Akamai Technologies & MIT v. Limelight Networks (CAFC 2009-1372, -1380, -1416, -1417) precedential

Joint Infringement (of '703)

Because Limelight itself does not perform all the steps of the asserted claims, Akamai presented a theory of joint liability at trial. Akamai relied on the reasoning expressed by this court in BMC Resources that while "[i]nfringement requires, as it always has, a showing that a defendant has practiced each and every element of the claimed invention," joint liability may be found when one party "control[s] or direct[s]" the activities of another party. BMC Res., Inc. v. Paymentech, L.P., 498 F.3d 1373, 1380 (Fed. Cir. 2007).

Following the verdict finding infringement, Limelight moved for JMOL of noninfringement on the ground that substantial evidence did not support the verdict that Limelight directs or controls all the steps in the asserted claims.

The district court at first resisted, but then reconsidered.

Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318 (Fed. Cir. 2008), applying BMC Resources, held that an accused infringer's control over its customers' access to an online system, coupled with instructions on how to use that system, was not enough to establish direct infringement. Id. at 1328-30. On reconsideration, the district court granted JMOL of noninfringement to Limelight holding that there was "no material difference between Limelight's interaction with its customers and that of Thomson in Muniauction." JMOL Opinion at 122.

The issue is infringement by proxy.

It is well settled that direct infringement requires a single party to perform every step of a claimed method. BMC Resources, 498 F.3d at 1378-79 (citing WarnerJenkinson Co., Inc. v. Hilton Davis Corp., 520 U.S. 17, 40 (1997)). In both BMC Resources and Muniauction this court confronted the situation in which more than one party is required to perform the steps of a claimed method. The court concluded that there can be no infringement unless "one party exercises 'control or direction' over the entire process such that every step is attributable to the controlling party." Muniauction, 532 F.3d at 1329 (citing BMC Resources, 498 F.3d at 1380-81). In assessing whether "control or direction" is present, the court in BMC Resources made reference to the legal principle that imposed "vicarious liability on a party for the acts of another in circumstances showing that the liable party controlled the conduct of the acting party." BMC Resources, 489 F.3d at 1379 (citing Engle v. Dinehart, 213 F.3d 639 (5th Cir. 2000) (unpublished decision); Restatement (Second) of Agency § 220 cmt. d)). The court concluded that "[it] would be unfair indeed for the mastermind in such situations to escape liability." Id. at 1381. Moreover, the court in BMC Resources also explained that "[a] party cannot avoid infringement . . . simply by contracting out steps of a patented process to another entity." Id.

While the "control or direction" test of BMC Resources established a foundational basis on which to determine liability for direct infringement of method claims by joint parties, it left several questions unanswered, including the question of whether the furnishing of instructions is sufficient to attribute the actions of the instructed party to the accused. Muniauction addressed the question about instructions and, in concluding that the instructions in that case were not enough, reiterated the notion of vicarious liability mentioned in BMC Resources. The court in Muniauction held that the requisite level of control or direction over the acts committed by a third party is met in circumstances in which "the law would traditionally hold the accused direct infringer vicariously liable for the acts committed by another party." 532 F.3d at 1330. Thus, both BMC Resources and Muniauction set forth relevant factors in assessing liability for joint infringement.

"Control" means "contractually obligated." In a word, an agent.

While control or direction is a consideration, as is the extent to which instructions, if any, may be provided, what is essential is not merely the exercise of control or the providing of instructions, but whether the relationship between the parties is such that acts of one may be attributed to the other. Implicit in this court's holdings in BMC Resources and Muniauction is that the performance of a method step may be attributed to an accused infringer when the relationship between the accused infringer and another party performing a method step is that of principal and agent, applying generally accepted principles of the law of agency as explicated by the Supreme Court and the Restatement of Agency. The Restatement defines agency as "the fiduciary relationship that arises when one person (a 'principal') manifests assent to another person (an 'agent') that the agent shall act on the principal's behalf and subject to the principal's control, and the agent manifests assent or otherwise consents so to act." Restatement (Third) of Agency § 1.01. For an agency relationship to exist, and thus, for infringement to be found, both parties must consent that the agent is acting on the principal's behalf and subject to the principal's control. See Dixon v. United States, 465 U.S. 482, 505 (1984) (citing the Restatement (Second) of Agency § 1 for the rule that an "agency relationship [is] created when one person agrees with another 'that the other shall act on his behalf and subject to his control'"). Similarly, also implicit in the court's holdings in BMC Resources and Muniauction, is that joint infringement occurs when a party is contractually obligated to the accused infringer to perform a method step.

