Enforcing a patent with claims that raise the specter of divided infringement can be a difficult plight for patent owners. Even under the more liberal standard set forth in the Federal Circuit’s en banc decision in Akamai v. Limelight, it has proven difficult for patent owners to establish the necessary levels of control or cooperation between two or more parties who together perform the steps of a method claim. However, the Federal Circuit decision in Travel Sentry, Inc. v. Tropp suggests that the requisite level of cooperation or control should be considered broadly. This recent interpretation of the Akamai test may at the very least make it more difficult for accused infringers to have divided infringement cases dismissed at the summary judgement stage.

The Patents at Issue

There were two patents at issue in Travel Sentry: U.S. 7,021,537 and U.S. 7,036,728. These patents are directed to methods of improving airline luggage or carrier baggage inspection, respectively, by utilizing a “dual-access lock.” Readers settling back into their routines after holiday travels are likely to appreciate any attempt to “improve[e] airline luggage inspection,” and may be familiar with  the type of “dual-access lock” claimed by the ’537 and ’728 patents.

Essentially, the “dual-access” luggage locks recited in the claims is a combination lock that can be opened by using a combination known to the purchaser or can be opened by a master key held by a “luggage screening entity” (i.e., the Transportation Security Administration (TSA). The claims recite a multi-step method of making these locks available to consumers and having the TSA be on the look-out for such locks when inspecting baggage, so that they can open and inspect the bags without damaging the locks.

Exemplary claim 1 of the ’537 patent recites:

1. A method of improving airline luggage inspection by a luggage screening entity, comprising:
   making available to consumers a special lock having a combination lock portion and a master key lock portion, the master key lock portion for receiving a master key that can open the master key lock portion of this special lock, the special lock designed to be applied to an individual piece of airline luggage, the special lock also having an identification structure associated therewith that matches an identification structure previously provided to the luggage screening entity, which special lock the luggage screening entity has agreed to process in accordance with a special procedure,
   marketing the special lock to the consumers in a manner that conveys to the consumers that the special lock will be subjected by the luggage screening entity to the special procedure,
   the identification structure signaling to a luggage screener of the luggage screening entity who is screening luggage that the luggage screening entity has agreed to subject the special lock associated with the identification structure to the special procedure and that the luggage screening entity has a master key that opens the special lock, and
   the luggage screening entity acting pursuant to a prior agreement to look for the identification structure while screening luggage and, upon finding said identification structure on an individual piece of luggage, to use the master key previously provided to the luggage screening entity to, if necessary, open the individual piece of luggage.

(Claim 1 of the ’728 patent recites a similar method that focuses on carrier baggage, as opposed to airline baggage.)

Thus, the claimed methods involve at least two actors: the entity making available/marketing the lock and the luggage screening entity.

The District Court Decision 

As noted in the Federal Circuit decision, this is the third time the court has “had occasion to preside over this longstanding dispute regarding whether Travel Sentry, Inc. … and its licensees infringe
one or more claims of two patents issued to appellant David A. Tropp.” Indeed, the case has been bouncing back and forth between the district court and the Federal Circuit since 2006, closely tracking the developments in Akamai.

The most recent appeal arose from the district court’s second round of decisions on summary judgement motions. Following supplemental briefing in the wake of the 2015 en banc Akamai decision, the district court granted summary judgement of non-infringement in favor of Travel Sentry (for the second time) and denied Tropp’s cross-motions for summary judgement of infringement. The district court found that “there is simply no evidence that Travel Sentry had any influence whatsoever on the third and fourth steps of the method carried out by the TSA, let alone ‘masterminded’ the entire patented process.” The court thus determined that “the unusual circumstances of Akamai are not mimicked here.”

The Federal Circuit Decision

The Federal Circuit was authored by Judge O’Malley and joined by Judges Lourie and Taranto.

The Federal Circuit disagreed with the district court regarding both the lack of evidence and that Akamai was so strictly limited to the particular facts of that case. Instead, the Federal Circuit suggests that Akamai expanded the scope of liability under section 271(a) such that one entity may be held responsible for another’s performance of method steps under two general circumstances:

1. where that entity “directs or controls” the other’s performance of those method steps, or
2. where the actors form a “joint enterprise.”

The court explained further that Akamai shows that a patent owner can prove that one entity was directing or controlling another the primary entity (the accused infringer) conditioned participation in an activity or receipt of a benefit upon performance of steps established by the primary entity.

Of particular relevance to this case was a “memorandum of understanding” that Travel Sentry entered into with TSA in 2003. While there was no penalty for non-compliance with this memorandum and either party could terminate it at any time, the memorandum nevertheless provided a detailed outline of the expectations and responsibilities of each party and how they would interact (e.g., Travel Sentry would provide TSA with 1,500 master keys to distribute at airports and TSA would use the keys “whenever practicable”). The Federal Circuit saw this as evidence that would allow a reasonable jury to find that Travel Sentry was conditioning a benefit to TSA (e.g., the ability to reduce theft claims and/or reduce luggage damage claims) based on TSA’s performance of steps that were established by Travel Sentry (e.g., distribute master keys to TSA location and make best efforts to use keys when locks possess the Travel Sentry emblem).

Thus, the Federal Circuit found a genuine issue of material fact as to whether Travel Sentry’s actions satisfy the Akamai test, and determined that the district court had impermissibly narrowed the test when characterizing the scope of interaction between Travel Sentry and TSA.

More Life For Divided Infringement Cases

Though still a tenuous position for patent owners, divided infringement liability may not be as difficult to prove as previously thought. In comparing Travel Sentry to Akamai and Eli Lilly v. Teva Parenteral Medicines (another recent case that found liability under a theory of divided infringement), the Federal Circuit noted:

[A] common thread connects all three cases: evidence that a third party hoping to obtain access to certain benefits can only do so if it performs certain steps identified by the defendant, and does so under the terms prescribed by the defendant.

The decision in Travel Sentry shows that this “benefit” does not necessarily have to be monetary and may be somewhat intangible, and that the “terms” do not necessarily have to be binding. This may open the door for more creative arguments for divided infringement liability, encouraged by the Federal Circuit’s emphasis that Akamai “broaden[ed] the circumstances in which others’ acts may be attributed to an accused infringer.” This also may increase the likelihood that infringement cases based on divided infringement theories will survive the summary judgement stage.