Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-14-01617/USCOURTS-ca13-14-01617-1/pdf.json

Parties Involved:
Benigno Adeva And His Companies
Not party
Blue Trading LLC
Not party
John Does
Not party
Exprint International, Inc.
Not party
Impression Products, Inc.
Appellant
LD Products, Inc.
Not party
Lexmark International, Inc.
Cross-Appellant
Printronic Corporation
Not party
Quality Cartridges, Inc.
Not party
Tesen Development (Hong Kong) Co. Ltd.
Not party

Document Text:

United States Court of Appeals 

for the Federal Circuit ______________________ 

LEXMARK INTERNATIONAL, INC.,

Plaintiff-Cross-Appellant

v.

 

IMPRESSION PRODUCTS, INC.,

Defendant-Appellant

QUALITY CARTRIDGES, INC., JOHN DOES, 1-20, 

BLUE TRADING LLC, EXPRINT INTERNATIONAL,

INC., LD PRODUCTS, INC., PRINTRONIC 

CORPORATION, TESEN DEVELOPMENT (HONG 

KONG) CO. LTD., BENIGNO ADEVA AND HIS 

COMPANIES,

Defendants

______________________ 

2014-1617, 2014-1619

______________________ 

Appeals from the United States District Court for the 

Southern District of Ohio in No. 1:10-cv-00564-MRB, 

Judge Michael R. Barrett.

______________________ 

Decided: February 12, 2016 

______________________ 

CONSTANTINE L. TRELA, JR., Sidley Austin LLP, Chicago, IL, argued for plaintiff-cross-appellant. Also represented by ROBERT N. HOCHMAN; BENJAMIN BEATON,

JOSHUA JOHN FOUGERE, Washington, DC; TIMOTHY COLIN 

Case: 14-1617 Document: 339-2 Page: 1 Filed: 02/12/2016
2 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

MEECE, BRYAN MEDLOCK, JR., AUDRA C. EIDEM HEINZE,

JASON S. SHULL, Banner & Witcoff, Ltd., Chicago, IL; 

STEVEN B. LOY, Stoll, Keenon & Park, LLP, Lexington, 

KY.

EDWARD F. O’CONNOR, Avyno Law, P.C., Encino, CA, 

argued for defendant-appellant. Also represented by 

JENNIFER HERBST HAMILTON. 

ANDREW J. PINCUS, Mayer Brown LLP, Washington, 

DC, argued for amici curiae LG Electronics, Inc., Dell Inc., 

Google Inc., Intel Corporation, L Brands Inc., Newegg 

Inc., Ninestar Image Tech Limited, QVC, Inc., Samsung 

Electronics Co., Ltd., SAS Institute, Inc., Xilinx, Inc. Also 

represented by JAMIE B. BEABER, KFIR LEVY, PAUL 

WHITFIELD HUGHES; JAMES SUH, LG Electronics Inc., 

Seoul, Korea; MATTHEW R. HULSE, Intel Corporation, 

Santa Clara, CA.

MELISSA N. PATTERSON, Appellate Staff, Civil Division, United States Department of Justice, Washington, 

DC, argued for amicus curiae United States. Also represented by BENJAMIN C. MIZER, MARK R. FREEMAN. 

BARBARA A. FIACCO, Foley Hoag LLP, Boston, MA, argued for amici curiae Biotechnology Industry Organization, CropLife International. Also represented by SARAH 

S. BURG. 

MARGRETH BARRETT, University of CaliforniaHastings College of Law, The Sea Ranch, CA, as amicus 

curiae pro se.

FREDERICK M. ABBOTT, Florida State University College of Law, Tallahassee, FL, as amicus curiae pro se. 

KRISTIN LEIGH YOHANNAN MOORE, Cadwalader, Wickersham & Taft LLP, Washington, DC, for amicus curiae 

Case: 14-1617 Document: 339-2 Page: 2 Filed: 02/12/2016
LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 3

American Intellectual Property Law Association. Also 

represented by TIHUA HUANG; LISA K. JORGENSON, American Intellectual Property Law Association, Arlington, VA.

MEENAKSHI KALA SARVAIYA, SoCal IP Law Group 

LLP, Westlake Village, CA, for amicus curiae Conejo 

Valley Bar Association. Also represented by STEVEN C.

SEREBOFF. 

NOAH LEIBOWITZ, Simpson Thacher & Bartlett, LLP, 

New York, NY, for amicus curiae New York Intellectual 

Property Law Association. Also represented by WALTER E.

HANLEY, JR., Kenyon & Kenyon LLP, New York, NY; 

DAVID F. RYAN, Croton-On-Hudson, NY.

CHARLES DUAN, Public Knowledge, Washington, DC, 

for amici curiae Public Knowledge, Electronic Frontier 

Foundation, Open Source Hardware Association, Digital 

Right to Repair Coalition, Public Citizen, Inc. Also represented by MOHAMMED RAZA PANJWANI, SHERWIN SIY; VERA 

RANIERI, Electronic Frontier Foundation, San Francisco, 

CA.

PETER JAMES WIED, Lee Tran Liang & Wang LLP, Los 

Angeles, CA, for amici curiae Quanta Computer, Inc., 

Acer, Inc. Also represented by VINCENT K. YIP. 

JOHN R. ALISON III, Winston & Strawn LLP, Washington, DC, for amici curiae HTC Corp., HTC America, Inc. 

Also represented by OWAIS AHMED SIDDIQUI, San Diego, 

CA; GINO CHENG, Los Angeles, CA.

CHARLES LIFLAND, O'Melveny & Myers LLP, Los Angeles, CA, for amicus curiae SK Hynix Inc. Also represented by SUSAN ROEDER, SUSAN VAN KEULEN, Menlo 

Park, CA.

Case: 14-1617 Document: 339-2 Page: 3 Filed: 02/12/2016
4 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

JAMES R. KLAIBER, Pryor Cashman LLP, New York, 

NY, for amicus curiae The Association of the Bar of the 

City of New York. Also represented by TIMOTHY P.

HEATON, Troutman Sanders LLP, New York, NY; AARON 

LIGOURY JOSEPH PEREIRA, Buchanan Ingersoll & Rooney 

PC, New York, NY.

STEVEN A. HIRSCH, Keker & Van Nest, LLP, San 

Francisco, CA, for amicus curiae SanDisk Corporation. 

Also represented by CHRISTA M. ANDERSON, ROBERT A.

VAN NEST, LEO L. LAM. 

ROBERT T. HASLAM, Covington & Burling LLP, Redwood Shores, CA, for amicus curiae Texas Instruments, 

Inc. Also represented by NATHAN SHAFFER; RANGANATH 

SUDARSHAN, Washington, DC.

MATTHEW J. MOORE, Latham & Watkins LLP, Washington, DC, for amici curiae Costco Wholesale Corp., 

Retail Litigation Center, Inc. Also represented by JAMES 

SCOTT BALLENGER, MELISSA ARBUS SHERRY. 

PHILLIP R. MALONE, Stanford Law School, Juelsgaard 

Intellectual Property and Innovation Clinic, Mills Legal 

Clinic, Stanford, CA, for amici curiae American Antitrust 

Institute, Jeremy W. Bock, Esq., Irene Calboli, Michael A. 

Carrier, Andrew Chin, Samuel Ernst, Shubha Ghosh, 

Ariel Katz, Mark A. Lemley, Yvette Joy Liebesman, Brian 

J. Love, Mark P. McKenna, Michael J. Meurer, Tyler T. 

Ochoa, Mark R. Patterson, Esq., Aaron Perzanowski, 

John A. Rothchild, Pamela Samuelson, Sharon K. 

Sandeen, Kurt M. Saunders, Christopher B. Seaman, 

Katherine J. Strandburg, Jennifer M. Urban, Esq., Ryan 

Vacca, Sarah R. Wasserman-Rajec. Also represented by 

JEFFREY THEODORE PEARLMAN. 

ROBERT ANTHONY SURRETTE, McAndrews, Held & 

Malloy, Ltd., Chicago, IL, for amicus curiae Association of 

Case: 14-1617 Document: 339-2 Page: 4 Filed: 02/12/2016
LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 5

Medical Device Reprocessors. Also represented by 

CHRISTOPHER M. SCHARFF. 

WILLIAM DOUGLAS KARI, Arbitech, LLC, Irvine, CA, 

for amici curiae Association of Service and Computer 

Dealers International, Inc., Owners’ Rights Initiative. 

MATTHEW A. LEVY, Computer & Communications Industry Association, Washington, DC, for amicus curiae 

Computer & Communications Industry Association.

DANIEL STRINGFIELD, Steptoe & Johnson, LLP, Chicago, IL, for amicus curiae Licensing Executive Society 

(U.S.A. and Canada), Inc. Also represented by KATHERINE 

H. JOHNSON; BRIAN P. O'SHAUGHNESSY, Ratner Prestia, 

Washington, DC.

MERRITT BLAKESLEE, The Blakeslee Law Firm, Washington, DC, for amicus curiae Recycling Times Media 

Corporation.

MARK SCHONFELD, Burns & Levinson, LLP, Boston, 

MA, for amicus curiae Imaging Supplies Coalition. Also 

represented by SARA BECCIA. 

GARRARD R. BEENEY, Sullivan & Cromwell LLP, New 

York, NY, for amicus curiae Dolby Laboratories, Inc. Also 

represented by ADAM R. BREBNER. 

ROBERT P. TAYLOR, Arnold & Porter, LLP, San Francisco, CA, for amicus curiae Intellectual Property Owners 

Association. Also represented by HERBERT CLARE 

WAMSLEY, JR., Intellectual Property Owners Association, 

Washington, DC; KEVIN H. RHODES, 3M Innovative Properties Company, St. Paul, MN; PHILIP STATON JOHNSON, 

Johnson & Johnson, New Brunswick, NJ.

Case: 14-1617 Document: 339-2 Page: 5 Filed: 02/12/2016
6 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

JOHN D. HAYNES, Alston & Bird LLP, Atlanta, GA, for 

amici curiae Nokia Technologies OY, Nokia USA Inc.

KATHI A. COVER, iBiquity Digital Corporation, Columbia, MD, for amicus curiae iBiquity Digital Corporation.

JOSEPH S. CIANFRANI, Knobbe, Martens, Olson & 

Bear, LLP, Irvine, CA, for amicus curiae Medical Device 

Manufacturers Association. Also represented by KENT N.

SHUM. 

ROGER BROOKS, Cravath Swaine & Moore LLP, New 

York, NY, for amicus curiae Qualcomm Incorporated. Also 

represented by DAVID J. KAPPOS. 

JOHN NILSSON, Arnold & Porter LLP, Washington, 

DC, for amicus curiae Pharmaceutical Research and 

Manufacturers of America. Also represented by KRISTAN 

LYNN LANSBERY, SAMUEL DREZDZON; WILLOW WHITE 

NOONAN, San Francisco, CA. 

THEODORE LAWRENCE FIELD, South Texas College of 

Law, Houston, TX, as amicus curiae pro se. 

DAVID S. STEUER, Wilson, Sonsini, Goodrich & Rosati, 

PC, Palo Alto, CA, for amicus curiae InterDigital, Inc. 

Also represented by MICHAEL BRETT LEVIN, MAURA L.

REES. 

SETH DAVID GREENSTEIN, Constantine Cannon LLP, 

Washington, DC, for amici curiae International Imaging 

Technology Council, Auto Care Association, Automotive 

Parts Remanufacturers Association. 

______________________ 

Before PROST, Chief Judge, NEWMAN, LOURIE, DYK,

MOORE, O’MALLEY, REYNA, WALLACH, TARANTO, CHEN,

HUGHES, and STOLL, Circuit Judges.

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 7

Opinion for the court filed by Circuit Judge TARANTO, in 

which Chief Judge PROST and Circuit Judges NEWMAN,

LOURIE, MOORE, O’MALLEY, REYNA, WALLACH, CHEN, and 

STOLL join. 

Dissenting opinion filed by Circuit Judge DYK, in which 

Circuit Judge HUGHES joins. 

TARANTO, Circuit Judge. 

Congress has declared: “Except as otherwise provided 

in [the Patent Act], whoever without authority makes, 

uses, offers to sell, or sells any patented invention, within 

the United States or imports into the United States any 

patented invention during the term of the patent therefor, 

infringes the patent.” 35 U.S.C. § 271(a); see id. § 154(a) 

(granting patentee “right to exclude others” from itemized 

actions). The doctrine of patent exhaustion (or “first sale” 

doctrine) addresses the circumstances in which a sale of a 

patented article (or an article sufficiently embodying a 

patent), when the sale is made or authorized by the 

patentee, confers on the buyer the “authority” to engage 

in acts involving the article, such as resale, that are 

infringing acts in the absence of such authority. There is 

nothing “otherwise provided” on the issue in the Patent 

Act. In that respect, the Patent Act differs from the 

Copyright Act, whose infringement, importation, and 

exclusive-rights provisions, 17 U.S.C. §§ 501, 602, 106, are 

all subject to a separate, overriding statutory provision 

that grants owners of certain copyrighted articles a right 

to sell those articles “without the authority” of the copyright holder, id. § 109(a). 

In this case, all of the initial sales at issue were made 

by the U.S. patentee, rather than by a licensee having 

authorization from the patentee. Some of the initial sales 

were made domestically, some abroad. All of the domestic 

sales, and an unknown portion of the foreign sales, were 

accompanied by clearly communicated restrictions on the 

buyer’s reuse and resale. 

Case: 14-1617 Document: 339-2 Page: 7 Filed: 02/12/2016
8 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

We decided to hear this case en banc to consider 

whether two decisions of this court concerning the uncodified doctrine of patent exhaustion—one decision from 

1992, the other from 2001—remain sound in light of later 

decisions of the Supreme Court. Today we reaffirm the 

principles of our earlier decisions.

First, we adhere to the holding of Mallinckrodt, Inc. v. 

Medipart, Inc., 976 F.2d 700 (Fed. Cir. 1992), that a 

patentee, when selling a patented article subject to a 

single-use/no-resale restriction that is lawful and clearly 

communicated to the purchaser, does not by that sale give 

the buyer, or downstream buyers, the resale/reuse authority that has been expressly denied. Such resale or reuse, 

when contrary to the known, lawful limits on the authority conferred at the time of the original sale, remains 

unauthorized and therefore remains infringing conduct

under the terms of § 271. Under Supreme Court precedent, a patentee may preserve its § 271 rights through 

such restrictions when licensing others to make and sell 

patented articles; Mallinckrodt held that there is no 

sound legal basis for denying the same ability to the 

patentee that makes and sells the articles itself. We find 

Mallinckrodt’s principle to remain sound after the Supreme Court’s decision in Quanta Computer, Inc. v. LG 

Electronics, Inc., 553 U.S. 617 (2008), in which the Court 

did not have before it or address a patentee sale at all, let 

alone one made subject to a restriction, but a sale made 

by a separate manufacturer under a patentee-granted 

license conferring unrestricted authority to sell.

Second, we adhere to the holding of Jazz Photo Corp. 

v. International Trade Comm’n, 264 F.3d 1094 (Fed. Cir. 

2001), that a U.S. patentee, merely by selling or authorizing the sale of a U.S.-patented article abroad, does not 

authorize the buyer to import the article and sell and use 

it in the United States, which are infringing acts in the 

absence of patentee-conferred authority. Jazz Photo’s noexhaustion ruling recognizes that foreign markets under 

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 9

foreign sovereign control are not equivalent to the U.S. 

markets under U.S. control in which a U.S. patentee’s 

sale presumptively exhausts its rights in the article sold. 

A buyer may still rely on a foreign sale as a defense to 

infringement, but only by establishing an express or 

implied license—a defense separate from exhaustion, as 

Quanta holds—based on patentee communications or 

other circumstances of the sale. We conclude that Jazz 

Photo’s no-exhaustion principle remains sound after the 

Supreme Court’s decision in Kirtsaeng v. John Wiley & 

Sons, Inc., 133 S. Ct. 1351 (2013), in which the Court did 

not address patent law or whether a foreign sale should 

be viewed as conferring authority to engage in otherwiseinfringing domestic acts. Kirtsaeng is a copyright case 

holding that 17 U.S.C. § 109(a) entitles owners of copyrighted articles to take certain acts “without the authority” of the copyright holder. There is no counterpart to 

that provision in the Patent Act, under which a foreign 

sale is properly treated as neither conclusively nor even 

presumptively exhausting the U.S. patentee’s rights in 

the United States. 

BACKGROUND

The relevant facts are set forth in the limited record 

that the parties agreed was determinative of the result. 

Lexmark International, Inc. makes and sells printers as 

well as toner cartridges for its printers. Lexmark owns a 

number of patents that cover its cartridges and their use. 

The cartridges at issue here were first sold by Lexmark, 

some abroad and some in the United States. Some of the 

foreign-sold cartridges and all of the domestically sold 

cartridges at issue were sold, at a discount, subject to an 

express single-use/no-resale restriction. Impression 

Products, Inc. later acquired the cartridges at issue in 

order to resell them in the United States—the restricted

ones after a third party physically modified them to 

enable re-use in violation of the single-use/no-resale

restriction. Impression has resold the patented Lexmark 

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10 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

cartridges at issue in the United States, and has imported 

those it acquired abroad. In each case, it has acted without affirmative authorization from Lexmark and, for the 

restricted cartridges, in violation of the express denial of 

authorization to engage in resale and reuse. Impression’s 

actions infringe under 35 U.S.C. § 271—unless the fact 

that Lexmark initially sold the cartridges constitutes the 

grant of authority that makes Impression’s later resale 

and importation non-infringing under the doctrine of 

exhaustion. Whether Lexmark’s initial sales have that 

effect raises two questions—one regarding the singleuse/no-resale restricted sales (wherever they occur), the 

other regarding the initial foreign sales of all cartridges, 

whether restricted or not. 

A 

Lexmark offers buyers a choice. A buyer may purchase a “Regular Cartridge” at full price, in which case 

the buyer is not subject to any sale terms restricting reuse 

or resale of the cartridge. Alternatively, a buyer may 

purchase a “Return Program Cartridge” at a discount of 

roughly 20 percent, subject to a single-use/no-resale 

restriction: the buyer may not reuse the cartridge after 

the toner runs out and may not transfer it to anyone but 

Lexmark once it is used, i.e., the buyer must “return” the 

cartridge “only” to Lexmark. J.A. 2559.1 Lexmark and 

Impression stipulated in this case that the reduced price 

“reflects the value of the property interest and use rights 

conveyed to the purchaser under the express terms of the 

conditional sale contract and conditional single-use li-

 

1 At oral argument, noting a reason the arrangement was not a lease, Lexmark stated that a Return 

Program Cartridge buyer is not absolutely required to 

return the cartridge to Lexmark. The restriction bars 

each of two acts: reusing the cartridge; transferring it to 

anyone else.

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 11

cense conferred by Lexmark.” Id. The stipulation adds 

that “Lexmark has an express and enforceable contractual agreement with each of its end-user customers.” J.A. 

2562. And it is undisputed that all end users receive 

adequate notice of the restriction supporting the discounted price before they make their purchases.

