United States: IP Newsflash - February 19, 2016


Federal Circuit Affirms its pre-Quanta and Kirtsaeng Precedent on Patent Exhaustion for Restricted Domestic Sales and Foreign Sales

In a long-awaited en banc decision, the Federal Circuit ruled that the patent exhaustion doctrine does not apply to (1) initial sales with a single-use/no-resale restriction, or (2) foreign sales, whether restricted or not. In doing so, the court found that the Supreme Court's Quanta and Kirtsaeng decisions did not overrule Federal Circuit precedent.

Lexmark sold its printer cartridges in the U.S. and abroad. Some of the foreign-sold cartridges and all of the U.S.-sold cartridges were sold subject to a "single-use/no-resale restriction." Impression acquired and modified Lexmark's cartridges for resale in violation of the Lexmark restriction. Impression not only resold the U.S. cartridges but imported the foreign-sold Lexmark cartridges for resale in the U.S.

In the face of a patent infringement claim, Impression contested liability on the basis that Lexmark had exhausted its U.S. patent rights in the cartridges by its initial sales of them. Impression also argued that the Supreme Court's recent decisions had made Mallinckrodt and Jazz Photo no longer good law. See Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (Fed. Cir. 1992) (rejecting exhaustion defense where a patentee sold a patented article subject to an otherwise-unobjectionable single-use restriction); Jazz Photo Corp. v. Int'l Trade Comm'n, 264 F.3d 1094 (Fed. Cir. 2001) (holding that an initial authorized sale of a patented product outside the U.S. would not exhaust the patent rights of the patent holder).

On the first issue, the court held that "a patentee may preserve its § 271 rights when itself selling a patented article, through clearly communicated, otherwise-lawful restrictions, as it may do when contracting out the manufacturing and sale." (Slip Op. at 38.) The court found that under Supreme Court precedent, a patentee may preserve its § 271 rights through such restrictions when licensing others to make and sell patented articles.

On the second issue, the court held that "[a] U.S. patentee, simply by making or authorizing a foreign sale of an article, does not waive its U.S. rights to exclude regarding that article, either conclusively (no matter how clear the reservation of U.S. rights) or only presumptively (subject to sufficiently clear preservation of U.S. rights)." (Slip Op. at 71.) The court found that the Kirtsaeng decision, a copyright case, was not controlling and did not undermine the no-exhaustion conclusion of Jazz Photo.

The court also considered the "real-world consequences," noting the possibility of unintended infringement by buyers of goods in foreign countries who bring them into the United States. The court explained that such a possibility was limited by the availability of an implied-license defense from the circumstances of a sale.

Lexmark Int'l, Inc. v. Impression Prods., Inc., 2014-1617, 2014-1619 (Fed Cir. Feb. 12, 2016).

[Taranto (Opinion), Prost, Newman, Lourie, Moore, O'Malley, Reyna, Wallach, Chen, Stoll, Dyk (Dissent), Hughes (joining Dissent)

- Author: Rehan M. Safiullah

If There's Knowledge of the Patent Application, Laches Starts to Run When Patent Issues

In a precedential opinion, the Federal Circuit affirmed the district court's order granting summary judgment that the doctrine of laches barred the plaintiff's inventorship claim. This is the third appellate decision since SCA Hygiene Products v. First Baby Products involving laches. In SCA Hygiene Products, the Federal Circuit en banc reaffirmed laches as a defense to patent suits.

Laches is an equitable defense to patent infringement when a patentee delays bringing an infringement suit. As background, the plaintiff filed a complaint against the defendants, requesting correction of inventorship of a U.S. patent, which was assigned to the defendants. The plaintiff initially developed the invention claimed in the U.S. patent. He then disclosed the details of the invention to the defendants. The defendants subsequently filed a German application and a PCT patent application from which the U.S. patent issued, but did not name him as an inventor in either application. After the plaintiff discovered the PCT patent application during its pendency, he initiated litigation against the defendants in both German and European courts to correct inventorship. After losing his claims abroad, the plaintiff filed the present litigation against the defendants in the U.S.

The plaintiff argued that he did not delay in filing the complaint because he had been diligently seeking to vindicate this inventorship rights overseas. The Federal Circuit summarily rejected this argument, because the relevant inquiry for the laches presumption does not depend on diligence. Rather, the proper inquiry is whether more than six years passed between the time when the inventor knew or should have known of the subject patent and the time the inventor initiated litigation. Here, the subject patent issued more than ten years before the plaintiff filed the complaint. The plaintiff also knew of the patent while it was still pending. Accordingly, the plaintiff should have pursued the inventorship claim within six years after the subject patent issued. Because the plaintiff had waited four additional years beyond this six-year critical date to do so, laches barred the plaintiff from bringing the present litigation.

Lismont v. Alexander Binzel Corp. et al. (Fed. Cir. February 16, 2016) (Lourie, Reyna & Chen, JJ.).

- Author: Alex Chan


Delaware Court Grants in Part a Summary Judgment Motion of Noninfringement

In a February 11, 2016, decision, Judge Andrews of the District of Delaware granted in part and denied in part a summary judgment motion of noninfringement filed by Defendant Micron Technology, Inc. Plaintiff HSM Portfolio sued Micron over patents relating to image sensors. Specifically, U.S. Patent No. 5,030,853 requires that each inverter in a chain increase in size by "less than a predetermined factor times the width of the N-channel of the immediately preceding inverter stage." The court found that the patentee intended to use a specific equation in the specification to calculate the "predetermined factor." Since Plaintiff relied on a different equation for the limitation, the court found that there is no literal infringement. Further, the court concluded that the specification expressly identifies a role for the claim limitation—using the specific equation to calculate the predetermined factor. Thus, the court held that Plaintiff cannot use the doctrine of equivalents to capture the subject matter based on a different equation.

After concluding that Defendant does not literally infringe certain claims of U.S. Patent No. 5,247,212, the court examined infringement under the doctrine of equivalents. The claims require a "clock input signal" and a "complementary FET inverter." Defendant contended that the doctrine of equivalents did not apply because the patentee dedicated the disclosed but unclaimed subject matter to the public. But the court found that the specification does not identify the "unclaimed" subject matter as an alternative to any limitation in the claims. Thus, the disclosure-dedication rule does not apply, and the court denied Defendant's motion for summary judgment of non-infringement under the doctrine of equivalents.

HSM Portfolio LLC & Tech. Props. Ltd. LLC v. Elpida Memory Inc., Civil Action No. 11-770-RGA, Dkt. No. 1205 (D. Del. Feb. 11, 2016).

- Author: Yimeng Dou

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
O'Melveny & Myers LLP
Masuda, Funai, Eifert & Mitchell, Ltd.
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
O'Melveny & Myers LLP
Masuda, Funai, Eifert & Mitchell, Ltd.
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions