Briefs: Quanta v. LGE

On Certiorari





On the Merits

















2 thoughts on “Briefs: Quanta v. LGE

  1. 1

    It appears that thus far most merits briefs in support of the Petitioner have been filed by every “Tom, Dick and Harry” who has a strong self interest in removing patents as a business annoyance. Of course the seed companies have weighed in to try and protect their turf (this is certainly not unexpected, but I wonder where the maker of “Roundup” is given its recent battles over its genetically engineered seed?).

    Other than the Respondent and the CAFC, I have not seen any merit briefs in support of their positions. What gives?

    I personally believe the outcome of this case will have significant ramifications, especially with regard to licensing. I also personally believe that the CAFC got it right. This is not your typical “patent exhaustion” case. The license is not unlimited; it is conditional with full notice of the condition being duly noted to each purchaser of the licensee’s product. Certainly they cannot shrug their shoulders and say “Gee, we didn’t know.”

    Contrary to the simplistic view presented by those who argue that the licensor received all of the compensation to which it was entitled under the license it granted to Intel, I would argue that the compensation received bears but a small portion of the possible damage caused to the licensor’s business by the incorporation of the licensee’s product into products manufactured by the Petitioner and others. While it may have a modicum of “legal” logic, such a position is totally at odds with how companies actually conduct business and the damages they may suffer when their competitors are able to get a “free ride” on the licensor’s innovation(s).

    I realize many will think this passe, but would a decision by the SCOTUS that the patentee’s right to compensation was exhausted upon the receipt of payment from its licensor be a fair end result? Copyright law has bent over backwards to do everthing possible to help copyright holders realize maximum value from the downstream use of their works. I happen to believe it is intellectually dishonest to afford such rights to copyright holders, but to view with skepticism such an outcome for patent holders. Yes, the two bodies of law do involve different rights. However, I do not believe that in and of itself is sufficient reason to be defferential to end runs of the first sale doctrine, but not so in the matter of patent exhaustion.

    That said, I think it more likely than not the Supreme Court will tend to look more favorably on a “bright line” test than on one that is a bit dimmer. This is the view I drew from the Bonito case (basically telling Judge Rich his analysis of the patent law and its interplay with unfair competition was wrong) and seems to reflect a predisposition by the court in matters pertaining to Title 35. I hope I am wrong, but the spate of cases from the Court’s first term this year provide scant encouragement that a decision in favor of the Respondent will result.

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