Cardiac Pacemakers, Inc. v. St. Jude Medical, Inc.

United States Court of Appeals for the Federal Circuit
2007-1296, -1347

CARDIAC PACEMAKERS, INC.
and GUIDANT SALES CORPORATION,

Plaintiffs-Appellants,

and

MIROWSKI FAMILY VENTURES, LLC and ANNA MIROWSKI,

Plaintiffs-Appellants,

v.

ST. JUDE MEDICAL, INC. and PACESETTER, INC.,

Defendants-Cross Appellants.

Arthur I. Neustadt, Oblon, Spivak, McClelland, Maier & Neustadt, P.C., of
Alexandria, Virginia, argued for all plaintiffs-appellants. With him on the brief for Mirowski
Family Ventures, LLC, et al. was Barry J. Herman. On the brief for Cardiac Pacemakers,
Inc., et al., were J. Michael Jakes, Kara F. Stoll, Michael V. O’Shaughnessy and Molly R.
Silfen, Finnegan, Henderson, Farabow, Garrett & Dunner, L.L.P., of Washington, DC.

Mark A. Perry, Gibson, Dunn & Crutcher LLP, of Washington, DC, argued for
defendants-cross appellants. With him on the brief was Denis R. Salmon, and H. Mark
Lyon, of Palo Alto, California. Of counsel on the brief was Jeffrey M. Olson, Sidley Austin
LLP, of Los Angeles, California.

Mark M. Supko, Crowell & Moring LLP, of Washington, DC, for amici curiae Federal
Circuit Bar Association, et al., on petition for rehearing en banc. With him on the brief
were Michael I. Coe; and Alyson G. Barker, Howrey LLP, of Irvine, California. Of counsel
on the brief were Joseph R. Re, Federal Circuit Bar Association, of Washington, DC, and
Teresa Stanek Rea, American Intellectual Property Law Association, of Arlington, Virginia.

Jamie H. McDole, Kirkland & Ellis LLP, of Chicago, Illinois, for amicus curiae
Research in Motion Limited, on petition for rehearing en banc.

Edward R. Reines, Weil, Gotshal & Manges LLP, of Redwood Shores, California,
for amici curiae Cisco Systems, Inc., et al., on petition for rehearing en banc. With him on
the brief were Melanie P. Sarwal, of Austin, Texas, and Rebecca Fett, of New York, New
York.
 Lance A. Lawson, Alston & Bird LLP, of Charlotte, North Carolina, for amici curiae
AGA Medical Corporation, et al., on petition for rehearing en banc. With him on the brief
were Michael S. Connor, Kirk T. Bradley and Brian F. McMahon.

R. Carl Moy, William Mitchell College of Law, of St. Paul, Minnesota, for amicus
curiae William Mitchell College of Law, on petition for rehearing en banc. With him on the
brief was Jay Erstling.

Daryl Joseffer, of McLean, Virginia, for amicus curiae Ormco Corporation, on
petition for rehearing en banc. With him on the brief was David L. DeBruin, Michael Best &
Friedrich LLP, of Milwaukee, Wisconsin.

Appealed from: United States District Court for the Southern District of Indiana

Judge David F. Hamilton

2
United States Court of Appeals for the Federal Circuit

2007-1296, -1347

CARDIAC PACEMAKERS, INC.
and GUIDANT SALES CORPORATION,

Plaintiffs-Appellants,

and

MIROWSKI FAMILY VENTURES, LLC and ANNA MIROWSKI,

Plaintiffs-Appellants,

v.

ST. JUDE MEDICAL, INC.,
and PACESETTER, INC.,

Defendants-Cross Appellants.

Appeals from the United States District Court for the Southern District of
Indiana in 96-CV-1718, Judge David F. Hamilton.
____________________

DECIDED: August 19, 2009
____________________

Before NEWMAN, MAYER, and LOURIE, Circuit Judges. Opinion for the court filed by
Circuit Judge LOURIE, in which Circuit Judge MAYER joins and Circuit Judge
NEWMAN joins parts A, B, C.1, and D.

Part C.2 was heard en banc before MICHEL, Chief Judge, NEWMAN, MAYER,
LOURIE, RADER, SCHALL, BRYSON, GAJARSA, LINN, DYK, PROST, and MOORE,
Circuit Judges. Opinion for the court filed by Circuit Judge LOURIE, in which Chief
Judge MICHEL and Circuit Judges MAYER, RADER, SCHALL, BRYSON, GAJARSA,
LINN, DYK, PROST, and MOORE join. Dissenting opinion filed by Circuit Judge
NEWMAN.

LOURIE, Circuit Judge.
 Cardiac Pacemakers, Inc., Guidant Sales Corporation, Mirowski Family

Ventures, LLC, and Anna Mirowski (collectively, “Cardiac” or “appellants”) appeal from

the decision of the United States District Court for the Southern District of Indiana

granting summary judgment of invalidity of claim 4 of U.S. Patent 4,407,288 (“the ’288

patent”). See Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., 483 F. Supp. 2d 734

(S.D. Ind. 2007) (“Invalidity Decision”). Cardiac also appeals aspects of the district

court’s decision concerning damages. See Cardiac Pacemakers, Inc. v. St. Jude Med.,

Inc., 418 F. Supp. 2d 1021, 1027-30 (S.D. Ind. 2006) (“Damages Decision”). Because

the district court erred in concluding in light of our prior mandates that it could find the

’288 patent anticipated, we reverse on invalidity. In light of the fact that infringement

has already been decided by the district court, we remand the case solely for a

determination of damages. We affirm the court’s decision limiting damages to those

devices that can be shown to have executed the steps of claim 4 of the ’288 patent.

St. Jude Medical, Inc. and Pacesetter, Inc. (collectively, “St. Jude”) cross-appeal

from the district court’s decision permitting damages under 35 U.S.C. § 271(f). See Id.

at 1027-30. The en banc court reverses the district court’s determination that 35 U.S.C.

§ 271(f) applies to method claims and hence permits damages in this case on devices

exported where the claimed method is carried out in countries other than the United

States (see Section C.2 of this opinion).

BACKGROUND

This patent dispute concerning implantable cardioverter defibrillators (“ICDs”),

has been before us on four previous occasions. See Cardiac Pacemakers, Inc. v. St.

Jude Med., Inc., 296 F.3d 1106 (Fed. Cir. 2002); Cardiac Pacemakers, Inc. v. St. Jude

2008-1296, -1347 2
Med., Inc., 381 F.3d 1371 (Fed. Cir. 2004) (“2004 Opinion”); Cardiac Pacemakers, Inc.

v. St. Jude Med., Inc., 144 F. App’x 106 (Fed. Cir. 2005) (“2005 Reassignment Order”);

In re Cardiac Pacemakers, Inc., 183 F. App’x 967 (Fed. Cir. 2006) (“2006 Writ Order”).

Three of our prior decisions, the 2004 Opinion, the 2005 Reassignment Order, and the

2006 Writ Order, are relevant to this appeal.

ICDs are small devices that detect and correct abnormal heart rhythms that can

be fatal if left untreated. The ICDs in this case work by administering electrical shocks

to the heart, those shocks being calibrated to restore normal heart functioning.

Implantable cardiac devices can be programmed to administer different types of

electrical shocks, including pacing shocks (which are relatively low power shocks),

defibrillation (relatively high power shocks), and cardioversion, the definition of which

has been a source of dispute throughout the protracted litigation of this case.

Cardiac owns various patents relating to cardiac defibrillators, including the ’288

patent. The ’288 patent claims a method of heart stimulation using an implantable heart

stimulator that is capable of detecting heart arrhythmias, or irregular heart rhythms, and

of being programmed to treat the arrhythmia through either single or multimode

operation. Multimode operation allows a heart stimulator to respond to arrhythmias by

applying first one type of shock and then, if unsuccessful, administering a second type

of shock. Claim 4 of the ’288 patent, the only claim at issue on appeal, is dependent on

claim 1:

1. A method of heart stimulation using an implantable heart stimulator capable
of detecting a plurality of arrhythmias and capable of being programmed to
undergo a single or multi-mode operation to treat a detected arrhythmia,
corresponding to said mode of operation the method comprising:
(a) determining a heart condition of the heart from among a plurality of
conditions of the heart;

2008-1296, -1347 3
 (b) selecting at least one mode of operation of the implantable heart
stimulator which operation includes a unique sequence of events
corresponding to said determined condition;
(c) executing said at least one mode of operation of said implantable heart
stimulator thereby to treat said determined heart condition.
* * *
4. The method of claim 1, wherein said at least one mode of operation of said
implantable heart stimulator includes cardioversion.

The litigation history of this case is complicated and protracted, but for clarity’s

sake we will recite the portion of that history that is relevant to this appeal. Cardiac

brought an infringement action against St. Jude on November 26, 1996, accusing St.

Jude of selling ICDs that infringed a number of Cardiac’s patents. In 2001 the case was

tried before a jury. The jury returned a verdict awarding Cardiac $140 million in

royalties for infringement of U.S. Patent 4,316,472 (“the ’472 patent”). Cardiac

Pacemakers, Inc. v. St. Jude Med., Inc., No. IP-96-1718-C, 2002 U.S Dist. LEXIS

14767, at *7 (S.D. Ind. July 5, 2002). The jury found the ’288 patent valid and

enforceable, but not infringed by St. Jude’s ICDs. Id. at *6-*7. In doing so, the jury

rejected St. Jude’s argument that the invention of the ’288 patent was obvious in light of

various prior art references, including U.S. Patent 3,805,795 (“Denniston”) and United

Kingdom Patent Application 2,026,870 (“Duggan”). Id. at *117, *120. The jury also

rejected St. Jude’s argument that the ’288 patent was unenforceable for inequitable

conduct. 1 Id. at *7.

