:

The “tagging” step was not performed by Limelight,

because Limelight neither tagged the embedded objects

itself, nor required its customers to do so.

Limelight did provide instructions on how to accomplish

the tagging, if the customers chose to do so.

Claim 19 from US 6,108,703

(Akamai Technologies, Inc. v. Limelight Networks, Inc)

19. A content delivery service, comprising:

Replicating a set of page objects across a wide area network of

content servers managed by a domain other than a content

provider domain;

For a given page normally served from the content provider

domain, tagging the embedded objects of the page so that

requests for the page objects resolve to the domain instead of the

content provider domain;

Responsive to a request for the given page received at the

content provider domain, serving the given page from the content

provider domain; and

Serving at least one embedded object of the given page from a

given content server in the domain instead of from the content

provider domain.

Facts:

• A laboratory carries out steps a. and b. by obtaining

the plasma sample and detecting JUL-1

• A doctor diagnoses the patient with julitis as per step c

What if the laboratory gives the patient direction to get

diagnosed by a doctor based on detecting Jul-1?

What if the laboratory test was part of a much larger test

that detected 10s or 100s of markers in plasma, and the

doctor assessed the entire set of test results before

performing the diagnosis (ie. the lab does not explicitly

test for JUL-1 alone)?

A claim from the May 6, 2016 USPTO

Guidelines on subject matter eligibility

4. A method of diagnosing julitis in a patient, said method

comprising:

(a) Obtaining a plasma sample from a human patient;

(b) Detecting whether JUL-1 is present in the plasma sample by

contacting the plasma sample with antibody mAb-D33 and

detecting binding between JUL-1 and antibody mAb-D33; and

(c) Diagnosing the patient with julitis when the presence of JUL-

1 in the plasma sample is detected.

Relates to prepaid calling cards – “vendible carrier

member”

What if the cards are produced by Party A (ie. step (e))

without knowledge of the claim language or how the

cards are to be used, but they do provide a list of the

series of numbers to Party B, the call service provider?

Party B purchases the “readily exposable” cards, offers

them for sale and provides the services of steps (a) to (e)

Appeal Court Dusseldorf, 2 U 51/08

(although the issue at trial was not multi-party infringement)

A method of processing telephone calls, particularly for use in

connection with public telephones, comprising the steps of:

(a) programming a respective Public Automatic Branch

exchange (PABX) to become toll-free accessible for incoming

calls through dialing any one out of a series of

predetermined numbers stored in a data-bank of the PABX;

(b) enabling a calling party to complete a connection with a called

party;

(c) cutting-off the said connection after a prefixed time/counter

pulses interval;

(d) erasing from the data-bank any number that had once been

dialed;

(e) marking the said series of numbers, each on a vendible carrier

member in an invisible—however readily exposable—manner; and

(f) offering the vendible carrier members for sale to the general

public.”

(a) How would infringement law be applied if the offer to

purchase is made by a third-party, based solely on

information from the music service provider that the

user does not own a particular song?

(b) How would infringement law be applied if the playlist

is obtained by Party A and the audio file database is

accessed by Party A, which merely reports to the user

whether or not the user owns particular songs and

makes available to the user the option to purchase

songs the user does not own? In this scenario, the

streaming step is initiated entirely by the user using

software from Party B.

1. A method for transmitting audio files comprising:

obtaining a playlist identifying a plurality of audio files from a

user;

accessing an audio file database to determine whether each of

the plurality of audio files is available on said audio file database;

upon a condition in which at least one of the plurality of audio

files is available on said audio file database, streaming said at

least one audio file to a user’s mobile device;

upon a condition in which at least one of the plurality of audio

files is not available on said audio file database, presenting an

offer to purchase at least one of said plurality of audio files to the

user’s mobile device.

Hypothetical Example

Questions?