"Single Entity Rule" Governs Liability for Direct Infringement of Method Claims

Akamai Technologies, Inc. v. Limelight Networks, Inc., ___F.3d ___ (Fed. Cir. May 13, 2015) (Prost, LINN, Moore (dissenting)) (D. Mass: Zobel) (5 of 5 stars)

On remand from the Supreme Court, Federal Circuit affirms judgment of noninfringement.

Section 271(a) establishes direct infringement liability for a method claim where, and only where, all steps of the claimed method are "performed by or attributed to a single entity—as would be the case, for example, in a principal-agent relationship, in a contractual arrangement, or in a joint enterprise." Slip op. at 6-7. The statute does not incorporate joint tortfeasor liability, i.e., liability for one who intentionally causes another entity to take some act, but does not actually perform the act itself. Such is required by the statute itself, and by the "single entity rule" of BMC and Muniauction. Although numerous conflicting theories of joint liability existed when the statute was enacted, Congress opted to enact only those codified in sections 271(b) and (c), and it was inappropriate to stretch section 271(a) to include more of them, especially because this might also render sections 271(b) and (c) redundant. Moreover, the dissent's proposed rule is inconsistent with the common law principles it purports to rely on and has the odd effect that adding a limitation could cause more parties to be liable for infringement.

There was no liability under the single-entity rule. There was no dispute that Limelight was not itself performing certain steps of the claimed method. To the extent Limelight's customers were performing any of the claimed steps, there was no evidence that they did so as Limelight's agents or in any way vicariously attributable to Limelight. Language in Limelight's standard form contract explaining the steps customers will have to perform if they elect to use Limelight's service did not actually obligate the users to perform the steps. "Because the customers were acting for their own benefit, Limelight is not vicariously liable for the customer's actions."  Slip op. at 28.

Dissent: Judge Moore would have found Limelight responsible for the acts of its users, as Limelight required users to perform certain steps before they could use Limelight's service and because Limelight and its users shared a common plan to make content available on the Internet. In Judge Moore's view, the Federal Circuit should act en banc to confirm that section 271(a) attaches direct infringement liability to "joint infringers—multiple entities acting in concert pursuant to a common plan or purpose (joint tortfeasors)." Dissent at 11.