Post-sale restraint

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A post-sale restraint, also termed a post-sale restriction, as those terms are used in United States patent law and antitrust law, is a limitation that operates after a sale of goods to a purchaser has occurred and purports to restrain, restrict, or limit the scope of the buyer's freedom to utilize, resell, or otherwise dispose of or take action regarding the sold goods. [1] Such restraints have also been termed "equitable servitudes on chattels". [2]

Under United States law, a patent is a right granted to the inventor of a (1) process, machine, article of manufacture, or composition of matter, (2) that is new, useful, and non-obvious. A patent is the right to exclude others from using a new technology. Specifically, it is the right to exclude others from making, using, selling, offering for sale, importing, inducing others to infringe, and/or offering a product specially adapted for practice of the patent.

United States Antitrust law is a collection of federal and state government laws that regulates the conduct and organization of business corporations, generally to promote fair competition for the benefit of consumers. The main statutes are the Sherman Act of 1890, the Clayton Act of 1914 and the Federal Trade Commission Act of 1914. These Acts, first, restrict the formation of cartels and prohibit other collusive practices regarded as being in restraint of trade. Second, they restrict the mergers and acquisitions of organizations that could substantially lessen competition. Third, they prohibit the creation of a monopoly and the abuse of monopoly power.

An equitable servitude is a term used in the law of real property to describe a nonpossessory interest in land that operates much like a covenant running with the land. In England and Wales the term is defunct and in Scotland it has very long been a sub-type of the Scottish legal version of servitudes, which are what English law calls easements. However covenants and equitable servitudes in most of the jurisdictions across North America, are slightly different. The usual distinction is based on the remedy plaintiff seeks and precedent will allow for the scenario in question. Where the terms are unmerged, holders of a covenant seek money damages; holders of equitable servitudes seek injunctions. The term used to exist in England widely before Tulk v Moxhay and as byproduct of the Judicature Acts became one of the fullest mergers of equity and common law in England and Wales so as to agree initially on the term "equitable covenant", then coming to be united in the term covenant save that "equitable" bears a particular meaning in English property rights since at least 1925: it means not fully compliant with registration/written formalities. If lacks legally routine formalities it is not a full legal covenant and therefore more tenuous, often only enforceable personally and against the original covenantor.

Contents

Support for the rule against enforcement of post-sale restraints has at times been rested on the common law's hostility to restraints on the alienation of chattels. "The right of alienation is one of the essential incidents of a right of general property in movables, and restraints upon alienation have been generally regarded as obnoxious to public policy, which is best subserved by great freedom of traffic in such things as pass from hand to hand. General restraint in the alienation of articles, things, chattels, except when a very special kind of property is involved, . . . have been generally held void." [3]

Common law Law developed by judges

In law, common law is that body of law derived from judicial decisions of courts and similar tribunals. The defining characteristic of “common law” is that it arises as precedent. In cases where the parties disagree on what the law is, a common law court looks to past precedential decisions of relevant courts, and synthesizes the principles of those past cases as applicable to the current facts. If a similar dispute has been resolved in the past, the court is usually bound to follow the reasoning used in the prior decision. If, however, the court finds that the current dispute is fundamentally distinct from all previous cases, and legislative statutes are either silent or ambiguous on the question, judges have the authority and duty to resolve the issue. The court states an opinion that gives reasons for the decision, and those reasons agglomerate with past decisions as precedent to bind future judges and litigants. Common law, as the body of law made by judges, stands in contrast to and on equal footing with statutes which are adopted through the legislative process, and regulations which are promulgated by the executive branch. Stare decisis, the principle that cases should be decided according to consistent principled rules so that similar facts will yield similar results, lies at the heart of all common law systems.

Case law

Adams v. Burke

Perhaps the earliest US discussion of post-sales restraints occurs in Adams v. Burke , [4] in which the US Supreme Court refused to find patent infringement when an undertaker — who purchased a patented coffin lid, and transported it outside the territory in which the manufacturer was licensed (the ten-mile radius surrounding Boston) — used the product to bury a client. The Court stated:

Adams v. Burke, 84 U.S. 453 (1873), was a United States Supreme Court case in which the Court first elaborated on the exhaustion doctrine. According to that doctrine, a so-called authorized sale of a patented product liberates the product from the patent monopoly. The product becomes the complete property of the purchaser and "passes without the monopoly." The property owner is then free to use or dispose of it as it may choose, free of any control by the patentee. Adams is a widely cited, leading case. A substantially identical doctrine applies in copyright law and is known as the "first sale doctrine".

Patent infringement is the commission of a prohibited act with respect to a patented invention without permission from the patent holder. Permission may typically be granted in the form of a license. The definition of patent infringement may vary by jurisdiction, but it typically includes using or selling the patented invention. In many countries, a use is required to be commercial to constitute patent infringement.

Boston Capital city of Massachusetts, United States

Boston is the capital and most populous city of the Commonwealth of Massachusetts in the United States. The city proper covers 48 square miles (124 km2) with an estimated population of 685,094 in 2017, making it also the most populous city in New England. Boston is the seat of Suffolk County as well, although the county government was disbanded on July 1, 1999. The city is the economic and cultural anchor of a substantially larger metropolitan area known as Greater Boston, a metropolitan statistical area (MSA) home to a census-estimated 4.8 million people in 2016 and ranking as the tenth-largest such area in the country. As a combined statistical area (CSA), this wider commuting region is home to some 8.2 million people, making it the sixth-largest in the United States.

But in the essential nature of things, when the patentee, or the person having his rights, sells a machine or instrument whose sole value is in its use, he receives the consideration for its use and he parts with the right to restrict that use. The article, in the language of the Court, passes without the limit of the monopoly. That is to say the patentee or his assignee having in the act of sale received all the royalty or consideration which he claims for the use of his invention in that particular machine or instrument, it is open to the use of the purchaser without further restriction on account of the monopoly of the patentees. [5]

Motion Picture Patents

Projector involved in Mot. Pict. Pats. case MPPprojr.png
Projector involved in Mot. Pict. Pats. case

On the basis of this doctrine, in Motion Picture Patents Co. v. Universal Film Mfg. Co. , [6] the Supreme Court refused to enforce by way of a patent infringement suit against a downstream purchaser an agreement requiring that a patented film projector be used only with films licensed by the Motion Picture Patents Co., that the same agreement be imposed on downstream purchasers, and that the machine be sold with a plate affixed to it stating the same requirement.

Straus v. Victor

VictorTalkingLogo.jpg

Contemporaneously, in Straus v. Victor Talking Machine Co., [7] the Court refused to enforce a post-sale price-fixing restraint imposed on phonograph machines by means of an affixed "License Notice". The defendants, the proprietors of Macy's department store in New York, disregarded the notice and proceeded to cut prices. The patentee sought an injunction under the patent laws to compel obedience to the notice and, also, damages. The Court held that the case fell within the principle of Adams v. Burke and denied any relief. In so holding, the Court explained:

Courts would be perversely blind if they failed to look through such an attempt as this "License Notice" thus plainly is to sell property for a full price, and yet to place restraints upon its further alienation, such as have been hateful to the law from Lord Coke's day to ours, because obnoxious to the public interest. [8]

1926 GE case

TungFil.jpg

In 1926, in United States v. General Electric Co. , [9] the Supreme Court tried to make a bright-line distinction between post-sale restraints on patented goods, which the exhaustion doctrine did not allow, and limitations that a patentee imposed on the freedom of a manufacturing-licensee to sell goods manufactured under a limited license of a patent, which were permissible if "normally and reasonably adapted to secure pecuniary reward for the patentee's monopoly". It was well settled that, under the exhaustion doctrine, "where a patentee makes the patented article and sells it, he can exercise no future control over what the purchaser may wish to do with the article after his purchase. It has passed beyond the scope of the patentee's rights." [10] But when a licensee is licensed only to make and sell goods in a particular field or through a particular channel of distribution, the patented goods so made are ordinarily subject to the limitations of the license, even when in the hands of a downstream purchaser. Accordingly, the Court upheld the legitimacy of price-fixing restrictions that GE imposed in its license to Westinghouse to manufacture light bulbs under GE's patents.

General Talking Pictures case

In General Talking Pictures Corp. v. Western Electric Co., [11] the Supreme Court reaffirmed and expanded on the distinction made in the 1926 GE case between post-sale restraints and licenses containing a limitation on what the licensee was permitted to do. The Court upheld as legitimate so-called field-of-use limitations on the scope of patent licenses to make and sell amplifiers only in the "non-commercial" field against a licensee and its customer that made amplifiers and sold them into the commercial field.

Ethyl case

The bright-line distinction made in the 1926 GE case and in the General Talking Pictures case was blurred to some extent in the Supreme Court's 1940 decision in Ethyl Gasoline Corp. v. United States . [12] In that case, Ethyl Gasoline Corporation had established an elaborate licensing program under its several patents on the fuel additive tetra-ethyl lead, a motor fuel containing tetra-ethyl lead, and a method of operating an automobile engine with fuel containing tetra-ethyl lead. Ethyl sold the fuel additive, and licensed purchasers to use it to practice the other patents. The licensing program fixed prices for the motor fuel and strictly limited the types of customer to which given licensees could sell the motor fuel. Ethyl emphasized to the Supreme Court the fact that while it sold the fuel subject to a post-sale restraint it licensed the other patents, which covered the manufacture of the fuel (by adding tetra-ethyl lead to ordinary gasoline) and the use of the fuel in automobile engines. The Supreme Court refused to make any distinctions among the different patents and struck the whole program down for improperly "regimenting" the industry.

Univis case

In United States v. Univis Lens Co. , [13] the patentee Univis sold unpatented lens blanks (partly finished blocks of glass comprising fused pieces of glass "of different refractive power") to "finishers", who further ground and polished them to manufacture patented lenses from them. The Supreme Court assumed that the patent was not "fully practiced"—i.e., infringed—"until the finishing licensee has ground and polished the blank". The finishing license was therefore a manufacturing license, and according to Univis, was within the protected dispensation of the General Talking Pictures case. [14] But the Supreme Court held that even though the lens blanks were unpatented their sale by the patentee triggered exhaustion of the patent. The Court considered that the blanks "embodie[d] essential features of the patented device", they were not used for anything else, and that was sufficient to trigger the exhaustion doctrine. [15] Since Univis's patent rights were exhausted by the sale of the lens blanks, the post-sale price and other restrictions that Univis imposed on the finishers were held illegal and in violation of the antitrust laws.

Parke, Davis case

In United States v. Parke, Davis & Co. . [16]

Schwinn case

In 1967, in United States v. Arnold, Schwinn & Co. , [17]

GTE Sylvania case

In 1977, in Continental T.V., Inc. v. GTE Sylvania Inc. , [18] the Supreme Court overruled the Schwinn case's rule that post-sale restraints on mass-marketed goods were illegal per se under the antitrust laws. "Prompted by a decline in its market share to a relatively insignificant 1% to 2% of national television sales", Sylvania adopted a franchise distribution system. "Sylvania limited the number of franchises granted for any given area and required each franchisee to sell his Sylvania products only from the location or locations at which he was franchised." [19] The Court found the case not distinguishable from Schwinn on any "principled basis". [20] Nonetheless, it found overruling Schwinn preferable to following stare decisis . Pointing to the use of a "rule of reason" antitrust analysis for restrictive non-sale transactions, the Court explained, "We conclude that the distinction drawn in Schwinn between sale and nonsale transactions is not sufficient to justify the application of a per se rule in one situation and a rule of reason in the other." [21] Seeing no demonstrable economic harm from Sylvania's conduct, the Court said that no antitrust violation should be found. [22] In a footnote, the Court rejected the reliance in Schwinn on "the ancient rule against restraints on alienation". [23] The opinion did not address post-sale restraints in patent cases.

Mallinckrodt case

In 1992, in Mallinckrodt, Inc. v. Medipart, Inc. , [24] the Federal Circuit held that post-sale restrictions (such as those in notices affixed to the patented product), other than ones fixing prices or imposing tie-ins, were to be governed by the rule stated in the 1926 GE case for manufacturing licenses, which is the same as the rule in the General Talking Pictures case. "The appropriate criterion" for determining the limits of a seller's freedom to impose restrictions, according to the Federal Circuit, "is whether [the patentee's or licensor's] restriction is reasonably within the patent grant, or whether the patentee has ventured beyond the patent grant and into behavior having an anticompetitive effect not justifiable under the rule of reason". In so ruling, the Federal Circuit said that any sweeping statements by the Supreme Court about property rights, and about post-sale restrictions on customers' use of patented products not being patent infringement, are mere obiter dicta that may properly be disregarded in cases not involving price-fixes or tie-ins.

