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Intellectual Property

Courthouse Steps: TC Heartland v. Kraft Foods

Intellectual Property Practice Group Monday, March 27, 03:00 PMFederalist Society Teleforum Conference Call

The question presented in TC Heartland LLC v. Kraft Foods Group Brands LLC is seemingly straightforward: Does the statute governing venue generally, 28 U.S.C. § 1391(c), supplement the patent venue statute, 28 U.S.C. § 1400(b)? In particular, the issue is whether § 1391(c)(2)’s broad residency definition, which provides that a corporate defendant “shall be deemed to reside . . . in any judicial district in which such defendant is subject to the court’s personal jurisdiction,” should be read into § 1400(b), which provides that a patent infringement action “may be brought in the judicial district where the defendant resides.” If a corporate defendant “resides” wherever a court has personal jurisdiction over it, a patent owner will typically have many choices of where it may sue that corporation for infringement.

TC Heartland is incorporated and headquartered in Indiana, while Kraft Foods is incorporated in Delaware and headquartered in Illinois. Kraft Foods sued in the District of Delaware, arguing that TC Heartland established personal jurisdiction—and thus venue—when it knowingly shipped a large number of allegedly infringing goods into that forum. The Federal Circuit held that the patent venue statute is supplemented by the broad definition of residency in § 1391(c). TC Heartland now asks the Supreme Court to reverse the decision and to hold that § 1400(b) is the sole and exclusive statute governing venue in patent infringement actions.

The case itself has garnered much attention because the same broad venue rules  also allow non-practicing entities—so-called “patent trolls”—to sue in the Eastern District of Texas. Indeed, the policy implications of the case have taken center stage among many commentators.

The issue of where patent owners may sue alleged infringers is an important one, and this case will determine whether patent owners, like federal plaintiffs generally, have numerous choices, or whether they are limited by the narrow patent venue rules that the Supreme Court has already said should stand alone.

Featuring:

  • Prof. J. Devlin Hartline, Assistant Director, Center for the Protection of Intellectual Property (CPIP) and Adjunct Professor, Antonin Scalia Law School, George Mason University

Courthouse Steps: Impression Products v. Lexmark International and the Law of Patent Exhaustion

Intellectual Property Practice Group Podcast
David S. Olson March 22, 2017

May a patent owner use contracts to prohibit any resale or reuse of its patented products beyond the initial purchaser? OnTuesday, March 21, 2017, the Supreme Court will hear oral argument in Impression Products v. Lexmark International, which raises this important question.

Lexmark makes patented toner cartridges and sells them with a contract restriction that the cartridges not be resold or refilled. Impression Products buys used Lexmark toner cartridges, refills, and resells them. Lexmark argues that because the license accompanying the original sale of the cartridges prohibits transferring the cartridges, any reuse and refilling of the cartridges is an unauthorized use and thus a patent infringement. If Lexmark’s argument wins, then manufacturers of patented goods will be able to restrict downstream uses of their goods by use of licenses, and no privity of contract will be required to hold third parties liable. On the other hand, defendant Impression Products argues that the “patent exhaustion” doctrine should operate here to restrict Lexmark from asserting any patent rights after a first, authorized sale. Also at issue is whether first sales in foreign countries instead of the U.S. should affect the outcome.

The case will have significant effects on the ability of patent owners to control the downstream uses of their patented products, and may affect the ability of patent owners to prevent the importation of “grey market” goods that have been lawfully sold in other countries, similarly to the Supreme Court’s holding in the 2013 copyright case of Kirtsaeng v. John Wiley & Sons, Inc. 

Professor David Olson of Boston College Law School offered impressions and predictions after the Court heard oral argument.

Featuring:

  • Prof. David S. Olson, Associate Professor, Boston College Law School

Life Technologies Corp. v. Promega Corp. - Post-Decision SCOTUScast

SCOTUScast 3-21-17 featuring Howard J. Klein
Howard J. Klein March 21, 2017

On February 22, 2017, the Supreme Court decided Life Technologies Corp. v. Promega Corp. Promega Corporation owned four patents for technology used in kits that can conduct genetic testing and was the exclusive licensee of a fifth patent. In 2010, Promega sued Life Technologies Corporation (LifeTech) for allegedly infringing on these patents.  A jury found in favor of Promega but the district court nevertheless ruled for LifeTech, concluding that Promega had failed to present evidence sufficient to sustain the favorable jury verdict. The U.S. Court of Appeals for the Federal Circuit reversed that judgment, holding that the four Promega patents were ultimately invalid but agreeing that LifeTech had infringed the fifth patent and remanding to the district court for a determination of damages.  In the course of its ruling, the Federal Circuit concluded that LifeTech’s supplying of a single, commodity component of a mulit-component invention had exposed LifeTech under federal law to damages liability on worldwide sales.

