In 1998, Congress further added section 271(g) to Title 35 of the Patent Act. This subsection creates liability for importing into the United States or selling, offering to sell, or using in the United States, a product "made by" a process covered by a U.S. patent. Under section 271(g), however, a product is not considered to be "made" by a patented process if it is materially changed or becomes a non-essential component of another product. [Rhetorical question: how much can you materially change the product to avoid the patent and still be kosher with the FDA wrt characterizing the product.]In particular, section 271(g) provides:
(g) Whoever without authority imports into the United States or offers to sell, sells, or uses within the United States a product which is made by a process patented in the United States shall be liable as an infringer, if the importation, offer to sell, sale, or use of the product occurs during the term of such process patent. In an action for infringement of a process patent, no remedy may be granted for infringement on account of the non-commercial use or retail sale of a product unless there is no adequate remedy under this title for infringement on account of the importation or other use, offer to sell, or sale of that product. A product which is made by a patented process will, for purposes of this title, not be considered to be so made after–
(1) it is materially changed by subsequent processes; or
(2) it becomes a trivial and nonessential component of another product.
Thus, under section 271(g), a party can be liable for infringement for importing into the United States, or selling or using in the United States, a product made by a patented process, regardless of where the process is performed or where the product was ultimately made. Congress added section 271(g) to increase protection of U.S. technology industries, specifically the pharmaceutical and biotechnology industries. See Kastenmier, Report to accompany H.R. 1931 (Apr. 22, 1987). Section 271(g) also sought to conform U.S. patent law to the infringement standards under foreign intellectual-property law. See S. Rep. No. 100-83 (1987).
Modern Interpretations of Section 271 Recent decisions by the Federal Circuit have interpreted the scope of acts deemed infringing under section 271. Among other things, these decisions have clarified the reach of section 271 with respect to technologies with cross-border applications. They have also addressed questions of infringement concerning non-traditional "products" and "components," such as information and computer software.
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Bayer AG v. Housey Pharmaceutical, Inc. In contrast to the holdings reached in Eolas and AT&T, the Federal Circuit took a more traditional approach when assessing section 271(g) in Bayer AG v. Housey Pharmaceutical, Inc., 340 F.3d 1367, 1368 (Fed. Cir. 2003). In that case, Housey Pharmaceutical, Inc. sued Bayer AG for infringement based on patented screening methods for discovering drugs. Bayer AG, 340 F.3d at 1368-69. Bayer allegedly practiced the screening methods abroad but then imported information gathered from the methods into the United States for drug development. Housey, however, asserted that these acts constituted infringement of the patented-screening methods under section 271(g). Id. at 1369-70.
Strictly reading the statute, the Federal Circuit concluded that section 271(g) addresses only patented manufacturing methods (i.e., methods of actually making or creating a product)and does not encompass methods of gathering information[Could be an interesting point about whether MNTA patents are about gathering information rather than actual manufacture, but it isn't one I'd bet on]. Id. at 1377. The Court noted that this interpretation was consistent with the legislative history of section 271(g), which, according to the Court, indicated that Congress was "concerned solely with physical goods that had undergone manufacture" and "not mere information." Id. at 1373, 1376. Because Bayer's acts of identifying and generating information were not considered steps in the manufacture of a final drug product, the Court held that there was no liability under section 271(g). Id. at 1377.[On the other hand, it would seem clear that the MNTA patents are actual steps in the product manufacture.]
In certain respects, the outcome in Bayer conflicts with that in Eolas and AT&T. In Bayer, the Federal Circuit held that the scope of infringing acts under section 271(g) is limited to tangible or physical products created or made by a manufacturing process. In contrast, the decisions in Eolas and AT&T show a more liberal and, perhaps, modern approach to assessing infringement under section 271. In Eolas and AT&T, the Federal Circuit interpreted section 271(f) as not being limited by a "tangibility" requirement and held that software (whether embodied on a golden master disk or transmitted electronically) could constitute a component of a patent invention. While the types of acts covered by section 271(f) and (g) are different, the application of those sections to "intangible" technology (such as information and software) arguably should be the same. Indeed, in today's global marketplace, information and software are not only viewed as commodities or products, but also are incorporated as key components of computerised systems and processes. Nonetheless, under current Federal Circuit case law, sections 271(f) and (g) are interpreted differently.
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