Madey v. Duke University
307 F.3d 1351 (2002)
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Rule of Law:
The common law experimental use defense to patent infringement is very narrow and does not apply to the use of a patented invention that is in furtherance of the alleged infringer's legitimate business, regardless of commercial intent or the user's non-profit status.
Facts:
- Dr. John M.J. Madey, a research professor, was the sole owner of two patents related to free electron laser (FEL) technology.
- In 1988, Duke University recruited Madey, who then moved his FEL research lab, including equipment practicing his patents, from Stanford University to Duke.
- Madey served as the director of the FEL lab at Duke for nearly a decade, during which the lab was used for research.
- After a dispute, Duke removed Madey as director of the lab in 1997.
- Madey resigned from his position at Duke in 1998.
- Following Madey's resignation, Duke University continued to operate the patented equipment in the FEL lab.
- One piece of equipment in the lab, the Microwave Gun Test Stand, was owned by North Carolina Central University (NCCU), not Duke.
Procedural Posture:
- Dr. Madey sued Duke University in the U.S. District Court for the Middle District of North Carolina for patent infringement.
- Duke filed a motion to dismiss under FRCP 12(b)(1), which the district court granted in part regarding patent use under a government research grant.
- After discovery, the district court granted Duke's motion for summary judgment on the remaining patent claims.
- The district court held that Duke's use of the patented equipment was protected by the experimental use defense and that Duke did not infringe on another patent because it did not own or control the specific equipment.
- Madey (appellant) appealed the district court's dismissal and summary judgment rulings to the U.S. Court of Appeals for the Federal Circuit.
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Issue:
Does the common law experimental use defense excuse a non-profit research university's use of patented technology when that use furthers the university's legitimate business objectives, such as educating students, enhancing the institution's status, and attracting research grants?
Opinions:
Majority - Gajarsa, Circuit Judge
No. The experimental use defense does not excuse a non-profit research university's use of patented technology if the use furthers its legitimate business objectives, because the defense is very narrow and strictly limited. The court reasoned that the defense is restricted to actions performed 'solely for amusement, to satisfy idle curiosity, or for strictly philosophical inquiry.' Any use that is in keeping with the alleged infringer's legitimate business, regardless of commercial implications, does not qualify. Major research universities like Duke are in the legitimate business of educating students, conducting research, increasing their institutional status, and luring lucrative grants and faculty. Using the patented equipment furthered these business objectives, placing it outside the scope of the narrow defense. The profit or non-profit status of the user is not determinative; the focus is on whether the act is in furtherance of the institution's business, not whether it generates commercial gain.
Analysis:
This decision significantly narrows the scope of the experimental use defense, particularly for research universities and other non-profit institutions. It clarifies that such institutions have 'legitimate business' interests beyond direct commercial profit, such as enhancing reputation, securing grants, and educating students. By holding that infringing activities in furtherance of these goals are not protected, the court makes the defense practically unavailable for most modern university research, thereby increasing the potential patent infringement liability for academic institutions and requiring them to be more diligent in obtaining licenses.