The question before the Supreme Court was whether the Federal Circuit erred in holding that supplying a single, commodity component of a multi-component invention from the United States exposes a manufacturer to liability for worldwide sales. 

By a vote of 7-0, the Supreme Court reversed the judgment of the Federal Circuit and remanded the case. In an opinion by Justice Sotomayor, the Court held that the supply of a single component of a multicomponent invention for manufacture abroad does not give rise to liability under Section 271(f)(1) of the Patent Act, which prohibits the supply from the United States of "all or a substantial portion of the components of a patented invention" for combination abroad. Justice Sotomayor’s opinion was joined by Justices Kennedy, Ginsburg, Breyer, and Kagan. Justices Thomas and Alito joined the majority opinion as to all but Part II-C. Justice Alito filed an opinion concurring in part and concurring in the judgment, in which Justice Thomas joined. Chief Justice Roberts was recused.

To discuss the case, we have Howard J. Klein who is Attorney at Law at Klein, O’Neill & Singh, LLP.

Impression Products v. Lexmark International and the Law of Patent Exhaustion - Podcast

Intellectual Property Practice Group Podcast
Adam Mossoff, David S. Olson, Steven M. Tepp, Kristen Osenga March 09, 2017

The Federalist Society will host a teleforum discussion of Impression Products v. Lexmark International, which is scheduled for argument before the Supreme Court March 21, 2017. At issue in the case is whether a patent owner may use a combination of patent rights and contract law to restrict what purchasers of patented printer toner cartridges may do with the cartridges. Lexmark makes patented toner cartridges and sells them with a restriction that the cartridges not be resold or refilled. Impression Products buys used Lexmark toner cartridges, refills, and resells them. Lexmark argues that Impression Products’ toner refilling activities violate Lexmark’s patent rights because the license to use the patented product that was given to consumers prohibited refilling, thus putting such use and resale of the patented products outside of the scope of the patent license, in violation of Lexmark’s patent rights. For its part, Impression Products argues that the “patent exhaustion” doctrine should operate here to restrict Lexmark from asserting any patent rights after a first, authorized sale. Also at issue is whether first sales in foreign countries instead of the U.S. should affect the outcome.

The case will have significant effects on the ability of patent owners to control the downstream uses of their patented products, and may affect the ability of patent owners to prevent the importation of “grey market” goods that have been lawfully sold in other countries, similarly to the Supreme Court’s holding in the 2013 copyright case of Kirtsaeng v. John Wiley & Sons, Inc. 

Featuring:

  • Prof. Adam Mossoff, Co-Founder, Director of Academic Programs & Senior Scholar, Center for the Protection of Intellectual Property; Professor, Antonin Scalia Law School, George Mason University
  • Prof. David Olson, Associate Professor, Boston College Law School
  • Mr. Steven Tepp, President & CEO of Sentinel Worldwide; Professorial Lecturer in Law, George Washington University Law School
  • Moderator: Prof. Kristen Osenga, Professor of Law, University of Richmond

Courthouse Steps: Packingham v. North Carolina - Podcast

Free Speech & Election Law Practice Group Podcast
Ilya Shapiro March 02, 2017

In Packingham v. North Carolina, the Supreme Court will decide whether the First Amendment bars a state from banning citizens from accessing social media sites like Facebook and Twitter. A North Carolina state makes it a felony for any person on the state's registry of former sex offenders to "access" a wide array of websites--including Facebook, YouTube, and nytimes.com--that enable communications among users if the site is known to allow minors to have accounts. The statute does not require the state to prove the defendant has actually had contact with a minor, intended to do so, or accessed a website for any illicit or improper purpose. ​Lester Packingham was convicted of violating the law for a Facebook post in which he celebrated the dismissal of a traffic ticket, declaring "God is Good!" Packingham and his supporters contend that law amounts to a sweeping, overbroad, and vague ban on protected speech untailored to any legitimate interest and unjustified by any compelling need.

Featuring:

  • Ilya Shapiro, Senior Fellow in Constitutional Studies, Cato Institute