Following the trial, the district court granted several post-verdict motions that

overturned the jury verdict and conditionally granted a new trial on several issues that

1
The jury also rejected St. Jude’s argument that the ’288 patent failed to
comply with the best mode requirement of 35 U.S.C. § 112 ¶ 1. St. Jude has not
appealed any decisions relating to 35 U.S.C. § 112.

2008-1296, -1347 4
St. Jude had lost at trial. First, the court granted St. Jude judgment as a matter of law

(“JMOL”) on invalidity and noninfringement of the ’472 patent, thereby vacating the

jury’s $140 million damage award. Id. at *100. Cardiac has not appealed any of the

district court’s decisions regarding the ’472 patent.

Regarding the ’288 patent, which the jury found valid and not infringed, the

district court granted St. Jude’s JMOL motions for invalidity due to obviousness and lack

of best mode. Id. at *100-*133. The court denied St. Jude’s JMOL motion of

unenforceability, in which St. Jude alleged that Cardiac had failed to pay proper

maintenance fees. Id. at *133-*143. Finally, the court further denied Cardiac’s motion

for a new trial on infringement. Id. at *195-*196. The court granted a conditional new

trial on the obviousness issue and the inequitable conduct issue in the event that the

JMOL decision finding the ’288 patent obvious was reversed on appeal. Id. at *114,

*143.

Following the district court’s post-trial decisions, Cardiac appealed the district

court’s grant of St. Jude’s motion for JMOL of invalidity of the ’288 patent as well as the

court’s rejection of Cardiac’s motion for JMOL of infringement of claim 4 of the ’288

patent. On appeal, we reversed on both issues. 2004 Opinion, 381 F.3d at 1378-80.

Regarding validity, we held that there was “substantial evidence whereby a reasonable

jury could have reached the verdict that it would not have been obvious in March 1981

to provide an ICD that includes cardioversion,” and therefore reinstated the jury verdict

that the “’288 patent is not invalid for obviousness. Id. We also found that the district

court’s conditional grant of a new trial on obviousness “exceeded the court’s

discretionary authority.” Id. at 1380.

2008-1296, -1347 5
 Regarding infringement, we reversed the court’s claim construction and therefore

vacated the jury’s finding of noninfringement. We held that the district court had erred in

finding that the “determining” step of claim 4 was a “step-plus-function” limitation under

35 U.S.C. § 112 ¶ 6 and remanded the case to the district court to modify its claim

construction of the “determining” step in accordance with our opinion. Id. at 1382.

Lastly, we agreed with St. Jude that our reversal of the district court’s claim construction

entitled St. Jude to a “jury determination on the question of infringement.” Id. at 1383.

We summarized our holding as follows:

We affirm in part and modify in part the district court’s claim construction,
reinstate the jury verdict of validity, and remand for a new trial on
infringement and reassessment of damages.

Id. at 1374.

On remand, the case was returned to Judge Hamilton. Cardiac challenged that

assignment, claiming that Seventh Circuit Rule 36 required automatic reassignment of a

case remanded for a new trial to a new judge. Judge Hamilton ultimately agreed with

Cardiac to reassign the case to another judge. He then certified the issue for an

interlocutory appeal. St. Jude appealed the reassignment decision to this court, and we

reversed, finding that further assignment to Judge Hamilton would best conserve judicial

resources. 2005 Reassignment Order, 144 F. App’x at 106. We also noted that the

case had been remanded for “a new trial on literal infringement of one claim of one

patent and for any damages determination.” Id. at 107.

With that background in mind, we now turn to the decisions of the district court

that are at issue on appeal. After that remand, both sides submitted to the district court

proposed claim constructions for the disputed “determining” limitation in claim 4 of the

2008-1296, -1347 6
’288 patent, and the district court adopted Cardiac’s definition of “determining” with one

minor change (which is not challenged on appeal). Damages Decision, 418 F. Supp. 2d

at 1027-30. Cardiac also moved for summary judgment on St. Jude’s invalidity and

unenforceability defenses, arguing that such defenses were precluded by our 2004

Opinion and the mandate rule. Id. at 1031. The district court disagreed and denied the

motion. The court found that “[t]he Federal Circuit’s remand left open the possibility of

new invalidity and unenforceability defenses.” Id. at 1031. According to the district

court, while our 2004 Opinion precluded assertion of the same obviousness argument

that St. Jude had raised and lost previously, “St. Jude’s other theories of invalidity were

not within the scope of the appealed judgment and therefore may be asserted on

remand.” Id. at 1032. In arriving at that conclusion, the district court relied on three

points. First, the court found that our remand instructions in the 2004 Opinion

“suggested” that a new claim construction might give rise to new invalidity defenses,

particularly with regard to the adequacy of the written description requirement. Id.

Second, the court found that because St. Jude had no obligation on appeal to present

alternative arguments for invalidity, those alternative arguments were not precluded on

remand. Id. at 1032-33. Third, and most importantly, the court found that St. Jude did

not abandon or waive its invalidity defenses that became relevant only on remand; in

other words, due to the court’s new claim construction of “determining,” certain prior art

that was not invalidating under the erroneous claim construction may have become

invalidating under the new claim construction. Id. at 1033.

The district court also rejected Cardiac’s motion for summary judgment on St.

Jude’s affirmative defense of inequitable conduct. The court found that “all of St. Jude’s

2008-1296, -1347 7
arguments concerning unenforceability” could be asserted on remand. Id. The district

court found that this court’s mandate “did not even suggest, let alone require,” that the

issue of inequitable conduct be precluded from adjudication on remand. Id. at 1034.

Finally, the district court granted in part and denied in part St. Jude’s motion for

summary judgment limiting damages. The court granted St. Jude’s motion to limit

damages to ICDs that actually performed the claimed steps. Id. at 1040. The court

held that because claim 4 is a method claim, only those devices that “can be shown to

have executed” the claimed method were to be used in the damages calculation. Id. at

1042. However, the court rejected St. Jude’s motion to limit damages to U.S. sales of

ICDs. The court held that, according to Federal Circuit case law regarding 35 U.S.C.

§ 271(f), Cardiac’s potential damages included the sale of infringing devices supplied

from the United States to other countries. Id. at 1042-44.

Following the district court’s rulings on claim construction and the various

summary judgment motions, Cardiac petitioned this court for a writ of mandamus

directing the district court to vacate its order allowing St. Jude to assert invalidity and

inequitable conduct defenses. We denied the petition. In doing so, we stated:

[W]e repeat that we “remand[ed] for a new trial of infringement and
reassessment of damages,” including re-construction by the district court
of the “determining” provision in light of our ruling that section 112 ¶ 6 did
not apply. We also recognized that a new claim construction may raise
directly related new issues, “such as whether the now-asserted scope of
the claims is supported by the specification.”

All of the other issues on remand were finally decided, and are not subject
to reopening on remand.

2006 Writ Order, 183 F. App’x at 967 (citations omitted) (emphasis added). The case

was once more remanded to the district court.

2008-1296, -1347 8
 On March 26, 2007, the district court granted Cardiac’s motion for summary

judgment of infringement, while also granting St. Jude’s motion for summary judgment

of anticipation. Invalidity Decision, 483 F. Supp. 2d at 745. As a threshold matter, the

district court found that because of the new, broader claim construction, the anticipation

defense was, in the words of this court, a “directly related new issue,” and therefore not

precluded by our previous decisions. Id. at 738-39 (quoting 2006 Writ Order, 183 F.

App’x at 967). The court then examined the prior art and found that the ’288 patent was

anticipated by two references that had been presented to the jury: Denniston and

Duggan. Id. at 740-45. Final judgment of invalidity was entered by the district court.

Cardiac timely appealed and we have jurisdiction pursuant to 28 U.S.C.

§ 1295(a)(1).

DISCUSSION

We review the district court's grant of summary judgment de novo, “applying the

same criteria used by the district court in the first instance.” Rothe Dev. Corp. v. Dep’t

of Defense, 545 F.3d 1023, 1035 (Fed. Cir. 2008) (quoting W.H. Scott Constr. Co. v.

City of Jackson, 199 F.3d 206, 211 (5th Cir. 1999)). Summary judgment is appropriate

“if the pleadings, the discovery and disclosure materials on file, and any affidavits show

that there is no genuine issue as to any material fact and that the movant is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56(c). We review the interpretation of our

own mandates de novo. Engel Indus., Inc. v. Lockformer Co., 166 F.3d 1379, 1382

(Fed. Cir. 1999).

A. Invalidity

On appeal, Cardiac argues that the district court erred in granting summary

2008-1296, -1347 9
judgment of invalidity. Preliminarily, Cardiac argues that invalidity was not at issue on

remand because the mandate rule precluded St. Jude’s anticipation defense.

Alternatively, Cardiac argues that if we find that anticipation was still at issue on

remand, then we should also find that the district court erred in finding that no genuine

issues of material fact existed as to whether Duggan and Denniston were anticipating

references, particularly with respect to whether Duggan teaches cardioversion and

whether Denniston teaches programming.

In response, St. Jude argues that while our 2004 Opinion and the mandate rule

bar consideration of obviousness on remand, St. Jude is permitted to bring an

anticipation defense. According to St. Jude, our reversal of the “determining”

construction in the 2004 Opinion created new validity defenses due to the changed

claim scope. St. Jude also claims that the ’288 patent was anticipated by both

Denniston and Duggan, as the district court found.

We agree with Cardiac that anticipation was not properly before the district court

on remand. In the 2004 Opinion, we clearly stated that the purpose of the remand was

“for a new trial of infringement and reassessment of damages.” 2004 Opinion, 381 F.3d

at 1374. Furthermore, we explicitly “reinstate[d] the jury verdict of validity.” Id. The

mandate rule requires that the district court follow an appellate decree as the law of the

case. Sibbald v. United States, 37 U.S. 488, 492 (1838). Therefore, according to our

explicit instructions, any new trial on remand was limited to an assessment of

infringement and a calculation of any damages.

