November 13, 2007 by Samir Nawaz
Under traditional legal norms, US patent laws did not extend beyond the
territorial bounds of the union. With a quick one-two punch, however, the
US court of Appeals for the Federal Circuit (CAFC) has expanded the
extraterritorial reach of patent law.
I tend to agree with the statement above (from the Article The Expanding
Reach of U.S. Patent Laws by Dennis Crouch) because after looking at the
“one-two punch” that Crouch refers to (the cases of Eolas v. Microsoft and
RIM v. NTP) it is fairly obvious that things have changed. While, as
Crouch has stated, U.S. patent laws traditionally have not extended beyond
the territorial boarders of the United States, the Eolas decision has run
contrary to this principle due to the fact that Microsoft was found liable
to Eolas (in an amount in excess of 500 million) for violating its patent
not in the US but in various countries abroad where it distributed and
licensed Internet software which the court found had key components of the
Eolas patent. This decision should thus serve notice not only to Microsoft
but other software companies as well, in that they can no longer expect to
escape the reach of US patent law simply because the patent they are
lifting from is not being used in the US. Also interesting regarding the
implications of this decision and what Crouch briefly touches, is that the
this decision can have consequences not just on the software industry, but
other industries as well. And while Crouch cites only the oil exploration
industry, the decision has the ability to touch many industries across the
spectrum, from genetic engineering to the manufacture of textiles. Using
the manufacture of textiles as an example, the decision in Eolas would
mean that companies in the US who for example constructed a machine based
on the US patent of another and then attempted to sell this machine would
not only be barred from doing so domestically (as per usual), but could
now internationally as well. The decision is thus not only a wake up call
and warning not just to the software industry, but to a great many more
across the board.
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