The distinctness of the options for buyers, which produce different revenues for Lexmark, is not just a matter 

of different terms of sale. It also is reflected in a microchip in the cartridges that, among other things, communicates with the printer. For a Return Program cartridge, 

the chip and printer, by monitoring toner levels, prevent 

use of a refilled cartridge. For a Regular cartridge, the 

toner can be replenished and the cartridge reused. J.A. 

2559–60. “To circumvent this technological measure,” 

however, “third parties have ‘hacked’ Lexmark’s microchips and created their own ‘unauthorized replacement’ 

microchips” that, when installed in a Return Program 

cartridge, fool the printer into allowing reuse of that 

cartridge. J.A. 2560. It is undisputed that various companies gather spent cartridges, replace the microchips, 

refill and “remanufacture” the cartridges, and sell them to 

resellers like Impression for marketing to consumers for 

use with Lexmark printers. 

Lexmark sells its cartridges in two channels of distribution. It sells directly to end users, and it sells to “resellers” (including wholesalers, dealers, and distributors). 

Lexmark offers the options of Return Program and Regular cartridges in both channels; the resellers pay less for 

the Return Program cartridges; and the single-use/noresale restriction applies to the resale by resellers. J.A. 

2564. There is no dispute about the adequacy of notice to 

resellers as well as end users or the binding nature of the 

Lexmark-reseller agreements. J.A. 2562–64. When 

Lexmark sells its cartridges to end users, that sale is the 

first sale; when it sells to resellers, that sale is the first 

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12 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

sale. When a reseller subsequently sells to end users, 

that sale is not the first sale.

B 

Lexmark sued Impression, among other companies, 

for infringement under 35 U.S.C. § 271. It alleged that 

Impression acquires spent cartridges, including some 

Return Program cartridges that have been altered by chip 

replacement and toner refilling, then sells them in the 

United States and, for the foreign-bought ones, imports 

them into the United States.2 For a large number of 

patents directly covering the cartridges, Lexmark alleged 

direct infringement under § 271(a). For a few patents 

that only the end user directly infringes, Lexmark alleged 

that Impression is liable for contributory infringement

under § 271(c). The operative complaint states the infringement allegations in a single count (Count I), covering past and continuing activity. 

More specifically, the infringement allegations are 

limited to two groups of cartridges. One group consists of 

Return Program cartridges that Lexmark sold in the 

United States under the restriction denying authority for 

resale and reuse. As it later made clear, Lexmark did not 

allege infringement by Impression’s actions involving 

Regular cartridges Lexmark had first sold domestically. 

J.A. 1895–97, 2557. The second group consists of all 

cartridges that Lexmark sold abroad, including Return 

Program and Regular cartridges. It is undisputed that 

Lexmark never granted anyone permission to import 

 

2 Lexmark has not argued to us that the chip replacement and ink replenishment result in new articles, 

which would be outside the scope of the exhaustion doctrine. See Aro Mfg. Co. v. Convertible Top Replacement 

Co., 365 U.S. 336, 346 (1961) (Aro I).

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 13

those cartridges into, or sell or use them in, the United 

States. 

C 

The litigation progressed to the point at which no defendant remained except Impression, and only the single 

count of infringement remained against Impression. 

Impression came to agree that the patents covered the 

cartridges it was importing and selling, and it did not 

dispute the validity or enforceability of the patents. It 

contested liability for infringement on just one ground, 

namely, that Lexmark had exhausted its U.S. patent 

rights in the cartridges by its initial sales of them.

Three defining aspects of Impression’s contention to 

the district court, and presentation to us, are worth 

noting here, because they narrow our focus. First, we 

discuss only Lexmark’s sales to end users (and the resales 

and reuses deriving from those sales), because neither 

party has made an argument for distinguishing 

Lexmark’s sales to resellers. Second, we take as a premise that both the first purchaser and Impression as a repurchaser had adequate notice of the single-use/no-resale 

restriction before they made their purchases; the adequacy of that notice is unchallenged. Thus, we do not have 

before us the questions that would arise, whether under 

principles governing bona fide purchasers or otherwise, if 

a downstream re-purchaser acquired a patented article 

with less than actual knowledge of such a restriction. 

Third, Impression has not contended that the particular 

restriction at issue gives rise to a patent-misuse defense, 

constitutes an antitrust violation, or exceeds the scope of 

the Patent Act’s express grant of exclusive rights over 

patented articles, 35 U.S.C. §§ 154, 271. Rather, Impression contends that, although there is no other illegality or 

breach of statutory limits identified, the single-use/noresale restriction is to be disregarded for exhaustion 

purposes. According to Impression, it has the authority to 

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14 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

resell despite the known denial of such authority by 

Lexmark for the Return Program cartridges.

Impression presented its exhaustion defense by filing 

motions to dismiss the infringement count, one motion for

each of the two groups of cartridges at issue. For each 

motion, Impression did not contest that, under this court’s 

governing law, its exhaustion defense must fail: Mallinckrodt for the cartridges initially sold in the United States, 

Jazz Photo for the cartridges initially sold abroad. But it 

argued that the Supreme Court’s more recent decisions

had made Mallinckrodt and Jazz Photo no longer good 

law. In a pair of opinions issued the same day, the district court agreed with Impression about Mallinckrodt but 

disagreed about Jazz Photo. 

1 

The district court granted Impression’s motion to 

dismiss Lexmark’s claim of infringement involving the 

single-use cartridges Lexmark had first sold in the United 

States. Lexmark Int’l, Inc. v. Ink Techs. Printer Supplies, 

LLC, No. 1:10-CV-564, 2014 WL 1276133 (S.D. Ohio Mar. 

27, 2014) (Domestic Sale Opinion), modified at J.A. 34–35

based on a joint stipulation of the parties, J.A. 2554–66. 

Like Impression, the court recognized that there is no 

exhaustion here under this court’s decision in Mallinckrodt, which rejected an exhaustion defense in circumstances similar to those presented here—namely, where a 

patentee sold a patented article subject to an otherwiseunobjectionable single-use restriction. Id. at *4, *6. And 

the court recognized this court’s post-Mallinckrodt decisions as reiterating that a “‘conditional sale’” of that type 

does not cause exhaustion of the patentee’s preserved 

rights in the article. Id. at *4, *6 (quoting Princo Corp. v. 

Int’l Trade Comm’n, 616 F.3d 1318, 1328 (Fed. Cir. 2010) 

(en banc)).

In nevertheless finding exhaustion here, the district 

court examined a number of Supreme Court decisions on 

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 15

patent exhaustion. It noted the Court’s explanation in 

Bloomer v. McQuewan, 55 U.S. (14 How.) 539, 549–50 

(1853), that a patentee’s grant of a license to another to 

make and sell a patented article is not the same thing as 

the patentee’s sale of the article itself. Domestic Sale 

Opinion, 2014 WL 1276133, at *3. It noted, too, the 

Court’s rejection of an exhaustion defense in General 

Talking Pictures Corp. v. Western Electric Co., 304 U.S.

175, opinion on rehearing at 305 U.S. 124 (1938), which 

held that a buyer of a patented article infringed when it 

used the article in a way forbidden by a known use restriction, having bought the article from a manufacturer 

licensed by the patentee to make and sell the article only 

to buyers who complied with the use restriction. Domestic 

Sale Opinion, 2014 WL 1276133, at *3. The district court 

also noted that the Supreme Court in Quanta found 

exhaustion where “the Supreme Court determined that 

the agreements [at issue] broadly authorized Intel [the 

seller] to sell the licensed products without restrictions or 

conditions.” Id. at *5 (emphasis added). 

Despite that recognition of what Quanta involved, the 

district court concluded “that Quanta overruled Mallinckrodt sub silentio.” Id. at *5, *6. Although Return Program cartridges were sold under post-sale restrictions on 

reuse and resale, the district court held that “those postsale use restrictions do not prevent patent rights from 

being exhausted given that the initial sales were authorized and unrestricted.” Id. The court thus dismissed the 

infringement claim regarding Impression’s actions involving Return Program cartridges Lexmark had sold in the 

United States. Id. at *7.

2 

As to cartridges Lexmark had sold abroad, the court 

held that exhaustion did not apply, i.e., did not render 

Impression’s imports and domestic resales of those cartridges non-infringing. Lexmark Int’l, Inc. v. Ink Techs.

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16 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

Printer Supplies, LLC, 9 F. Supp. 3d 830 (S.D. Ohio 2014) 

(Foreign Sale Opinion). The court recognized, and Impression did not dispute, that “under Jazz Photo, an 

initial authorized sale of a patented product outside of the 

United States would not exhaust the patent rights of the 

patent holder.” Id. at 833. It then examined the Supreme 

Court’s decision in Kirtsaeng and rejected Impression’s 

contention that Kirtsaeng “overturns the Federal Circuit’s 

decision in Jazz Photo, 264 F.3d 1094, such that 

Lexmark’s patent rights were exhausted upon the first 

authorized sale abroad.” Foreign Sale Opinion, 9 F. Supp. 

3d at 834 (footnote omitted).

The court stated that “[t]he Supreme Court’s decision 

was rooted in interpretation of a statutory provision of 

copyright law,” namely, 17 U.S.C. § 109(a). Foreign Sale 

Opinion, 9 F. Supp. 3d at 833. The district court noted 

the absence from Kirtsaeng of any discussion of exhaustion in the patent field and the Supreme Court’s 

longstanding recognition that copyright law and patent 

law are not interchangeable. Id. at 835 (citing BobbsMerrill Co. v. Straus, 210 U.S. 339, 346 (1908)). It added 

that Kirtsaeng “is rooted in statutory and legislative 

interpretation of section 109(a) of the Copyright Act,” but 

“[n]oticeably absent from patent law is a codification of 

the exhaustion doctrine,” concluding: “the core statutory 

text that weighed in favor of a non-geographical interpretation is non-existent in the context of patent law.” Id. 

The Patent Act, the court concluded, calls for its own 

analysis of “context, history and practical considerations.” 

Id. at 836. 

For those reasons, while recognizing that this court 

might reconsider Jazz Photo in light of Kirtsaeng, the 

district court held that Jazz Photo remains good law. Id.

at 837–38. The court therefore denied Impression’s 

motion to dismiss Lexmark’s claim of infringement involving the Foreign-Sold Cartridges. Id. at 838.

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 17

3 

Soon thereafter, with the parties’ agreement, the 

court entered a “Stipulated Final Judgment.” J.A. 1. The 

judgment was (a) for Impression (i.e., Impression does not 

infringe) as to the Return Program cartridges whose 

precursors Lexmark had sold in the United States and (b) 

for Lexmark (i.e., Impression infringes) as to cartridges 

whose precursors Lexmark had initially sold abroad. Id. 

The parties agree that the judgment is final under 28 

U.S.C. § 1295(a)(1), even as to cartridges found to infringe. 

In agreeing to the final judgment of infringement as 

to the foreign-sold cartridges, which remained an open 

issue after the Rule 12(b)(6) rulings, Impression reasonably construed the district court’s Jazz Photo ruling to 

foreclose its exhaustion defense, even though all the 

district court had done was to deny Impression’s request 

for judgment in its favor based on that defense. In particular, the district court’s rationale as to the unavailability of exhaustion did not depend on the facts in the record 

that Lexmark identifies as suggesting the “regional” 

character of its foreign-sold cartridges, facts that therefore went unexplored in the district court. And, notably, 

when Impression agreed to a judgment of infringement as 

to foreign-sold cartridges, it did not preserve an impliedlicense defense, even though the Supreme Court made 

clear in Quanta the distinctness of implied-license and 

exhaustion defenses. 553 U.S. at 637.

D 

Impression appealed and Lexmark cross-appealed. 

This court has jurisdiction under 28 U.S.C. § 1295(a)(1). 

The parties submitted briefs and presented oral argument 

to a panel of this court, focused on whether Quanta had 

stripped Mallinckrodt of its controlling force and whether 

Kirtsaeng had stripped Jazz Photo of its controlling force. 

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18 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

Shortly after oral argument, this court sua sponte 

took the case en banc. Lexmark Int’l, Inc. v. Impression 

Prods., Inc., 785 F.3d 565 (Fed. Cir. 2015). We directed 

the parties to address the following issues:

(a) The case involves certain sales, made 

abroad, of articles patented in the United States. 

In light of Kirtsaeng v. John Wiley & Sons, Inc.,

133 S. Ct. 1351 (2013), should this court overrule 

Jazz Photo Corp. v. International Trade Commission, 264 F.3d 1094 (Fed. Cir. 2001), to the extent 

it ruled that a sale of a patented item outside the 

United States never gives rise to United States 

patent exhaustion[?] 

(b) The case involves (i) sales of patented articles to end users under a restriction that they use 

the articles once and then return them and (ii) 

sales of the same patented articles to resellers 

under a restriction that resales take place under 

the single-use-and-return restriction. Do any of 

those sales give rise to patent exhaustion? In 

light of Quanta Computer, Inc. v. LG Electronics, 

Inc., 553 U.S. 617 (2008), should this court overrule Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 

700 (Fed. Cir. 1992), to the extent it ruled that a 

sale of a patented article, when the sale is made 

under a restriction that is otherwise lawful and 

within the scope of the patent grant, does not give 

rise to patent exhaustion?

Id. at 566. 

DISCUSSION

I 

The Patent Act’s language defines the framework 

within which the two exhaustion questions arise. In 

1952, based on pre-existing uncodified understandings, 

Congress set forth a statutory prescription of what constiCase: 14-1617 Document: 339-2 Page: 18 Filed: 02/12/2016
LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 19

tutes patent “infringement.” See Aro Mfg. Co. v. Convertible Top Replacement Co., 377 U.S. 476, 483–84 (1964)

(Aro II); Aro I, 365 U.S. at 341–42 & n.8. In its current 

form, which includes a bar on importation and offers to 

sell added by a 1994 enactment, § 271(a) states that, 

unless another provision of the Act provides otherwise,

whoever “without authority” during the term of a patent 

commits certain acts—“makes, uses, offers to sell, or sells

any patented invention, within the United States or 

imports into the United States any patented invention”—

“infringes the patent.” 35 U.S.C. § 271(a). 

Section 271(a) connects “make,” “sell,” “use,” and the 

other terms with the disjunction “or,” as does the related 

provision granting the patentee various rights to exclude 

others from the same activities, id. § 154(a). Congress 

has thus prescribed that whoever, “without authority,” 

does any one of the listed acts—“the making, using, 

offering to sell, selling, or importing of a patented invention,” Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 

2060, 2065 (2011) (emphasis added)—is an infringer. See 

5 Donald S. Chisum, Chisum on Patents § 16.01 (2015)

(“The exclusive rights are disjunctive: one may infringe by 

(1) making without selling or using, (2) using without 

making or selling or (3) selling without making or using.”) 

(footnote omitted); William C. Robinson, The Law of 

Patents §§ 903–906 (1890). The government observes: 

“Nothing in the text of the Patent Act expressly prevents 

a patentee from demanding compensation from each 

downstream user or reseller of an article embodying his 

invention.” U.S. Br. 5.

Section 271(a)’s language embodies an understanding 

of “infringement” that was long recognized even before 

Congress enacted § 271 as part of the 1952 recodification 

of the patent laws. The pre-1952 statute included a rightto-exclude provision comparable to § 154, which, in language that varied over time, gave the patentee a right to 

exclude others (not a right to practice the invention). See

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20 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

35 U.S.C. § 40 (1946); Rev. Stat. § 4884; Bauer & Cie. v. 

O’Donnell, 229 U.S. 1, 9–10 (1913); 5 Chisum § 16.02[1]. 

But while the pre-1952 statute provided for actions for 

“infringement,” e.g., 35 U.S.C. §§ 67, 70 (1948); Rev. Stat. 

§§ 4919, 4921, there was no provision prescribing what 

constitutes infringement. Nevertheless, the courts consistently understood infringement to mean what § 271 

came to say—committing the identified acts without

authority (synonymously, without consent or permission):

“The infringement of a patent, being the invasion of this 

exclusive right, therefore consists in the manufacture, 

use, or sale of the invention protected by the patent 

within the area and time described in the patent, by any 

person not duly authorized to do so by the patentee.” 

Robinson, § 890, at 43–44 (emphasis added); see 3 Anthony William Deller, Walker on Patents § 450, at 

1681 (1937) (“An infringement is the unauthorized making or using or selling of the patented invention.”).3 Thus, 

the 1952 Act’s “without authority” language simply codifies an authority requirement long recognized to be the 

meaning of “infringement” of the enumerated rights to 

exclude. See Warner-Jenkinson Co. v. Hilton Davis Chem. 

Co., 520 U.S. 17, 26–27 (1997) (§ 271(a) left directinfringement law intact); Aro II, 377 U.S. at 483; Aro I, 

365 U.S. at 342; Giles S. Rich, Infringement Under Section 

271 of the Patent Act of 1952, 21 Geo. Wash. L. Rev. 521, 

537 (1953). 

 

3 See, e.g., Global-Tech Appliances, Inc., 131 S. Ct. 

at 2065 n.2; General Talking Pictures, 304 U.S. at 181–82; 

Crown Die & Tool Co. v. Nye Tool & Mach. Works, 261 

U.S. 24, 38 (1923); Geneva Furniture Mfg. Co. v. S. 

Karpen & Bros., 238 U.S. 254, 257 (1915); Cantrell v. 

Wallick, 117 U.S. 689, 694 (1886); Blake v. Robertson, 94 

U.S. 728, 733 (1876); Smith v. Nichols, 88 U.S. (21 Wall.) 

112, 118–19 (1875); Bloomer, 55 U.S. (14 How.) at 549. 

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The requirement of “authority” in order to avoid infringement, in its natural meaning, refers to a grant of 

permission. Logically, permission might come from 

Congress, whether outside the Patent Act or within the 

Patent Act itself, as reflected in § 271(a)’s “[e]xcept as 

otherwise provided in [the Patent Act]” language, which

explicitly bows to other contrary sections of the Patent 

Act. But it is undisputed that no other statutory provision applies in this case. See U.S. Br. 5; compare 35 

U.S.C. § 262 (each joint owner of a patent may engage in 

making, using, selling, offering to sell, and importing 

without authority from other owners). Nothing in the Act 

supersedes the § 271 requirement of authority from the 

patentee before a person in Impression’s position may 

engage in the itemized acts without infringing. 

