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U.S. Supreme Court Reins in Reach of U.S. Patents Abroad
In a 7-1 decision, the U.S. Supreme Court sided with Microsoft and found that installing copies of software made from a master disk shipped from the U.S. on computer systems in other countries is not an infringement of a U.S. patent. AT&T had claimed damages for every Windows-based computer combined outside the United States that included a digital speech coder system covered by AT&T’s patent. Lower courts had awarded substantial damages for foreign-based infringements.
To determine the issue, the Court had to examine 35 U.S.C. §271(f), the U.S. patent statute that makes it an infringement to supply from the United States components of a patented invention in a manner so as to actively induce the combination of such components outside of the United States in a way that would infringe the patent, if the combination had occurred in the United States.
The master disk software was distinguished from the actual copies (“components”) made from the disk that were combined with the computer systems abroad. As well, the court concluded that the copies were not “supplied” from the United States for purposes of finding patent infringement under §271(f). A narrow interpretation was applied to the provision in view of the presumption of territorial limits to patents.
For a copy of the decision, visit: