ACCO Brands v. ABA Locks and Belkin Components (CAFC 2006-1570)

The patents in suit were 5,502,989; 5,493,878; & 6,006,557.

ACCO does business as, and is better known as, Kensington Technology Group. ABA Locks is a Taiwan-based lock manufacturer, while Belkin is a California-based distributor.

ABA got a lock on the jury during trial, securing a finding of willfully induced infringement, though direct infringement slipped.

At trial, the jury was informed that, based on the claim construction of the pin limitation, the key lock could essentially be operated in two ways, one infringing and the other noninfringing. The noninfringing method, the “press-to-lock” method, was the method that Belkin instructed its customers to use in the instructions included in its key lock product. The parties agreed that when a user employs the press-to-lock method, direct infringement does not occur.

The jury found that defendants willfully induced infringement of the asserted claims of the ’989 and ’557 patents and rejected all invalidity defenses.

The ground rules for appeal of willful infringement -

A determination of infringement is a question of fact that is reviewed for substantial evidence when tried to a jury. TI Group Auto. Sys. (N. Am.), Inc. v. VDO N. Am., L.L.C., 375 F.3d 1126, 1133 (Fed. Cir. 2004). “Whether infringement is willful is a question of fact, and the jury’s determination as to willfulness is therefore reviewable under the substantial evidence standard.” Braun Inc. v. Dynamics Corp. of Am., 975 F.2d 815, 822 (Fed. Cir. 1992) (citation omitted). Willful infringement must be proven by clear and convincing evidence and is determined from the totality of circumstances. Id. We review a district court’s exceptional case finding for clear error, Pharmacia & Upjohn Co. v. Mylan Pharms., Inc., 182 F.3d 1356, 1358-59 (Fed. Cir. 1999).

Belkin argued that infringement was only a hypothetical, that it actually taught away from infringement.

On appeal, Belkin argues that the jury’s findings of induced infringement and willfulness are not supported by substantial evidence. According to Belkin, the record is devoid of any evidence that Belkin’s customers actually used the ABA key lock in an infringing manner or that Belkin encouraged any of its customers to use the key lock in that way. Instead, Belkin asserts that the record shows that it had no knowledge of the infringing mode and that it instructed its customers to use the noninfringing press-to-lock method to operate the lock.

ACCO argued that the lock is most naturally used infringingly. What's more, damn them, Belkin knew of '998, and didn't even bother with a clearing opinion.

According to ACCO, the record shows that key lock users will use the lock in an infringing manner at least some of the time because that configuration is the most natural and intuitive way to use the lock, in comparison with the press-to-lock method. ACCO contends that the record also supports the jury’s finding of willfulness because, inter alia, Belkin had knowledge of the ’989 patent, but failed to obtain its own noninfringement opinion.

ACCO weak arguments didn't sway, particularly intent, as there was this little obstacle called evidence that ACCO had none of.

The record further shows that ACCO failed to point to specific instances of direct infringement... We agree with Belkin that substantial evidence is lacking in the record to support the verdict that Belkin induced infringement of the ’989 patent. Section 271(b) of the Patent Act provides that “[w]hoever actively induces infringement of a patent shall be liable as an infringer.” 35 U.S.C. § 271(b). In order to prevail on an inducement claim, the patentee must establish “first that there has been direct infringement, and second that the alleged infringer knowingly induced infringement and possessed specific intent to encourage another’s infringement.” Minn. Mining & Mfg. Co. v. Chemque, Inc., 303 F.3d 1294, 1304-05 (Fed. Cir. 2002) (citation omitted). Specific intent requires a “showing that the alleged infringer’s actions induced infringing acts and that he knew or should have known his actions would induce actual infringements.” DSU Med. Corp. v. JMS Co., Ltd., 471 F.3d 1293, 1304 (Fed. Cir. 2006) (en banc in relevant part) (quoting Manville Sales Corp. v. Paramount Sys., Inc., 917 F.2d 544, 554 (Fed. Cir. 1990)).

Belkin didn't need that clearing opinion after all.