In this respect, the Patent Act differs from the Copyright Act. In the copyright statute, Congress included a 

provision giving a right of sale to certain article owners, 

17 U.S.C. § 109(a), and made the infringement, importation, and exclusive-rights provisions all subservient to 

that express guarantee.4 The Patent Act does not contain

 

4 17 U.S.C. § 501(a) defines “an infringer of the copyright” as “[a]nyone who violates any of the exclusive 

rights of the copyright owner as provided by sections 106 

through 122.” Section 106 gives the copyright owner “the 

exclusive rights to do and to authorize” certain actions, 

such as making copies and “distribut[ing] copies or 

phonorecords of the copyrighted work to the public by sale 

or other transfer of ownership,” id. § 106(1), (3), but it 

declares that those rights are “[s]ubject to sections 107 

through 122”—hence to section 109(a). Similarly, § 602(a) 

declares importation to be “an infringement of the exclusive right to distribute copies or phonorecords under 

section 106, actionable under section 501.” Section 602 

makes the importation bar subservient to § 109(a) by 

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22 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

a congressionally prescribed exhaustion rule, let alone a 

provision that makes the express definition of infringement and rights to exclude (both of which now encompass 

importation) subservient to any congressionally expressed 

exhaustion rule.5 

In the Patent Act, then, as relevant here, it is a conferral of “authority” by the patentee that is needed in 

order for the actions listed in § 271(a) not to constitute 

infringement. As the government says, noting the parallelism of § 271(a) and the § 154(a) grant of rights to 

exclude, what § 271(a) means is that “[w]hoever does any 

of these acts ‘without authority’ from the patentee infringes the patent.” U.S. Br. 1 (emphasis added). In brief:

§ 271(a) by its terms requires that whoever engages in the 

enumerated acts receive permission from the patentee 

(directly or indirectly) for the acts being performed, which 

otherwise are infringing; and nothing in § 271(a) constrains the patentee’s choices about whom to grant the 

required authority, if anyone, or about which acts (of 

manufacture, use, sale, etc.) to authorize, if any. 

Congress defines the existence and scope of patent 

rights. See, e.g., Octane Fitness, LLC v. ICON Health & 

Fitness, Inc., 134 S. Ct. 1749, 1755–56 (2014); Crown Die 

 

making it subservient to the § 106(3) right, which in turn 

is subservient to § 109(a), as the Supreme Court held in 

Quality King Distributors, Inc. v. L’anza Research International, Inc., 523 U.S. 135, 145 (1998), and reiterated in 

Kirtsaeng, 133 S. Ct. at 1354–55.

5 Since 1999 Congress has provided a prior-use defense to infringement in certain circumstances and, in so 

doing, given a sale or disposition by a person having a 

prior-use defense the same exhaustion effect as a sale or 

disposition by a patent owner. See 35 U.S.C. § 273(d); id.

§ 273(b)(2) (2006). But Congress has not defined the 

underlying patent-exhaustion rule.

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& Tool Co., 261 U.S. at 40; Continental Paper Bag Co. v. 

Eastern Paper Bag Co., 210 U.S. 405, 423 (1908). Unless 

Congress has directed the courts to fashion governing 

rules in a particular statutory context (as in, e.g., the 

Sherman Act), “once Congress addresses a subject, even a 

subject previously governed by federal common law, the 

justification for lawmaking by the federal courts is greatly 

diminished. Thereafter, the task of the federal courts is 

to interpret and apply statutory law, not to create common law.” Northwest Airlines, Inc. v. Transp. Workers 

Union of Am., 451 U.S. 77, 95 n.34 (1981); see City of 

Milwaukee v. Illinois, 451 U.S. 304, 315 (1981) (“Our 

commitment to the separation of powers is too fundamental to continue to rely on federal common law by judicially 

decreeing what accords with common sense and the public 

weal when Congress has addressed the problem.”) (internal quotation marks omitted); Am. Elec. Power Co. v. 

Connecticut, 131 S. Ct. 2527, 2537 (2011). 

If ordinary congressional supremacy is to be respected, exhaustion doctrine in the Patent Act must be understood as an interpretation of § 271(a)’s “without authority” 

language. And so it has been understood: some sales 

confer authority on the purchaser to take certain actions—such as selling or using the purchased article in 

the United States or importing it into the United States—

that would otherwise be infringing acts. See 5 Chisum 

§ 16.03[2][a], at 16-362.8; U.S. Br. 1 (tying exhaustion to 

“authority” language of § 271(a)). We decide here (a) 

whether a sale, even though accompanied by a clearly 

communicated and otherwise-lawful denial of such authority, nonetheless has the legal effect of conferring such 

authority and (b) whether a foreign sale has the legal 

effect of conferring such authority where (as we must 

assume at present in this case) neither a grant nor a 

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24 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

reservation of § 271(a) rights was communicated to the 

purchaser before the foreign sale.6 

II

The Mallinckrodt issue has been framed for us in 

clear terms. Suppose that Lexmark had granted another 

firm a nonexclusive license to make and sell Return 

Program cartridges. It is undisputed and clear under 

Supreme Court precedent—most prominently, the 1938 

decision in General Talking Pictures—that Lexmark 

would not have exhausted its patent rights in those 

 

6 Before 1952, the patent statute provided that 

“[e]very person who purchases of the inventor, . . . or with 

his knowledge and consent constructs any newly invented . . . machine, or other patentable article, prior to the 

application by the inventor . . . for a patent, or who sells 

or uses one so constructed, shall have the right to use, and 

vend to others to be used, the specific thing so made or 

purchased, without liability therefor.” 35 U.S.C. § 48 

(1946); Rev. Stat. § 4899. That provision dated from 1870; 

a broader version (from 1839) did not depend on purchase 

from the inventor or construction with the inventor’s 

knowledge and consent. See Dable Grain Shovel Co. v. 

Flint, 137 U.S. 41, 42 (1890). The pre-1952 provision was 

viewed as a species of “implied license.” 3 Walker on 

Patents § 451, at 1682–83; Robinson, § 917, at 88. 

The Patent Act of 1952 repealed the provision, the 

House Report briefly explaining that it was “[r]edundant 

and unnecessary.” H.R. Rep. No. 82-1923, at 72 (1952). 

No argument for the significance of the repeal has been 

made to us—perhaps because (1) the provision did not 

depend on a sale; (2) it involved (pre-patent) conduct 

viewed as giving an “implied license,” which the Court has 

distinguished from “exhaustion,” Quanta, 553 U.S. at 637; 

and (3) it was not authoritatively construed to apply even 

to sales subject to authority-denying restrictions.

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cartridges, upon the manufacturing licensee’s sale (the 

first sale), if a buyer with knowledge of the restrictions 

resold or reused them in violation of the restrictions. 

Impression and the government contend that a different 

result is required—that Lexmark automatically lost its 

patent rights—simply because Lexmark sold the Return 

Program cartridges itself, subject to the same communicated restriction, rather than having left the manufacture 

and sale to others under license. See U.S. Br. 7, 8, 10, 11

(case turns on distinction between patentee sale and nonpatentee licensee sale). (Impression has left the en banc 

briefing on this issue largely to the government.) 

We conclude otherwise, as we did in Mallinckrodt and 

subsequent decisions. A sale made under a clearly communicated, otherwise-lawful restriction as to post-sale use 

or resale does not confer on the buyer and a subsequent 

purchaser the “authority” to engage in the use or resale

that the restriction precludes. And there is no sound 

reason, and no Supreme Court precedent, requiring a 

distinction that gives less control to a practicing-entity 

patentee that makes and sells its own product than to a 

non-practicing-entity patentee that licenses others to 

make and sell the product.

A 

Mallinckrodt involved a patentee’s sale of its medical 

device to hospitals, subject to a “single use only” restriction. The device consisted of a nebulizer and associated components for delivering to a patient, for diagnosis 

or treatment of lung diseases, a mist of radioactive or 

therapeutic material. It also trapped radioactive or toxic 

material when the patient exhaled. Mallinckrodt sold it 

under the single-use condition and with instructions for 

post-use disposal in a lead-shielded container. But some 

hospital purchasers instead sent used devices to Medipart 

for reconditioning and for replacement of certain compoCase: 14-1617 Document: 339-2 Page: 25 Filed: 02/12/2016
26 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

nents. When Mallinckrodt sued Medipart for direct and 

indirect infringement by virtue of the reuse in violation of 

the single-use restriction, the district court granted 

Medipart summary judgment of non-infringement, concluding that Mallinckrodt’s sale of the devices exhausted 

its ability to assert its patent rights in the units sold. 976 

F.2d at 701–02. 

This court reversed. Id. at 709. The court stated its 

ruling: “The restriction here at issue does not per se 

violate the doctrine of patent misuse or the antitrust law. 

Use in violation of a valid restriction may be remedied 

under the patent law, provided that no other law prevents 

enforcement of the patent.” Id. at 701. 

In explanation, the court observed that the patent 

grant of § 154 is a “right to exclude,” which “may be 

waived in whole or in part,” “subject to patent, contract, 

antitrust, and any other applicable law, as well as equitable considerations such as are reflected in the law of 

patent misuse.” Mallinckrodt, 976 F.2d at 703. It noted 

that the Supreme Court had held that two particular 

types of restrictions in sales exceeded the legitimate scope 

of patent rights, so that the patentee did not retain its 

patent rights against a buyer’s sale or use of a patented 

article in violation of those particular conditions: resaleprice-maintenance conditions, Bauer, 229 U.S. 1; Straus 

v. Victor Talking Machine Co., 243 U.S. 490 (1917); Boston Store of Chicago v. American Graphophone Co., 246 

U.S. 8 (1918), and tying arrangements requiring use of 

non-patented articles with the patented one, Motion 

Picture Patents Co. v. Universal Film Mfg. Co., 243 U.S. 

502 (1917). Mallinckrodt, 976 F.2d at 704. The Mallinckrodt court explained that those cases “did not hold, and it 

did not follow, that all restrictions accompanying the sale 

of patented goods were deemed illegal.” Id.

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The court then described the key Supreme Court 

precedent, General Talking Pictures. As the Mallinckrodt 

court observed, in General Talking Pictures “the patentee 

had authorized the licensee to make and sell amplifiers 

embodying the patented invention for a specified use 

(home radios),” and “[t]he defendant had purchased the 

patented amplifier from the manufacturing licensee, with 

knowledge of the patentee’s restriction on use,” but used 

it contrary to the restriction. Id. at 705. The Supreme 

Court held that the defendant was liable for infringement; 

it “observed that a restrictive license to a particular use 

was permissible, and treated the purchaser’s unauthorized use as infringement of the patent.” Id. This court 

noted that the Supreme Court in General Talking Pictures 

“did not decide the situation where the patentee was the 

manufacturer” and seller. Id. This court then held that 

to distinguish the patentee sale (at issue in Mallinckrodt) 

from the licensee sale (at issue in General Talking Pictures) would be to make “formalistic distinctions of no 

economic consequence.” Id.

Finally, the court described “a group of cases in which 

the Supreme Court considered and affirmed the basic 

principles that unconditional sale of a patented device 

exhausts the patentee’s right to control the purchaser’s 

use of the device; and that the sale of patented goods, like 

other goods, can be conditioned.” Id. at 706. This court

noted that, insofar as several cases ruling against patentees’ claims discussed or involved sales, the sales were not 

made under restrictions as to use. Id. at 707 (discussing

Bloomer, 55 U.S. (14 How.) 539; Adams v. Burke, 84 U.S. 

(17 Wall.) 453 (1873); Keeler v. Standard Folding Bed Co., 

157 U.S. 659 (1895)). The court also noted the statement 

in Mitchell v. Hawley that “[s]ales of the kind may be 

made by the patentee with or without conditions,” 83 U.S. 

(16 Wall.) 544, 548 (1873), and the holding of Mitchell

that a purchaser of a patented machine “licensed for use 

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28 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

only during the original term of the patent” was liable for 

infringement for using the machine past that term when 

the patent term was extended. 976 F.2d at 707.

The court in Mallinckrodt concluded that “[u]nless the 

condition violates some other law or policy (in the patent 

field, notably the misuse or antitrust law, e.g., United 

States v. Univis Lens Co., 316 U.S. 241 (1942)), private 

parties retain the freedom to contract concerning conditions of sale.” 976 F.2d at 708. Thus, unless a sale restriction is improper under some other body of law, 

whether within the Patent Act or outside it, a patentee’s 

own sale of its patented article subject to a clearly communicated restriction does not confer authority to sell or 

use the article in violation of that restriction, i.e., does not 

exhaust the patentee’s § 271 rights against such conduct 

involving that article. Since Mallinckrodt, we have followed that principle. B. Braun Med., Inc. v. Abbott Labs., 

124 F.3d 1419, 1426 (Fed. Cir. 1997); Princo Corp. v. Int’l 

Trade Comm’n, 616 F.3d 1318, 1328 (Fed. Cir. 2010) (en 

banc).

B 

The district court concluded in this case that Quanta 

overturned the Mallinckrodt rule as to a patentee’s sale of 

a patented article subject to a clearly communicated 

single-use/no-resale restriction. But no issue as to such a 

sale was presented for decision or decided in Quanta. And 

the Supreme Court in Quanta did not address the distinction between patentee sales and licensee sales on which 

the argument for overturning Mallinckrodt rests.

Quanta did not involve a patentee’s sale at all, let 

alone one subject to a restriction or, more particularly, a 

single-use/no-resale restriction. Quanta involved a sale 

made (to computer maker Quanta) not by the patentee

(LGE) but by a manufacturing licensee (chip maker Intel), 

which the patentee had authorized to make and sell the 

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articles at issue (chips for installation in computers that 

would then be covered by LGE’s patents). 553 U.S. at

623–25. And the patentee’s authorization to the licensee

to make (the first) sales was not subject to any conditions, 

much less conditions to be embodied in those sales. Id. at 

636–38. While Intel had certain other contractual obligations to LGE regarding notice to Intel’s purchasers, neither party contended that Intel breached those 

obligations, and in any event, the Court repeatedly stated

that the relevant LGE-Intel contract gave Intel an unrestricted authorization to sell the articles. Id. at 636–37

(“Intel’s authority to sell its products embodying the LGE 

Patents was not conditioned on the notice or on Quanta’s 

decision to abide by LGE’s directions in that notice.”); id.

at 637 (“The License Agreement authorized Intel to sell 

products that practiced the LGE Patents. No conditions 

limited Intel’s authority to sell products substantially 

embodying the patents.”); id. at 638 (“Nothing in the 

License Agreement limited Intel’s ability to sell its products practicing the LGE Patents.”).

In short, Quanta did not involve the issue presented 

here. The facts defining the issues for decision, and the 

issues decided, were at least two steps removed from the 

present case. There were no patentee sales, and there 

were no restrictions on the sales made by the licensee. 

The two main issues decided by the Court in Quanta 

have no bearing on the issue of restricted sales by a 

patentee. The Court decided that exhaustion applies to 

method claims. Id. at 628–30. And the Court decided 

“the extent to which a product must embody a patent in 

order to trigger exhaustion.” Id. at 630; see id. at 630–35. 

Only the third issue addressed by the Court in Quanta concerns restrictions on sales—though not patentees’ 

sales—and the Court’s discussion of that issue does not 

undermine Mallinckrodt’s ruling that a patentee can 

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30 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

preserve its patent rights through restrictions on its sales. 

As just described, when LGE invoked precedent such as

General Talking Pictures that make clear that patentees 

are able to preserve their patent rights through restrictions on the sales they authorizes licensees to make, 

Quanta, 553 U.S. at 636, the Court’s response was to 

conclude that there simply were no such restrictions on 

LGE’s grant to Intel of the authority to sell. Id. at 636–

38. The Court thus had prominently in view the principle 

that, through at least one path, a patentee can reserve its 

patent rights through sale restrictions. The Court found 

the principle inapplicable to the case before it because of 

the absence of any restriction, and the Court said nothing 

to cast doubt on the principle. Indeed, the Court indirectly underscored the principle when it quoted Motion Picture Patents as stating “the rule” of exhaustion in terms 

expressly based on an “‘unconditional sale.’” Quanta, 553 

U.S. at 626 (quoting Motion Picture Patents, 243 U.S. at 

516). And the Court did not consider whether or decide 

that the principle was limited to contracted-out, as distinguished from in-house, manufacturing and sales, or even 

recognize and discuss such a distinction.

 Inferring disapproval of Mallinckrodt by the Supreme 

Court in Quanta is unwarranted for another reason. The 

decision of this court under review in Quanta relied 

centrally on Mallinckrodt and its successor case, B. Braun 

Medical. See LG Elecs., Inc. v. Bizcom Elecs., Inc., 453 

F.3d 1364, 1370 (Fed. Cir. 2006). In the Supreme Court, 

the government prominently featured an argument that 

Mallinckrodt was incorrect and should be repudiated, 

U.S. Amicus Brief at 18–24, Quanta (No. 06-937), 2007 

WL 3353102, and Quanta presented similar criticisms of 

Mallinckrodt, Brief for Petitioner at 13, 30–33, Quanta 

(No. 06-937), 2007 WL 3276505. Yet the Supreme Court

said nothing about Mallinckrodt or B. Braun Medical. 

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tion was presented for decision—or was being decided—as 

to the effect a restriction on the first sale, whether made 

by a patentee or by a manufacturing licensee, would have 

on preservation of § 271 rights.

C 

For the foregoing reasons, the challenge to Mallinckrodt in the present case cannot rest on what the Supreme 

Court in Quanta ruled about the issues it said it was 

addressing or the facts and issues presented for decision. 

The challenge asserts that any post-sale restriction in a 

patentee’s own sale fails, as a matter of law, to preserve 

the patentee’s § 271 rights against unauthorized sales or 

uses. The argument rests ultimately on language the 

Court used in Quanta in introducing the exhaustion 

doctrine before defining the specific issues for decision—

as it has done elsewhere.

The Court in Quanta said: “The longstanding doctrine 

of patent exhaustion provides that the initial authorized 

sale of a patented item terminates all patent rights to 

that item.” 553 U.S. at 625. More recently, the Court

used similar “authorized sale” language in introducing the 

exhaustion doctrine in Bowman v. Monsanto Co., which 

held that a patentee, by selling patented seeds, does not 

lose its § 271 right to prevent the buyer from making new 

seeds. The Court said: “Under the doctrine of patent 

exhaustion, the authorized sale of a patented article gives 

the purchaser, or any subsequent owner, a right to use or 

resell that article.” 133 S. Ct. 1761, 1764 (2013). See also, 

e.g., Univis, 316 U.S. at 249 (“authorized sale”); Dissent at 

3–5. 

The challenge to Mallinckrodt asserts that any sale of 

a patented article by a patentee, even when the rights 

granted are expressly restricted, is automatically an 

“authorized sale,” causing the patentee to lose all § 271 

rights in the item sold. That consequence follows, the 

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argument goes, no matter how clearly the patentee states 

an otherwise-lawful restriction on what authority is being 

conferred and what authority is being withheld. In this 

view, exhaustion law embodies a sharp distinction between a sale by a patentee (for which restrictions are to be 

disregarded) and a sale made by another person authorized by the patentee to sell, i.e., a licensee as in General 

Talking Pictures (for which a patentee may preserve its 

§ 271 rights by restricting the licensee’s authorized sales). 

That is an extraordinary doctrinal consequence to find 

established by the Supreme Court’s use of the phrase

“authorized sale.” No one suggests that Bowman (concerning new articles) intended such consequences. And 

there are good reasons not to find any such implied meaning in Quanta either. 

1 

Most obviously, as discussed above, the Court was not 

addressing the patentee-sale/licensee-sale distinction. 

Among other things, the Court did not consider the issues 

presented by making such a distinction, such as where 

the line would sensibly be drawn along the spectrum that 

includes original patentees, assignees, exclusive licensees, 

and non-exclusive licensees. Such distinctions matter for 

determining who may bring infringement suits, but they 

can involve detailed inquiries into the contractual relationships between an original patent owner and others 

(here, a first seller), based on information a buyer may 

have no ability or reason to acquire. See, e.g., Independent Wireless Telegraph Co. v. Radio Corp. of Am., 269 U.S. 

