Types of Patent Infringement
There are many different types of patent infringement. The specific type of patent infringement at issue can help guide your decision on how to respond.
Not every instance of patent infringement is malicious or willful, and in these instances, a patent cease and desist letter may be more appropriate than litigation. These types of letters keep over 97 percent of legal disputes out of the courtroom. Recognizing the specific form of violation that’s occurring – and whether there’s overlap – will help you decide the best legal path forward.
What are the Different Types of Patent Infringement?
Every time your patent rights are violated, the action falls under a specific form of infringement. Most of the infringing activities mentioned here will fall under the umbrellas of either Direct or Indirect Infringement.
Once an invention is registered with the U.S. Patent and Trademark Office (USPTO), it receives a variety of federal protections. Direct patent infringement is the most obvious violation of this protection. This occurs when a third party produces, sells, offers to sell, uses or imports a federally protected invention. These can include machines, processes, production methods, manufacturing articles, compositions and even plant varieties.
The type of patent matters less than whether the third party has obtained authorization from the patent owner. For a claim of infringement to be valid, the unauthorized item or process must utilize every element of at least one claim of the patent. The following are just a few examples of direct infringement:
- Company A begins to use a manufacturing process created by Company B without authorization.
- Company A begins importing items that violate Company B’s patent.
- Company A places an infringing item for sale online – even if the item never sells.
- Pharmaceutical Company A begins producing a federally protected medication prior to the patent’s expiration.
In each of these cases, Company A is directly infringing upon a protected invention. Proving willful infringement also creates the opportunity for enhanced damages during litigation. If courts find that a violation is particularly egregious and willful, they can increase the amount of damages granted by the jury by up to three times.
Claims of indirect patent infringement involve a person or company violating the rights of a patent owner, but there’s evidence that they were not the original infringer. This can occur whether the violating party knows that their actions are illegal or not. A lack of maliciousness or intent of infringement does not preclude the offender from facing patent injunctive relief or a patent damages ruling.
If willful intent cannot be proven, it’s less likely that a plaintiff will receive enhanced damages. In these situations, a plaintiff will typically be granted injunctive relief along with compensation based on either reasonable royalties or loss of profits. As explained below, these two can vary drastically.
Reasonable Royalties in Patent Cases
An award of reasonable royalties is the lowest potential amount that a patent owner may receive – regardless of the type of patent infringement that occurs. This is a fact-intensive process that requires experts to reconstruct the positions of each party when the violation began. This will help the court decide an appropriate price for a theoretical licensing agreement that could have occurred at the time.
Loss of Profits in Patent Cases
Patent litigation that results in compensatory relief can also be based on the sales and profits lost due to the underlying infringement. These damages are rarer than reasonable royalties because (1) the plaintiff must be commercially active and (2) actual damages are more difficult to prove.
Types of Indirect Infringement
There are two types of patent infringement that qualify as indirect violations. They are known as infringement by inducement and contributory infringement. Each of these could qualify as willful or non-willful. This means that even instances of indirect infringement can result in enhanced damages in federal court. These two types of violations are explained in more depth below.
Infringement by Inducement
When infringement by inducement occurs, the willful infringer will often not be the party engaged in the infringing acts. This applies to actions undertaken by third parties which lead to direct infringement. By engaging in behaviors or convincing other entities to take part in actions that constitute a patent infringement, this third party is guilty of infringement by inducement.
Here are a few infringement by inducement examples:
- Asking a third party to manufacture a patented product without proper licensing.
- Printing out instructions on how to build a patented item and selling them.
- Providing instructions to a third party on how to produce a protected invention.
- Supplying the manufacturing process necessary to create a patented item.
- Assisting in the manufacture of a protected invention in any way.
Even when the other party doesn’t realize that they’re being induced into infringement, the inducer can be held legally accountable for their actions. If it’s proven that there was knowledge that their actions were infringing, the infringer could be liable for enhanced damages due to willful infringement. In any case, a lack of maliciousness or direct infringement doesn’t protect a party from legal consequences.
Parties involved in the importation or purchase of items used in creating a patented invention are engaged in patent contributory infringement. Even if someone isn’t involved in the actual manufacturing of a federally protected invention, they can be held liable for contributing to such actions. If the main use of an imported or purchased part is to create an infringing item, they’ll be just as guilty as the direct infringer.
Manufacturing generic materials or parts capable of substantial non-infringing uses generally will not constitute patent infringement. So importing a capacitor used in an invention that’s also used in the manufacture of vintage radios, for instance, would not compromise the exclusive rights that patent owners are afforded.
Whereas inducement refers to actions that cause others to infringe, contributory actions refer to participating somehow in an infringement. All parties involved in either of these actions – regardless of willful intent or maliciousness – can be held legally responsible.
Any person or entity that knows a patent exists and chooses to infringe upon it is engaged in willful infringement. In addition to paying for reasonable royalties, lost profits and enhanced damages based on willful intent, infringing parties could also be held liable for attorney fees.
Whenever an item or process that’s being sold, used, or imported matches every element of a claim outlined in a patent registration, literal infringement has occurred. It becomes difficult for someone to claim they had no knowledge of a patent when their infringing item directly corresponds to the claims of the protected invention.
Doctrine of Equivalents Infringement
It’s possible for patent infringement to occur even if there’s not a direct correlation between the infringing item and the patented claims. This is due to the Doctrine of Equivalents. If it’s shown that an invention performs substantially the same as a protected item and produces substantially the same result, infringement may still exist even if literal infringement has not occurred.
The Doctrine of Equivalents applies when the elements of two inventions are interchangeable and a person skilled in the appropriate industry would have known they were interchangeable when the violation occurred. This is even the case if the subsequent product is more efficient than the patented item.
If you have questions about the types of patent infringement, please contact us today.