Patent is the method of granting of the exclusive rights to an intellectual property by the federal government to the inventor or owner for a limited period of time.

The concept for U.S. patents was rooted in Article I, Section 8 of the original U.S. Constitution, adopted in 1787. The Patent Act of 1790, titled “An Act to promote the progress of useful Arts” was the very first federal Patent legislation in US.

The modern patent system in the US is a consequence of several judgements and verdicts that shaped the progression of history for patent laws.

The federal law known as Patent Act (35 U.S. Code), governs all the patents in US.

Infringement of patent, as defined in 35 US Code § 271, is the condition where someone without appropriate authority “makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent” and the person actively inducing the infringement of a patent is known as an ‘infringer’.

Over the years, various cases have shaped the modern patent law in the US. They have significantly contributed on the laws, patentability criterion and the importance of patents.

Famous Patent Infringment Cases

The number of patent cases shaping US Patent Laws are many. Amongst them, the most noteworthy cases are discussed as following:

O’Reilly v. Morse 56 U.S. (15 How.) 62 (1853)

The case, famously known as “The Telegraph Patent Case” is one of the most landmark cases in US Patent history. The 1854 decision by US Supreme Court has contributed immensely in the law of patent-eligibility.

The plaintiff, Samuel Morse, original inventor of the electro-magnetic telegraph was issued patent twice for his telegraph in 1840 and again in 1848. In the two patent applications, he claimed sole ownership rights to the telegraph machinery. However, the eighth claim of his patent application was the exclusive claims to any future invention using electro-magnetism to print characters or letters at a distance.

In 1845, the defendant, Henry O’Reilly installed telegraph systems in Kentucky and Tennessee. Morse filed a patent infringement suit against O’Reilly in the United States Circuit Court for the District of Kentucky. The circuit court ruled in favour of the plaintiff and found that O’Reilly had committed patent infringement. O’Reilly appealed to the United States Supreme Court.

The United States Supreme Court held that the claim of an exclusive right of a future invention is too broad and reasoned that Morse cannot claim patent monopoly and is not warranted by law. The claim didn’t include any practical application and implementation of the idea. Hence the Court held the eighth claim is void and too broad to be patented.

Schillinger v. United States 155 US 163 (1894)

The 1894 decision of US Supreme Court held that the government itself cannot be sued in their own courts.

On 19^th July 1870, John J. Schillinger was issued a patent for an improvement in concrete pavement which was reissued on 2^nd May, 1871. Later the Architect of the Capitol (AOC) invited tenders for a concrete pavement in the Capitol grounds and entered into a contract with GW Cook according to plans and specifications prepared by AOC, without referring the patent specifically.

John J. Schillinger and others filed a petition in the court of claims for the wrongful use of the patented invention.

The court held that the petition is not for infringement but rather for appropriate compensation and no contract between the owner of the patent and government existed. Hence, the petition was dismissed as being outside the jurisdiction of the court.

Subsequently, Congress passed 28 U.S.C. § 1498, permitting the owners of intellectual properties to sue for “just and entire compensation” if the United States uses such intellectual property rights.

Aro Manufacturing Company v. Convertible Top Replacement Company 365 U.S. 336 (1961)

This is one of the landmark cases in the US which redefined the doctrine of repair and reconstruction.

Convertible Top Replacement Company was issued a patent for ““convertible folding top with automatic seal at rear quarter.” The folding top consisted of several parts and none of them were separately patented. The respondent filed a direct and contributory infringement suit against Aro Manufacturing Company for separately selling and manufacturing the parts which embodies the combinations covered by the patent.

The district court ruled in favour of Convertible Top and stopped Aro from further manufacturing. The Court of Appeals held the same.

The issue raised was whether a patent holder can prevent the manufacture of a replacement part for a patented device when the replacement part is not patented.

The Supreme Court ruled that since Convertible Top did not patent the fabric top individually, there was no direct patent infringement. Since there is no direct infringement, there could be no contributory infringement.

Hence the Court held that the petitioners were not guilty of either direct or contributory infringement of the patent.

Polaroid vs Kodak 641 F. Supp. 828 (D. Mass. 1986)

This is one of the milestone patent infringement cases along with in modern times. The parties were involved in an instant photography patent-infringement suit for several years.

Polaroid filed a patent infringement suit over its 12 patents and sought damages amounting to $12 billion. Kodak denied all the infringements.

US District Court held that Polaroid lost approximately $250 million due to Kodak’s illegal action and ordered Kodak to pay a hefty sum of $909 million making it one of the largest awarded patent damages in that decade.