Of course, as St. Jude rightly notes throughout its brief, our 2004 Opinion altered

the district court’s claim construction, and in the 2006 Writ Order we left open the

2008-1296, -1347 10
possibility that a new claim construction ruling “may raise directly related new issues.”

2006 Writ Order, 183 F. App’x at 967. As one example of a directly related new issue,

we suggested that written description may be challenged under a new, broader claim

construction. Id. We did not explicitly include or exclude anticipation from the list of

possible new issues raised by a new construction of “determining.”

Thus, the question before us now is whether anticipation is a “directly related

new issue” in this case, or whether our reinstatement of the jury’s validity verdict

precludes raising anticipation on remand. The jury found the claims of the ’288 patent

nonobvious in light of numerous prior art references, including both Duggan and

Denniston. In overturning the jury’s validity verdict, the district court permitted St. Jude

to raise anticipation arguments on remand that St. Jude did not raise at trial. The court

based its decision on the fact that “St. Jude may have chosen not to pursue some

invalidity defenses, including anticipation, at trial,” due to the erroneous claim

construction of “determining” used at trial. Damages Decision, 418 F. Supp. 2d at 1033.

In finding the claims of the ’288 patent nonobvious, the jury necessarily reached the

conclusion that some element necessary to prove obviousness had not been

demonstrated. For St. Jude to succeed in this appeal, that missing element would have

to have been the “determining” limitation.

While it is true that a changed claim construction may permit new anticipation

arguments, that cannot be the case here because the “determining” limitation never

served as a basis for distinguishing the prior art from the ’288 patent and is therefore

not a “directly related new issue.”

At trial, Cardiac did not dispute that the “determining” step was in the prior art

2008-1296, -1347 11
and did not raise that step as a distinguishing feature between the ’288 patent and

Duggan or Denniston. See Reply Br. of Plaintiffs-Appellants at 12-14, 2004 Opinion

(arguing that Duggan and Denniston do not teach cardioversion); Br. of Plaintiffs-

Appellants at 21-24, 2004 Opinion (arguing that the jury heard evidence that the prior

art did not teach “cardioversion,” “multi-mode operation,” and “programmability”); cf. id.

at 22 (noting evidence that the Baker reference does not perform, among other things,

the determining step). The evidence of obviousness during the trial primarily focused

on whether the prior art taught multi-mode with cardioversion. See Br. for Defendants-

Cross Appellants at 7-8, 2004 Opinion (stating that with regard to obviousness, the only

disputed limitations were the claimed invention’s ability to perform multimode operation

and the use of cardioversion). Duggan and Denniston were not only known to St. Jude

before trial, but both references were presented to the jury. The jury found that those

references did not invalidate the patent even though Cardiac did not dispute that the

“determining” construction was known in the prior art. Thus, it cannot be said that the

jury’s decision hinged on the erroneous construction of that claim. Stated differently,

the jury’s verdict of validity could not have depended upon the erroneous construction of

“determining” because it was uncontested during trial that that term was present in the

prior art.

The initial, erroneous construction of “determining” was appealed by Cardiac in

order to challenge the jury’s verdict of noninfringement. While a change in claim

construction often may affect a jury’s validity determination, in this case it does not.

Therefore, St. Jude cannot now be allowed to claim that its anticipation arguments

involving Duggan and Denniston are “directly related” to the change in the construction

2008-1296, -1347 12
of “determining,” because the jury’s validity determination, which we reinstated, did not

depend upon that erroneous definition. Thus, in light of the jury’s verdict and our

previous mandates unique to this case, we reverse the district court’s summary

judgment of invalidity and reinstate the jury’s verdict that the ’288 patent has not been

shown to be invalid.

B. Inequitable Conduct

Cardiac asks this court to instruct the district court that enforceability defenses

are precluded from any remand order. According to Cardiac, the mandate rule requires

such a determination. St. Jude counters that inequitable conduct is still at issue on

remand because of the district court’s explicit ruling that “in the event of a new trial . . .

the inequitable conduct defense shall be part of the trial.” Cardiac Pacemakers, 2002

U.S. Dist. LEXIS 14767, at *143. Because Cardiac failed to appeal that ruling, St. Jude

contends, that decision is final.

The district court characterized St. Jude’s inequitable conduct arguments as

falling into three broad categories. The first category involved misrepresentations made

before the PTO. Damages Decision, 418 F. Supp. 2d at 1033-34. Some of those

arguments were raised by St. Jude at trial and rejected by the jury. Id. at 1034. Others

were raised and abandoned at trial. Id. The second category of arguments involved

three patents that are no longer at issue in this case. St. Jude alleges that those

patents were asserted by Cardiac even though Cardiac knew that they were invalid. Id.

The district court granted Cardiac’s motion for summary judgment on those arguments,

and St. Jude did not appeal that decision. Id.

We conclude that St. Jude has waived the first two categories of inequitable

2008-1296, -1347 13
conduct arguments. St. Jude either failed to pursue those arguments at trial, thereby

waiving the arguments, or failed to appeal the arguments to this court. Id. St. Jude

cannot now be heard to raise those arguments again on remand.

A third category of inequitable conduct arguments relates to misrepresentations

made by Cardiac’s expert, Dr. Bourland. The jury rejected many of St. Jude’s

inequitable conduct arguments based on Dr. Bourland’s conduct, and the district court

declined to reverse the jury’s decision. However, due to revelations that came to light

after trial, the court found that Dr. Bourland’s conduct entitled St. Jude to a new trial.

Cardiac Pacemakers, 2002 U.S. Dist. LEXIS 14767, at *143. In September 2006, the

parties filed a stipulation stating that St. Jude would not pursue any defense based in

whole or in part on Dr. Bourland’s conduct. Following that stipulation, Cardiac filed a

renewed motion for summary judgment on inequitable conduct. The district court never

ruled on Cardiac’s renewed motion because it entered a final judgment on anticipation

on March 26, 2007.

With the stipulation removing Dr. Bourland’s conduct as a basis for an inequitable

conduct defense, St. Jude cannot now be heard to raise inequitable conduct on remand.

Any language from the district court’s opinion indicating otherwise would be an abuse of

the court’s discretion to grant a new trial. We therefore reinstate the jury’s verdict of

enforceability of the ’288 patent and hold that enforceability should not form part of any

new trial on remand.

C. Damages

Cardiac argues that the district court erred by limiting damages to those ICDs

that actually performed cardioversion during the infringement period. According to

2008-1296, -1347 14
Cardiac, St. Jude waived its damages argument by not raising it at trial. Furthermore,

Cardiac argues, Stryker Corp. v. Intermedics Orthopedics, Inc., 96 F.3d 1409 (Fed. Cir.

1996), and other cases have held that it is appropriate for patentees to recover

damages based on sales of products with the mere capability to practice the invention.

St. Jude responds that it is not precluded from arguing for limited damages

because the remanded damages assessment was significantly altered from the

assessment that occurred at trial. Because Cardiac is now asserting only a method

claim, St. Jude contends, any damages claim must be limited accordingly.

Furthermore, in a cross-appeal, St. Jude argues that the district court erred in

concluding that Cardiac could recover damages for overseas sales of St. Jude’s ICDs

under 35 U.S.C. § 271(f).

1. Damages Limited to Devices Performing Claimed Method

We agree with St. Jude that the district court correctly limited damages to those

devices that were shown to infringe the ’288 patent. As a preliminary matter, we find

that St. Jude has not waived its argument to limit damages. The jury was presented

with a damages decision regarding two claims of the ’288 patent: an apparatus claim

that has since been abandoned by Cardiac and the method claim (claim 4) that is at

issue on appeal. While both patent claims were at issue during trial, St. Jude would not

have benefited if it had moved to limit damages because the damages on the apparatus

claims would have covered any sale of an apparatus that could execute the elements of

the claims. However, now only a method claim is at issue; thus, St. Jude stands to

benefit from limiting damages to devices that actually practice the method. As the

district court noted, the purpose of the waiver rule is to prevent a party from arguing on

2008-1296, -1347 15
remand what it should have argued at trial or on appeal. Damages Decision, 418 F.

Supp. 2d at 1035 (citing Tronzo v. Biomet, Inc., 236 F.3d 1342, 1347-48 (Fed. Cir.

2001)). St. Jude cannot have been expected to raise at trial an argument that would not

have reduced damages until after Cardiac abandoned its apparatus claim on remand.

The district court was also correct in limiting damages to sales of ICDs that

performed the steps of the claimed method. Cardiac disputes the district court’s ruling

by pointing this court to Stryker, in which we affirmed a district court’s decision awarding

damages on sales of an infringing prosthesis, even in cases in which a distal sleeve, a

required element of the claim, was not included. See Stryker, 96 F.3d at 1416-17. The

holding in Stryker is distinguishable from this case by the type of damages being sought

and the type of patent being asserted. In Stryker, the patentee was seeking lost profits

on an apparatus claim. We held, based on the particular facts of that case, that the

patentee was entitled to profits on the sale of all devices, with or without the required

distal sleeve because the sale of the device robbed the patentee of “the opportunity to

make the sale.” Id. at 1417. This was true because the sleeve, while not included in

every sale, was available to the surgeon during surgery. Id.

In the present case, however, Cardiac is not seeking lost profits on an apparatus

and therefore cannot rely on the reasoning in Stryker. Here, Cardiac seeks royalties on

its patented method. “A method claim is directly infringed only by one practicing the

patented method.” Joy Tech. v. Flakt, Inc., 6 F.3d 770, 775 (Fed. Cir. 1993). Thus,

regarding claim 4 of the ’288 patent, infringement can only occur in cases in which the

patented method is practiced.

