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Can U.S. Patents Be Drafted to Rein in Overseas Infringers?

By Patrick Fay and Benjamin Han
January 05, 2006

The increasing transnational nature of communications systems and, more specifically, the frequency and ease with which Internet transactions may be handled from locations around the globe make more difficult the enforcement of certain patent rights. Technology allows transactions involving participants (human and/or machine) to be in more than one nation, and a working system or method to be fragmented across a number of jurisdictions. This type of scenario may frustrate efforts to enforce patent rights when no one jurisdiction includes all of the elements necessary to establish infringement. This situation arises most frequently in the context of the Internet where an accused infringer services U.S. customers using servers located outside the country. Although the U.S. courts have recognized this problem, the law in this area is far from settled and focusing on these issues from the beginning of the patent application drafting process will increase the chances of successfully enforcing such patents.

The U.S. patent laws are territorial. Congress provided that “whoever makes, uses, offers to sell, or sells any patented invention, within the United States … infringes the patent.” 35 U.S.C. '271(a). That is, U.S. patents are not infringed by acts in foreign countries even where those acts would constitute infringement if performed in the United States. Deep South Packing Co. v. Laitram Corp., 406 U.S. 518 (1972). The U.S. Court of Claims (hereinafter “USCC”) refined this doctrine to indicate that infringement could be based, at least in part, on activity outside the United States. Specifically, the USCC found infringement where a part of an accused system was located in Norway stating that “only a portion of the claimed combination … is located outside the United States while the beneficial use of the completed assembly actually occurs within the jurisdiction of the United States.” Decca Ltd. v. The United States, 544 F.2d 1070, 1081 (U.S. Court of Claims 1976) (hereinafter “Decca“).

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