“Patent Exhaustion” Sustained

From Supreme Court Rules Patent Laws Can’t Be Used to Prevent Reselling regarding Impression Products, Inc. v. Lexmark Int’l, Inc. [local pdf]

The Supreme Court on Tuesday placed sharp limits on how much control patent holders have over how their products are used after they are sold.

The case concerned Lexmark International, which makes toner cartridges for use in its printers. The court ruled that the company could not use patent law to stop companies from refilling and selling the cartridges.

The fine point that Justice Ginsburg places on the ruling (dissenting on the notion of US patent exhaustion with respect to foreign sales, where she elects to distinguish the applicability of copyright and patent regimes in the case of exhaustion) is worth noting:

[…] I dissent, however, from the Court’s holding on international exhaustion. A foreign sale, I would hold, does not exhaust a U. S. inventor’s U. S. patent rights.

Patent law is territorial. When an inventor receives a U. S. patent, that patent provides no protection abroad….

Because a sale abroad operates independently of the U. S. patent system, it makes little sense to say that such a sale exhausts an inventor’s U. S. patent rights. U. S. patent protection accompanies none of a U. S. patentee’s sales abroad—a competitor could sell the same patented product abroad with no U. S.-patent-law consequence. Accordingly, the foreign sale should not diminish the protections of U. S. law in the United States.