In Stryker, the court found that because the entire patented apparatus was

2008-1296, -1347 16
“supplied” during surgery, the patent was infringed by any sale of the device. Stryker,

96 F.3d at 1416-17. In this case it cannot be said that St. Jude has somehow “supplied”

all of the elements of Cardiac’s patented method through its devices unless those

devices actually performed all of the steps required by the claims. “The law is

unequivocal that the sale of equipment to perform a process is not a sale of the

process.” Joy Tech., 6 F.3d at 773. Therefore, Cardiac can only receive infringement

damages on those devices that actually performed the patented method during the

relevant infringement period. We thus affirm the district court’s ruling.

2. Section 271(f)

The court hears this section C(2) en banc. The district court, following our

decision in Union Carbide Chemicals & Plastics Technology Corp. v. Shell Oil Co., 425

F.3d 1366 (Fed. Cir. 2005), found that 35 U.S.C. § 271(f) applied to method claims and

that St. Jude’s shipment of ICDs abroad could result in a violation of that section.

Damages Decision, 418 F. Supp. 2d at 1042-44. On cross-appeal to this court, St. Jude

challenged the court’s decision. The panel affirmed the court’s decision on the basis of

Union Carbide. Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., 303 F. App’x 884

(Fed. Cir. 2008). St. Jude filed a petition for rehearing en banc, which we granted, thus

vacating the panel decision. Cardiac Pacemakers, Inc. v. St. Jude Med., Inc., No. 07-

1296, -1347, 2009 U.S. LEXIS 4379 (Mar. 6, 2009). The en banc court heard oral

argument on this issue on May 29, 2009. For the reasons stated below, we reverse and

hold that Section 271(f) does not cover method claims and is therefore not implicated in

this case. 2

2
The court has received a number of briefs amicus curiae on the Section

2008-1296, -1347 17
 a. Background on 35 U.S.C. § 271(f)

Before analyzing the merits of St. Jude’s cross-appeal, some background on

Section 271(f) is in order. In Deepsouth Packing Co., Inc. v. Laitram Corp., 406 U.S.

518 (1972), the Supreme Court held that a manufacturer who shipped unassembled

parts of a patented shrimp deveining machine abroad was not liable for patent

infringement. Because “it is not an infringement to make or use a patented product

outside of the United States,” the Court held that the shipment of unassembled

components of the deveining machine did not constitute patent infringement. Id. at 527,

531.

In response to Deepsouth, Congress enacted Section 271(f). See, e.g., Patent

Law Amendments of 1984, S. Rep. No. 98-663, pp 2-3 (1984) (describing Section 271(f)

as a response to the “Deepsouth decision which interpreted the patent law not to make

it infringement where the final assembly and sale is abroad”); see also Microsoft Corp.

v. AT&T Corp., 550 U.S. 437, 444 & n.3 (2007) (AT&T II) (stating that Section 271(f)

was enacted with Congress “[f]ocusing its attention on Deepsouth”).

Section 271(f) provides in full as follows:

(1) Whoever without authority supplies or causes to be supplied in or from
the United States all or a substantial portion of the components of a
patented invention, where such components are uncombined in whole
or in part, in such manner as to actively induce the combination of such
components outside of the United States in a manner that would
infringe the patent if such combination occurred within the United
States, shall be liable as an infringer.

(2) Whoever without authority supplies or causes to be supplied in or from
the United States any component of a patented invention that is
especially made or especially adapted for use in the invention and not

271(f) issue that we are reviewing en banc. The court is appreciative of these
contributions.

2008-1296, -1347 18
 a staple article or commodity of commerce suitable for substantial
noninfringing use, where such component is so made or adapted and
intending that such component will be combined outside of the United
States in a manner that would infringe the patent if such combination
occurred within the United States, shall be liable as an infringer.

35 U.S.C. § 271(f). 3

This court first dealt with Section 271(f) in Standard Havens Products, Inc. v.

Gencor Industries, Inc., 953 F.2d 1360 (Fed. Cir. 1991). Standard Havens involved

patent claims directed to methods of producing asphalt compositions. Id. at 1363. We

held simply that a “sale to a foreign customer” of an asphalt plant did not implicate the

provisions of Section 271(f). Id. at 1372-74. Our opinion on that issue did not elaborate

further.

We more fully addressed Section 271(f) in Eolas Technolgies, Inc. v. Microsoft

Corp., 399 F.3d 1325 (Fed. Cir. 2005). In that case, we held that Microsoft could not

avoid Section 271(f) liability by exporting golden master disks containing software code

that were subsequently copied onto computer hard drives and sold outside of the United

States. Id. at 1331, 1341. Eolas involved both a product and a method claim. In

holding that Microsoft was liable under Section 271(f), we held that the software code

included on Microsoft’s master disks was a “component” of a patented invention under

Section 271(f), id. at 1339, and that the relevant “component” referred to a part of the

product claim. See id. at 1339 (holding that the “computer readable code claimed in

claim 6,” the product claim, was “a part or component of that invention”). We rejected

3
Our analysis here focuses on 271(f)(1), but is equally applicable to
271(f)(2). While the two paragraphs differ in some respects, neither party argues that
the differences are relevant in this case. Indeed, both paragraphs require the “supply”
of “components” that are capable of being “combined outside of the United States.”
Compare 35 U.S.C. § 271(f)(1) & (2); see also AT&T II, 550 U.S. 437, 454 n.16. The
definition of those terms guides our analysis on this issue.

2008-1296, -1347 19
Microsoft’s argument that the term “component” was limited to physical items, id. at

1340, and held that “section 271(f)’s ‘components’ include software code on golden

master disks,” id. at 1341. No specific mention was made in Eolas concerning the

relationship between Section 271(f) and the method claims. See id. at 1339 (citing the

patent specification, not the claims, as evidence that the patented invention was a

software product).

Shortly after Eolas issued, we decided a similar issue in AT&T Corp. v. Microsoft

Corp., 414 F.3d 1366 (Fed. Cir. 2005) (AT&T I). AT&T I involved a factual scenario

similar to that in Eolas: Microsoft exported golden master disks containing software that

was covered by a patent held by AT&T. The software, once shipped abroad, was

copied onto hard drives and sold to foreign customers. In our holding in AT&T I, we

relied on the holding in Eolas that intangible software code was capable of being a

component of a patented invention. Id. at 1369. We further held that such software

was “supplied” for purposes of Section 271(f) when “a single copy [was sent] abroad

with the intent that it be replicated.” Id. at 1370.

In the same year that we decided Eolas and AT&T I, we decided a third case

dealing with the scope of Section 271(f). Our discussion of Section 271(f) in NTP, Inc.

v. Research in Motion, Ltd. was limited to the question whether infringement liability was

somehow proper under Section 271(f) where RIM supplied BlackBerry handheld

devices to customers in the United States, and use of those devices (in concert with a

relay of the Blackberry network located in Canada) would infringe NTP’s patented

method if all steps were performed in the United States. 418 F.3d. 1282, 1321 (Fed.

Cir. 2005). We held that it was not. In doing so, we held that “[w]hile it is difficult to

2008-1296, -1347 20
conceive of how one might supply or cause to be supplied . . . the steps of a patented

method,” the supply of BlackBerry devices to customers in the United States did not

constitute the supply step required by Section 271(f). Id. at 1322.

In 2006, a panel of this court explicitly held that Section 271(f) applied to method

claims. In Union Carbide, the court was presented with a case in which a catalyst,

which was necessary to perform a patented method for producing ethylene oxide, was

exported from the United States. 425 F.3d 1366, 1369 (Fed. Cir. 2006). The court held

that Section 271(f) was applicable to the exportation of the catalyst and use of the

patented method abroad. In doing so, the court referred to the catalyst as the

“component” referred to in Section 271(f). It distinguished NTP by noting that the

catalyst at issue in Union Carbide was directly supplied to foreign affiliates whereas the

device in NTP was sold domestically and then used in a foreign country. Id. at 1380. It

found that Eolas, which supported a finding of infringement under Section 271(f),

expressly under a product claim and impliedly under a method claim, was more factually

analogous and earlier in time than NTP, and therefore governed the case. Id. Indeed,

the court considered that the shipment of the chemical catalyst was an even stronger

candidate for the application of Section 271(f) than the shipment of master disks in

Eolas because, unlike Eolas, Shell used the shipped components directly in its process

instead of using copies of the exported components. Id. at 1379. Thus, the court held

that “because § 271(f) governs method/process inventions, Shell’s exportation of

catalysts may result in liability” under that section. Id. at 1380.

The Supreme Court subsequently examined Section 271(f) when it granted

certiorari and reversed our decision in AT&T I. AT&T II, 550 U.S. 437 (2007). The

2008-1296, -1347 21
Court held that Microsoft did not supply combinable components of a patented invention

when it shipped master disks abroad to be copied. Because the foreign-made copies of

Windows that were installed on computers were supplied “from places outside of the

United States,” the Court held that Microsoft had not supplied components from the

United States. Id. at 452. The court reserved judgment on whether “an intangible

method or process . . . qualifies as a ‘patented invention’ under § 271(f),” but noted that

if so, the “combinable components of that invention might be intangible.” Id. at n.13.

The Court sent a clear message that the territorial limits of patents should not be lightly

breached. Id. at 454-56.

b. Analysis

In construing the terms of Section 271(f), we do so “in accordance with [their]

ordinary or natural meaning.” Id. at 449 (alteration in original) (quoting FDIC v. Meyer,

510 U.S. 471, 476 (1994)). Section 271(f)(1) provides that one who “supplies . . . in or

from the United States, all or a substantial portion of the components of a patented

invention, where such components are uncombined in whole or in part, in such manner

as to actively induce the combination of such components” shall be liable as an

infringer. 35 U.S.C. § 271(f)(1). Section 271(f)(2) contains similar language.

