Addressing the applicability of 35 U.S.C. §271(f)(1) to the issue of components that are manufactured, assembled and sold exclusively outside of the United States, the U.S. Court of Appeals for the Federal Circuit held that "the ‘tort’ of patent infringement occurs where the offending act is committed and not where the injury is felt." Pellegrini v. Analog Devices, Inc., Case No. 04-1054 (Fed. Cir. July 8, 2004).
Pellegrini is the owner of U.S. Pat. 4,651,069 (the `069 patent) (directed to brushless motor drive circuits). Analog develops and fabricates integrated circuit chips, including a line of chips called ADMC chips. Pellegrini sued Analog, alleging infringement of the `069 patent and contending that certain claims of the `069 patent read on the combination of ADMC chips and other components in brushless motors. Both parties moved for summary judgment. The district court granted Analog’s motion with respect to Pellegrini’s infringement claim under §271(f)(1), and Pellegrini appealed.
The ADMC chips that were the subject of Pellegrini’s infringement claim were manufactured exclusively outside of the United States and only sold and shipped to customers outside the United States. However, Pellegrini asserted that since Analog’s headquarters are in the United States and the instructions for the production and disposition of the ADMC chips emanate from the United States, the chips should be regarded as having been "supplie[d] or cause[d] to be supplied in or from the United States" rendering Analog liable as an infringer under 35 U.S.C. §271(f)(1).
The Federal Circuit, considering the issue presented to be a matter of "first impression," affirmed the district court’s decision, holding that "[35 U.S.C. §271(f)(1)] applies only where components of a patent invention are physically present in the United States and then either sold or exported ‘in such a manner as to actively induce the combination of such components outside the United States in a manner that would infringe the patent if such combination occurred within the United States.’" Further, citing North American Phillips, the Court held that "the ‘tort’ of patent infringement occurs where the offending act [making, using, selling, offering for sale or importing] is committed and not where the injury is felt." Accordingly, the Federal Circuit held that "suppl[ying] or caus[ing] to be supplied" in §271(f)(1) clearly refers to physical supply of components, not simply to the supply of instructions or corporate oversight," and "although Analog may be giving instructions from the United States that cause the components of the patented invention to be supplied, it is undisputed that those components are not being supplied in or from the United States."
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