US Federal Circuit Finds Infringement Despite FOB Transfer of Title Outside the US

In a recent decision of the US Court of Appeals for the Federal Circuit (Litecubes v. Northern Light Productions (GlowProducts) (Fed. Cir. 2008)), the Court of Appeals found that a Canadian company, GlowProducts, infringed a US patent owned by Litecubes, even though the legal title of the product was transferred outside the US. GlowProducts imported from China a number of novelty items, which it then sold across North America. Some of the novelty items distributed by GlowProducts include artificial illuminated ice-cubes. GlowProducts would sell the ice-cubes to US customers by having them shipped f.o.b., which technically meant that the title to the product transferred to the customer in Canada, and the risk and cost for importing the ice-cubes to the US was the customer's responsibility once title had transferred. The district court found that the GlowProducts ice-cubes had all the essential elements of the main claims of the Litecubes patent, but in defense to the allegation of infringement under Section 271, GlowProducts asserted that it did not sell within the US, or import the product into the US. Since the product was shipped f.o.b, GlowProducts argued that the sale took place in Canada, and the act of importing was done by the customer. The US Court of Appeals found that there was indeed a sale within the US. "[T]he criterion for determining the location of a "sale" under section 271(a) is not necessarily where legal title passes; the "˜more familiar places of contracting and performance' may take precedence over the passage of legal title." Since the American customers were in the US, and the ice-cubes were delivered directly to the US, the Court found substantial evidence that there had been a sale of the ice-cubes within the US. Link to decision of US Court of Appeals: http://www.cafc.uscourts.gov/opinions/06-1646.pdf Summary by: James Kosa