In June, 2005, the United States Supreme Court set forth an "inducement" rule in MGM Studios, Inc. v. Grokster, Ltd. that imposes secondary liability on "one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement." The Court emphasized the limitations of the liability standard it was setting forth, stating that the target was only "purposeful, culpable expression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise." Yet, the liability standard set forth in Grokster is not as clear or as precise as the Court's opinion suggested. Moreover, it has potential implications for the scope of secondary liability under the Patent Act as well. The Copyright Act contains no statutory language referring to "inducement to infringe," "contributory infringement," or any other type of secondary or vicarious liability. Rather, the courts have exported these theories of indirect liability from the Patent Act, where they are explicit, and have read them into copyright law. Thus, the Grokster Court drew its liability standard for inducement of copyright infringement from the inducement of infringement liability provision of the Patent Act. It is not surprising that the Court did so--the relationship between the law relating to copyright infringement and patent infringement has been closely intertwined for many decades, and the Supreme Court itself has drawn upon the intricate relationship between the two areas in crafting its copyright jurisprudence, both in Grokster and in earlier cases. Unfortunately, however, the contours of liability for inducement of infringement under the Patent Act have been unclear historically. The decisions of the U.S. Court of Appeals for the Federal Circuit have spawned two competing lines of cases: one imposing a broader scope of liability for inducement to infringe because of a weaker intent standard, and one imposing a narrower scope of liability because of a stronger intent standard. The Supreme Court ignored this intra-circuit split in Grokster, leaving unsettled both the parameters of indirect infringement liability in copyright law and the impact that Grokster is likely to have on the development of inducement of infringement jurisprudence under patent law. Thus, two critical aspects of Grokster are its potential impact on the development of indirect liability under both copyright and patent law and, most importantly, its potential influence on our understanding of the "intent" element of inducement of infringement in both areas. As discussed below, inducement liability first evolved in the patent context through case law. It was codified in the Patent Act and imported into copyright law by the courts, even though no statutory basis for such liability exists in that context. Then, in Grokster, the Supreme Court expounded upon the meaning of intent for inducement of infringement in the copyright area. That language has since been adopted by the Federal Circuit in analyzing the intent standard for inducement in the patent area. It is worth exploring whether these incremental judicial alterations in what is fundamentally a statutory area of patent law intrude upon the proper relationship between the courts and the legislature, and whether these changes result in rational or piecemeal development of the legal standards pertaining to inducement of infringement liability in patent law.
Lynda J. Oswald,
The Intent Element of Inducement to Infringe under Patent Law: Reflections on Grokster,
Mich. Telecomm. & Tech. L. Rev.
Available at: http://repository.law.umich.edu/mttlr/vol13/iss1/6