A unanimous Supreme Court ruled Monday that a company is not liable for inducing patent infringement if someone other than the company carries out some of the steps leading to infringement.
The justices decided that Internet content delivery company Limelight Networks Inc. did not infringe on the patented system for managing images and video owned by rival Akamai Technologies Inc.
Akamai contended that Limelight used some of its patented methods for speeding content delivery and then illegally encouraged its customers to carry out the remaining steps. The U.S. Court of Appeals for the Federal Circuit agreed, but the Supreme Court reversed that decision.
Justice Samuel Alito said all the steps for patent infringement must be performed by a single party. Since there was no direct infringement, Alito said, there could be no inducement.
The case drew interest from tech giants including Google Inc. and Oracle Corp., which have been sued frequently by "patent trolls," companies that buy patents and force businesses to pay license fees or face costly litigation. They had urged the high court to overturn the Federal Circuit to limit the growing number of patent infringement lawsuits.
In another patent case Monday, the Supreme Court also unanimously reversed a Federal Circuit decision in a patent dispute over heart rate monitors. Medical device company Biosig Instruments sued exercise equipment maker Nautilus Inc. for allegedly infringing its monitor's design.
Writing for the court, Justice Ruth Bader Ginsburg said the appeals court had used the wrong standard in determining that Biosig's patent was not too vague to pass muster. The Supreme Court instructed the appeal court to use a more exacting standard.