CAFC Finds Importer Can Infringe Production Process Patents Even If Not Involved in Production

An importer can still be guilty of infringing patents related to production processes, even if it didn’t itself perform those processes and only imported the finished good, the U.S. Court of Appeals for the Federal Circuit said in a Dec. 18 decision.

Willowood, an importer accused of infringing Syngenta’s patents related to the production of the fungicide azoxystrobin, had argued that a “single entity requirement,” which requires that a single company perform all steps of a patented process to infringe the related patent, applies to 35 USC 271(g), which sets penalties on infringement of process patents. Reversing a district court judgment, CAFC found that no such requirement applies, and it is irrelevant whether a single or multiple entities were involved in the process. Instead, it is the act of importation and sale of a good that causes liability to arise under the relevant statute, 35 USC 271(g), the appeals court said.

“In sum, because liability under § 271(g) is not predicated on practicing the claimed process, but instead is based on the act of importing into or offering for sale, selling, or using a product in the United States that is made by a U.S. process patent, it [is] irrelevant whether the overseas manufacturing is performed by a single entity or multiple entities,” the law firm Bradley said in a blog post on the decision.

The court also affirmed the district court’s ruling that Willowood’s Chinese affiliate was not liable for patent infringement. Willowood USA was responsible for clearing the shipments through U.S. customs and registering the fungicide with the Environmental Protection Agency. Also, the shipment was marked “f.o.b. China,” so legal title passed from Willowood China to Willowood USA in Hong Kong. Willowood China sold the fungicide in China, not the U.S., and did not infringe Syngenta’s patents, CAFC said.

Finally, CAFC vacated the district court’s ruling that the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) precludes Syngenta’s copyright infringement claims on Willowood’s EPA-required labels. “We conclude that this determination was premature. Because the text of FIFRA does not, on its face, require a me-too [i.e. generic] registrant to copy the label of a registered product, the statute only conflicts with the Copyright Act to the extent that some particular element of Syngenta’s label is both protected under existing copyright doctrines and necessary for the expedited approval of Willowood’s generic pesticide product. This determination requires this court to review the merits of Syngenta’s copyright claims, which the district court did not reach,” CAFC said.