The U.S. Supreme Court’s reinvigoration of the patent exhaustion doctrine in Quanta Computer, Inc. v. LG Electronics, Inc., 128 S.Ct. 2109 (2008), continues to reverberate through the courts.
- A Federal district court has now agreed to reconsider an order that had previously upheld Lexmark’s printer cartridge return program. The restriction on re-use is enforced by a smart chip that prevents its cartridges from being reused unless they are refilled by Lexmark. Lexmark is trying to keep others from circumventing its smart chip, but this decision suggests that post-sale restrictions on use will face more scrutiny in light of Quanta. Static Control Components Inc. v. Lexmark International Inc. (E.D. Ky., March 31, 2009).
- The U.S. Court of Appeals has affirmed the dismissal of a patent infringement suit on the grounds that the patentee’s covenant not to sue, made as part of a settlement of earlier infringement claims, effectively exhausted its related patent rights, including a patent that had not even issued at the time of the settlement. The decision emphasizes the need for litigants to be particularly careful drafting settlement terms in the wake of Quanta. TransCore LP and TC License Ltd. v. Electronic Transaction Consultants Corp. (Fed. Cir., April 8, 2009).