Cardiac argues that the use of the term “patented invention” in 271(f) indicates

Congress’s intent to include all classes of invention within that statute’s reach. Cardiac

rightly notes that “invention” is defined in the U.S. Code to include “any new and useful

process, machine, manufacture or composition of matter,” 35 U.S.C. § 101, and thus is

broad enough to include method patents. However, examination of the statute before

us is not quite so simple. While the isolated “patented invention” language in Section

2008-1296, -1347 22
271(f) by itself might seem to extend to all inventions within the definition of “invention,”

we cannot disregard all the other language of that section, which, as we shall

demonstrate, makes it clear that it does not extend to method patents. We also cannot

ignore the context of the statute and its legislative history, which lead us to the same

conclusion, which is that Section 271(f) does not encompass method patents.

In interpreting the terms of Section 271(f), it is critical to recall what a “patented

invention” consists of when method patents are at issue. We have noted “the distinction

between a claim to a product, device, or apparatus, all of which are tangible items, and

a claim to a process, which consists of a series of acts or steps.” In re Kollar, 286 F.3d

1326, 1332 (Fed. Cir. 2002); see also NTP, 418 F.3d at 1322 (“The invention recited in

a method claim is the performance of the recited steps.”). Thus, a component of a

tangible product, device, or apparatus is a tangible part of the product, device, or

apparatus, whereas a component of a method or process is a step in that method or

process. As we demonstrate herein, this fundamental distinction between claims to a

product, device, or apparatus on one hand and claims to a process or method on the

other, is critical to the meaning of the statute and dooms Cardiac’s argument on this

issue.

Cardiac relies on the Supreme Court’s language in Quanta Computer, Inc. v. LG

Electronics, Inc., 128 S. Ct. 2109 (2008), in which the Court stated: “Apparatus and

method claims may approach each other so nearly that it will be difficult to distinguish

the process from the function of the apparatus.” Id. at 2118 (citation and internal

quotations omitted). However, the Court’s language throughout the Quanta opinion is

focused on the similarities between method and apparatus patents in the unique context

2008-1296, -1347 23
of patent exhaustion. See, e.g., id. at 2117-18 (noting that a method may be

“embodied” in devices for purposes of a “sale”); id. (method patents may be “exhausted

by the sale of an item”). Moreover, in an exhaustion context, which considers whether a

patent owner has been fully compensated when a sale or license of his invention has

occurred, it matters little whether the patent involved claims to a product (apparatus) or

a method. If a patent owner sells or licenses a product, it is not unreasonable to hold

that the patent owner has received his due compensation under the patent, whether it is

a product or a method patent. Thus, as the Supreme Court stated, for purposes of

exhaustion, it may “be difficult to distinguish the process from the function of the

apparatus.” Quanta, 128 S. Ct. at 2118 (citation and internal quotations omitted). The

Supreme Court’s statement in an exhaustion context has no application here.

Our precedents draw a clear distinction between method and apparatus claims

for purposes of infringement liability, which is what Section 271 is directed to. See, e.g.,

Joy Tech., 6 F.3d at 773-75 (stating that method claims are infringed only by practicing

the steps of the method); NTP, 418 F.3d 1282, 1318 (“[A] patent for a method or

process is not infringed unless all steps or stages of the claimed process are utilized.”).

Section 271(f) “applies only to ‘such components’ as are combined to form the ‘patented

invention’ at issue.” AT&T II, 550 U.S. at 449 (footnote omitted). “Component” is

defined as “a constituent part,” “element,” or “ingredient.” Webster’s Third New

International Dictionary of the English Language 466 (1981); see also AT&T II, 550 U.S.

at 449 n.11 (adopting same definition in Section 271(f) case). As we have seen, the

patented invention at issue when a method patent is implicated consists of a “series of

acts or steps.” In re Kollar, 286 F.3d at 1332. The elements of a method are the steps

2008-1296, -1347 24
that comprise the method. Thus, method patents do have “components,” viz., the steps

that comprise the method, and thus they meet that definitional requirement of Section

271(f), but the steps are not the physical components used in performance of the

method.

Cardiac disagrees that a component of a patented method is a step of that

method. Instead, Cardiac urges us to adopt a definition of “component” that would

encompass “the apparatus that performed the process.” Appellants’ Br. 15. That

position is clearly contrary to the text of Section 271(f). It is not even supported by the

lone amicus brief we have received in favor of including method patents within Section

271(f)’s reach. Br. for Ormco Corp. as Amicus Curiae Supporting Application of Section

271(f) to Method Claims, No. 07-1296,-1347 at 11 (Fed. Cir. Apr. 13, 2009) (“Ormco

Br.”) (“[T]he components of a method are the steps or acts that comprise the

method.”). 4

Another subsection of Section 271 further undercuts Cardiac’s proposed

definition of “component.” It is a “fundamental canon of statutory construction that the

words of a statute must be read in their context and with a view to their place in the

overall statutory scheme.” Davis v. Mich. Dept. of Treasury, 489 U.S. 803, 809 (1989).

Section 271(c) illustrates the contrasting treatment that Section 271 gives to tangible

inventions and method inventions and the meaning of the term “component.” Section

271(c) contrasts “a component of a patented machine, manufacture, combination, or

composition” with a “material or apparatus for use in practicing a patented process.” 35

U.S.C. § 271(c). Congress clearly believed that a “component” was separate and

4
Aside from Ormco’s brief, all other amicus briefs we have received support
our conclusion that Section 271(f) does not apply to method patents.

2008-1296, -1347 25
distinct from a “material or apparatus for use in practicing a patented process.” Thus, a

material or apparatus for use in practicing a patented process is not a component of that

process. The components of the process are the steps of the process.

Although such patented methods do have components, as indicated, Section

271(f) further requires that those components be “supplied.” That requirement

eliminates method patents from Section 271(f)’s reach. The ordinary meaning of

“supply” is to “provide that which is required,” or “to furnish with . . . supplies, provisions,

or equipment.” Webster’s Third New International Dictionary of the English Language

2297 (1981). These meanings imply the transfer of a physical object. Supplying an

intangible step is thus a physical impossibility, a position that not even Cardiac seems to

dispute. See Appellants’ Br. 15 (arguing that steps of a patented process, “which

conceptually could not be supplied from the United States,” were not the components of

the process). As we have noted before, “it is difficult to conceive how one might supply

or cause to be supplied all or a substantial portion of the steps in a patented method in

the sense contemplated by” Section 271(f). NTP, 418 F.3d at 1322.

One amicus curiae brief has argued that one might supply a physical object that

is the result of one of the steps of a patented process and combine that object with the

remaining steps abroad. Ormco Br. at 12-14. That argument, however, confuses the

result of a method step with the step itself. See id. (arguing that one who “supplies the

results of” patented steps meets the requirements of Section 271(f)) (emphasis added).

Section 271(f) does not forbid the supplying of products that are the result of steps of

the patented method; rather it forbids the supply of the components themselves. 35

U.S.C. § 271(f) (imposing liability on one who “supplies or causes to be supplied in or

2008-1296, -1347 26
from the United States all or a substantial portion of the components of a patented

invention”). Thus, because one cannot supply the step of a method, Section 271(f)

cannot apply to method or process patents.

Our holding today is fully consistent with the legislative history of Section 271(f).

As discussed above, in enacting Section 271(f), Congress intended to overturn the

holding in Deepsouth. AT&T II, 550 U.S. at 457-58. Deepsouth dealt with an apparatus

patent, a shrimp deveining machine, and the exportation of the physical components of

that machine. Deepsouth 406 U.S. at 519. Congress was clearly focused on closing

the loophole presented in Deepsouth, viz., that shipping an unassembled patented

product abroad for later assembly avoids patent infringement. Congress’s focus on

patented products is apparent from an examination of the legislative history. See, e.g.,

S. Rep. No. 98-663 at 6 (1984) (stating that Section 271(f) will “prevent copiers from

avoiding U.S. patents by shipping overseas the components of a product patented in

this country so that assembly of the components will be completed abroad.” (emphasis

added)); 130 Cong. Rec. H10,525 (daily ed. Oct. 1 1984) (same). The legislative history

of Section 271(f) is almost completely devoid of any reference to the protection of

method patents and the Supreme Court has advised us that it is Congress’s right, not

the courts’, to extend the statute beyond the Deepsouth problem it was designed to fix.

See AT&T II, 550 U.S. at 457-58 (explaining that Congress designed 271(f) to close the

Deepsouth loophole and that another loophole should be left in “Congress’ court”).

Cardiac argues that a single statement by former Commissioner of Patents,

Donald Banner, indicates that Congress understood “components” to apply also to

method patents. In a prepared statement, Mr. Banner stated that Section 271(f) “makes

2008-1296, -1347 27
it infringement to supply components of a patented process for final assembly abroad, if

supplied for the purpose of avoiding the patent.” S. 1535 – A Bill To Amend Title 35,

United States Code, To Increase The Effectiveness Of The Patent Laws And For Other

Purposes: Hearing Before The Subcommittee On Patents, Copyrights And Trademarks

of the Committee On The Judiciary, United States Senate, 98th Cong. 46 (1984)

(prepared statement of Donald W. Banner, President, Intellectual Property Owners,

Inc.). Cardiac argues that this statement proves that a method can have components,

Appellants’ Br. 17, a statement with which we do not disagree. What we do disagree

with is the argument that Section 271(f) encompasses method patents. In any event,

the impact of the Banner statement is limited at best. That statement, while apparently

reflecting an interested party’s views of the effect of a pending bill, is not persuasive

regarding the meaning of the enacted language. A statement by one private proponent

of a pending bill in Congress, even if his testimony was that the bill was intended to

encompass methods as well as apparatus patents, a matter not entirely clear from its

language, cannot override the clear language of the statute and the context in which it

was enacted. See McCaughn v. Hershey Chocolate Co., 283 U.S. 488, 493-94 (1931)

(stating that “individual expressions are without weight in the interpretation of a statute”).