459, 464–69 (1926); Crown Die & Tool, 261 U.S. at 40–41; 

E.W. Bliss Co. v. United States, 253 U.S. 187, 192 (1920); 

Pope Mfg. Co. v. Gormully & Jeffery Mfg. Co., 144 U.S. 

248 (1892); Waterman v. Mackenzie, 138 U.S. 252, 255–56

(1891); 8 Chisum § 21.03. Nothing in Quanta suggests 

that the Court either considered such issues or intended

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to build such inquiries into the exhaustion doctrine by 

making the distinction the government now urges. 

2 

One cannot infer the contrary from the immediate 

context of the “authorized sale” phrase, i.e., from the 

several decisions that Quanta briefly describes in the 

paragraph it introduces with the “authorized sale” shorthand. 553 U.S. at 625. Those decisions did not involve 

restricted patentee sales of patented articles. And the 

Quanta Court, in describing those cases, said nothing to 

indicate adoption of a patentee-sale/licensee-sale distinction.

Thus, Bloomer v. McQuewan identifies no sale of a patented article as involved in the case. During an initial 

patent term, a license granted to the defendants (via 

Collins and Smith, then Barnet, then Warner and 

McQuewan) the right to make patented machines and use 

them “without any limitation as to the time for which 

they were to be used.” 55 U.S. (14 How.) at 553; id. at 

540–41, 548. When the defendants made and used such 

machines, and the patent term was later extended, the 

Supreme Court held that the unrestricted right to use did 

not end when the earlier patent term ended, because the 

right to use did not come from the patent statute, which 

grants only rights to exclude, not rights to practice. Id. at 

549–50. The Court discussed purchased articles, but with 

no restrictions at issue, it did not decide the effect that 

any restrictions would have. Id.

Bloomer v. Millinger, 68 U.S. (1 Wall.) 340 (1864), is 

similar in its facts to McQuewan. The Court held that 

Millinger, who “constructed the machines and put them in 

operation under the authority of the patentee or his 

assigns” during a first term extension, was not subject to 

an infringement action for continued use during a second 

term extension. Id. at 349, 350. The Court made no 

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34 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

tween purchases “from the patentee . . . or from any other 

person by him authorized to” make the sale, on the issues 

addressed. Id. at 350, 351. In referring to a constructor 

or purchaser of a patented machine having “also acquired 

the right to use and operate it during the lifetime of the 

patent,” id. at 350 (emphasis added), the Court implicitly 

recognized that a purchaser might not acquire a full right 

to use an acquired article.

And in Adams v. Burke, the Boston regional assignee 

(Lockhart & Seelye) sold patented coffin lids to Burke, 

“without condition or restriction.” 84 U.S. (17 Wall.) at 

455 (emphasis added). When Burke used the lids outside 

the Boston territory, for burials within a different territory where Adams was the regional assignee, Adams sued. 

The Court held that, for such an unrestricted sale, “there 

is no restriction on their use to be implied for the benefit 

of the patentee or his assignees or licensees.” Id. at 457 

(bold italics added). 

When the Supreme Court in Quanta moved beyond 

the Bloomer cases and Adams, it likewise did not advance 

a patentee-sale/licensee-sale distinction. 553 U.S. at 625–

26. The Court’s next paragraph recounts the developments of the 1910s: The Court initially adopted a broad 

greater-includes-the-lesser approach allowing preservation of patent rights through even otherwise-unlawful 

restrictions, such as tie-ins, Henry v. A.B. Dick Co., 224 

U.S. 1 (1912); but the Court quickly rejected that broad 

principle and its application to resale price maintenance, 

Bauer, 229 U.S. 1 (1913), and then to tie-ins, Motion 

Picture Patents, 243 U.S. 502 (1917), the latter expressly 

overruling A.B. Dick. The Court in Quanta, summarizing 

that history, said nothing about the patenteesale/licensee-sale distinction; and it recognized that the 

“rule” that emerged, as quoted from Motion Picture Patents, was one based on “‘a single, unconditional sale.’” 

553 U.S. at 626 (emphasis added). 

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The Court in Quanta then proceeded to a longer discussion of Univis. That discussion made no patenteesale/licensee-sale distinction. Rather, it recounted 

Univis’s application of exhaustion to sales of articles that

may not be strictly covered by the patent but that sufficiently embody the patent. 553 U.S. at 627–28. 

In no part of the Court’s discussion did the Court consider which cases involved “patentee” sales and which 

“licensee” sales. Indeed, it is not always easy to tell where 

the facts of each case fall on the spectrum from original 

patentee through non-exclusive licensee. See, e.g., Bauer, 

229 U.S. at 8 (seller was either “agent” or “licensee”). The 

Court in Quanta did not say that the inquiry mattered. 

And in Univis, the Court did the opposite of suggesting 

that the distinction matters: it affirmatively stated that it 

was treating the patent owner (Univis Corporation) and 

the licensee-seller (Lens Company) as the same for purposes of its analysis. 316 U.S. at 243.

3 

In these circumstances, it would read too much into 

the Court’s use of the phrase “authorized sale” to draw 

the government’s conclusion—making the sharp patenteesale/licensee-sale distinction—without full analysis of 

statutory, precedential, and other considerations. Full 

analysis of the relevant legal context is necessary. 

Such analysis would be required regardless, but it is 

important to note that the phrase “authorized sale” does 

not, by its words alone, compel the government’s conclusion. It has long been a familiar feature of our legal 

landscape that property rights in a particular thing—like 

the separate interests in making, selling, using, etc., an 

invention—are viewed as a “bundle” of rights (or sticks) 

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36 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

that can generally be transferred separately.7 Of course, 

particular legal regimes, for various purposes, commonly 

identify the transfer of particular rights as determinative 

of a “sale.” In determining which transfers are decisive, 

context matters. And here the context is a statute that 

identifies separate rights of manufacture, sale, use, etc., 

and the precedential setting is one that expressly recognizes the possibility of separating the rights in a patented 

article. See, e.g., Mitchell, 83 U.S. (16 Wall.) at 547 (exhaustion exists when a patentee “has himself constructed 

a machine and sold it without any conditions, or authorized another to construct, sell, and deliver it, or to construct and use and operate it, without any conditions . . .”; 

“the owner of the machine, whether he built it or purchased it, if he has also acquired the right to use and 

operate it during the lifetime of the patent, may continue 

to use it”) (emphases added); Bloomer v. Millinger, 68 U.S. 

(1 Wall.) at 350. Moreover, the statutory purpose of the 

inquiry here is to identify what sales confer “authority” on 

the buyer to engage in distinct, otherwise-infringing acts.

Context is particularly important where, as here, the 

phrase being interpreted comes from judicial opinions not 

 

7 See, e.g., Horne v. Dep’t of Agric., 135 S. Ct. 2419, 

2428 (2015); Tahoe-Sierra Pres. Council, Inc. v. Tahoe 

Reg’l Planning Agency, 535 U.S. 302, 327 (2002); New 

York Times Co. v. Tasini, 533 U.S. 483, 495–96 (2001);

Keystone Bituminous Coal Ass’n v. DeBenedictis, 480 U.S. 

470, 500–01 (1987); United States v. Sec. Indus. Bank, 459 

U.S. 70, 75–76 (1982); Loretto v. Teleprompter Manhattan 

CATV Corp., 458 U.S. 419, 433 (1982); Kaiser Aetna v. 

United States, 444 U.S. 164, 176 (1979); Fidelity-Phila. 

Trust Co. v. Smith, 356 U.S. 274, 278–79 (1958); Guggenheim v. Rasquin, 312 U.S. 254, 257–58 (1941); Charles C. 

Steward Mach. Co. v. Davis, 301 U.S. 548, 580–81 (1937); 

Henneford v. Silas Mason Co., 300 U.S. 577, 582 (1937). 

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directly deciding the point at issue. Chief Justice Marshall wrote for the Court almost 200 years ago: “It is a 

maxim not to be disregarded, that general expressions, in 

every opinion, are to be taken in connection with the case 

in which those expressions are used.” Cohens v. Virginia, 

19 U.S. (6 Wheat.) 264, 399–400 (1821); see Armour & Co. 

v. Wantock, 323 U.S. 126, 132–33 (1944) (per Jackson, J.) 

(“[W]ords of our opinions are to be read in the light of the 

facts of the case under discussion. . . . General expressions 

transposed to other facts are often misleading.”).8 We 

bear that maxim in mind in applying the body of Supreme 

Court case law on exhaustion: that body of precedent 

contains no decision against a patentee’s infringement 

assertion in the present circumstances, and the decisions 

on related circumstances require careful reading to determine the best understanding of what issues the Court 

actually decided. 

 

8 See also Ark. Game & Fish Comm’n v. United 

States, 133 S. Ct. 511, 520 (2012) (quoting Cohens); United States v. Alvarez, 132 S. Ct. 2537, 2544–45 (2012); 

Illinois v. Lidster, 540 U.S. 419, 424 (2004); Reiter v. 

Sonotone Corp., 442 U.S. 330, 341 (1979); United Gas 

Improvement Co. v. Cont’l Oil Co., 381 U.S. 392, 404 

(1965); Wright v. United States, 302 U.S. 583, 593–94 

(1938); Sterling v. Constantin, 287 U.S. 378, 400 (1932) 

(“the general language of the opinion must be taken in 

connection with the point actually decided”); Pacific S.S. 

Co. v. Peterson, 278 U.S. 130, 136 (1928); Bramwell v. 

U.S. Fid. & Guar.Co., 269 U.S. 483, 489 (1926) (“It is a 

rule of universal application that general expressions 

used in a court’s opinion are to be taken in connection 

with the case under consideration.”).

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D 

We conclude that a patentee may preserve its § 271 

rights when itself selling a patented article, through 

clearly communicated, otherwise-lawful restrictions, as it 

may do when contracting out the manufacturing and sale.

1 

That conclusion follows naturally from the statute. 

Congress straightforwardly prescribed, in § 271(a), that a 

sale or use of a patented article “without authority” is an 

infringement. Under that language, a clear denial of 

authority leaves a buyer without the denied authority.

The exhaustion rule for unrestricted sales readily fits 

the language of § 271(a). It is reasonable for the courts to 

treat a patentee-made or patentee-authorized sale of a 

patented article (without distinction) as presumptively 

granting “authority” to the purchaser to use it and resell 

it. Such an approach recognizes the utility of having a 

default rule for determining whether authority has been 

conferred in the many circumstances where an express 

conferral is missing. And it chooses as the default a 

principle that sensibly accords with parties’ likely expectations as to a domestic sale. 

But it is quite a different matter to treat a sale as conferring on the buyer the very authority that is being 

denied through clearly communicated restrictions. 

Mallinckrodt sensibly rejects that counter-textual result. 

Unless granting “authority” is to be a legal fiction, a 

patentee does not grant authority by denying it. And that 

is so for patentee sales and licensee sales alike, i.e., 

whether the patentee denies the authority to its direct 

purchaser or to one purchasing through a manufacturing 

licensee. For the same reason, the result does not reasonably reflect market participants’ expectations: a buyer 

cannot reasonably expect that the seller is conferring 

authority that the seller is expressly denying, whether the 

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seller is the patentee or a manufacturing licensee. The 

statutory question of authority neither allows denials to 

be grants nor logically depends on whether there is an 

intermediary between the patentee and the first buyer.

In short, the government’s position would create a 

rule of court-made law that runs counter to, rather than 

accords with, the statutory definition of actionable infringement. An exhaustion rule should fit rather than 

contradict the statutory text. 

2 

Under longstanding Supreme Court precedent, a patentee may preserve its patent rights against downstream 

buyers by arranging with someone else, even a nonexclusive licensee, to make and sell patented articles, 

under clearly stated restrictions on post-sale activities. 

There is no good reason that a patentee that makes and 

sells the articles itself should be denied the ability that is 

guaranteed to a non-practicing-entity patentee. No 

precedent requires a contrary conclusion. 

a. The Supreme Court has recognized that a patentee 

may preserve its rights against infringement by establishing restrictions accompanying the sale of the patented 

article (communicated at the time of sale), including 

restrictions on the buyer’s post-acquisition use. That 

recognition is implicit in the Motion Picture Patents 

statement of the exhaustion rule as based on an “unconditional” sale, as quoted in Quanta, 553 U.S. at 626. More 

affirmatively, the Court upheld a claim of infringement on 

that basis in Mitchell v. Hawley, where the licensee seller 

was under a restriction as to the (temporal) scope of rights 

it could and did convey when selling the patented machine. Mitchell involved a licensee seller, but the Court 

stated the exhaustion principles in terms keyed to the 

absence of conditions and applicable to patentee sales:

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[W]hen [the patentee] has himself constructed a 

machine and sold it without any conditions, or authorized another to construct, sell, and deliver it, 

or to construct and use and operate it, without 

any conditions, and the consideration has been 

paid to him for the thing patented, the rule is well 

established that the patentee must be understood 

to have parted to that extent with all his exclusive 

right, and that he ceases to have any interest 

whatever in the patented machine so sold and delivered or authorized to be constructed and operated.

83 U.S. (16 Wall.) at 547; see id. at 548 (sales “may be 

made by the patentee with or without conditions, as in 

other cases, but where the sale is absolute, and without 

any conditions, the rule is well settled that the purchaser 

may continue to use the implement or machine purchased 

until it is worn out”).9 Although Mitchell involved a 

licensee sale, its language did not distinguish licensees’ 

sales from patentees’ sales in the respects discussed, and 

it was not long before the Court invoked those formulations in a patentee-sale case. Keeler, 157 U.S. at 662–63. 

 

9 We do not see a sufficient basis to read Mitchell’s 

“without conditions” language as limited to sales in which 

title is not transferred until a condition is fulfilled (sometimes called “conditional sales”). The terminology in 

Mitchell is not limited to “conditional sales,” and the 

Court later used the term “conditions” more broadly, 

including in discussions of Mitchell. See Motion Picture 

Patents, 243 U.S. at 506, 514–15; A.B. Dick, 224 U.S. at 

12, 16, 19; In re Paper-Bag Cases, 105 U.S. 766, 770–71 

(1882). In any event, the language of Mitchell is just one

part of the analysis, of which General Talking Pictures is 

the most significant precedent. 

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Most importantly, the Court squarely held in the General Talking Pictures case that a patentee could preserve 

its infringement rights against unauthorized uses by 

restricting manufacturing licensees’ authority to sell for 

such uses. General Talking Pictures Corp. v. Western 

Elec. Co., 304 U.S. 175, opinion on rehearing at 305 U.S. 

124 (1938). Companies holding patent rights in certain 

amplifiers (AT&T, Western Electric, RCA) licensed the 

American Transformer Company to make and sell amplifiers. The Transformer Company “was a mere licensee 

under a nonexclusive license, amounting to no more than 

‘a mere waiver of the right to sue.’” 304 U.S. at 181

(quoting De Forest Radio Telephone & Telegraph Co. v. 

United States, 273 U.S. 236, 242 (1927)). The license 

permitted sales only “for radio amateur reception, radio 

experimental reception, and home broadcast reception,” 

not “for use in theaters as a part of talking picture equipment.” Id. at 180. The Transformer Company nevertheless sold amplifiers to General Talking Pictures for 

theater use in violation of the restriction, and General 

Talking Pictures “had actual knowledge that [the Transformer Company] had no license to make such a sale.” Id. 

When the patentees sued General Talking Pictures (the 

buyer) for infringement, the Supreme Court, based on 

Mitchell, affirmed the judgment of infringement. Id. at 

181–82.

The Court came to the same conclusion when it reconsidered the question on rehearing. It said: “Any use 

beyond the valid terms of a license is, of course, an infringement of a patent.” 305 U.S. at 126. Moreover, 

“[t]hat a restrictive license is legal seems clear.” Id. at 

127 (citing Mitchell). The use restriction was a lawful 

one, the Court observed, and “[a]s the restriction was 

legal and the amplifiers were made and sold outside the 

scope of the license, the effect is precisely the same as if 

no license whatsoever had been granted to Transformer 

Company.” Id. General Talking Pictures, knowing of the 

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restriction, was “liable because it ha[d] used the invention 

without license to do so.” Id. Thus, General Talking 

Pictures was held to be liable for patent infringement. It 

was not held liable for breach of contract; indeed, it had 

no contractual relationship with the patentees. 

b. The Supreme Court thus held that a patentee can 

preserve its patent rights by authorizing a manufacturing 

licensee to make and sell a patented article under an 

otherwise-proper restriction, including a restriction on the 

buyer’s post-purchase use. When the buyer, knowing of 

the restriction at the time of purchase, subsequently uses 

the article in violation of the restriction, the buyer is 

infringing. 

To distinguish the present patentee-sale situation, the 

government must contend that a patentee cannot preserve its patent rights against uses of a patented article 

contrary to known use restrictions if, instead of licensing 

someone else to make and sell the article, it chooses to 

make and sell the article itself. That contention would 

draw a sharp line between practicing-entity patentees 

(those who themselves make and sell the articles at issue) 

and non-practicing-entity patentees (those who do not). 

Non-practicing-entities would have greater power to 

maintain their patent rights than practicing entities.

The government points to no basis in the policy of the 

patent statute for making that distinction. Nothing in the 

patent statute suggests that patentees should have to 

contract out their manufacture and sale of patented 

articles to preserve their § 271 rights. The essential 

tradeoff of the patent system—to provide a market-based 

reward in exchange for disclosure—is equally applicable 

whether the patentee sells or licenses another to make 

and sell. The Federal Trade Commission made the fundamental point as follows: “A patentee can obtain a 

financial reward for its patent by producing a product 

that incorporates the invention or by transferring the 

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technology through a patent license or sale to a manufacturer who develops and produces a product. The market 

reward earned by the patentee in either case will depend 

upon the extent to which consumers prefer the patented 

invention over alternatives and prior technology, which 

helps determine the invention’s economic value.” See Fed. 

Trade Comm’n, The Evolving IP Marketplace: Aligning 

Patent Notice and Remedies with Competition 139 (2011)

(footnote attached to “market reward” states: “The ‘market reward’ defined here is the amount the patentee could 

have earned by either selling a patented product or licensing the patented technology in the absence of infringement.”). The distinction urged on us appears to be 

unjustifiably formalistic, not founded in relevant economic 

substance. Mallinckrodt, 976 F.2d at 705.

The proposed distinction would also introduce practical problems. Where would the line be drawn along the 

spectrum from original patentees to assignees (e.g., regional assignees) to exclusive licensees (exclusivity being 

possible as to some but not all of the § 154 rights) to nonexclusive licensees? As we already have noted, patent law 

makes those distinctions for purposes of identifying who 

may bring infringement actions, but the distinctions are 

sometimes difficult to pin down and dependent on detailed inquiries into contractual provisions. When purchasing a patented article from a particular seller under 

specified restrictions that are not independently improper, how is the buyer to know where the seller falls along 

the spectrum—and, hence, whether the buyer may ignore 

the restrictions without fear of patent infringement? 

c. The government advances a doctrinal defense of the 

patentee-sale/licensee-sale distinction on which it rests its 

challenge to Mallinckrodt. The government begins its 

argument on the Mallinckrodt issue by first noting the 

absence of statutory text supporting its position and then 

turning, in the next sentence, to a passage from Bloomer 

v. McQuewan to supply a foundation for its argument. 