Quanta case

In 2008, in Quanta Computer, Inc. v. LG Electronics, Inc. , [25] the Supreme Court held that the sale of patented microprocessors exhausted the patent monopoly on the microprocessors and also as to patents covering the combination of the patented microprocessors with other electronic components, where (as in Univis) the essential features of the invention were all contained in the microprocessors, i.e., the sold article embodies the essential features of the patented invention. In this case, Quanta's primary patents were on microprocessors, but it also had patents on products combining the patented microprocessors and other apparently conventional devices, such as PCs.) In so ruling, the Court reversed the judgment of the Federal Circuit holding that the licenses were effective under the Mallinckrodt doctrine.

Kirtsaeng case

In 2013, in Kirtsaeng v. John Wiley & Sons, Inc. , [26] the Supreme Court held that post-sale restraints imposed abroad by a company related to the US publisher could not be enforced by a US copyright infringement action that the publisher brought. In so ruling, the Court relied in substantial part on the "impeccable historic pedigree" of "the common law's refusal to permit restraints on the alienation of chattels". It also said that the "doctrine also frees courts from the administrative burden of trying to enforce restrictions upon difficult-to-trace, readily movable goods."

See also

Related Research Articles

Bauer & Cie. v. O'Donnell, 229 U.S. 1 (1913), was a 1913 United States Supreme Court decision involving whether a purchaser of a patented product bearing a price–fixing notice incurs guilt of patent infringement by reselling the product at a price lower than that which the notice commands. A divided Court (5-4) held that it was not.

In United States patent law, patent misuse is a patent holder's use of a patent to restrain trade beyond enforcing the exclusive rights that a lawfully obtained patent provides. If a court finds that a patent holder committed patent misuse, the court may rule that the patent holder has lost the right to enforce the patent. Patent misuse that restrains economic competition substantially can also violate United States antitrust law.

The exhaustion doctrine, also referred to as the first sale doctrine, is a U.S. common law patent doctrine that limits the extent to which patent holders can control an individual article of a patented product after a so-called authorized sale. Under the doctrine, once an authorized sale of a patented article occurs, the patent holder's exclusive rights to control the use and sale of that article are said to be "exhausted," and the purchaser is free to use or resell that article without further restraint from patent law. However, under the repair and reconstruction doctrine, the patent owner retains the right to exclude purchasers of the articles from making the patented invention anew, unless it is specifically authorized by the patentee to do so.

General Talking Pictures Corp. v. Western Electric Co., 304 U.S. 175 (1938), was a case that the Supreme Court of the United States decided in 1938. The decision upheld so-called field-of-use limitations in patent licenses: it held that the limitations were enforceable in a patent infringement suit in federal court against the licensee and those acting in concert with it—for example, a customer that knowingly buys a patented product from the licensee that is outside the scope of the license.

<i>Mallinckrodt, Inc. v. Medipart, Inc.</i>

Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700, is a decision of the United States Court of Appeals for the Federal Circuit, in which the court appeared to overrule or drastically limit many years of U.S. Supreme Court precedent affirming the patent exhaustion doctrine, for example in Bauer & Cie. v. O'Donnell.

Quanta Computer, Inc. v. LG Electronics, Inc., 553 U.S. 617 (2008), is a decision of the United States Supreme Court in which the Court reaffirmed the validity of the patent exhaustion doctrine, and in doing so made uncertain the continuing precedential value of a line of decisions in the Federal Circuit that had sought to limit Supreme Court exhaustion doctrine decisions to their facts and to require a so-called "rule of reason" analysis of all post-sale restrictions other than tie-ins and price fixes. In the course of restating the patent exhaustion doctrine, the Court held that the exhaustion doctrine is triggered by, among other things, an authorized sale of a component when the only reasonable and intended use of the component is to practice the patent and the component substantially embodies the patented invention by embodying its essential features. The Court also overturned, in passing, the part of decision below that held that the exhaustion doctrine was limited to product claims and did not apply to method claims.