Certainly in light of the statutory language and the overwhelming evidence of

Congress’s focus on patented products, that lone statement cannot carry the day for

Cardiac.

Any ambiguity as to Congress’s intent in enacting Section 271(f) is further

resolved by the presumption against extraterritoriality. The Supreme Court took a

narrow view of Section 271(f) by stating that the presumption against extraterritoriality

2008-1296, -1347 28
still applies to Section 271(f), even though that section specifically extends the reach of

U.S. patent law in a limited manner. AT&T II, 550 U.S. at 454-56. In light of the near

complete absence of any Congressional intent to protect patented methods under

Section 271(f) and the explicit Congressional purpose of overruling Deepsouth’s

holding, the presumption compels us not to extend the reach of Section 271(f) to

method patents.

In sum, the language of Section 271(f), its legislative history, and the provision’s

place in the overall statutory scheme all support the conclusion that Section 271(f) does

not apply to method patents. We therefore overrule, to the extent that it conflicts with

our holding today, our decision in Union Carbide Chemicals & Plastics Technology

Corp. v. Shell Oil Co., 425 F.3d 1366 (Fed. Cir. 2005), as well as any implication in

Eolas or other decisions that Section 271(f) applies to method patents.

We now turn to the facts of this case. Cardiac alleges that St. Jude violates

Section 271(f) when it ships its ICDs outside of the United States. We disagree. Claim

4 of the ’288 patent is comprised of the steps of determining a heart condition, selecting

cardioversion as the appropriate therapy, and executing a cardioverting shock. Cardiac

does not allege that all of those steps are carried out in the United States with respect to

certain of the ICDs. Moreover, it cannot allege that the steps of the method are

supplied, a contradiction in terms. Rather, Cardiac alleges that St. Jude’s shipment of a

device that is capable of performing the method is sufficient to fall within the scope of

Section 271(f). Although the ICD that St. Jude produces can be used to perform the

steps of the method, as we have demonstrated, Section 271(f) does not apply to

method or process patents. As Section 271(f) does not encompass devices that may

2008-1296, -1347 29
be used to practice a patented method, St. Jude is therefore not liable for infringement

of claim 4 of the ’288 patent under Section 271(f) for ICDs exported abroad.

D. Reassignment

Finally, Cardiac urges us to reassign this case to a different judge on remand.

However, there is no evidence of, and Cardiac does not appear to allege, that Judge

Hamilton has been partial or biased in any way during the proceedings. We therefore

decline to designate a judge to preside over the remand. We see no reason to interfere

with the internal operations of the Seventh Circuit, and we leave the determination of

assignment on remand to that circuit’s internal rules and procedures.

CONCLUSION

For the foregoing reasons, we reverse the district court’s grant of summary

judgment of invalidity of the ’288 patent and reinstate the jury verdict that the patent has

not been shown to be invalid. We also reinstate the jury’s verdict that the ’288 patent is

not unenforceable for inequitable conduct and reverse the district court’s grant of a

conditional new trial on that issue. We remand to the district court for a determination of

damages. We affirm the district court’s rulings limiting damages to instances in which

the patented method has been performed. Finally, we reverse the court’s decision that

35 U.S.C. § 271(f) is applicable to this case and hold that St. Jude’s ICDs that practice

the method of claim 4 outside the United States do not infringe that claim under

Section 271(f).

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED

2008-1296, -1347 30
United States Court of Appeals for the Federal Circuit

2007-1296, -1347

CARDIAC PACEMAKERS, INC.,
and GUIDANT SALES CORPORATION,

Plaintiffs-Appellants,

and

MIROWSKI FAMILY VENTURES, LLC and ANNA MIROWSKI,

Plaintiffs-Appellants,

v.

ST. JUDE MEDICAL, INC.,
and PACESETTER, INC.,

Defendants-Cross Appellants.

Appeal from the United States District Court for the Southern District of Indiana in 96-
CV-1718, Judge David F. Hamilton.

NEWMAN, Circuit Judge, concurring in parts A, B, C.1, and D, dissenting from part C.2.

I concur in the court’s opinion except for the en banc ruling in part C.2. I

respectfully dissent from the court’s interpretation of 35 U.S.C. §271(f) as excluding all

process inventions. The statutory term “patented invention” in §271(f) has the same

meaning in this subsection as in every other part of Title 35: it is the general term

embracing all of the statutory classes of patentable invention. The court’s interpretation
of §271(f) to exclude all process inventions is contrary to the text of the statute, ignores

the legislative history, is without support in precedent, and defeats the statutory

purpose.

35 U.S.C. §271(f) was enacted to provide remedy to patentees for certain activity

conducted outside of the United States, when that activity would be infringing if

conducted within the nation’s borders. Section 271(f) specifically concerns offshore

activity where practice of a patented invention is “actively induced” by the supply of

defined components from the United States, in which situation the supplier is deemed

an infringer under §271(f). The statute is aimed at evasion of United States patents,

and is not limited to any particular class of patentable subject matter. The court now

holds, sitting en banc for the purpose, that the statutory term “patented invention”

excludes process inventions in §271(f). That ruling, placing a different definition on

“patented invention” in §271(f) than in any other provision of Title 35, is incorrect.

The statute is unambiguous

Section 271(f) contains two subsections. The court today holds that both parts

exclude all process inventions from the “patented invention” of the statutory text, without

discrimination or exception; the court imposes this reading despite the plain text of the

statute, as follows (with emphases added):

§271(f)(1) Whoever without authority supplies or causes to be supplied in
or from the United States all or a substantial portion of the components of
a patented invention, where such components are uncombined in whole
or in part, in such manner as to actively induce the combination of such
components outside of the United States in a manner that would infringe
the patent if such combination occurred within the United States, shall be
liable as an infringer.

§271(f)(2) Whoever without authority supplies or causes to be supplied in

2007-1296,-1347 2
 or from the United States any component of a patented invention that is
especially made or especially adapted for use in the invention and not a
staple article or commodity of commerce suitable for substantial
noninfringing use, where such component is uncombined in whole or in
part, knowing that such component is so made or adapted and intending
that such component will be combined outside of the United States in a
manner that would infringe the patent if such combination occurred within
the United States, shall be liable as an infringer.

Title 35 defines “inventions patentable” as including all patent-eligible subject matter,

including processes:

§101. Whoever invents or discovers any new and useful process,
machine, manufacture, or composition of matter, or any new and useful
improvement thereof, may obtain a patent therefor, subject to the
conditions and requirement of this title.

Many sections of Title 35 use “invention” or “patented invention” or “patentable

invention” when referring to all of the statutory classes of invention set forth in §101.

E.g., §§102, 103, 104, 105, 181, 201, 286, etc. 1 When a specific statutory class is

intended it is explicitly stated, as for example in §271(c) and (g), as explained post. The

text of §271(f) states no such limitation, and presents no ambiguity in its use of

“patented invention.” The extreme redefinition here proffered for this subsection, unique

within the entire statute, cannot be inferred from the use of “patented invention,” without

qualification, in §271(f).

The Supreme Court has stressed that “in interpreting a statute a court should

always turn first to one, cardinal canon before all others. We have stated time and

1
E.g., §102 (use of the term “invention” to refer to statutory subject matter);
§103(a) (use of “invention” as synonymous with “subject matter sought to be patented”);
§104 (describing rights in an “invention made abroad”); §105 (“invention made, used or
sold in outer space”); §181(d) (defining “invention” as “any invention or discovery which
is or may be patentable or otherwise protectable under this title or any novel variety of
plant which is or may be protectable under the Plant Variety Protection Act”); §286 (time
limit on damages for infringement of a “patented invention”).

2007-1296,-1347 3
again that courts must presume that a legislature says in a statute what it means and

means in a statute what it says there.” Connecticut Nat’l Bank v. Germain, 503 U.S.

249, 253-254 (1992). “When the words of a statute are unambiguous, then, this first

canon is also the last: ‘judicial inquiry is complete.’” Id. at 254 (quoting Rubin v. United

States, 449 U.S. 424, 430 (1981)). The Federal Circuit, too, has recognized that “[i]f the

statute is unambiguous, our inquiry is at an end; we must enforce the congressional

intent embodied in that plain wording.” Chamberlain Group, Inc. v. Skylink Techs., Inc.,

381 F.3d 1178, 1192 (Fed. Cir. 2004). The meaning of “patented invention” is

unambiguously stated in 35 U.S.C. §101, for the entire statute.

The Supreme Court has previously so held. In Eli Lilly & Co. v. Medtronic, Inc.,

496 U.S. 661 (1990) the Court addressed the term “patented invention” as it appears in

§271(e), an infringement provision enacted six weeks before §271(f). The Court

rejected the argument that the term “patented invention” in §271(e) was limited by other

language in the provision to mean only drug patents, holding that “[t]he phrase ‘patented

invention’ in §271(e)(1) is defined to include all inventions, not drug-related inventions

alone.” Id. at 665. The Court stated that if the statute had been intended to apply only

to drug-related inventions, “there were available such infinitely more clear and simple

ways of expressing that intent that it is hard to believe the convoluted manner petitioner

suggests was employed would have been selected.” Id. at 667.

