St. Louis patent attorney Bryan Wheelock recently spoke with Law360 about the biggest patent cases of the year. After a year of big decisions from the Federal Circuit and U.S. Supreme Court, and with the groundwork laid for a big decision regarding the constitutionality of AIA reviews coming next year, Wheelock shared his thoughts on two patent cases that were in the headlines in 2017.
In Impression Products Inc. v. Lexmark International Inc. — as previously discussed on the Harness IP Blog here and here — the Supreme Court reversed the Federal Circuit and held that a sale of a patented product by (or on behalf of) the patent owner, whether in the U.S. or outside the U.S., exhausts the patent owner’s rights and allows any subsequent purchase to use the patented product without infringing the patent. The Supreme Court allowed that the first purchaser might be bound by contractual restrictions imposed by the patent owner, but said that these restrictions do not apply to subsequent purchasers, in effect allowing the first purchaser to sell more than the first purchaser acquired.
As Law360 notes, the May decision tossed out “longstanding patent law precedent.” Wheelock noted that the decision is “pretty negative for patent owners” as they can no longer restrict the use of patented items after they are sold. Patent owners will also lose their patent rights once the product is sold in any market in the world.
“It’s going to be a couple of years before the workarounds for Impression start to be tested out,” Wheelock added.
In March’s decision in SCA Hygiene Products AB et al. v. First Quality Baby Products LLC, the Supreme Court eliminated availability of the laches defense in claims for patent infringement damages brought within the six year statute of limitations period.
This decision, however, has positive implications for patent owners in that it limits the defenses available to an alleged infringer. The elimination of the laches defense to bar a claim for damages brought within the limitations period allows patent owners more time to assess the value of a potential infringer’s products before bringing suit. The potential delay in bringing suit may be detrimental to accused infringers that invest in manufacturing during a period of silence by the patent holder.
Wheelock says the SCA Holding will be embraced by patent owners: “It gives a little more comfort that you can send a cease and desist letter and don’t have to worry about whether you have to sue right away because of laches.”