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U.S. Br. 5. It asserts that “[t]his distinction stems from 

the fact that licensees exercise a portion of the patentee’s 

rights.” Id. at 8 (citing Bloomer v. McQuewan, 55 U.S. (14 

How.) at 549–50). But that key distinction is wrong as a 

matter of basic patent law, misreads Bloomer v. McQuewan, and cannot distinguish General Talking Pictures 

from this case. A mere non-exclusive licensee, as in 

General Talking Pictures, possesses no portion of the 

rights granted by Congress in the patent.

Patent rights are only rights to exclude, not rights to 

practice. See 5 Chisum § 16.02[1]. Among the “clearly 

established principles” of patent law, as the Supreme 

Court described them in Crown Die & Tool Co., are that 

“the government did not confer on the patentee the right 

himself to make, use or vend his own invention” and “in 

its essence all that the government conferred by the 

patent was the right to exclude others from making, using 

or vending his invention.” 261 U.S. at 35; see Bauer, 229 

U.S. at 10 (“The right to make, use, and sell an invented 

article is not derived from the patent law. . . . The [patent 

statute] secured to the inventor the exclusive right to 

make, use, and vend the thing patented, and consequently 

to prevent others from exercising like privileges without 

the consent of the patentee.”); Continental Paper Bag, 210 

U.S. at 425; Bloomer v. McQuewan, 55 U.S. (14 How.) at 

549 (“The franchise which the patent grants, consists 

altogether in the right to exclude every one from making, 

using, or vending the thing patented, without the permission of the patentee. This is all that he obtains by the 

patent.”); Western Elec. Co. v. Pacent Reproducer Corp., 42 

F.2d 116, 118 (2d Cir. 1930); see also Dawson Chem. Co. v. 

Rohm & Haas Co., 448 U.S. 176, 215 (1980) (“long-settled 

view that the essence of a patent grant is the right to 

exclude others from profiting by the patented invention”). 

It is for that reason, for example, that a patentee may be 

prevented from practicing its own patent by another’s 

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patent. See Cantrell, 117 U.S. at 694; Blake, 94 U.S. at 

733; Smith, 88 U.S. (21 Wall.) at 118–19.

A patentee exercises its congressionally granted 

rights only when it invokes its power to exclude others, 

not when it sells its product. Similarly, the congressionally granted right to exclude may be viewed as being shared 

by certain exclusive licensees, who, in appropriate circumstances (e.g., with joinder of the patent owner), may bring 

infringement actions against others to enforce exclusivity. 

See Independent Wireless, 269 U.S. at 464–69 (discussing 

cases); 8 Chisum § 21.03[2]. But an exclusive licensee, in 

merely selling (or making, using, etc.) a patented article, 

is not exercising any power conferred by the patent statute. That is a fortiori true of a non-exclusive licensee, like 

the licensee in General Talking Pictures, which has no 

exclusivity protections at all. Thus, although the government’s assertion that “licensees stand in patentees’ 

shoes” in sharing certain patent-granted rights is true in 

a significant respect as to exclusive licensees, U.S. Br. 8, it 

is not true as to non-exclusive licensees—like the licensee 

in General Talking Pictures. Accordingly, a patentee’s 

ability to preserve its patent rights (rights to exclude) by 

arranging for sales to be made by a non-exclusive licensee, like the Transformer Company, cannot rest on a 

premise that “licensees exercise a portion of the patentee’s 

rights.” U.S. Br. 8.

Bloomer v. McQuewan, on which the government relies from the outset of its argument, U.S. Br. 5, does not 

say otherwise. The government states that in Bloomer v. 

McQuewan “the Court explained that a purchaser of a 

patented article ‘stands on different ground’ than one who 

obtains a license under the patent,” because the latter 

“‘obtains a share in the monopoly . . . derived from, and 

exercised under’ the patent.” Id. (emphasis added) (quoting Bloomer v. McQuewan, 55 U.S. (14 How.) at 549). But 

the Court did not say that about simply “one who obtains 

a license,” like the licensee in General Talking Pictures. 

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46 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

What the Court said in Bloomer v. McQuewan—

immediately after the sentences stating that the patent 

gives the patentee only “the right to exclude”—is that 

“when [the patentee] sells the exclusive privilege of making or vending [the invention] for use in a particular 

place,” the privilege ends with the patent that creates it. 

55 U.S. (14 How.) at 549 (emphasis added). That statement is about the exclusivity right, i.e., the right to exclude others, which an assignee or exclusive licensee 

obtains in whole or in part. By its terms, and consistent 

with the just-stated definition of the limited nature of the 

patent franchise, it says nothing about a non-exclusive 

licensee obtaining a share in the monopoly. The Court 

then contrasted, as “stand[ing] on different ground,” one 

who simply buys a patented device, which “[t]he inventor

might lawfully sell to him, whether he had a patent or 

not, if no other patentee stood in his way.” Id. The buyer, 

as mere owner and user of the device, lacks any patentgranted right to exclude, i.e., “exercises no rights created 

by the act of Congress,” so whatever rights it has do not 

end with the patent’s expiration. Id. The distinction was 

not between a sale from a patentee and a sale from a bare 

(non-exclusive) licensee. In short, General Talking Pictures cannot be distinguished on the doctrinal basis the 

government invokes. 

d. No Supreme Court decision compels adoption of the 

distinction the government urges. As Impression noted at 

oral argument, it is undisputed that no Supreme Court 

decision has involved a single-use/no-resale restriction on 

a patentee’s sale and found the restriction insufficient to 

preserve the patentee’s infringement rights against a 

buyer engaging in the forbidden reuse or resale. More 

generally, no Supreme Court precedent denies a patentee

the ability to preserve its § 271 rights, by a clear communication of an otherwise-permissible restriction, when it 

sells the patented article itself, just as the patentee may 

do, under the General Talking Pictures principle, when 

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contracting out the making and selling of the patented 

article. 

We have already noted the limitations on what was 

presented and decided in the Bloomer cases (rejecting 

implied temporal use restrictions) and Adams (rejecting 

implied geographic use restrictions). In 1881, the Supreme Court summarized the relevant law: “The right of 

the owner of a patented machine, without any conditions 

attached to his ownership, to continue the use of his 

machine during an extended term of the patent, is well 

settled.” In re Paper-Bag Cases, 105 U.S. at 770–71 

(emphasis added) (citing Bloomer v. McQuewan, Mitchell, 

Adams, and Chaffee v. Boston Belting Co., 63 U.S. (22 

How.) 217 (1859)). In so stating the law, in terms that 

tied exhaustion to the absence of conditions, the PaperBag Cases Court cited at least one case, Adams, involving 

a sale made by an assignee (a patentee under patent 

law).10 

The Court in Hobbie v. Jennison, 149 U.S. 355 (1893), 

described and followed the holding of Adams that, when 

an assignee sold machines, “there was no restriction on 

their use to be implied, for the benefit of the patentee or 

his assignees or licensees.” 149 U.S. at 362 (emphasis 

added). The Court held that an unrestricted sale of pipe 

in Michigan by the Michigan assignee (Jennison’s firm), 

with full rights to sell it, allowed the buyer to use it in 

Connecticut free of the patent rights belonging to the 

Connecticut assignee (Hobbie). 

 

10 In Chaffee, which involved Goodyear’s rubber patents, the Supreme Court rejected the defendants’ invocation of the Bloomer principle, again in a term-extension 

context, explaining that there was no evidence that the 

defendants had ever received any authority to practice the 

patented invention. 63 U.S. (22 How.) at 222–24.

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In its 1895 decision in Keeler, the Court applied its existing precedents, especially Adams and Hobbie. The 

Massachusetts assignee (Standard Folding-Bed) sued 

Keeler when he bought patented beds from the Michigan 

assignee, subject to no restrictions, and brought them to 

Massachusetts for sale. 157 U.S. at 660 (stating facts 

before opinion starts). The Court noted that in Adams the 

patented articles “were sold to [Burke] without condition 

or restriction,” id. at 663, and it concluded that Adams 

“was applicable,” id. at 665. The Court also quoted as 

defining the law (in this patentee-sale case) the passage 

set out above from Mitchell (a licensee-sale case). Id. at 

663. In any event, with no restriction on the sale present,

the Court followed Adams’ refusal to find one implied by 

the patent law. 

It was against that background that the Court then 

noted: “Whether a patentee may protect himself and his 

assignees by special contracts brought home to the purchasers is not a question before us,” but “such a question 

would arise as a question of contract, and not as one 

under the inherent meaning and effect of the patent laws.” 

Id. at 666 (emphasis added). That language lends itself to 

use in the government’s argument that sale restrictions 

never preserve patent rights, but give only contract rights. 

But even in Keeler the language does not compel that 

reading, and the later decisional law—most importantly, 

General Talking Pictures—undermines the contract-only 

interpretation. 

Thus, in Keeler itself, the word “inherent” naturally 

ties the language to the modest point based on Adams

that actually decided Keeler: with no contract restriction 

as part of the sale, an implied one cannot be found in 

patent law itself. That says nothing about the irrelevance 

of an actual contract restriction to preservation of patent 

rights. Moreover, in the licensee-sale context, General 

Talking Pictures establishes that contract restrictions can 

indeed preserve a patentee’s infringement rights and are 

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not merely enforceable under contract law: General 

Talking Pictures, which had no contract with the patentees, was held liable for patent infringement, not breach of 

any contract with the patentees. Notably, then, in Quanta, a licensee-sale case like General Talking Pictures, the 

Court quoted the language from Keeler after discussing 

General Talking Pictures (without a hint of disapproval) 

and concluding that, as in Keeler, Adams, and Hobbie, 

there simply was no patentee-imposed contractual restriction applicable to the sales at issue. 553 U.S. at 637 

n.7. And in the present case, as in General Talking 

Pictures, there is no reason to think that the patentee has 

a contract remedy available as a substitute for patent 

infringement: as far as the record before us shows, 

Lexmark has no contractual relationship with Impression. 

In United States v. General Electric Co., 272 U.S. 476 

(1926), the Supreme Court rejected the government’s 

antitrust challenge to (among other things) General 

Electric’s licensing of Westinghouse to make and sell 

patented lamps under terms controlling resale prices. See 

Fed. Trade Comm’n v. Actavis, Inc., 133 S. Ct. 2223, 2232 

(2013) (describing General Electric). In making a general 

point about patentee sales (not involved in the case), the 

Court said: “It is well settled, as already said, that 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.” 272 

U.S. at 489 (citing cases). We read that language to deem 

“settled” only what was settled in the cited precedents—a 

patentee’s sales without restrictions exhaust patent rights 

in the item sold. The cited cases are Adams, Bloomer v. 

McQuewan, Hobbie, Keeler, and Mitchell. They do not go 

beyond that proposition.

The prominent exhaustion decisions from the 1910s 

do not make the patentee-sale/licensee-sale distinction 

urged by the government here. After A.B. Dick adopted a 

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broad principle that preserved a patentee’s patent-law 

rights against restriction-violating sale, use, etc., even if 

the restrictions were otherwise unlawful—in A.B. Dick, a

tie-in requiring purchase of unpatented products—the 

Supreme Court repudiated A.B. Dick’s broad principle

and held particular restrictions improper and therefore 

not effective at preserving patent rights against actions 

contrary to those restrictions. It did so as to tie-ins in

Motion Picture Patents, overruling A.B. Dick and relying 

on the 1914 Clayton Act, 38 Stat. 730. See 243 U.S. at 

517. And it did so as to resale price maintenance in

Bauer, Straus, and finally Boston Store, relying on the 

judicially adopted per se antitrust condemnation of that 

practice in Dr. Miles Medical Co. v. John D. Park & Sons 

Co., 220 U.S. 373 (1911), overruled by Leegin Creative 

Leather Prods., Inc. v. PSKS, Inc., 551 U.S. 877 (2007). 

See Bauer, 229 U.S. at 12; Straus, 243 U.S. at 498; Boston 

Store, 246 U.S. at 21. But the Court did not rule that all 

restrictions on a patentee’s sale were ineffective to preserve the patentee’s patent-law rights. Instead, it called 

for an inquiry—in accord with what Mallinckrodt later 

said—into whether a patentee’s restrictions were otherwise improper, as by “extend[ing] the scope of its patent 

monopoly.” Motion Picture Patents, 243 U.S. at 516. And 

the Court did not adopt the line the government suggests 

between patentee sales and licensee sales.

In its 1942 decision in Univis, the Supreme Court rejected a patent-based defense to the government’s antitrust challenge to resale-price-maintenance restrictions in 

the licensing and selling of eyeglass lenses. The Court 

said that it had two questions before it: first, whether the 

restrictions were “excluded by the patent monopoly from 

the operation of the Sherman Act,” i.e., whether if the 

restrictions were illegal under the Sherman Act, they 

were saved by the patent law; and second, whether the 

restrictions were illegal under the Sherman Act. 316 U.S. 

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at 243. The Court said no on the first question, id. at 

249–52, and yes on the second, id. at 252–54. 

The second answer (regarding the substance of antitrust law) is immaterial here, and the first answer is in 

accord with Mallinckrodt’s ruling—which expressly 

recognizes that, as Univis held, restrictions that are 

otherwise unlawful do not preserve patent rights. Moreover, although some language in Univis, like language in 

other decisions in the area, can be taken out of context 

and read as going beyond the specific restrictions involved, id. at 249–51, the most the Court ruled, even as to 

patent law all by itself, was that a vertical price-control 

restriction was ineffective to preserve patent rights after 

sales of articles embodying the patents. While Univis is 

controlling on what it decided on the issues before it, we 

do not think it appropriate to give broad effect to language in Univis, taken out of context, to support an 

otherwise-unjustified conclusion here on a question not 

faced there. And that is particularly so today, given that 

the Univis opinion relied in part on strongly restrictive

patent-misuse decisions that were repudiated by Congress 

after Univis was decided.11

 

11 Univis supports some of its broader statements 

about loss of patent rights with citations to some of the 

highly restrictive patent-misuse decisions—e.g., Leitch 

Manufacturing Co. v. Barber Co., 302 U.S. 458 (1938); 

Morton Salt Co. v. G.S. Suppiger Co., 314 U.S. 488 (1942); 

B.B. Chemical Co. v. Ellis, 314 U.S. 495 (1942)—that were 

soon to culminate in the Mercoid decisions, Mercoid Corp. 

v. Mid-Continent Investment Co., 320 U.S. 661 (1944); 

Mercoid Corp. v. Minneapolis-Honeywell Regulator Co., 

320 U.S. 680 (1944). In the 1952 Patent Act, Congress, by 

adopting § 271(d), sharply limited the patent-misuse 

doctrine in response to that line of authority. See Dawson 

Chem. Co. v. Rohm & Haas Co., 448 U.S. 176, 204–15 

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Most pointedly for present purposes, Univis does not 

support the distinction between patentee sales and licensee sales the government urges in this case. The Univis 

case was decided just four years after General Talking 

Pictures, which confirmed that a patentee may preserve 

its patent rights by imposing otherwise-lawful restrictions 

on sales by its manufacturing licensees. Yet Univis says 

nothing to limit that prominent, recent ruling. Moreover, 

as we have already noted, Univis is explicit that it made 

no difference to the Court’s analysis whether the patentee 

(Univis Corporation) or the manufacturing licensee 

(Univis Lens Company) was doing the selling: the Court 

stated that the two companies “may for the purposes of 

this suit be treated as though they were a single corporation.” 316 U.S. at 243. The Court also stated its point 

about the particular sale as equally applicable to a “[s]ale 

of a lens blank by the patentee or by his licensee.” Id. at 

249 (emphasis added).12

For the foregoing reasons, we think that the best lesson to draw from the Supreme Court’s precedents, as 

applied to the question before us, is that a patentee may 

preserve its patent rights by otherwise-proper restrictions 

when it makes and sells patented articles itself and not 

only when it contracts out manufacturing and sales.

3 

 We see no basis for a different conclusion in Lord 

Coke’s description in 1628 of a British common-law principle, as quoted in Kirtsaeng, 133 S. Ct. at 1363. Lord 

 

(1980); Rich, supra, at 21. In 1988, Congress limited the 

patent-misuse doctrine still further. See Illinois Tool 

Works, 547 U.S. at 41–43.

12 The government also cites Aro II, 377 U.S. at 497, 

but that case involved no issue about restrictions in the 

terms of authorized sales.

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Coke described what British courts, in the absence of an 

overriding legislative prescription, would treat as an 

impermissible anti-alienation restriction on a seller’s 

disposition of “‘his whole interest’” in a chattel. Id. Lord 

Coke’s formulation was part of the judicial formulation of 

background law for personal property generally, and it 

neither addressed possible differences among particular 

kinds of personal property nor suggested that a judicial 

rule would override specific legislative grants. Lord 

Coke’s formulation was a pertinent reference point in 

Kirtsaeng, because, as we have noted, the copyright 

statute, 17 U.S.C. § 109(a), states a rule that itself overrides the otherwise-applicable statutory bars on infringement and importation and grants of exclusive rights. In 

stating one common-law jurisdiction’s general judicial 

policy at one time toward anti-alienation restrictions, 

Lord Coke’s description confirmed that the otherwisesupported reading of § 109(a) fit a legal tradition. 

Lord Coke’s quote does not purport to address the effect of a legislative prescription of broad rights to control 

sale and use.13 That is what is present in the Patent Act, 

but not the copyright law. Sections 154(a) and 271(a) 

legislatively establish a patentee’s rights over sale and 

use, without subservience to a superseding grant of rights 

to one who owns a particular article. They grant those 

rights separately as to making, selling, using, etc., thus 

recognizing different sticks in the bundle of rights; they 

 

13 Lord Coke’s 1628 statement does not address the 

Statute of Monopolies, enacted just a few years earlier, to

which American patent law has often been traced. See 

Pennock v. Dialogue, 27 U.S. (2 Pet.) 1, 18, 20 (1829); J.M. 

Robinson & Co. v. Belt, 187 U.S. 41, 47 (1902). Lord Coke 

did discuss the Statute of Monopolies elsewhere. See 

Pennock, 27 U.S. (2 Pet.) at 20 (citing Edward Coke, Third 

Part of the Institutes of the Laws of England 184 (1644)).

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grant them without an exception keyed to the patentee’s 

prior ownership of a particular article embodying the 

invention; and they grant them unless, as relevant here,

the patentee confers “authority.” Lord Coke’s quote does 

not address the Patent Act situation or suggest that 

federal courts may treat a denial of authority as a conferral of authority. 