My colleagues reach the opposite conclusion today, without mentioning the use

of the identical words “patented invention” by the same Congress that enacted §271(e)

and soon thereafter enacted §271(f). It is not reasonable now to rule that the same

words used in two adjacent subsections of the same statute, enacted by the same

2007-1296,-1347 4
Congress in close temporal proximity, were intended to diverge radically from the

statutory definition of “patented invention” and from each other.

The context of §271(f)

The statutory meaning of “patented invention” is reinforced upon observation of

those sections of the Patent Act that are directed to particular categories of invention, as

illustrated in §271 itself. The relationships and balance of the several provisions in

subsections of this section demonstrate the statutory use of “patented invention” as the

umbrella term for the forms of invention subject to the Patent Act, with narrower

terminology used in those provisions that have narrower application. The §271

subsections deal with the various legislative remedies for various forms of infringement,

as Congress acted to plug the loopholes that had arisen or were foreseen.

Reviewing the context of §271, we start with §271(a), the general infringement

statute, directed to “any patented invention.” Section 271(b) is directed to inducement

of infringement of “a patent.” All agree that subsections (a) and (b) apply to all statutory

subject matter. Section 271(c) recites contributory infringement by a “component of a

patented machine, manufacture, combination or composition, or a material or apparatus

for use in practicing a patented process”; Congress thus specified how contributory

infringement occurs for the statutory categories. Section 271(d) relates to misuse of “a

patent,” citing specific commercial practices. Section 271(e) concerns “a patented

invention” and although the statute refers to the drug regulatory context, the court in Eli

Lilly, supra, explained that this term incorporates the entire subject matter of §101.

Section 271(f) concerns the supply of components of “a patented invention” for use

outside of the United States, again incorporating the subject matter of §101. Section

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271(g), in contrast, is specific to the importation or sale of “a product which is made by a

process patented in the United States.” Each subsection is directed to different

circumstances of infringement, and each recites its subject matter with generality or

specificity, as appropriate.

Some amici curiae in this appeal suggested that since §271(g) specifically

mentions practice of a patented process, then “patented invention” in §271(f) must

exclude processes. That thesis is devoid of support. Subsections (g) and (f) are

directed to distinct situations, for §271(g) requires importation or sale of the product of a

patented process practiced abroad, before infringement can be established under that

provision, while §271(f) does not require importation or sale, but instead requires that a

component of the “patented invention” practiced abroad comes from the United States.

Subsections 271(f) and (g) address quite different acts, and their subject matter is

defined in accordance with the action that the specific statute is designed to remedy.

Section 271(c) is relied upon by the court as somehow requiring that §271(f)

excludes processes. Section 271(c) defines as “contributory infringement” acts that

include the sale or importation into the United States of a non-staple article of

commerce that is a “component of a patented machine, manufacture, combination or

composition, or a material or apparatus for use in practicing a patented process,” where

the non-staple article constitutes a “material part of the invention” and is known to be

made or adapted for the purpose of infringing, within the United States, a patented

product or process. The text of §271(c) illuminates the text of §271(f), for §271(c)

mentions the statutory classes in terms of how “contributory infringement” works,

whereas §271(f)(1) is directed to inducement, and in the usage “patented invention” in

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both subparts, §271(f) states its independent scope. This is not an inadvertent

distinction, in view of these heavily scrutinized provisions and their years of legislative

consideration. My colleagues appear to have misinterpreted these distinct usages, for

the different subsections reinforce that the legislators carefully structured each for a

distinct purpose. See Russello v. United States, 464 U.S. 16, 23 (1983) (“[W]here

Congress includes particular language in one section of a statute but omits it in another

section of the same Act, it is generally presumed that Congress acts intentionally and

purposefully in the disparate inclusion or exclusion.”).

The various subsections of §271 reflect the considered legislative approach to

plug loopholes in the infringement statute, in the interest of United States patentees and

in support of United States innovation. The close relationship among these and all

sections of the Patent Act “presents a classic case for application of the normal rule of

statutory construction that identical words used in different parts of the same act are

intended to have the same meaning.” Sullivan v. Stroop, 496 U.S. 478, 484 (1990)

(quoting Sorenson v. Sec’y of Treasury, 475 U.S. 851, 860 (1986)). Nonetheless, the

court today discards this rule, and holds that despite its consistent usage throughout the

Patent Act, “patented invention” in §271(f) was intended to have a unique meaning,

applicable only to this subsection, to exclude all processes from “patented invention.”

The new loophole here created under §271(f) will outshine the simple evasion

that led Congress and the innovation community to the carefully written texts of sections

271(c), (e), (f), and (g). These texts show that when legislation specific to one or

another class of invention was intended, it was explicitly stated in those subsections of

§271. “‘It is not uncommon to refer to other, related legislative enactments when

2007-1296,-1347 7
interpreting specialized statutory terms,’ since Congress is presumed to have ‘legislated

with reference to’ those terms.” Reno v. Koray, 515 U.S. 50, 57 (1995) (quoting Gozlon-

Peretz v. United States, 498 U.S. 395, 407-408 (1991)).

Legislative history and congressional intent

This congressional intent is confirmed by the legislative history. Various

proposals were considered over many years before selecting the text that was enacted

as §271(f). Beginning with the statutory loophole exposed in Deepsouth Packing Co. v.

Laitram Corp., 406 U.S. 518 (1972), legislative activity proceeded for a decade as new

pitfalls were foreseen, new bills introduced, new hearings held, and new provisions

written. For example, the early proposals suggested adapting the language in existing

statutory provisions. See, e.g., Hearings Before the Subcomm. on Patents,

Trademarks, and Copyrights of the Sen. Comm. on the Judiciary, 93rd Cong. 2871-74

(1973) (statement of Guy W. Shoup) (proposing amendment to overturn Deepsouth and

stating that an “attempt has been made to track present statutory language as closely

as possible, specifically 35 U.S.C. §271(b) and §271(c)”). The early bills borrowed

directly from §271(c), as for instance in S. 2504, initially introduced on October 1, 1973.

A committee print of that bill, as amended, shows the following text, with the relevant

language emphasized:

(f) Whoever, without authority, makes or sells, within the United States, all
of the components of a patented machine, manufacture, or composition of
matter, uncombined, intending that such components will be combined
outside the United States to constitute the patented subject matter,
knowing that if such components were combined within the United States,
the combination would be an infringement of the patent, shall be liable as
an infringer.

S. 2504, 93d Cong., 2d Sess. (comm. print dated May 8, 1974); see also S. 473, 94th

2007-1296,-1347 8
Cong., 1st Sess., §271(e) (1975) (same text); S. 23, 94th Cong., 1st Sess., §271(f)

(1975) (same text); S. 2255, 94th Cong., 1st Sess., §271(f) (1975) (same text).

Reprinted in Hearings Before the Subcomm. of Courts, Civil Liberties, and the

Administration of Justice of the H.R. Comm. on the Judiciary, 98th Cong. 2859-69

(1984) (“Hearing Review”). It is seen that these early bills did not include processes,

but were specific to “a patented machine, manufacture, or composition of matter.”

Subsequent bills, including S.1535, 98th Cong., 1st Sess. (1983), replaced this

specific text with the encompassing term “patented invention.” The published record in

the Hearing Review shows the understanding that the effect of this change is to cover

processes as well as the other statutory categories. Contrary to the majority’s

suggestion, the legislative history is not limited to an ambiguous private statement by an

“interested party,” see maj. op. at 28, for the Hearing Review demonstrates that the

executive branch considered it important that the statute cover process inventions. The

Hearing Review contains a report prepared by the Patent and Trademark Office for the

Justice Department, observing that the Deepsouth holding had been applied to process

patents in John Mohr & Sons v. Vacudyne Corp., 354 F. Supp. 1113 (N.D. Ill. 1973),

and stating that “[n]o reasons exist for treating process patents differently from product

patents in this regard, and therefore, the Mohr case should also be overturned.”

Hearing Review at 2897. The majority has not controverted the clear evidence that the

change in statutory language was for the purpose of encompassing processes.

The ensuing change in legislative language, embodied in S.1535, demonstrates

the purposeful action to include processes in §271(f), instead of the more limited scope

of earlier versions of the legislation. “Where Congress includes limiting language in an

2007-1296,-1347 9
earlier version of a bill but deletes it prior to enactment, it may be presumed that the

limitation was not intended.” Russello, 464 U.S. at 23-24 (citing Arizona v. California,

373 U.S. 546, 580-81 (1963)). This broadening of statutory protection, over the decade

of hearings and review that followed the Deepsouth decision, reflects a careful and

deliberative process, as additional concerns were exposed and additional subsections

proffered, in a collaborative legislative effort to reinforce the value of the patent statute

as an innovation incentive. As the Court observed in Oncale v. Sundowner Offshore

Serv., Inc., 523 U.S. 75, 79 (1998), “statutory prohibitions often go beyond the principal

evil to cover reasonably comparable evils, and it is ultimately the provisions of our laws

rather than the principal concerns of our legislators by which we are governed.” Here,

in plugging the Deepsouth loophole, Congress eventually enacted a statute directed to

all classes of patentable invention. Yet this court curiously returns to the precise words

that were initially proposed and then explicitly superceded.

Plain language and contemporary context

It is a canon of statutory construction that the statute must be understood in its

contemporary context. The Court stated in Cannon v. University of Chicago, 441 U.S.

677, 696-97 (1979), that “it is always appropriate to assume that our elected

representatives, like other citizens, know the law . . . and that an evaluation of

congressional action taken at a particular time must take into account its contemporary

legal context.” Despite the clarity of “patented invention” in §271(f), and the context of

concern for statutory loopholes inimical to the interest of innovators in the United States,

this court now rules that the legislators intended to preserve a large loophole for

patented processes, and never intended to cover more than the narrow Deepsouth

2007-1296,-1347 10
loophole for machinery.

