Stephen McBride and Elissa Sanford’s co-authored article “The Presumption Against Extraterritoriality’s Slow Decline in Patent Law,” was featured in AIPLA’s Quarterly Journal (48-3).
United States patent law has traditionally held a strong presumption against extraterritorial application. Over the years, this presumption has gradually waned in response to advances in technology and global integration. Not only has Congress periodically amended the infringement statute (35 U.S.C. §271) to reach scenarios that were once considered extraterritorial, but caselaw has also slowly expanded to encompass more foreign activities, with the most recent example being the expansion of damages in the Supreme Court’s WesternGeco opinion. This expansion cuts across many areas of patent law, including infringement, damages and personal jurisdiction. As a result, companies with little or no United States presence may be liable for infringing United States patents even if they have never sold a product in the United States. This Article discusses the trends driving this expansion and how this expansion creates new liability and exposure for many foreign entities with no direct contact in the United States. First, it provides a recap of the historic presumption against extraterritorial application of United States Patent Law. Second, it discusses the statutory development of extraterritorial infringement and how those developments have expanded the scope of direct and indirect infringement (especially inducement). Third, it examines the expanding scope of patent damages. Fourth, the Article highlights remedies available at the International Trade Commission. Finally, the Article discusses the expansion of personal jurisdiction under theories like the stream of commerce theory. Taken together, many barriers to applying United States patent laws to foreign entities are significantly lower than they once were.
Originally Published by Oblon, November 2020