Various Wall Street Journal analysts expected the damages to be much higher than what was awarded.

eBay Inc. vs MercExchange 547 U.S. 388 (2006)

This is another landmark patent infringement cases where the issuance of Injunction on finding a patent infringement was made crystal clear.

eBay, an online auction site uses a function “Buy it Now” for which the MercExchange owned the patents but no agreement was reached. MercExchange filed a patent infringement suit against eBay and the lower court found eBay guilty of wilfully infringing the patent and ordered to pay $30 million in damages.

MercExchange filed an injunction to stop eBay the continued use of its intellectual property, but the District Court ruled against the issuance of injunction. The United States Federal Court reversed it following which eBay approached the Supreme Court.

It was unanimously decided by the US Supreme Court that a court should rely on the “four-factor test” to issue an injunction if a patent infringement is found.

Quanta Computer Inc vs LG Electronics (2008)

It is another important decision taken by US Supreme Court regarding the validity of the patent exhaustion doctrine as a defense to patent infringement.

The respondent, LG Electronics owned patents for a variety of products, including microprocessor chips for personal computers. It licensed the patents to Intel but excluded any Intel customer that combined the chip with non-Intel machineries. Quanta Computer purchased the licensed chips and used in computers for Dell, Hewlett-Packard and Gateway. LG Electronics sued Quanta Computer for patent infringement.

The Supreme Court unanimously concluded that a patent holder cannot seek royalties from companies other than its direct purchaser, not even if the purchaser integrates the patented product in other components.

Apple vs Samsung (2012)

This case internationally became one of the most sensational patent infringement cases filled with suits and counter-suits across courts in various countries in the world including South Korea, Japan, Germany, France, Italy, Netherland, Australia, UK and several trials in US courts.

Apple first sued Samsung alleging infringement of intellectual property including patents, trademarks and user-interface in 2011 following by counter-suing by Samsung in Seoul, Tokyo, Mannheim in Germany accusing Apple of patent infringement of mobile communications technology. Samsung also filed countersuits in courts of UK and US.

At the end, the court found Samsung guilty of infringement and ended up awarding Apple a hefty sum of almost $1 billion.

Pfizer vs Teva Pharmaceuticals & Sun Pharma (2013)

This became the first case where the generic drugmakers ended up paying a large sum as damages for patent infringement for marketing the same copy of the drug.

In this interesting case Israel-based generic drugmaker Teva Pharmaceuticals and Sun Pharma in India paid $2.15 billion to Pfizer to settle a patent infringement suit related to Protonix, an acid-reflux drug whose patent was held by Pfizer.

The patent for the active component in Protonix known as Pantoprazole was to expire in 2011 but both Teva Pharmaceuticals and Sun Pharma launched the generic versions respectively in 2007 and 2008.

Teva paid $1.6 billion and India’s Sun Pharma paid $550 million for this patent infringement suit.

Alice Corporation vs CLS Bank 573 U.S. 208 (2014)

It is another landmark case on patent eligibility.

Alice Corporation, an Australian company owned four patents regarding a computerized trading platform. Alice accused CLS Bank of patent infringement. In 2007, CLS Bank filed a suit against Alice and sought declaratory judgement regarding the invalidity of the claims. Alice counterclaimed of infringement.

A judgement written by Justice Clarence unanimously held that claims related to computer-implemented inventions—including systems, machines, processes, and items of manufacture are not eligible for patent-eligible subject matter.

Intel vs VLSI Technology (2021)

This case became one of the cases where highest damages were awarded for infringement of patents when a federal jury in Texas found Intel guilty of patent infringement and asked to pay $2.18 billion to VLSI Technology.

The jury found Intel guilty of intentional infringement of claims under the doctrine of equivalents. Intel has appealed for the verdict.

Effects on US Patent System

The cases, over the years, have shaped the law related to infringement of patents. Intrinsic patent risks have increased. It has become harder to patent an invention and prove patent infringement and easier to challenge the eligibility of patents.

The debates over “patent-eligibility” are of great concern in US Patent system. Cases like Alice vs CLS have stirred significant uncertainty in case of patent-eligibility of software.

The Leahy-Smith America Invents Act passed in 2011 changed the patent system in US from “first-to-invent” to “first-inventor-to-file” system.

Conclusion

In this comprehensive list, it is not possible to mention all the cases which played a significant role in shaping the course of US Patent laws. It is impertinent to mention that each of these cases is a milestone and the verdicts have contributed immensely to make the US patent law in its current form.