The court notes that the common law of agency encompasses not only the fiduciary relationship noted above, but also some other relationships, which may include those of independent contractors... A party that engages another to perform a step of a claimed method as its agent cannot escape liability simply by designating its agent an independent contractor if all the elements that otherwise reflect an agency relationship are present.

Joint infringement is not about "friends with benefits." Whose benefit is bereft to figuring joint infringement. After all, "in any relationship there may be benefits that inure in some respects to both parties."

In assessing infringement based on the actions of joint parties, it is not enough to determine for whose benefit the actions serve, for in any relationship there may be benefits that inure in some respects to both parties. This court therefore holds as a matter of Federal Circuit law that there can only be joint infringement when there is an agency relationship between the parties who perform the method steps or when one party is contractually obligated to the other to perform the steps. Neither is present here.

Limelight's customers serve themselves, not Limelight.

In this case, there is nothing to indicate that Limelight's customers are performing any of the claimed method steps as agents for Limelight... Here, the customers decide what content, if any, they would like delivered by Limelight's CDN and then perform the step of "tagging" that content. Limelight's customers also perform the step of "serving" their own web pages.

Tuck away noninfringement.

Because Limelight did not perform all of the steps of the asserted method claims, and the record contains no basis on which to attribute to Limelight the actions of its customers who carried out the other steps, this court affirms the finding of noninfringement and does not reach Limelight's cross-appeal regarding damages.

Claim Construction ('645 & '413)

A summary litany of claim construction.

"We begin a claim construction analysis by considering the language of the claims themselves." Edwards Lifesciences LLC v. Cook Inc., 582 F.3d 1322, 1327 (Fed. Cir. 2009). However, "the written description can provide guidance as to the meaning of the claims, thereby dictating the manner in which the claims are to be construed, even if the guidance is not provided in explicit definitional format." Scimed Life Sys., Inc. v. Advanced Cardiovascular Sys., Inc., 242 F.3d 1337, 1344 (Fed. Cir. 2001).

First, a preamble term that imposed a limitation (undisputedly). The disputed term was a long-winded version of a URL (universal resource locator). Akamai argued claim construction limitation import, but the patent spec had a different import.

Akamai appeals the construction of the term "a given object of a participating content provider is associated with an alphanumeric string" in the preamble of claim 1 of the '645 patent. The district court construed the limitation to require that the alphanumeric string include the embedded object's original URL (the URL including the hostname of the computer on which the actual object resided within the content provider's domain). Claim Construction Order at 39.

Here, as in Honeywell International, Inc. v. ITT Industries, Inc., 452 F.3d 1312, 1318 (Fed. Cir. 2006), alphanumeric strings including the object's original URL were not merely discussed as a preferred embodiment. Instead, the written description specifically refers to strings including the object's original URL as "the invention."

Second, two terms that translated to using a DNS as a name server.

The district court interpreted both limitations to require that the name server be selected by the alternative domain name system. Claim Construction Order, at 42, 45.

Method claims often include structural details. See e.g., Microprocessor Enhancement Corp. v. Tex. Instruments, Inc., 520 F.3d 1367, 1374 (Fed. Cir. 2008) ("Method claim preambles often recite the physical structures of a system in which the claimed method is practiced, and claim 1 is no different."); Eaton Corp. v. Rockwell Int'l Corp., 323 F.3d 1332, 1342 (Fed. Cir. 2003) (construing a method claim as including "steps that require the operation or manipulation of the particular structure identified and described by the preamble"). All of the asserted claims in both the '645 patent and the '413 patent explicitly refer to the alternative domain name system as a detail associated with the claimed method. '645 patent col.17 ll.50-51 ("having the service provider establish an alternative domain name system (DNS)"); '413 patent col.18 ll.22-23, col.19 ll.44-45, col.20 ll.25-26 ("having the content delivery network service provider establish an alternative domain name system (DNS)"). Therefore, the structural element of the alternative DNS framework was explicitly and properly included in the claims.

In fact, the patent repeatedly defines using DNS lookup for choosing the ultimate CDN DNS server as the "invention."

This court... affirms the district court's judgment of noninfringement of the '645 and '413 patents based on its rulings on claim construction.

Affirmed.