A field-of-use limitation is a provision in a patent license that limits the scope of what the patent owner authorizes a manufacturing licensee to do in relation to the patent, by specifying a defined field of use—that is, a defined field of permissible operation by the licensee. In addition to affirmatively specifying the field of use, the license may negatively specify a field or fields, by specifying fields of use from which the licensee is excluded.

United States v. Univis Lens Co., 316 U.S. 241 (1942), is a decision of the United States Supreme Court explaining the exhaustion doctrine and applying it to find an antitrust violation because Univis's ownership of patents did not exclude its restrictive practices from the antitrust laws. The Univis case stands for the proposition that when an article sold by a patent holder or one whom it has authorized to sell it embodies the essential features of a patented invention, the effect of the sale is to terminate any right of the patent holder under patent law to control the purchaser's further disposition or use of the article itself and of articles into which it is incorporated as a component or precursor.

United States v. General Electric Co., 272 U.S. 476 (1926), is a decision of the United States Supreme Court holding that a patentee who has granted a single license to a competitor to manufacture the patented product may lawfully fix the price at which the licensee may sell the product.

Continental Television v. GTE Sylvania, 433 U.S. 36 (1977), was an antitrust decision of the Supreme Court of the United States. It widened the scope of the "rule of reason" to exclude the jurisdiction of antitrust laws.

Motion Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 502 (1917), is United States Supreme Court decision that is notable as an early example of the patent misuse doctrine. It held that, because a patent grant is limited to the invention described in the claims of the patent, the patent law does not empower the patent owner, by notices attached to the patented article, to extend the scope of the patent monopoly by restricting the use of the patented article to materials necessary for their operation but forming no part of the patented invention, or to place downstream restrictions on the articles making them subject to conditions as to use. The decision overruled The Button-Fastener Case, and Henry v. A.B. Dick Co., which had held such restrictive notices effective and enforceable.

Ethyl Gasoline Corp. v. United States, 309 U.S. 436 (1940), was a decision of the United States Supreme Court that limited the doctrine of the Court's 1938 decision in General Talking Pictures Corp. v. Western Electric Co. Beginning with the 1926 decision in United States v. General Electric Co., the Supreme Court made a sharp distinction between (i) post-sale restraints that a patentee imposed on purchasers of a patented product and (ii) restrictions (limitations) that a patentee imposed on a licensee to manufacture a patented product: the former being illegal and unenforceable under the exhaustion doctrine while the latter were generally permissible under a lenient "rule of reason." Thus, under the General Talking Pictures doctrine, a patent holder may permissibly license others to manufacture and then sell patented products in only a specified field (market), such as only a particular type of product made under the patent or only a particular category of customer for the patented product. The Ethyl decision held, however, that a patent licensing and distribution program based on both the sale of a patented product and licenses to manufacture a related product was subject to ordinary testing under the antitrust laws, and accordingly was illegal when its effect was to "regiment" an entire industry.

<i>Princo Corp. v. ITC</i>

Princo Corp. v. ITC, 616 F.3d 1318 was a 2010 decision of the United States Court of Appeals for the Federal Circuit, that sought to narrow the defense of patent misuse to claims for patent infringement. Princo held that a party asserting the defense of patent misuse, absent a case of so-called per se misuse, must prove both "leveraging" of the patent being enforced against it and a substantial anticompetitive effect outside the legitimate scope of that patent right. In so ruling, the court emphasized that the misuse alleged must involve the patent in suit, not another patent.

