Published: 20 March 2017 20 March 2017
By Melissa A. McCurdy, Senior Associate, Standley Law Group LLP
Supreme Court Set to Decide Important Questions on the Scope of Patent Exhaustion in 2017
Impression Products, Inc. v. Lexmark International, Inc., is set for oral argument before the United States Supreme Court on March 21, 2017. The outcome of the case, which will address the scope of patent exhaustion, could have a serious impact on certain segments of business such as companies, like Impression Products, that refurbish used, patented products for resale (think phones, laptops, toner cartridges, etc.). It could also have an effect on the rights of consumers that purchase patented goods. The two specific questions pertaining to the doctrine of patent exhaustion that are going to be analyzed by the Court are: 1) whether a conditional sale that transfers title to a patented item, but which specifies post-sale restrictions on the item’s use or resale avoids application of the patent-exhaustion doctrine and therefore permits the enforcement of the post-sale restrictions; and 2) whether patent exhaustion will be triggered by a sale of the patented item (the sale being authorized by the patentee) when the sale occurs outside of the United States. The Federal Circuit has upheld post-sale restrictions on patented articles despite the doctrine of patent exhaustion and it has rejected the contention that patent exhaustion can be triggered by a foreign sale. We are about to find out whether the Supreme Court agrees with these applications of law.
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