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SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

law.cornell.edu

51–60 of 319 posts

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#51

In practice it means people will still be able to stop you from doing things with stuff you own. Just not using patent rights. Lexmark's real problem here is that its enforceable contracts are usually with the resellers, and so enforcing against a third party purchaser is trickier, so it tried to use patent law instead. (It has plenty of contracts, including on the wrapping of the printer cartridges, I'm just stickin…

All they really need to do is make cartridges rentals instead of sales, no?

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#52
I'm a little surprised that Ginsburg dissented here, and also dissented from Kirtsaeng v. John Wiley: naively, she's "liberal", and (at least in my bubble) being "liberal" is associated with wanting less strong IP protection.

But I see also that she wrote the majority opinion in Eldred v. Ashcroft, saying that the 28-year extension to copyright terms was constitutional.

What's the right way to understand her legal thinking here? Is she known as an IP maximalist? Or are there other principles she's using to reach these conclusions? (I don't completely follow her logic that, because US patent law doesn't provide any protection in other countries, US patent rights are preserved across a sale in some other country.)

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#53

Could Lexmark argue that they're not really selling the cartridges to you, but are instead leasing them for an indeterminate period of time?

I think you'd then have to enter some kind of a lease agreement, which would be a big turn-off for customers that would like to just buy a replacement cartridge without signing a contract.

1) As with many of the tricks that printer companies use to dissuade people from buying off-brand inks, if enough printer manufacturers did it, consumers might find that they have few other options -- especially if they've had poor luck with third-party inks.

2) I pay $3 a month for HP's Instant Ink program. It allows me to print up to 50 full-color pages a month with my inkjet printer, and when one of the cartridges is running low, it automatically sends a replacement. It's not significantly more expensive, in my case (low-volume usage), than buying the ink cartridges directly, but it's a lot more convenient. I'm not quite sure if it technically counts as a leasing program, but it follows a similar ethos. So I wouldn't so easily dismiss the idea that a leasing program would lead to a consumer backlash.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#54
Good, but the tip of the issue is licensing. Autodesk[1] has set precedence that all an organization must do to limit the resale of anything is institute a EULA. Simply by asserting that an offer is for a license not the thing being licensed the seller can bypass common law, Lord Coke, and the first sale doctrine.

P.S. This also means that expensive professional software like Autodesk's, or anything with such an EULA, cannot be considered an asset since it has no dollar value after purchase.

1: https://www.wired.com/2010/09/first-sale-doctrine/

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#55

Earlier quoted context omitted.

Yes they both stem from common law disfavouring restraints on alienation.

Something I've searched for but not found a layperson introduction to: any idea why that doesn't apply to real estate? Deed restrictions that purport to put conditions on how property can be resold have repeatedly been upheld, except for a really narrow, somewhat recent carve-out for no-selling-to-black-people deed restrictions, which were held unenforceable, but specifically because they were racially discriminatory…

Many restrictions may be implicitly time limited by the common law rule against perpetuities; but different rules apply to real estate and retail sale because of the process to buy either one. If I buy a book, I'm not bringing my lawyer to review the contract and objecting to terms in the purchase agreement; if I buy real estate, it's a major investment and I'm expected to examine the title for encumbrances and carefully consider the consequences of them; and there's a customary process (escrow) which provides for time to ensure any defects in title or other condition are remediated or compensated for to the agreement of both parties.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#56
post #43

Can somebody explain, what does the word ‘exhaust’ mean? It doesn't seem like it's being used in the plain-English sense here.

It's the verb/adjective sense, as in "I ran a marathon and am exhausted." rather than the noun sense, as in "The car's exhaust was unpleasant to breathe." In the sense used, "exhaust" means "to use up" or "to reach the limit" (in that you can go no further). The patent holder's patent rights are exhausted at sale, or the patent holder exhausts their patent rights at sale.

(Note that "exhaust" in the noun sense is really the same meaning: it is fuel that has been used up by combustion.)

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#57
post #28

Outside of the narrow case involving printer cartridges, what other implications and precedents can we expect this to set? Can it stop smartphone makers from being able to blacklist devices that are resold, for instance?

> smartphone makers from being able to blacklist devices that are resold What is that blacklist?

Verizon denied my activation of used phones a couple of times due to a blacklisted IMEI, so apparently they (at least used to) keep an internal blacklist also.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#58

Does this mean that printer prices are about to go up since HP/Brother/Lexmark will no longer be able to make as much money on the ink?

Perhaps, but how often do you really need to buy a printer? And they're so cheap a mild price increase wouldn't harm much. The Canon MG2520 (I think there's a newer version now) is a printer/scanner/copier combo that often retails for $20. (And comes with ink.) Price of ink would fall in exchange, since they have to compete with the off-brand folks.

Hmm, cheapest I found the MG2520 was $30 shipped including ink. Not bad, and still pretty low. I'd expect the minimum for a wireless printer-scanner with ink, shipped, to be $40 or so. $9 shipping, $3 wireless chip, $5 ink, $9 plastic/frame, $5 motors/print heads, that's already $31. (I could be off, of course.) I wonder how much, if anything, Canon loses on the printer, and how many people buy replacement ink.

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#59
post #54

Good, but the tip of the issue is licensing. Autodesk[1] has set precedence that all an organization must do to limit the resale of anything is institute a EULA. Simply by asserting that an offer is for a license not the thing being licensed the seller can bypass common law, Lord Coke, and the first sale doctrine. P.S. This also means that expensive professional software like Autodesk's, or anything with such an EULA…

well I am curious how it will play out in the long run because unlike printer cartridges you have no physical object with software since almost all is done via digital distribution.

I do know our commercial software at work on about every platform is by license only. we don't own any of it. didn't microsoft do this with Office, give you a "low" monthly rate instead of selling out right?

Perhaps the plan is, buy it for 299 or license it for 9.99 a month or 99 a year? so this would skirt the issues presented with physical items?

Re: SCOTUS: Patent Rights Over a Printer Cartridge Are Exhausted When It Is Sold

#60

Could Lexmark argue that they're not really selling the cartridges to you, but are instead leasing them for an indeterminate period of time?

Potentially, but if challenged the courts would see right past a company taking away customer rights by shifting words around and rule that such an indefinite lease was ownership.
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