BGH on Indirect Infringement

The principle of exhaustion of rights, in a nutshell, prevents a patent proprietor from using his patent rights in respect of patented articles put on the market by himself. In a decision of the BGH (Flügelradzähler, Mitteilungen 2004, page 358), the BGH addressed the issues of indirect infringement and exhaustion of rights.

Claim 1 of the patent at issue related to an impeller counter comprising, among other elements, a measuring unit. The patentee marketed the impeller counter with and without the measuring unit; the defendant marketed the measuring units only. The Oberlandesgericht Frankfurt in second instance had denied indirect infringement because there was no supply to persons not entitled to use the invention. Instead, the measuring units were supplied only to parties who had previously obtained impeller counters (without the measuring units) from the patentee. The patent rights in the impeller counters were thus exhausted and supply of the measuring units by a third party could no longer constitute an indirect infringement.

The BGH overturned this decision and stated that there was no exhaustion because the finished, patented product, i.e. the impeller counter including the measuring unit, was produced for the first time when the impeller counter and the measuring unit were assembled. There could be no exhaustion of rights when the patentee put on the market only elements but not the whole patented article.

The BGH also found that the measuring unit related to an essential element of the invention. Interestingly, the BGH explained that the requirement that the means in question had to “relate” to an essential element of the invention meant that the means had to have a functional relationship with an essential element so as to put the invention into effect, rather than to form an essential element.

Comment

The court’s comments on functional relationship with an essential element appear to provide scope for indirect infringements when the supplied means is not a claimed element but something “outside” the claim.

As to which of the features of a claim were essential elements, the BGH stated that, normally, every element that found its way into the claim was essential to the invention. In particular, an essential claim feature could not be told apart from a non-essential feature on the basis of whether or not the feature distinguished the invention from the prior art. This statement, although delivered in the context of indirect infringement, appears to be in marked contrast to the many attempts by the courts to distinguish between essential and non-essential claim features, for example in order to decide whether or not an invention is technical.