High Court OKs Patent Award Over Deep Fryers

(CN) - A Hong Kong-based appliance maker has to pay up for reproducing a French competitor's deep fryer, though it claims it did not know the French product was patent protected, the Supreme Court ruled Tuesday.

SEB, the French company, invented a "cooltouch" deep fryer in the late 1980s and patented it in the United States in 1991. Since the product - with its heat source isolated from the cool plastic exterior - was superior to contemporary American products, it became a commercial success.

The Hong Kong-based Pentalpha Enterprises, a subsidiary of Global-Tech Appliances, then began supplying SEB's American competitors with deep fryers. Its product directly copied the mechanics of a Hong Kong-acquired SEB fryer that did not bear the U.S. patent.

SEB sued the first competitor, Sunbeam, for patent infringement, which in turn notified Pentalpha and quickly settled with the lawsuit. When SEB sued Pentalpha, a jury awarded SEB $4.65 million, finding that Pentalpha had committed direct patent infringement and actively induced others to commit infringement. The District Court and Federal Circuit both upheld the jury's finding, modifying the final award to $4.8 million.

Pentalpha and Global-Tech appealed to the Supreme Court, arguing it did not know about SEB's patent until the 1998 lawsuit against Sunbeam.

An eight-justice majority of the high court rejected the defense. Though deliberate indifference is not an appropriate standard with which to determine contributory infringement, "the evidence in this case was plainly sufficient to support a finding of Pentalpha's knowledge under the doctrine of willful blindness," Justice Samuel Alito wrote for the majority.

"Given the long history of willful blindness and its wide acceptance in the Federal Judiciary, we can see no reason why the doctrine should not apply in civil lawsuits for induced patent infringement," he added.

"Taken together, this evidence was more than sufficient for a jury to find that Pentalpha subjectively believed there was a high probability that SEB's fryer was patented, that Pentalpha took deliberate steps to avoid knowing that fact, and that it therefore willfully blinded itself to the infringing nature of Sunbeam's sales," the 16-page decision also states.

Justice Anthony Kennedy dissented, saying that the majority has mistakenly broadened a legislative proscription by analogy.

"There is no need to invoke willful blindness for the first time in this case," Kennedy wrote. "Facts that support willful blindness are often probative of actual knowledge. Circumstantial facts like these tend to be the only available evidence in any event, for the jury lacks direct access to the defendant's mind. The jury must often infer knowledge from conduct, and attempts to eliminate evidence of knowledge may justify such inference, as where an accused inducer avoids further confirming what he already believes with good reason to be true. The majority's decision to expand the statute's scope appears to depend on the unstated premise that knowledge requires certainty, but the law often permits probabilistic judgments to count as knowledge."

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