Different policy choices can readily be made and justified in this area, even as to background rules applicable to 

personal property generally. Some of the numerous, 

distinct common-law jurisdictions, including Lord Coke’s, 

have departed at various times from the background rule 

expressed by Lord Coke. See De Mattos v. Gibson, (1859) 

45 Eng. Rep. 108 (Ch. App.); Waring v. WDAS Broad. 

Station, Inc., 194 A. 631, 637–38 (Pa. 1937); Metro. Opera 

Ass’n v. Wagner-Nichols Recorder Corp., 101 N.Y.S.2d 

483, 494–95 (N.Y. Sup. Ct. 1950), aff’d, 279 A.D. 632 (N.Y. 

App. Div. 1951); Pratte v. Balatsos, 113 A.2d 492, 494–95

(N.H. 1955); Nadell & Co. v. Grasso, 346 P.2d 505, 509–10

(Cal. 1959); Clairol Inc. v. Cosmetics Plus, 325 A.2d 505, 

508 (N.J. Sup. Ct. 1974); Zechariah Chafee, Jr., Equitable 

Servitudes on Chattels, 41 Harv. L. Rev. 945, 1007–13

(1928); Zechariah Chafee, Jr., The Music Goes Round and 

Round: Equitable Servitudes and Chattels, 69 Harv. L. 

Rev. 1250, 1254–56 (1956); Glen O. Robinson, Personal 

Property Servitudes, 71 U. Chi. L. Rev. 1449, 1455–60

(2004). In 1918, then-Dean Harlan Fiske Stone wrote: 

“The tendency in the United States has been to apply the 

doctrine of restrictive agreements to personal property 

when not regarded as an unlawful restraint of trade or in 

violation of public policy.” The Equitable Rights and 

Liabilities of Strangers to a Contract, 18 Colum. L. Rev. 

291, 310 (1918). 

In any event, and more specifically, whatever considerations might go into a jurisdiction’s choice as to the 

background rule for personal property in general, lawmaking authorities may reasonably make different choicCase: 14-1617 Document: 339-2 Page: 54 Filed: 02/12/2016
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es for particular kinds of property. Notably, as to intellectual property in its various forms, Congress, implementing the Constitution, has long deemed it important to 

incentivize creation and disclosure through grants to the 

creator of rights to exclude others for a time, the duration 

and scope based on features of the particular kind of 

intellectual property (e.g., patent terms are much shorter 

than copyright terms). The Patent Act expressly does so

regarding patent rights, specifically giving separate rights 

to exclude others from making, using, selling, etc. That 

overriding legislative prescription removes the patentedarticle sale from the scope of Lord Coke’s 1628 description 

of his country’s general judicially fashioned property law, 

as British tribunals recognized long ago. See A.B. Dick, 

224 U.S. at 42–43 (quoting the judicial committee of the 

Privy Council, speaking through Lord Shaw in 1911: “the 

general doctrine of absolute freedom of disposal of chattels of an ordinary kind is, in the case of patented chattels, subject to the restriction that the person purchasing 

them, and in the knowledge of the conditions attached by 

the patentee, which knowledge is clearly brought home to 

himself at the time of sale, shall be bound by that 

knowledge and accept the situation of ownership subject 

to the limitations. These limitations are merely the 

respect paid and the effect given to those conditions of 

transfer of the patented article which the law, laid down 

by statute, gave the original patentee a power to impose.”) 

(quoting Nat’l Phonograph Co. v. Menck, [[1911] A.C. 336, 

349 (P.C. 1911 appeal taken from Aus.)]); Incandescent 

Gas Co. v. Cantelo, [1895] 12 R.P.C. 262, 264 (Eng.). 

In short, notwithstanding Lord Coke’s description of 

English general personal-property judge-made law, the 

patent-specific statutory analysis must govern here. 

4 

Finally, following the analytical method of Kirtsaeng, 

we consider what we can reliably gauge about the likely 

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real-world consequences of one answer or another to the 

exhaustion question presented here. As indicated at the 

front of this opinion, we have received numerous amicus 

briefs making competing arguments, with varying degrees 

of reliable factual support, for the effect of Mallinckrodt 

on their interests or the interests they promote. We 

cannot assess those contentions and make policy choices 

in the way Congress can. We can say only that the amicus presentations give us no reason to depart from the 

application of § 271 we derive from the statute and precedent. 

In particular, we see no basis for predicting the extreme, lop-sided impacts the Court found plausible in 

Kirtsaeng in different circumstances. Mallinckrodt has 

been the governing case law since 1992 and has been 

reiterated in subsequent precedent. And yet we have 

been given no reliable demonstration of widespread 

problems not being solved in the marketplace. Given 

General Talking Pictures, the only question is about 

patentees’ ability to do for their own sales what they 

already can do by contracting out their manufacturing 

and sales. Regarding the specific scenario we are addressing today—in which the patentee has sought to 

preserve its patent rights by conditioning its first sale on 

a single-use/no-resale restriction of which the accused 

infringer had adequate notice at the time of purchase—we 

have been given no proof of a significant problem with 

enforcing patent rights. 

At the same time, the conduct challenged here can 

have benefits. Lexmark’s Return Program provides 

customers an immediate up-front benefit: a choice between two options, one offering them a lower price in 

exchange for the single-use/no-resale limitation. And a

company in Lexmark’s position could have a plausible 

legitimate interest in not having strangers modify its 

products and introduce them into the market with the 

quality of modifications (including ink refills) not subject 

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to Lexmark’s control: lower quality of remanufactured 

cartridges could harm Lexmark’s reputation. See Chafee, 

41 Harv. L. Rev. at 946–47. A medical supplier in 

Mallinckrodt’s position plausibly may have similar reason 

to believe that reuse, when not under its own control, 

carries a significant risk of poor or even medically harmful performance, to the detriment of its customers and its 

own reputation. Such interests are hardly unrelated to 

the interests protected by the patent law—the interests 

both of those who benefit from inventions and of those 

who make risky investments to arrive at and commercialize inventions. See Robinson, 71 U. Chi. L. Rev. at 1480–

1515 (surveying reasons for restrictions, particularly in 

intellectual-property area). 

We do not have a record on such interests in this case, 

as Impression has not claimed that the restrictions at 

issue violate antitrust, patent-misuse, or similar constraints. And it is not our function to assess the strength 

of such interests against those which might pull the other 

way. Nor can we fairly assume the illegitimacy of the 

conduct here. Such an assumption would run counter to 

the large-scale changes in antitrust law and patentmisuse law, especially over the last four decades, that 

have displaced the strict condemnation of various vertical 

restrictions that characterized both areas of law in the 

first half of the twentieth century. 

Thus, the Supreme Court broadly held that non-price 

vertical restraints are to be judged by a rule of reason. 

See Continental T.V., Inc. v. GTE Sylvania Inc., 433 U.S. 

36, 57–59 (1977), overruling United States v. Arnold, 

Schwinn & Co., 388 U.S. 365 (1967). The Court abandoned its “strong disapproval of tying arrangements” by 

insisting on market power in the tying product as a 

precondition to condemnation. See Illinois Tool Works, 

547 U.S. at 35–38; Jefferson Parish Hosp. Dist. No. 2 v. 

Hyde, 466 U.S. 2 (1984). It overturned both the per se 

ban on vertical agreements setting maximum resale 

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58 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

prices, State Oil Co. v. Khan, 522 U.S. 3, 7 (1997), overruling Albrecht v. Herald Co., 390 U.S. 145 (1968), and the 

per se ban on vertical agreements setting minimum resale 

prices, Leegin Creative Leather Prods., Inc. v. PSKS, Inc., 

551 U.S. 877, 900–01 (2007), overruling Dr. Miles Medical 

Co. v. John D. Park & Sons Co., 220 U.S. 373 (1911). 

The absence of a general basis for finding market 

harm from vertical restrictions is recognized specifically 

in the patent area, too. Field-of-use restrictions in patent 

licenses have long been common, as Mallinckrodt points 

out and General Talking Pictures shows. In 1988, building on an initial relaxation of patent-misuse standards in 

1952, Congress made clear that tying arrangements 

involving a non-patented product do not constitute patent 

misuse where the patentee lacks market power. 35 

U.S.C. § 271(d)(5). The Supreme Court, citing that determination, subsequently overturned its own longstanding antitrust presumption that patent (and copyright) 

owners have market power. Illinois Tool Works, 547 U.S. 

at 41–42. And the two federal antitrust agencies have 

recognized that restrictions in intellectual-property licenses can be procompetitive. See U.S. Dep’t of Justice & 

Fed. Trade Comm’n, Antitrust Guidelines for the Licensing of Intellectual Property § 2.3 (1995) (“Field-of-use, 

territorial, and other limitations on intellectual property 

licenses may serve procompetitive ends by allowing the 

licensor to exploit its property as efficiently and effectively as possible.”). 

For those reasons, we see no basis for departing from 

the legal analysis set out above. A patentee already may 

preserve its patent rights against downstream buyers 

(with notice) through otherwise-lawful restrictions, by 

licensing others to make and sell its patented articles. 

We conclude that the law does not forbid the patentee to 

do the same when making and selling the articles itself.

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III

The second question presented to us is whether 

Lexmark’s sales of its cartridges abroad conferred authority on its buyers, and derivatively on Impression, to 

import the cartridges into, and sell and use them in, the 

United States, which would be infringing acts in the 

absence of authorization. The question was decided by 

the district court, and is presented here, on the premise 

that Lexmark made the foreign sales without communicating a reservation of U.S. patent rights. And the question is presented only as an exhaustion question, because 

Impression did not press any implied-license defense, 

despite the fact that Quanta made clear that the doctrines 

are distinct.

The absence of an implied-license defense in this case 

sharpens the definition of the issue presented. There is 

no doubt that a U.S. patentee, when selling a U.S.-

patented article abroad, could give the buyer permission, 

expressly or by implication from the circumstances, to

import the purchased article into the United States and 

sell and use it here. Such a license would make those acts 

non-infringing. The question for decision is whether, if 

there is no proof of any such license (express or implied), 

there is nonetheless a legal rule that such a foreign sale 

confers authority on the overseas buyer to import the 

patented article into the United States and sell and use it 

here. If there is such a legal rule of authorization, the 

next question is whether the authorization is conclusive, 

effective even in the face of the U.S. patentee’s reservation of U.S. rights, or only presumptive, with the U.S. 

patentee able to reserve its U.S. rights if it can demonstrate with adequate certainty that it has taken the steps 

needed to do so. 

We conclude, as we did in Jazz Photo, that there is no 

legal rule that U.S. rights are waived, either conclusively 

or presumptively, simply by virtue of a foreign sale, either 

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60 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

made or authorized by a U.S. patentee. The government, 

we note, agrees that a conclusive-exhaustion rule should 

be rejected but argues for a presumptive-exhaustion rule

regarding a U.S. patentee’s foreign sales. In the government’s view, a U.S. patentee can reserve its U.S. rights 

when selling abroad (but not if selling domestically, under 

the government’s view that Mallinckrodt is wrong). We 

conclude that neither a conclusive- nor a presumptiveexhaustion rule is legally justified.

A 

This court’s 2001 decision in Jazz Photo reviewed the 

International Trade Commission’s finding that Jazz Photo 

(and others) infringed patents of Fuji Photo Film by 

importing refurbished disposable cameras originally sold 

by or with the authorization of Fuji Photo. 264 F.3d 1094, 

1098. Two groups of cameras sold by or with the authorization of Fuji Photo were at issue: those sold initially in 

the United States, refurbished abroad, and imported back 

into the United States; and those initially sold abroad, 

refurbished abroad, and imported into the United States. 

This court drew different conclusions about infringement 

regarding those two groups of imported cameras. 

Disagreeing with the Commission on the central issue 

in the case, the court held that a specifically described set 

of refurbishment changes (involving insertion of new film 

into the used casings) were mere repairs, not reconstructions that amounted to creation of new articles. Id. at 

1102–07. Therefore, the court ruled, for the “used cameras whose first sale was in the United States with the 

patentee’s authorization,” and that were subjected to only 

those changes (with disclosure to the Commission), Jazz 

Photo’s importations were not infringing: repair maintained the identity of the article initially sold, and the

domestic sale exhausted the patentee’s rights in the 

article sold (but not in newly created articles). Id. at 

1098–99, 1102–05 (discussing, for example, Aro I, 365 

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U.S. at 346); see Bowman, 133 S. Ct. at 1766. As to those 

used cameras, the court reversed the Commission. 264 

F.3d at 1099.

The court held, however, that a different result was 

required for any of the imported cameras that previously

had been “sold only overseas,” even if the changes in them 

amounted only to repair. Id. at 1105 (emphasis added). 

Relying on Boesch v. Graff, 133 U.S. 697, 701–03 (1890),

the court ruled that “United States patent rights are not 

exhausted by products of foreign provenance,” i.e., products previously sold only abroad. 264 F.3d at 1105. Thus, 

the court’s non-infringement ruling (and reversal of the 

Commission) applied only to used cameras “for which the 

United States patent right has been exhausted by first 

sale in the United States” and whose refurbishing was 

limited as described. Id. The imported cameras not 

previously sold in the United States, in contrast, “are not 

immunized from infringement of United States patents by 

the nature of their refurbishment.” Id. There is no suggestion that Jazz Photo argued that Fuji Photo had expressly or impliedly licensed importation in making or 

authorizing the foreign sales, and the court said nothing 

to foreclose such a defense to infringement. Accordingly, 

as to cameras “whose prior sale was not in the United 

States,” the court affirmed the Commission’s infringement 

finding and remedies against Jazz Photo. Id. at 1111.

The court followed Jazz Photo in Fuji Photo Film Co., 

Ltd. v. Jazz Photo Corp., 394 F.3d 1368, 1370 (Fed. Cir. 

2005), which affirmed a district court’s judgment of infringement by Jazz Photo (and others) in favor of Fuji 

Photo in litigation involving the same dispute as Jazz 

Photo. This court rejected Jazz Photo’s argument for 

exhaustion as to first sales made abroad. The court in 

Fuji Photo explained that in Jazz Photo “this court expressly limited first sales under the exhaustion doctrine 

to those occurring within the United States.” Id. at 1376. 

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Accordingly, exhaustion of U.S. rights is not triggered by 

“[t]he patentee’s authorization of an international first 

sale.” Id. In Fuji Photo, as in Jazz Photo, the court did 

not foreclose any argument about express or implied 

licenses conferred in particular foreign sales.

In short, this court has held since 2001 that the foreign sale of a U.S.-patented article, when the sale is 

either made or authorized by the U.S. patentee, does not,

standing alone, confer on the buyer “authority” to import 

the item into the United States or to sell and use it here, 

and so does not save those acts from being infringing 

under § 271(a). See Ninestar Tech. Co. v. Int’l Trade 

Comm’n, 667 F.3d 1373, 1378 (Fed. Cir. 2012).14 The 

 

14 In Ninestar, this court rejected the argument that 

Quanta, 553 U.S. at 632 n.6, upset Jazz Photo. Quanta’s 

footnote 6 does not address or decide whether a foreign 

sale can trigger exhaustion. It makes a different point, 

stated in the textual assertion the footnote supports: 

“LGE has suggested no reasonable use for the Intel Products other than incorporating them into computer systems 

that practice the LGE Patents.” Id. at 632. That assertion applies the Court’s standard for when an article not 

covered by a patent nevertheless embodies the patent. 

Footnote 6 responds to footnote 10 in LGE’s brief, Brief 

for Respondent 21–22 n.10, Quanta (No. 06-937), 2007 

WL 4244683, which does not rely on a foreign sale of the 

Intel Products, but argues that the (first-sale) Intel Products do not embody the patents because they have substantial non-infringing uses, namely, wholly foreign 

making, selling, and using of computers covered by the 

patents. Quanta’s footnote 6 responds that such foreign 

acts with those computers “would still be practicing the 

patent, even if not infringing it,” which is what counts for 

the “embody” inquiry. 553 U.S. at 632 n.6.

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court has not curtailed the ability of an accused infringer 

to show that the patentee conferred such authority by 

words or implications. Exhaustion cannot rest on a 

foreign first sale, but an express or implied license might 

be found based on the circumstances of particular foreign 

sales. 

B 

The Supreme Court’s decision in Kirtsaeng does not 

undermine the no-exhaustion conclusion of Jazz Photo. In 

Kirtsaeng, the Court interpreted § 109(a) of the Copyright 

Act, which states that “the owner of a particular 

copy . . . lawfully made under this title . . . is entitled, 

without the authority of the copyright owner, to sell or 

otherwise dispose of the possession of that copy . . . .” 17 

U.S.C. § 109(a). The Court held that § 109(a)’s guarantee 

is not limited to copies manufactured in the United 

States, but applies regardless of the place of manufacture, 

as long as the maker of the copies had permission from 

the copyright owner to make them. Kirtsaeng, 133 S. Ct. 

at 1355–71.

For various reasons, that ruling does not answer the 

question presented under the Patent Act. Kirtsaeng says 

 

Neither in footnote 6 nor elsewhere does Quanta refer 

to LGE’s final footnote, Brief for Respondent 53 n.19, in 

which LGE cited Boesch, suggested that Intel’s sales 

might have been made abroad, and said that this was an 

open question for remand. Quanta replied that LGE had 

waived any foreign-sale-location contention, so that 

reversal, not remand, was required. Reply Brief for 

Petitioners 3 n.2, Quanta (No. 06-937), 2007 WL 4613423. 

The Court evidently agreed with Quanta. Without discussing Boesch or any issue about foreign-sale exhaustion 

law, the Court reversed, holding that “LGE can no longer 

assert its patent rights against Quanta.” 553 U.S. at 638.

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nothing about patent law; and it does not address, even in 

the context of copyright law, the exhaustion question 

presented by the Patent Act. Whether a sale constitutes a 

grant to a buyer of (conclusive or presumptive) “authority” 

to engage in otherwise-prohibited acts of importation, 

sale, and use is the question here. It is not the question 

presented by the Copyright Act. That Act contains no 

right to exclude anyone from “use,” and § 109(a) of the Act

expressly overrides the copyright holder’s rights to exclude from importing or selling copies, permitting acts 

“without the authority” of the rights owner—in circumstances that undisputedly have nothing to do with the 

place of sale. The Court in Kirtsaeng merely interpreted 

§ 109(a) and resolved the dispute about whether the place 

of manufacture matters under § 109(a), holding—for a 

number of reasons “taken together”—that it does not. 133 

S. Ct. at 1358, 1371. The Kirtsaeng question thus is 

several steps removed from the question presented under 

the Patent Act, which requires a quite different analysis.

To elaborate: In Kirtsaeng, the Supreme Court did not 

advert to the foreign-exhaustion issue under patent law. 

Nor did it cite, even to distinguish, its own leading case on 

exhaustion and foreign sales in the patent area, namely,

Boesch—which has no counterpart in the copyright area. 

More generally, the Court nowhere relied on the wealth of 

exhaustion cases in the patent area. The absence of such 

references to patent law, even at a general level, reinforces the need for a distinct patent-law analysis.