Despite the multiple manifestations of legislative intent, in the plain language, the

statutory context, and the evolution of §271(f), my colleagues now rule that in one and

only one subsection of Title 35, “patented invention” excludes process inventions. My

colleagues state that they agree that the plain meaning of “patented invention” is fixed

by §101, yet they decide that Congress cannot have meant what it said, and that this

plain meaning is defeated by hidden meaning in §271(f). The Court has cautioned that

such a statutory interpretation can arise only in “rare and exceptional circumstances,”

Crooks v. Harrelson, 282 U.S. 55, 58 (1930) (rejecting argument to ignore literal

meaning of a statute based on Holy Trinity Church v. United States, 143 U.S. 457

(1892), and stating that a court may “override the literal terms of a statute only under

rare and exceptional circumstances”). Such circumstances are not present here.

My colleagues seek support in the statutory words “components” and “supply.”

The en banc court concedes that processes have “components,” but argues that

process components cannot be “supplied” from the United States to a foreign operation,

because the steps of a process are intangible. However, process information, as well

as the results of process steps, are readily supplied from one entity to another. The

Court recently noted, in a case under §271(f) involving products, that “[i]f an intangible

method or process . . . qualifies as a ‘patented invention’ under §271(f) (a question as to

which we express no opinion) the combinable components of that invention might be

intangible as well.” Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 452 n.13 (2007). My

colleagues’ opinion mentions tangibles and intangibles, but does not apply §271(f) to

the claimed process.

2007-1296,-1347 11
 Although the facts of infringement are not developed on the en banc record,

enough is before this court to show that the claim is not for an abstract, disembodied

process. In addition, the claims include both method and structural aspects. See ’288

patent, Claim 1 (reciting method “using an implantable heart stimulator capable of

detecting a plurality of arrhythmias and capable of being programmed to undergo a

single or multi-mode operation to treat a detected arrhythmia”); Claim 4 (reciting “mode

of operation of said implantable heart stimulator”).

It appears that the heart stimulator is supplied from the United States and

combined with process steps that are taught from the United States and performed

abroad. Although both product and process aspects are involved, the court presents no

findings concerning the nature of the components supplied from the United States. It

may also be relevant that in Quanta Computer, Inc. v. LG Electronics, Inc., 128 S. Ct.

2109, 2117-18 (2008), the Court reminded us that: “Apparatus and method claims ‘may

approach each other so nearly that it will be difficult to distinguish the process from the

function of the apparatus.’” (quoting United States ex rel. Steinmetz v. Allen, 192 U.S.

543, 559 (1904)). Such complex issues have not been brought out on this appeal,

because they were not presented in the winner-take-all question presented for en banc

briefing. 2 The court’s new statutory interpretation is far more sweeping than is needed

to decide this case, and far simpler than today’s technology deserves. The challenge of

applying important and complex law to new facts is poorly met by holding that no law

applies to any facts.

2
The court invited briefing limited to the question “Does 35 U.S.C. §271(f)
apply to method claims, as well as product claims? Cardiac Pacemakers, Inc. v. St.
Jude Medical, Inc., No. 07-1296 (order granting rehearing en banc) (Fed. Cir. March 6,
2009).

2007-1296,-1347 12
 It is well recognized that a process has parts, or “components”; this is a general

term applicable to all inventions. In Microsoft, 550 U.S. at 449 n.11, the Court, in

discussing §271(f), noted that “component” is defined as “a constituent part,” “element,”

or “ingredient,” quoting Webster's Third New International Dictionary of the English

Language; and as the majority acknowledges, the Court stated that for a process

invention, the “combinable components of that invention might be intangible,” id. at 452

n.13. In a discussion of process claims in Warner-Jenkinson Co. v. Hilton Davis Chem.

Co., 520 U.S. 17 (1997), where the patent was for a purification process, the Court

stated the inquiry as: “Does the accused product or process contain elements identical

or equivalent to each claimed element of the patented invention?” Id. at 40.

Throughout our own precedent this court has, without quibble, described a step in a

process or method as an element of the process or method. See, e.g., Clock Spring,

L.P. v. Wrapmaster, Inc., 560 F.3d 1317, 1328 (Fed. Cir. 2009) (“In summary, during the

1989 demonstration, all elements of the repair method in claim 1 of the ’307 Patent

were performed.”); Lucent Techs., Inc. v. Gateway, Inc., 525 F.3d 1200, 1214 (Fed. Cir.

2008) (“This court has consistently interpreted ‘including’ and ‘comprising’ to have the

same meaning, namely, that the listed elements (i.e., method steps) are essential but

other elements may be added.”).

Each step of a process is a component thereof, which, when combined with the

other steps, performs the process. In BMC Resources, Inc. v. Paymentech, L.P., 498

F.3d 1373 (2007), this court held that process claims are infringed when some steps are

practiced by one entity and other steps are practiced by another, provided that the

charged entity controls or directs the conduct of the other, the court explaining that: “A

2007-1296,-1347 13
party cannot avoid infringement, however, simply by contracting out steps of a patented

process to another entity.” Id. at 1381. The court concluded that the practice of steps

of the patented method can be combined, whereby the party that performs earlier steps

“supplies” this component to the party that performs the later steps. This principle is

commensurate with the application of §271(f) to processes that are partly performed in

the United States. Surely there is no cause to conclude, as the majority concludes, that

it is a “physical impossibility” to read §271(f) as applying to processes. Maj. op. at 26.

On the established understanding of how processes are performed, it cannot be

ruled that the words “component” and “supply” in §271(f)(1) impart a unique meaning

that defeats the plain text of the statute. It cannot be ruled that Congress, along with all

of the contributors to this legislation, who understood and intended the use of general

terms to embrace all forms of patented invention in Title 35, nonetheless silently

eliminated patented processes from “patented invention” in §271(f).

Sovereignty Issues

I share every court’s concern about legislatively impinging upon sovereign

foreign rights. In this case, however, the statutory purpose is to reach the evasion of

United States rights by actions that are taken within the United States by entities subject

to United States law. The practice in foreign countries of United States–origin

technology without any contribution of components from the United States is untouched

by §271(f), whether of process or product. Liability under §271(f) is based on domestic

conduct and intent.

Although protection in foreign countries can sometimes be had by obtaining and

2007-1296,-1347 14
enforcing foreign patents, as mentioned in Microsoft, 550 U.S. at 456, that expensive

alternative may not be available. When a patented process is practiced so that some

steps are performed in the United States and other steps are performed offshore, the

purloiner of the patented process may escape liability everywhere, for United States

infringement is avoided if all of the process steps are not practiced in the United States,

and infringement of foreign patents is avoided for the same reason. It cannot be that

the legislators intended to enable avoidance of process patents by this ploy, while

correcting it for machine patents. A statutory interpretation that results in all process

inventions being seriously devalued, is not free of the charge of “absurd result.” See

Dewsnup v. Timm, 502 U.S. 410, 427 (1992) (the interpretation of a statute should

“avoid absurd results”).

St. Jude and several amici curiae observe that some countries do not permit

patenting of medical procedures, and cite this as a reason for refusing all remedy under

§271(f) for any practice abroad of any infringing process in any aspect of technology.

This reasoning is insupportable in the broad thesis proposed by the amici. And as to

the specific patent in suit, as Cardiac points out, a medical device such as a defibrillator

and its method of use are generally viewed as patentable in most countries.

Concerns of amici curiae

Several amicus curiae briefs expressed concern that a broad construction of

§271(f) could lead to unfair liability for United States providers of computer-based

systems. Thus these amici proposed that blanket removal of all process inventions—

the yes-or-no question here posed by this court—would best meet the needs of their

industries. True, this court’s inquiry was insufficiently nuanced, for such a blunderbuss

2007-1296,-1347 15
attack on all process technologies is not needed to serve the asserted special needs of

information industries. However, my colleagues have over-reacted as well as over-

reached, for it is not necessary (nor is it our prerogative) to destroy the statute for all

process industries, in order to avert potential abuses in unknown circumstances. I

agree that for ever more complex technologic facts, vigilance is required to preserve the

statutory purpose. As in all areas of evolving interests and policy, if statutory change is

warranted, it should be achieved with the participation of all those affected. It is not the

judicial role to dump the statute entirely, as overreaction to the facts of one case. The

court’s decision today is as unnecessary as it is incorrect.

The simple purpose of §271(f) is that, for patented inventions, a United States

patent cannot be avoided by providing substantial components from the United States

while performing some aspect offshore to avoid a technical act of infringement under

§271(a). Section 271(f) draws no distinction between process and product inventions,

and such distinction is unrelated to the legislative purpose. As Judge Learned Hand

reminds us, “statutes always have some purpose or object to accomplish:”

“[I]t is true that the words used, even in their literal sense, are the primary,
and ordinarily the most reliable, source of interpreting the meaning of any
writing: be it a statute, a contract, or anything else. But it is one of the
surest indexes of a mature and developed jurisprudence not to make a
fortress out of the dictionary; but to remember that statutes always have
some purpose or object to accomplish, whose sympathetic and
imaginative discovery is the surest guide to their meaning.”

Cabell v. Markham, 148 F.2d 737, 739 (2d Cir.), aff’d, 326 U.S. 404 (1945).

The court’s ruling reopens, for process inventions, the loophole that was plugged

by §271(f) for all patented inventions. The extensive legislative record shows

consideration of equity, economics, innovation incentive, and international concerns, in

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the evolution of the text of §271(f). The en banc court makes no mention of any of

these concerns, and does not discuss the consequences of today’s holding in negating

the legislative purpose. I respectfully dissent from the court’s statutory interpretation

and the decision based thereon.

2007-1296,-1347 17