CAFC in Travel Sentry: no single- entity requirement in the inducement context
In a post-Akamai case Travel Sentry v. Tropp:
Thus, as our precedent now stands, on the issue of direct infringement under §271(a), we agree with the district court that there is no genuine issue of material fact that Travel Sentry does not control or direct the performance of each step of the claimed method. Like the district court, we focus our analysis on steps 3 and 4 of Tropp’s claimed method. See Travel Sentry, 736 F. Supp. 2d at 638. If the performance of those steps is not attributable to Travel Sentry, then Travel Sentry cannot be directly liable for infringing Tropp’s asserted method claims. The parties do agree that steps 3 and 4 of Tropp’s claimed method can only be performed by a baggage screening entity—i.e., TSA. In addition, Travel Sentry does not seriously dispute that it is TSA who performs those steps independently. The inquiry, then, is whether there is sufficient evidence that Travel Sentry controls or directs TSA in its performance of those steps, such that Travel Sentry is liable for TSA’s acts.
In performing its direct infringement analysis, the district court correctly scrutinized the MOU, the only written agreement between Travel Sentry and TSA. Id. at 628. It correctly concluded that it is clear from the MOU that Travel Sentry neither controls nor directs TSA’s performance of steps 3 and 4 of the asserted claims.
Accordingly, we conclude that the district court did not err by finding no genuine issue of material fact that Travel Sentry is not liable for direct infringement of Tropp’s asserted claims. See Travel Sentry, 736 F. Supp. 2d at 639. That does not end our analysis, however, because the district court’s grant of summary judgment also rested on its determination that Travel Sentry could not be liable for indirect infringement. Id. At 634-35, 639.
With respect to inducement under § 271(b), we conclude that the district court legally erred in its analysis of indirect infringement. Travel Sentry, 736 F. Supp. 2d at 634–35, 639. Recently, sitting en banc in Akamai, we clarified the law on inducement. We explained that all the steps of a claimed method must be performed in order to find induced infringement, but that it is not necessary to prove that all the steps were committed by a single entity. Akamai, 692 F.3d at 1307. In so holding, we overruled the holding in BMC that in order for a party to be liable for induced infringement, some other entity must be liable for direct infringement. Id.
Travel Sentry’s reliance on BMC in support of the dis- trict court’s conclusion on indirect infringement is, accord- ingly, unpersuasive. The district court summarily concluded that because a single party was not liable for direct infringement, “any claim by [Tropp] against Travel Sentry for indirect infringement fails as a matter of law.” Travel Sentry, 736 F. Supp. 2d at 639. As we explained in Akamai, however, our prior cases do not support a single- entity requirement in the inducement context. Akamai, 692 F.3d at 1315. Rather, liability under § 271(b) may arise when the steps of a method claim are performed by more than one entity, provided the other requirements for inducement are met. Id. at 1306.
The district court, although following our then- existing precedent, erred by founding its indirect in- fringement analysis on a single-entity requirement. See id. at 1318. The district court did not determine whether a genuine issue of material fact existed as to the perform- ance of all the claim steps—whether by one entity or several. Moreover, the court did not analyze whether Travel Sentry had knowledge of Tropp’s patent and induced others to perform the claim steps that Travel Sentry did not itself perform.
We therefore vacate the district court’s grant of sum- mary judgment and remand for a determination whether, under the standard set forth in our recent en banc opinion in Akamai, Travel Sentry is liable for indirect infringement.