The Court has long recognized the distinctness of the 

copyright and patent regimes and observed that particular questions require separate analysis for each body of 

law. For example, the Court has noted that the patent 

right is broader in scope than the copyright right in at 

least one important respect: the patent statute gives a 

right to exclude others from “use,” whereas the copyright 

statute does not. Bauer, 229 U.S. at 13–14. In a decision 

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relied on in Kirtsaeng, 133 S. Ct. at 1363, the Court stated 

more generally that copyright-law conclusions and patentlaw conclusions do not necessarily align, so that a conclusion about copyright law does not automatically carry 

over to patent law. Bobbs-Merrill, 210 U.S. at 345–46. In 

Sony Corp. of America v. Universal City Studios, Inc., the 

Court, noting that patent and copyright law “are not 

identical twins,” required “caution . . . in applying doctrine formulated in one area to the other.” 464 U.S. 417, 

439 n.19 (1984). In Eldred v. Ashcroft, the Court explained that “patents and copyrights do not entail the 

same exchange.” 537 U.S. 186, 216 (2003). 

The answer to a particular question therefore requires 

analysis of the specifics of the relevant statute. The Court 

in Kirtsaeng conducted just such an analysis for the 

copyright-law question before it. It analyzed a copyrightspecific text, namely, § 109(a), and stressed that it was

determining “the best reading of § 109(a).” 133 S. Ct. at 

1370 (emphasis in original). See id. at 1371 (“we do no 

more here than try to determine what decision Congress 

has taken”); id. at 1357 (“We must decide whether the 

words ‘lawfully made under this title’ restrict the scope of 

§ 109(a)’s ‘first sale’ doctrine geographically.”). And the 

structure of the Court’s analysis confirms the primacy of 

the statutory text: The Court began its analysis with an 

extensive consideration of the text of § 109(a). 133 S. Ct. 

at 1358–60. It concluded that “[t]he language of § 109(a) 

says nothing about geography”; reading “made under this 

title” to mean made with the rights holder’s permission,

not to mean made in the United States, “is simple, . . . promotes a traditional copyright objective (combatting piracy), and . . . makes word-by-word linguistic 

sense”; while the made-in-the-United-States interpretation “bristles with linguistic difficulties.” 133 S. Ct. at 

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cal, and practical considerations to support that textual 

conclusion. Id. at 1358–62. 

The text construed in Kirtsaeng has no counterpart in 

the Patent Act. And that text presents a sharply different 

question from the statutory question presented by the 

Patent Act. By its terms, far from calling for a determination of whether any kind of sale constitutes the conferring 

of “authority” from the rights holder, § 109(a) defines the 

circumstances (ownership of a copy lawfully made) that, 

when present, give a copy owner a right to sell or dispose 

of the owned copy “without the authority of the copyright 

owner.” 17 U.S.C. § 109(a) (emphasis added). Moreover, 

as we have explained, and as the Court ruled in Kirtsaeng

and Quality King, the Copyright Act makes the provisions 

on exclusivity, infringement, and importation all subservient to § 109(a). In the Copyright Act, the § 109(a) grant 

to copy owners overrides other requirements of authority

from the rights holder, specifically those governing importation and sale. That is not so in the Patent Act, under 

which exhaustion textually can be nothing but an answer 

to a statutory question of when a patentee has, by a sale,

conferred such authority. 

Section 109(a)’s language, which gives an owner an

entitlement to resell “without the authority of the copyright owner,” does not make that entitlement depend on 

an assessment of whether a first sale made or authorized 

by the copyright holder confers resale authority on the 

buyer. The right to resell is given to the “owner” of an 

article “lawfully made” under the Act. The “owner” language—whose meaning was not at issue in Kirtsaeng—

says nothing about where ownership is acquired and does 

not require a prior sale at all: a copy made by the person 

who owns it, as long as the making was authorized, is 

within § 109(a)’s language. See 133 S. Ct. at 1361 (discussing 17 U.S.C. § 115); 2 Melville B. Nimmer & David 

Nimmer, Nimmer on Copyright § 8.12[B][3][c] (2015). 

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Even when ownership comes from a sale, moreover, the 

provision prescribes the result for the owner’s resale 

entitlement in terms not dependent on “authority” from 

the copyright holder but as independent of any such 

authority. And the remaining requirement stated by the 

language at issue in Kirtsaeng—“lawfully made under 

this title”—undeniably refers only to the manufacture of 

the copy and whether that manufacture was lawful. That

language, like the “owner” language, leaves no place for 

consideration of the location of a prior sale (if there was 

one), which is the issue here. 

Years before deciding Kirtsaeng, the Court in Quality 

King had made clear that the language of § 109(a) makes 

sale location irrelevant: under that language, “the owner 

of goods lawfully made under the Act is entitled to the 

protection of the first sale doctrine in an action in a United States court even if the first sale occurred abroad.” 

523 U.S. at 145 n.14. The Court in Kirtsaeng confirmed 

the point. 133 S. Ct. at 1371 (noting the “holding in 

Quality King that § 109(a) is a defense in U.S. courts even 

when ‘the first sale occurred abroad’”). Not surprisingly, 

neither party in Kirtsaeng argued that the provision could 

be read to refer to the sale location.15 And the Court 

 

15 The Second Circuit in Kirtsaeng had held that 

§ 109(a) was inapplicable whenever the copy had been 

made abroad, John Wiley & Sons, Inc. v. Kirtsaeng, 654 

F.3d 210, 222 (2d Cir. 2011), and Kirtsaeng’s “question 

presented” to the Supreme Court was “whether the copyright owner is entitled to control downstream sales just 

because it opts to manufacture the copies abroad.” Brief 

for Petitioner at i, Kirtsaeng (No. 11-697), 2012 WL 

2641850. Kirtsaeng noted once in passing that a salelocation standard “sacrifices any pretense of fidelity to the 

statutory text” of § 109(a). Id. at 25. Wiley similarly 

recognized that “[t]he question presented is whether 

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readily dismissed a sale-location view as “not defensible” 

and facing “linguistic and other hurdles that . . . are 

insurmountable.” Id. at 1366. With sale location off the 

table, the dispute in Kirtsaeng was simply between two 

different interpretations of the statutory reference to 

manufacture (“lawfully made under this title”)—whether 

it referred to where manufacture occurred (the “geographic” interpretation) or to whether the manufacture was 

lawful under the standards of the Copyright Act (e.g., 

with the copyright owner’s permission, as opposed to 

pirated). For that reason, whether an “implied license” 

would arise from sales in some circumstances was immaterial to the statutory question being debated, and the 

Court did not comment on that notion, despite its mention 

in the dissent, 133 S. Ct. at 1389 & n.25 (Ginsburg, J., 

dissenting), and the government’s brief, Brief for the 

United States as Amicus Curiae Supporting Respondent

at 21, Kirtsaeng (No. 11-697), 2012 WL 3902599. 

In short, given the nature of the question framed by 

§ 109(a), the Court in Kirtsaeng did not have occasion to 

decide, and did not decide, whether a foreign sale (by or 

authorized by the U.S. rights holder) is properly treated 

as conferring on the buyer, conclusively or presumptively,

the authority to resell. The Court did not decide, even for 

copyrights, the question presented here for patents.

 

copies made outside the United States are ‘lawfully made 

under this title’ within the meaning of Section 109(a).” 

Brief for Respondent at i, Kirtsaeng (No. 11-697), 2012 

WL 3836936. Wiley explained that the relevance of sale 

location was not being argued; and it nowhere argued 

that the sale of the books outside the United States, as 

opposed to their manufacture outside the United States, 

defeated exhaustion. Id. at 37–38. 

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The nature of the statutory question decided in 

Kirtsaeng also shows why the Court’s discussion of considerations supporting its textual conclusion cannot be 

transposed to the patent-law setting at issue here. The 

discussion of the statutory history and certain provisions 

of the Copyright Act, 133 S. Ct. at 1360–62, 1370, is 

statute-specific. And the Court’s discussion of the absence 

of any constitutional history or congressional action 

permitting market division was limited to the copyright 

area. Id. at 1370–71. Compare 35 U.S.C. § 261 (patentee 

may assign rights “to the whole or any specified part of 

the United States”).

Similarly, the Court’s discussion of Lord Coke’s 1628 

description of his country’s general judicial personalproperty law, id. at 1363–64, is inapplicable here. That 

description, as already explained, is apt background for a 

provision, like § 109(a), that is superior to any legislative 

grant of rights that cover post-purchase activities of a 

buyer. The Patent Act contains no such override of the 

Act’s grant of rights to patentees. And the Court in 

Kirtsaeng drew from Lord Coke’s description only a general recognition of “the importance of leaving buyers of 

goods free to compete with each other when reselling or 

otherwise disposing of those goods,” adding that American 

antitrust law recognizes a similar point. 133 S. Ct. at 

1363. That observation merely confirms that the result of 

the § 109(a) analysis is sensible because it fits one policy 

found in aspects of American and British law containing 

no specific statutory override. And the Court then cited 

Bobbs-Merrill, which construed the pre-1909 copyright 

statute not to contain an override in the circumstances at 

issue, 210 U.S. at 349–51, and noted that the next year, 

Congress adopted that result by enacting the statutory 

predecessor of § 109(a). Kirtsaeng, 133 S. Ct. at 1363–64.

In addition, the Court’s account of the potential realworld consequences of the statutory interpretation it was 

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rejecting, though it mentions sale location a few times, is 

pervasively tied to the issue actually in dispute—whether 

a foreign manufacture location makes § 109(a) inapplicable. 133 S. Ct. at 1364–67. Under that interpretation, the 

Court stated, the rights holder would have “permanent” 

control, id. at 1362, “perpetual downstream control,” id. at 

1371, of copies circulating in the United States as long as 

those copies had been made abroad: § 109(a) would not 

kick in to give resale rights to purchasers of those copies

even if the copyright holder sold the article in the United 

States. See also id. at 1366 (referring to “the absurd 

result that the copyright owner can exercise downstream 

control even when it authorized the import or first sale”). 

As the government notes to us, the Patent Act, which 

lacks a provision like § 109(a), is quite different: “there is 

no concomitant risk of ‘perpetual downstream control’ 

over patented goods.” U.S. Br. 24. At the very least, an 

unrestricted patentee-made or -authorized sale in the 

U.S. triggers exhaustion as to the article sold.

Moreover, the “copyright-related consequences” emphasized by the Court in Kirtsaeng, 133 S. Ct. at 1367, 

were to a large extent, though not entirely, tied to the 

distinctive problems of museums, libraries, and 

booksellers. Id. at 1364–67. To that extent, the Court’s 

overall analysis of plausible practical effects—of an interpretation keeping every foreign-made copy forever outside 

§ 109(a)—was copyright-specific. The Court in Kirtsaeng 

also concluded that circuit-court precedent on § 109(a) 

was too fractured to give meaningful comfort that the 

practical problems from the Court’s adoption of Wiley’s 

view of § 109(a) were unlikely to materialize. Id. at 1366. 

In contrast, our exclusive jurisdiction and clear rule since 

2001, together with the pre-2001 precedents from other 

courts, provide considerably more reason to discount 

predictions that adhering to a territorial line to make 

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exhaustion unavailable based on a foreign sale will result 

in serious practical problems. 

For all of those reasons, Kirtsaeng is not controlling in 

this case. The patent-law issue presented here requires a 

separate analysis in its own legal setting. 

C 

The Patent Act question is whether a foreign sale of a 

U.S.-patented article made or authorized by a U.S. patentee, standing alone, confers on the buyer authority to 

import the article into the United States and sell and use 

it here, even though such an act would be infringing in 

the absence of authority. The best answer to that question, we conclude, is that such a foreign sale does not 

confer such authority. A U.S. patentee, simply by making 

or authorizing a foreign sale of an article, does not waive

its U.S. rights to exclude regarding that article, either 

conclusively (no matter how clear the reservation of U.S. 

rights) or only presumptively (subject to sufficiently clear 

preservation of U.S. rights).

1 

The combined logic of the statutory grant of patent 

rights and the long-recognized basis for exhaustion leads 

naturally to rejecting exhaustion based on a foreign sale. 

The statute gives patentees the reward available from 

American markets. A patentee cannot reasonably be 

treated as receiving that reward from sales in foreign 

markets, and exhaustion has long been keyed to the idea 

that the patentee has received its U.S. reward.

Thus, what the statute expressly provides to a U.S. 

patentee is the reward available from the right to exclude 

“in the United States.” See 35 U.S.C. §§ 154(a)(1), 

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271(a).16 The reward is inherently a market reward: “it is 

one of the legal beauties of the system that what is given 

by the people through their government—the patent 

right—is valued automatically by what is given by the 

patentee. His patent has value directly related to the 

value of his invention, as determined in the marketplace.” 

In re Kirk, 376 F.2d 936, 964 (CCPA 1967) (Rich, J., 

dissenting).17 And the market reward, under the statute, 

is explicitly the reward available from American markets 

subject to American laws, a reward obtained by selling or 

authorizing sales in those markets.

 

16 Congress has added certain limited extensions to 

foreign conduct. See 35 U.S.C. § 271(f). Those limited 

extensions are not applicable here and only strengthen 

the essential guarantee of a U.S.-market reward.

17 See Bonito Boats, Inc. v. Thunder Craft Boats, 

Inc., 489 U.S. 141, 150–51 (1989) (“The federal patent 

system thus embodies a carefully crafted bargain for 

encouraging the creation and disclosure of new, useful, 

and nonobvious advances in technology and design in 

return for the exclusive right to practice the invention for 

a period of years.”); Fed. Trade Comm’n, Evolving IP 

Marketplace 138–39 (“An important benefit of the patent 

system, in contrast to other methods of encouraging 

innovation, like direct prizes, is that it allows each invention to be valued directly through a market mechanism.”) 

(citing Kenneth W. Dam, The Economic Underpinnings of 

Patent Law, 23 J. Legal Stud. 247, 248–49 (1994); Joseph 

Farrell, John Hayes, Carl Shapiro & Theresa Sullivan, 

Standard Setting, Patents and Hold-Up, 74 Antitrust L.J. 

603 (2007)); see also Aro II, 377 U.S. at 507 (patent “damages” tied to market valuation); Dowagiac Mfg. Co. v. 

Minnesota Moline Plow Co., 235 U.S. 641, 648 (1915) 

(reasonable royalty measures “the value of what was 

taken” by infringement, necessarily a market value). 

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At the same time, the Supreme Court has “explained 

the basis for [exhaustion] doctrine” in terms of the patentee’s receipt of the reward given by the statute. Bowman, 133 S. Ct. at 1766. “‘The purpose of the patent law 

is fulfilled with respect to any particular article when the 

patentee has received his reward . . . by the sale of the 

article.’” Id. (quoting Univis, 316 U.S. at 251, itself citing 

earlier authorities). Only when it is appropriate to assume the receipt of that reward does the sale support an 

inference of conferral of authority on an article’s buyer (in 

the absence of clearly communicated restrictions on the 

authority conferred).

Whatever other issues may be presented by determining when a patentee has “received his reward,” the territorial nature of the statutory guarantee supplies a simple, 

strong reason to exclude foreign sales. The guarantee is 

the reward from sales in American markets, not from 

sales in foreign markets. A sale in a foreign market 

therefore does not furnish “the basis for” exhaustion—

even for a presumption that authority is being conferred 

on the buyer to exploit the article in American markets by 

the actions (importation, sale, use, etc.) that are infringing in the absence of patentee-conferred authority.

American markets differ substantially from markets 

in many other countries, and not just because of disparities in wealth that can lead to dramatically different 

prices (especially for low-marginal-cost products). Government policies differ dramatically, including policies on

price regulation and, most particularly, policies on the 

availability and scope of patent protection. Patents 

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involve costly government-approval processes, and the 

standards vary.18 The government explains: 

The independence of national patent systems . . . is one of the defining principles of the international legal regime governing the protection 

of inventions. The United States has ratified the 

Paris Convention for the Protection of Industrial 

Property, originally adopted more than a century 

ago, which specifically provided in Article 4bis 

 

18 See, e.g., Robert Patrick Merges & John Fitzgerald 

Duffy, Patent Law and Policy: Cases and Materials 55 

(5th ed. 2011); Graeme B. Dinwoodie, William O. Hennessey, & Shira Perlmutter, International and Comparative 

Patent Law § 2.03 at 53–54 (2002); John Gladstone Mills 

III, A Transnational Patent Convention for the Acquisition 

and Enforcement of International Patent Rights, 88 J. Pat. 

& Trademark Off. Soc’y 958, 958–59 (2006); Margaret A. 

Boulware, Jeffrey A. Pyle, & Frank C. Turner, An Overview of Intellectual Property Rights Abroad, 16 Hous. J. 

Int’l L. 441, 458–59 (1994). 

A few dollar figures provide some context. For a U.S. 

patent, the minimum application fee is $2,560 (covering 

only the basic filing, search, examination, and issue fees). 

See USPTO Fee Schedule, U.S. Patent & Trademark 

Office, http://www.uspto.gov/learning-and-resources/feesand-payment/uspto-fee-schedule. As for lawyers’ charges 

for preparing and prosecuting a patent application, a 2015 

report indicated that the median charge to prepare a 

minimally complex utility patent application is $7,000, 

with responses to Office Actions ranging from $2,000 to 

$3,200 each. Am. Intellectual Prop. Law Ass’n, Report of 

the Economic Survey 29 (2015). For an example of filing 

fees for patents abroad, see European Patent Office, 

Schedule of Fees, http://www.epoline.org/myepoline_eofp 

_portletapp-2.8.3/fees/pdf?language=en. 

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that “Patents applied for in the different contracting States . . . shall be independent of the patents 

obtained for the same invention in the other 

States . . . .” 32 Stat. 1936 (Aug. 25, 1902). While 

international agreements facilitate the ability of 

inventors in one country to seek patent protection 

in others, the patents laws of each country are not 

reciprocal in their protections for particular inventions. As every patent attorney knows, the 

United States may issue a patent while another 

country denies protection for the same invention, 

or approves claims significantly different in scope.

U.S. Br. 15–16. 

Copyrights are different. They generally spring into 

being without any government approval, and standards 

hardly vary compared to patenting standards. As the 

government says, “patent law is different from copyright 

law, under which authors automatically ‘enjoy copyright 

protection in nations across the globe’ pursuant to the 

Berne Convention for the Protection of Literary and 

Artistic Works.” U.S. Br. 16 (quoting Golan v. Holder, 

132 S. Ct. 873, 878 (2012)); see Golan, 132 S. Ct. at 878 

(referring to “Berne’s 164 member states”).19 And there is 

no reason to think that the costs of copyright registration 

(not even a prerequisite to all copyright protection) are 

 

19 It has been noted that, as a matter of statutory 

text, “of the three principal forms of [federally protected] 

intellectual property [copyright, patent, trademark], 

patent rights are the most explicitly territorial.” Donald 

S. Chisum, Normative and Empirical Territoriality in 

Intellectual Property: Lessons from Patent Law, 37 Va. J. 

Int’l L. 603, 605 (1997); see Dinwoodie et al., § 1.03 at 30.

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generally comparable to those of securing patent protection.20 

Given the varying standards, and the separate examination processes and fees, a U.S. patentee may choose 

not even to seek patent protection in particular foreign 

countries. And those seeking protection may not obtain 

it, or may not obtain protection comparable to that of the 

U.S. patent. In either event, foreign sales in such circumstances may not occur under protections likely to produce 

market returns comparable to the reward contemplated 

by our patent law. Such country-to-country differences in 

patent law, moreover, are only part of the likely differences affecting foreign sales, supplementing differences in 

economic circumstances and in governments’ price and 

other non-patent regulations bearing on sales. 

