Supreme Court Rules on "Willful Blindness" Doctrine

By Ben Hodges

In Global-Tech Appliances, Inc. v. SEB S.A.G, the Supreme Court determined that a party may only induce infringement with actual knowledge that the induced acts would be infringing, or willful blindness to that fact. This changes the previous standard endorsed by the Federal Circuit of either actual knowledge or deliberate indifference.

Writing for the majority, Justice Alito first examined the history of inducing infringement and found that inducement’s common origin with contributory infringement meant that both doctrines should require the same level of knowledge. The Supreme Court had previously held in Aro Manufacturing Co. v. Convertible Top Replacement Co., 377 U.S. 476 (1964), that contributory infringement required knowledge of infringement.

The Federal Circuit has for many years held that deliberate indifference satisfies the knowledge requirement, but the Supreme Court disagreed. Instead it found that willful blindness satisfies the knowledge requirement.

The Court found that willful blindness has two basic requirements: “(1) the defendant must subjectively believe that there is a high probability that a fact exists and (2) the defendant must take deliberate actions to avoid learning of that fact.” According to the Court, these two requirements sufficiently limit willful blindness to “one who takes deliberate actions to avoid confirming a high probability of wrongdoing and who can almost be said to have actually known the critical facts.”

Turning to the facts in the present case, the Court found that while the Federal Circuit did not apply the correct standard, the facts warranted affirming the verdict because the actions here did show willful blindness. The Petitioner, Pentalpha Enterprises, Ltd (a wholly owned subsidiary of the named petitioner), was asked to supply a U.S. company with home deep fryers with certain specifications. In order to do so, Pentalpha purchased a fryer manufactured by SEB that was doing well in the U.S. market. The fryer was purchased in Hong Kong so there would be no U.S. patent markings on the product. After purchasing this fryer, Pentalpha copied all the relevant features to design its own fryer, omitting only cosmetic features. Pentalpha then obtained a right-to-use letter from an attorney who did not find SEB’s patent in a search and was not told of the copying. Pentalpha then sold its fryer to U.S. customers.

In finding willful blindness, the Court specifically pointed to the fact that the technology at issue, a cool-touch fryer, was a known innovation in the U.S. market when it was copied overseas. The defendant knew about SEB’s innovation through market research and saw that the SEB’s market share was growing as a result. This was evidenced by both deposition testimony and the fact that the fryer was copied in whole except for cosmetic features. The Supreme Court also looked at the decision to copy an overseas model of SEB’s fryer. The Court found that Pentalpha was a sophisticated entity in regards to the U.S. Patent system and was well aware that a product designed for a foreign market would not contain U.S. patent markings. Also telling for willful blindness was the decision not to inform the attorney who issued the right to use opinion of the copying of SEB’s fryer.