Mattress Firm takes on delivery and setup services for mattress buyers on Wayfair.com.
The U.S. Supreme Court seeks input on Limelight’s request for a case review.
In a court battle over a patented method of delivering content to web sites, Limelight Networks Inc. received some encouraging news last week regarding its petition to have its case reviewed by the U.S. Supreme Court. Although the court hasn’t indicated whether it will take on the case, in which Akamai Technologies Inc. won a favorable ruling in a federal appeals court last year, the high court demonstrated its interest in the case by asking the U.S. Solicitor General to comment on whether it should review it. Both companies provide Internet-based technology that cache and accelerate web content that display on e-commerce and other types of web sites.
“We are pleased that the Supreme Court has asked the Solicitor General to weigh in on our petition for certiorari,” Limelight said in a statement. Akamai declined to comment on Limelight’s Supreme Court petition.
The case involves whether Limelight can be held liable for infringing on Akamai’s patent for accessing and displaying cached content on the Internet, such as product images and videos. A final determination in the case could have implications for whether retailers as well as Limelight could be liable for patent infringement and monetary damages.
Akamai initially charged in a federal district court that Limelight and its web site-operating clients, including retailers, had collectively infringed on its patent. After Akamai won a $45.5 million judgment in November 2008, the same court reversed the verdict in April 2009, citing new case law that had found that a company and its clients were not collectively liable for patent infringement.
Akamai lost an appeal of that decision to a three-judge panel of the U.S. Court of Appeals for the Federal Circuit, but it won a subsequent decision by the full court on Aug. 31, 2012. In that decision, the 11-member appeals court voted six to five in favor of Akamai, finding that Limelight could be held liable for infringing on Akamai’s patent, regardless of how many clients it worked with during the alleged infringement. In effect, the court reversed an earlier decision in another case that had held a party could be found liable for induced infringement only if it encouraged another single party to perform all the steps of a patented method.
The expanded ruling on induced infringement could benefit patent holders and possibly subject more retailers to liability claims, because it allows patent holders to claim infringement even if steps of a patented method are spread among numerous companies, patent attorneys say. Whereas in the past Akamai would have to show that Limelight worked with just one retailer to take all the steps of a patented method, it could now try to show infringement even if numerous Limelight clients each took only one or a few patented steps.
The appeals court remanded the case back to the U.S. District Court for the District of Massachusetts, but Limelight filed a petition on Dec. 28, 2012, to have the U.S. Supreme Court review the Federal Circuit’s ruling.
Jeffrey M. Drake, a patent attorney with law firm Miller Canfield in Chicago, says individual retailers could be found liable under the findings of the Federal Circuit’s decision, but only if the patent holder could prove the retailer, or “individual actor” in legal terms, was aware of the patent and had a specific intent to infringe it. “So if the individual actor is not aware of the steps claimed in the patent, it would be difficult to hold the individual actor liable for infringement,” he says. A retailer could become liable, however, if it “knows that it is performing one or more of the steps claimed in a patented method and it also knows that another entity is performing the remaining steps,” he says. He adds that such liability rules could still change based on the outcome of the possible review by the Supreme Court.
Some retailers have expressed concern that such liability could even extend to individual consumers downloading content on a retail site, though lawyers say this would be a rare case, such as where a consumer was also a retailer familiar with the patent.
Patent attorneys Joseph Mencher and Ellie Simpson at Austin, TX-based law firm Haynes and Boome LLP say that, if the Supreme Court agrees to review the case, Limelight is likely to refer to two dissents filed in the August 2012 decision by five of the 11 Federal Circuit judges. One dissent, written by Judge Richard Linn and joined by three other judges, argued that the court’s decision did not adequately address the issue of joint patent infringement by multiple parties. The other dissent, by Judge Pauline Newman, cited a “vast potential for abuse” by patent holders resulting from the court’s decision.
“It is likely that the losing parties will utilize these dissents when petitioning the Supreme Court for review and final judgment,” Mencher and Simpson said in a blog post last month.