Extraterritorial Patent Infringement Liability after NTP, Inc. V. Research in Motion, Ltd

I. INTRODUCTION 218 II. BACKGROUND 219 A. Territorial Nature of Patent Laws 219 1. Limits on Extraterritorial Application of U.S. Patent Law 220 2. Role of International Treaties in Specifying the Territorial Limits of Patent Laws 221 3. International Comity 221 B. Patent Infringement Liability 222 1. Infringing Activities Under 35 U.S.C. § 271 (a) 222 2. Infringing Activities Under 35 U.S.C. §§271(f) and 271 (g) 223 3. The Special Problem of Network Inventions 224 C. Background of the NTP v. Research In Motion Litigation 225 1. The Technology at Issue 225 2. Procedural History 226 III. ANALYSIS 227 A. Holding of the NTP v. Research In Motion Case 227 1. The Court's Consideration of NTP's System Claims 228 2. The Court's Consideration of NTP's Method Claims 228 3. Applicability of §§ 271(f) and 271 (g) 230 B. Consistency with Statutory Language and Supreme Court Precedent 231 C. Consistency with International Patent Treaties and Foreign Relations 232 IV. RECOMMENDATIONS 234 A. Amend Infringement Liability Provisions 234 B. Reciprocal Trade Agreements 235 C. Careful Claim Drafting 235 V. CONCLUSION 235 I. INTRODUCTION Conventional wisdom supposes that patent law is territorial.1 Since individual countries grant patent rights to inventions, those rights are necessarily enforceable only in that country.2 New technologies involving computer and telecommunications networks challenge a basic assumption of territoriality: that patent-eligible subject matter is geographically discrete. For example, a patented machine in a factory has only one location: the factory. On the other hand, components of a patented communications system may not even be on the same continent, let alone in the same building. An invention that is not situated in one place may make it difficult to show patent infringement against a single user when applying current law. This Note will analyze the recent Court of Appeals for the Federal Circuit (CAFC) decision in NTP, Inc. v. Research In Motion, Ltd.,3 which challenges the traditional notions of patent law territoriality. The case examined whether Research In Motion (RIM), the maker of the BlackBerry® handheld e-mail system, could be held liable for patent infringement in the United States even though some of the components of that system were located in Canada.4 The CAFC held that there could be patent infringement, and applied the control and beneficial use test: as long as the control and beneficial use of the system occurs within the United States, then there may be infringement regardless of any one component's location.5 Thus, liability for patent infringement may extend to some activities outside the territorial bounds of the United States. Expanding the territorial application of U.S. patent law poses an interesting policy conflict. On the one hand, it may be desirable to allow U.S. patentees the right to recover from infringers operating partly inside and partly outside the United States. If the alleged infringer simply attempts to subvert the rights of the patent holder by moving some operations across the border, then perhaps those activities should be reachable under U.S. law. This policy would find support in the idea that, in order to provide the constitutional incentive for progress in the useful arts,6 inventors should be accorded fair protection for their inventions. …