In previous posts “Will Formal Opinions Act as a Shield Against Charges of Induced Infringement?” and “What’s the Intent? Comparing Induced Infringement and Willfulness”, we discussed the impact of the Federal Circuit’s decision in Commil v. Cisco Systems on opinions of counsel. The Supreme Court recently overturned the Federal Circuit’s ruling in Commil, holding that a defendant’s belief regarding patent liability is not a defense to an induced infringement claim. In the opinion, the Court reaffirmed Global-Tech, which held that liability for induced infringement can only attach if the defendant knew of the patent and knew that the induced acts constitute patent infringement. The Court clarified that a person or entity who, for example, reads the patent’s claims differently than the patent holder, and the reading was reasonable, would not be liable for induced infringement. In other words, inducement “requires proof the defendant knew the acts were infringing.”2 The Court’s holding thus affirms that a reasonable opinion of counsel regarding non-infringement can be used to defend against a charge of induced infringement.
The Court refused to extend this rationale to a reasonable belief in the invalidity of a patent because of “the long-accepted truth-perhaps the axiom-that infringement and invalidity are separate matters under patent law.”3 Indeed, the Court stated that if they were to interpret §271(b) as permitting a defense of belief in invalidity, “it would conflate the issues of infringement and validity.”4 Further, the Court found that if a belief in invalidity were a defense to induced infringement, the presumption of a patent’s validity would be greatly lessened because a defendant could prevail by proving he reasonably believed the patent was invalid, even if a court or jury came to the opposite conclusion.
Where does Commil leave opinions of counsel? Commil doesn’t appear to change anything with respect to obtaining opinions of counsel of non-infringement to defend against a finding of induced infringement. Such opinions can be highly valuable, so long as they are competent and reasonable. An accused induced infringer can avoid liability altogether by proving that they lacked the necessary state of mind necessary to find induced infringement, i.e., they did not know that their acts would be infringing. Invalidity opinions remain relevant as well, for the same reasons as before Commil. Such opinions can be used to defend against a charge of willful infringement, for example. Also, for companies that reasonably believe a competitor’s patent is invalid, an opinion of counsel can provide a roadmap for any potential litigation. Such opinions may also be useful to instill confidence in potential investors or partners.
Another reason to obtain quality opinions of counsel is to defend against a claim that the case is “exceptional” in the context of awarding attorney’s fees. In determining whether a case is exceptional the court reviews the “totality of the circumstances.” Thus, a court may consider a variety of factors in determining whether a case is exceptional, including frivolousness, motivation of the litigant and objective unreasonableness.5 Invalidity opinions of counsel have been used in this context in the past.6
2 Id. at 1928.
5 See Octane Fitness, LLC v. ICON Health and Fitness, Inc., 134 S. Ct. 1749 (2014).
6 See Ortho Pharm. Corp., v. Smith, 959 F.2d 936 (Fed. Cir. 2014).