Henry v. A.B. Dick Co., 224 U.S. 1 (1912), was a 1912 decision of the United States Supreme Court that upheld patent licensing restrictions such as tie-ins on the basis of the so-called inherency doctrine—the theory that it was the inherent right of a patent owner, because he could lawfully refuse to license his patent at all, to exercise the "lesser" right to license it on any terms and conditions he chose. In 1917, the Supreme Court overruled the A.B. Dick case in Motion Picture Patents Co. v. Universal Film Mfg. Co.,

<i>Button-Fastener case</i>

The Button-Fastener Case, Heaton-Peninsular Button-Fastener Co. v. Eureka Specialty Co., also known as the Peninsular Button-Fastener Case, was for a time a highly influential decision of the United States Court of Appeals for the Sixth Circuit. Many courts of appeals, and the United States Supreme Court in the A.B. Dick case adopted its "inherency doctrine"—"the argument that, since the patentee may withhold his patent altogether from public use, he must logically and necessarily be permitted to impose any conditions which he chooses upon any use which he may allow of it." In 1917, however, the Supreme Court expressly overruled the Button-Fastener Case and the A.B. Dick case, in the Motion Picture Patents case.

Impression Products, Inc. v. Lexmark International, Inc., 581 U.S. ___ (2017), is a decision of the Supreme Court of the United States on the exhaustion doctrine in patent law in which the Court held that after the sale of a patented item, the patent holder cannot sue for patent infringement relating to further use of that item, even when in violation of a contract with a customer or imported from outside the United States. The case concerned a patent infringement lawsuit brought by Lexmark against Impression Products, Inc., which bought used ink cartridges, refilled them, replaced a microchip on the cartridge to circumvent a digital rights management scheme, and then resold them. Lexmark argued that as they own several patents related to the ink cartridges, Impression Products was violating their patent rights. The U.S. Supreme Court, reversing a 2016 decision of the Federal Circuit, held that the exhaustion doctrine prevented Lexmark's patent infringement lawsuit, although Lexmark could enforce restrictions on use or resale of its contracts with direct purchasers under regular contract law. Besides printer and ink manufacturers, the decision of the case could affect the markets of high tech consumer goods and prescription drugs.

<i>National Lockwasher Co. v. George K. Garrett Co.</i>

National Lockwasher Co. v. George K. Garrett Co., 137 F.2d 255, is one of the earliest or the earliest federal court decision to hold that it is patent misuse for a patentee to require licensees not to use a competitive technology. Such provisions are known as "tie-outs."

United States v. Line Material Co., 333 U.S. 287 (1948), is a decision of the United States Supreme Court limiting the doctrine of the 1926 General Electric decision, excusing price fixing in patent license agreements. The Line Material Court held that cross-licenses between two manufacturer competitors, providing for fixing the prices of the licensed products and providing that one of the manufacturers would license other manufacturers under the patents of each manufacturer, subject to similar price fixing, violated Sherman Act § 1. The Court further held that the licensees who, with knowledge of such arrangements, entered into the price-fixing licenses thereby became party to a hub-and-spoke conspiracy in violation of Sherman Act § 1.

Bulk-sale restrictions—also known as bulk-sale restraints, finished-form limitations, and dosage-form limitations—are, as the term is used in United States antitrust case law, clauses in patent licenses that provide that the licensee shall make and sell the licensed product only in "finished pharmaceutical form" or "dosage form", not in bulk. Bulk form is the form in which drug chemicals are manufactured by chemical or other processes. These clauses are found primarily in pharmaceutical product licenses and are used to keep active drug ingredients out of the hands of generic manufacturers and price-cutters.

