PracticeGroupPodcastsThe Federalist Society has a new patent law podcast posted on the Quanta Computer v. LG Electronics case before the Supreme Court and its impact on patent licensing.   In Quanta, the Supreme Court is being asked whether the Federal Circuit erred by holding, in conflict with decisions of this Court and other courts of appeals, that respondent’s patent rights were not exhausted by its license agreement with Intel Corporation, and Intel’s subsequent sale of product under the license to petitioners.

Quanta: Patent Rights in the Supreme Court 9-30-09 – MP3
Running Time: 01:40:52

To listen, please right click on the audio file you wish to hear and then select “Save Link As…” or “Save Target As…”  After their opening remarks, the panelists engage in a vigorous exchange of ideas about exhaustion doctrine and patent licensing.

In the case, LG Electronics owned a patent for a microprocessor chip, which it licensed to Intel, but excluded from the licensing agreement any Intel customer that used the chip with non-Intel products.  One third-party purchaser integrated the chip with Dell, HP and Gateway products.

In this U.S. Supreme Court case, the Court was asked whether a patent holder can seek royalties from the downstream third-party purchaser.  The Court concluded unanimously that it could not. Writing for the Court, Justice Clarence Thomas relied on the theory of “patent exhaustion,” which provides that a patented item’s initial authorized sale terminates all patent rights to that item, denying LGE royalties from companies down the line of commerce.  The panel of experts discuss the decision, and the implications of the decision for patent law and  licensing agreements.

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    5 Comments

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    3. That was very informative and well written. Below is an excerpt of an article on patent exhaustion in India.

      “A patent grants the Patent holder exclusive rights to prevent others from making, using, selling, offering for sale in the territory of patent grant or importing an invention into the territory of patent grant. Once an unrestricted sale of the patented invention is made, the rights of the patent holder with respect to the product are exhausted and this is called as the Doctrine of Exhaustion or First Sale Doctrine……To read more please visit:http://indianipinfo.blogspot.com/2010/10/patent-exhaustion-in-india.html

    4. […] Quanta Podcast: Patent Rights in the Supreme Court […]

    5. […] Quanta Podcast: Patent Rights in the Supreme Court […]