References

The citations in this Article are written in Bluebook
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  1. ↑ See, e.g., Peter Carstensen Archived 2007-07-06 at the Wayback Machine ., Post-Sale Restraints via Patent Licensing: A "Seedcentric" Perspective, 16 Ford. Intell. Prop. Media & Ent. L.J. 1053 (2006) ("The use of post-sale restraints on buyers of patented goods is an increasingly common strategy of patent holders. The seller attaches a notice to the patented good or a good containing a patented component purporting to limit scope of what the buyer has bought and imposing explicit restraints on buyers' freedom to resell the product or take other actions. The patent community has sought to justify and explain these post-sale restraints based on an analogy to the right of real property owners to encumber such property with covenants that restrict future owners. The key claim is that the patent owner has the right to divide the interests in the goods being sold and declare that only some rights were transferred. This conception provides a basis to bind not only the party in privity but all others who come, or might come, into possession of this property."); Jeffery B. Fromm and Robert A. Skitol, Harmonization of the IP Misuse Doctrine and Antitrust Law, The Antitrust Source (Jan. 2003), p. 4 ("The Federal Circuit has addressed the application of the patent misuse doctrine to certain kinds of post-sale restrictions, such as 'single-use only' provisions. According to the Federal Circuit, such restrictions cannot be deemed misuse unless they are both (1) found outside the scope of the patent grant and then also (2) found anticompetitive under full application of the antitrust rule of reason."); Anne K. Bingaman, Assistant Attorney General, Antitrust Division, U.S. Department of Justice, Antitrust and Innovation in a High Technology Society, Address at the celebration of the 60th anniversary of the founding of the Antitrust Division (Jan. 10, 1994) ("Whether the holder of a patent may, for instance, tie unpatented supplies to the patented product; engage in compulsory assignment grant backs; or place post-sale restraints on resale by purchasers are just a few of the host of issues that have been debated and litigated in the patent/antitrust field for several decades."). See also B. Braun Medical, Inc. v. Abbott Laboratories, 124 F.3d 1419, 1429 (Fed. Cir. 1997) ("Moreover, the district court erred by instructing the jury that it must find patent misuse if Braun placed any post-sale restrictions on use of the SafSite valves it sold to Abbott."); United States v. Ciba-Geigy Corp., 508 F.Supp. 1118, 1147 n.14 (D.N.J., 1976) ("As noted, infra, CIBA's attempt to insulate itself from horizontal competition by use of illegal post-sale restraints did not appreciably enhance its market position.").
  2. ↑ See Clairol, Inc. v. Cody's Cosmetics, Inc., 353 Mass. 385, 231 N.E.2d 912 (1967) (refusing to enforce servitude). See also Z. Chafee, Equitable Servitudes on Chattels, 41 Harv. L. Rev. 945 (1928); Z. Chafee,Comment: The Music Goes Round and Round: Equitable Servitudes and Chattels, 69 Harv. L. Rev. 1250 (1956).
  3. ↑ Dr. Miles Medical Co. v. John D. Park & Sons Co., 220 U.S. 373, 404 (1911). See also id. at 404-05 (quoting Coke on Littleton sec. 360: "If a man be possessed . . . of a horse or of any other chattel, real or personal, and give or sell his whole interest or property therein, upon condition that the donee or vendee shall not alien the same, the same is void, because the whole interest and property is out of him, so as he hath no possibility of a reverter, and it is against trade and traffic and bargaining and contracting between man and man."). See also, to the same effect, Kirtsaeng v. John Wiley & Sons, Inc., 133 S. Ct. 1351 (2012).
  4. ↑ Justia, 84 U.S. (17 Wall.) 453 (1873).
  5. ↑ 84 U.S. at 456.
  6. ↑ Justia, 243 U.S. 502 (1917).
  7. ↑ Justia, 243 U.S. 490 (1917).
  8. ↑ 243 U.S. at 500-01.
  9. ↑ 272 U.S. 476 (1926).
  10. ↑ Id. at 489.
  11. ↑ 304 U.S. 175, 182 (1938), affirmed on rehearing, 305 U.S. 124 (1938).
  12. ↑ 309 U.S. 436 (1940).
  13. ↑ 316 U.S. 241 (1942).
  14. ↑ General Talking Pictures Corp. v Western Electric Co., 304 U.S. 175, 182 (1938) (upholding as legitimate field-of-use limitations on scope of patent licenses to make and sell amplifiers only in "non-commercial" field), affirmed on rehearing, 305 U.S. 124 (1938).
  15. ↑ Univis, 316 U.S. at 249. What made the finished lenses operate as desired (in bifocal eyeglasses) was that they had fused layers of glass with two different refractive indexes. This feature was already present in the lens blanks.
  16. ↑ 362 U.S. 29 (1960).
  17. ↑ 388 U.S. 365 (1967).
  18. ↑ 433 U.S. 36.(1977)
  19. ↑ 433 U.S. at 38.
  20. ↑ 433 U.S. at 46.
  21. ↑ 433 U.S. at 57.
  22. ↑ 433 U.S. at 59.
  23. ↑ 433 U.S. at 53 n.21.
  24. ↑ 976 F.2d 700 (Fed. Cir. 1992).
  25. ↑ 553 U.S. 617 (2008).
  26. ↑ 133 S. Ct. 1351 (2013).
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