For those reasons, a foreign sale, standing alone, is 

not reasonably viewed as providing the U.S. patentee the 

reward guaranteed by U.S. patent law. Such a sale is not 

reasonably viewed as itself a waiver by the patentee of its 

U.S. patent rights to prevent the buyer or others from 

bringing that article into the United States and selling or 

using it to satisfy a U.S.-market demand that the patentee could otherwise help satisfy at U.S.-market prices, as 

guaranteed by the Patent Act.

 

20 The application fee for a U.S. copyright registration is $35. Fees, U.S. Copyright Office, 

http://copyright.gov/ about/fees.html. The same 2015 

Survey that gives a median charge of $7,000 for legal 

services for preparing a minimally complex patent application (before the back-and-forth of prosecution occurs) 

gives a figure of $400 for services to prepare an application for a copyright registration. Am. Intellectual Prop. 

Law Ass’n, Report at 29. 

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2 

The only Supreme Court decision directly addressing 

the effect of a foreign sale on U.S. patent rights is the 

1890 decision in Boesch v. Graff, 133 U.S. 697. Albert 

Graff and J.F. Donnell, by assignments, held an 1883 U.S. 

patent on certain lamp burners. Without their permission, Emile Boesch and Martin Bauer sold patent-covered 

burners in the United States. Boesch and Bauer had 

bought those burners from a supplier in Germany, without permission from the holders of the rights under German patents (dated 1879–1880), which had been issued to 

the same individuals as the U.S. patent. The German 

supplier was authorized to make the sale to Boesch and 

Bauer, not by the German patentees, but by a German 

law that allowed continuation of certain preparatory 

activities that began before the application for the German patents was filed. 133 U.S. at 698–99, 701–02. 

When Graff and Donnell sued Boesch and Bauer for 

infringement, the single-judge circuit court for the Northern District of California found infringement, and the 

Supreme Court affirmed that holding. Id.

The Court rejected Boesch and Bauer’s defense that 

they “could not be held for infringement, because they 

purchased the burners in Germany from a person having 

the right to sell them there, though not a licensee under 

the German patents.” Id. at 699. The Court stated “the 

exact question presented [a]s whether a dealer residing in 

the United States can purchase in another country articles patented there, from a person authorized to sell them, 

and import them to and sell them in the United States, 

without the license or consent of the owners of the United 

States patent.” Id. at 702. In answering the question, the 

Court recited the then-leading decisions on domestic 

exhaustion, culminating in Adams, which, the Court 

observed, held that, within the confines of the United 

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rial limit to the rights conferred by an unrestricted sale by 

a regional assignee. Id. at 703. The Court then concluded 

that the cross-border situation was different. Its full 

rationale was as follows: 

The right which [the German seller] had to make 

and sell the burners in Germany was allowed him 

under the laws of that country, and purchasers 

from him could not be thereby authorized to sell 

the articles in the United States in defiance of the 

rights of patentees under a United States patent. 

A prior foreign patent operates under our law to 

limit the duration of the subsequent patent here, 

but that is all. The sale of articles in the United 

States under a United States patent cannot be 

controlled by foreign laws.

Id.

That rationale by its terms does not make relevant 

whether the foreign sale was made under a foreign patent. Indeed, the second sentence says that a “prior 

foreign patent” does not cause loss of U.S. patent rights. 

Rather, the rationale turns only on the fact that the 

foreign sale was made under foreign law.21 The last 

sentence states the territorial principle: “The sale of 

articles in the United States under a United States patent 

cannot be controlled by foreign laws.” Id. 

That principle does not preclude an accused infringer 

from establishing that the U.S. patentee actually gave it a 

 

21 The “duration” language refers to a sentence in 

Rev. Stat. 4887 that tied certain U.S. patents’ expiration 

dates to those of related foreign patents. See Robinson, 

§ 337, at 461. Congress deleted the provision in 1897. 

Act of Mar. 3, 1897, ch. 391, § 3, 29 Stat. 693; see H.R. 

Rep. No. 1923, at 38 (1952).

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license, expressly or by implication. It means that the 

exhaustion doctrine does not treat a foreign sale, lawful 

abroad for whatever reason, as having the cross-border 

legal effect of authorizing otherwise-infringing U.S. acts 

involving the purchased article. And that is how the 

principle has been understood by the Supreme Court. See 

Keeler, 157 U.S. at 664–65 (“The exact question presented 

was whether a dealer residing in the United States could 

purchase in another country articles patented there from 

a person authorized there to sell them, and import them 

to and sell them in the United States without the license 

or consent of the owners of the United States patent, and 

the court held that the sale of articles in the United 

States under a United States patent cannot be controlled 

by foreign laws. In this case neither the patentee nor any 

assignee had ever received any royalty or given any 

license to use the patented article in any part of the 

United States.”); A. Bourjois & Co. v. Katzel, 260 U.S. 689, 

692 (1923) (trademark case, explaining: “Ownership of 

[particular] goods . . . does not necessarily carry the right 

to sell them at all in a given place. If the goods were 

patented in the United States a dealer who lawfully 

bought similar goods abroad from one who had a right to 

make and sell them there could not sell them in the 

United States. Boesch . . . .”). 

The principle of Boesch, precluding foreign control of 

U.S. rights, has a mirror-image counterpart in the territoriality principle of U.S. patent law that broadly denies 

projection of U.S. patent rights to cover foreign conduct. 

In Brown v. Duchesne, 60 U.S. (19 How.) 183 (1857), the 

Supreme Court, referring to the patent statutes, said that 

“these acts of Congress do not, and were not intended to, 

operate beyond the limits of the United States.” Id. at

195. The Court also explained the guaranteed reward 

from domestic markets: the patent laws “secure to the 

inventor a just remuneration from those who derive a 

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profit or advantage, within the United States, from his 

genius and mental labors.” Id.; see, e.g., Dowagiac, 235 

U.S. at 650 (“The right conferred by a patent under our 

law is confined to the United States and its territories 

(Rev. Stat. § 4884, Comp. Stat. 1913, § 9428), and infringement of this right cannot be predicated of acts 

wholly done in a foreign country.”). 

The Supreme Court relied on the strength of the 

territorial principle in Deepsouth Packing Co. v. Laitram 

Corp., 406 U.S. 518 (1972), which rejected a claim of 

infringement against Deepsouth just because the ultimate 

combination covered by the patent was made abroad, 

after Deepsouth shipped all the parts from the United 

States. The Court explained:

Our patent system makes no claim to extraterritorial effect; “these acts of Congress do not, and 

were not intended to, operate beyond the limits of 

the United States,” Brown v. Duchesne, 19 How., 

at 195 (1856), and we correspondingly reject the 

claims of others to such control over our markets. 

Cf. Boesch v. Graff, 133 U.S. 697, 703 (1890).

406 U.S. at 531.

In Microsoft Corp. v. AT&T Corp., 550 U.S. 437 (2007), 

the Supreme Court quoted the foregoing passage from 

Deepsouth as support for “[t]he traditional understanding 

that our patent law ‘operate[s] only domestically and 

do[es] not extend to foreign activities,’ . . . [which] is 

embedded in the Patent Act itself, which provides that a 

patent confers exclusive rights in an invention within the 

United States. 35 U.S.C. § 154(a)(1) (patentee’s rights 

over invention apply to manufacture, use, or sale 

‘throughout the United States’ and to importation ‘into 

the United States’).” Id. at 455. And the Court added:

As a principle of general application, moreover, we 

have stated that courts should “assume that legisCase: 14-1617 Document: 339-2 Page: 80 Filed: 02/12/2016
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lators take account of the legitimate sovereign interests of other nations when they write American 

laws.” F. Hoffmann-La Roche Ltd. v. Empagran 

S. A., 542 U.S. 155, 164 (2004); see EEOC v. Arabian American Oil Co., 499 U.S. 244, 248 (1991). 

Thus, the United States accurately conveyed in 

this case: “Foreign conduct is [generally] the domain of foreign law,” and in the area here involved, in particular, foreign law “may embody 

different policy judgments about the relative rights 

of inventors, competitors, and the public in patented inventions.” Brief for United States as Amicus 

Curiae 28. 

Id. (emphasis added). The Court then applied the presumption of congressional respect for territorial limits in 

patent law to interpret the very provision, § 271(f), that 

Congress had enacted (in 1984) to supersede Deepsouth, 

explaining that the presumption “remains instructive in 

determining the extent of the statutory exception” to the 

strict territorial limits elsewhere stated in the statute. 

Id. at 456.

The principles thus expressed, perhaps especially the

sentence highlighted in the quote just above, recognize 

what we noted above: Patent law is especially territorial, 

and laws vary considerably from country to country. The 

Supreme Court’s recognition of those points reinforces our 

conclusion that foreign markets are not the predictable 

equivalent of the American markets in which the U.S. 

patentee is given a right to exclude and the rewards from 

that exclusivity. The Court’s closest patent-law precedents thus support our holding that sales in foreign 

markets should not be presumed to confer on the buyer 

authority to displace sales in American markets. 

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3 

Congress has not enacted a general provision of the 

Patent Act specifically addressed to foreign-sale exhaustion of U.S. patent rights. Congress has left the general 

issue to judicial resolution. 

When the subject arose in the Uruguay round of multilateral negotiations that led to the Agreement on TradeRelated Aspects of Intellectual Property Rights (TRIPS), 

the parties agreed not to address the subject, stating, in 

article 6, that “nothing in this Agreement shall be used to 

address the issue of the exhaustion of intellectual property rights.” TRIPS, Apr. 15, 1994, 33 I.L.M. 1197, 1200, 

quoted in Kirtsaeng, 133 S. Ct. at 1383 (Ginsburg, J., 

dissenting). And when Congress implemented the international agreement through the 1994 legislation that 

(among other things) added the new importation ban to 

§ 271(a), the accompanying Statement of Administrative 

Action—which Congress deemed authoritative, 19 U.S.C. 

§ 3512(d)—stated that “[t]he Agreement . . . does not 

affect U.S. law or practice relating to parallel importation 

of products protected by intellectual property rights.” 

H.R. Rep. No. 103-316, at 633, 981 (1994), reprinted in 

1994 U.S.C.C.A.N. 4040, 4280. The recent Trans Pacific 

Partnership agreement includes a similar disclaimer, 

reserving the parties’ rights to make other international 

agreements on the subject. See Trans-Pacific Partnership 

art. 18.11 & n.8, Oct. 5, 2015, https://ustr.gov/tradeagreements/free-trade-agreements/trans-pacific-partnersh

ip/tpp-full-text.

Congress did act in three specific instances formally

to guarantee a U.S. patentee the right to retain its U.S. 

rights despite selling abroad. Congress so provided 

through legislation, adopted by both houses and signed by 

the President, that approved three international agreements. United States-Morocco Free Trade Agreement 

Implementation Act, Pub. L. No. 108-302, 118 Stat. 1103 

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(2004);22 United States-Australia Free Trade Agreement 

Implementation Act, Pub. L. No. 108-286, 118 Stat. 919 

(2004);23 United States-Singapore Free Trade Agreement 

Implementation Act, Pub. L. No. 108-78, 117 Stat. 948 

(2003).24 In doing so, Congress did not provide the prom-

 

22 Article 15.9.4 of the U.S.-Morocco agreements 

says: “Each Party shall provide that the exclusive right of 

the patent owner to prevent importation of a patented 

product, or a product that results from patented process, 

without the consent of the patent owner shall not be 

limited by the sale or distribution of that product outside 

its territory.” A footnote attached to the provision adds: 

“A Party may limit application of this paragraph to cases 

where the patent owner has placed restrictions on importation by contract or other means.” United StatesMorocco Free Trade Agreement, Morocco-U.S., June 15, 

2004, 44 I.L.M. 544 (2005).

23 Article 17.9.4 of the U.S.-Australia agreement 

says: “Each Party shall provide that the exclusive right of 

the patent owner to prevent importation of a patented 

product, or a product that results from a patented process, 

without the consent of the patent owner shall not be

limited by the sale or distribution of that product outside

its territory, at least where the patentee has placed

restrictions on importation by contract or other means.” 

United States-Australia Free Trade Agreement, Aus.-

U.S., May 18, 2004, KAV 6422 (2005).

24 Article 16.7.2 of the U.S.-Singapore agreement 

says: “Each Party shall provide a cause of action to prevent or redress the procurement of a patented pharmaceutical product, without the authorization of the patent 

owner, by a party who knows or has reason to know that 

such product is or has been distributed in breach of a 

contract between the right holder and a licensee, regardless of whether such breach occurs in or outside its terriCase: 14-1617 Document: 339-2 Page: 83 Filed: 02/12/2016
84 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

ised rights other than through the existing Patent Act 

provisions of §§ 154, 271.

Those congressionally approved guarantees would be 

negated if Impression’s view of the Patent Act were 

adopted: U.S. patentees would lose their U.S. patent 

rights by selling abroad. An interpretation of a statute 

that produces such a contradiction with other enactments

is to be avoided, at least where other considerations 

already point against such an interpretation. See FDA v. 

Brown & Williamson Tobacco Corp., 529 U.S. 120, 143 

(2000); Vimar Seguros y Reaseguros, S.A. v. M/V Sky 

Reefer, 515 U.S. 528, 539 (1995); W. Va. Univ. Hosps., Inc. 

v. Casey, 499 U.S. 83, 100 (1991). The three congressional 

enactments thus provide a further reason to reject Impression’s view. At the same time, they leave to our 

internal law—the Patent Act, as judicially interpreted—

whether even a presumptive-exhaustion rule governs. 

The agreements say nothing to undermine our reasons for 

rejecting a presumptive-exhaustion rule.

The only other legislative enactment presented for our 

consideration is 21 U.S.C. § 381(d)(1)–(2). Paragraph (1) 

of that subsection states a general rule that “no drug 

subject to section 353(b) of this title [concerning prescription-necessitating drugs] or composed wholly or partly of 

insulin which is manufactured in a State and exported 

may be imported into the United States unless the drug is 

imported by the manufacturer of the drug.” The general 

rule is subject to one exception, stated in paragraph (1), 

 

tory.” A footnote attached to that sentence adds: “A Party 

may limit such cause of action to cases where the product 

has been sold or distributed only outside the Party’s 

territory before its procurement inside the Party’s territory.” United States-Singapore Free Trade Agreement, 

Sing.-U.S., May 6, 2003, 42 I.L.M. 1026 (2003).

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for certain prescription drugs imported by pharmacists 

and wholesalers from Canada, as regulated under 21 

U.S.C. § 384. And it is subject to a second exception 

stated in paragraph (2), which authorizes the Secretary of 

Health and Human Services to permit importation otherwise within the paragraph (1) ban “if the drug is required 

for emergency medical care.” 21 U.S.C. § 381(d)(2).

That provision does not alter our conclusion. The 

provision does not purport to limit patentees’ rights 

regarding importations under 35 U.S.C. §§ 154, 271. It 

adds an express government-enforced ban on certain 

importations, and it makes certain exceptions to the 

added ban, authorizing the Secretary to allow certain 

importations. Perhaps where the Secretary does so, an 

injunctive remedy might be unavailable to the patentee

under 35 U.S.C. § 283, for public-interest reasons. See 

eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006). 

But nothing in 21 U.S.C. § 381(d) makes non-infringing 

any conduct that otherwise would be infringing. 

Congress may modify patentees’ rights under the Patent Act. It may do so with respect to particular articles, 

without modifying the general exhaustion rule for foreign 

sales under the Patent Act—though § 381(d) does not do 

even that. Or it may more generally prescribe a general 

exhaustion rule for patented articles, specifying the 

conditions for exhaustion, as it did in the Copyright Act 

for copyrighted works. But it has not done that either. 

4 

Our no-exhaustion conclusion—which leaves undisturbed the availability of an express- or implied-license 

defense to infringement—is broadly consistent with the

decisions of courts other than the Supreme Court, with 

the apparent exception of a trial-court decision that predates Boesch. 

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The pre-Boesch decision is Holiday v. Mattheson, 24 F. 

185 (C.C.S.D.N.Y. 1885), in which few facts are set out. 

The defendants bought some U.S.-patented article in 

England from “a vendee of the patentee,” “without restriction or conditions.” Id. at 185. The court denied the 

patentee’s motion for a preliminary injunction against 

U.S. activities involving the article. It reasoned that, 

whether or not an article is patented, “[w]hen the owner 

sells an article without any reservation respecting its use, 

or the title which is to pass,” “[t]he presumption arising 

from such a sale is that the vendor intends to part with 

all his rights in the thing sold”; and a patentee-seller 

“parts with his monopoly” as to that article—“unless by 

the conditions of the bargain the monopoly right is impressed upon the thing purchased,” i.e., unless “the owner 

of a patent sells the patented article under circumstances 

which imply that the purchaser is not to acquire an 

unqualified property in the thing purchased.” Id. at 185–

86. That description, with its emphasis on the absence or 

presence of patentee-conveyed restrictions on postpurchase use, is taken entirely from domestic exhaustion 

law. The court said nothing to recognize that a distinct 

issue is presented when the sale was made abroad; and 

the opinion, describing few facts, does not make clear 

even indirectly if the circumstances would have given rise 

to an implied-license defense. In any event, just a few 

years after the trial-court decision in Holiday, the Supreme Court in Boesch made clear how much the crossing 

of international boundaries matters.

After Boesch, the Second Circuit in Dickerson v. 

Matheson, 57 F. 524 (2d Cir. 1893), affirmed a finding of 

infringement against Matheson & Co., which had acquired from a German seller in 1887, and brought into the 

United States for sale and use here, batches of a coloring 

agent that was subject to a U.S. patent and a German 

patent, both assigned to the Bayer Company. The GerCase: 14-1617 Document: 339-2 Page: 86 Filed: 02/12/2016
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man seller (the Berlin Company) was a licensee of the 

Bayer Company, with the right to sell both in Europe and 

the United States, and it made clear that importation into 

the United States was prohibited. Id. at 525–26. In the 

suit brought by Dickerson, to whom the Bayer Company 

assigned the U.S. patent in 1888, the Second Circuit 

rejected Matheson’s defense to infringement. It read 

Boesch to establish that “[a] purchaser in a foreign country of an article patented in that country and also in the 

United States, from a licensee under the foreign patent 

only, does not give the purchaser a right to import the 

article into, and to sell it in, the United States, without 

the license or consent of the owner of the United States 

patent.” Id. at 527.

The Eighth Circuit reached a similar result in Dickerson v. Tinling, 84 F. 192 (8th Cir. 1897), involving Bayer 

& Co.’s phenacetine product. The court noted that “it 

appears that no patent [on the product] had ever been 

issued in Germany” and that “every package of phenacetine that had ever been sold by Bayer & Co. in a foreign 

country had a prohibition against its importation into and 

sale within the United States printed upon it, and was 

sold subject to that prohibition.” Id. at 193. It was unclear whether Tinling bought the phenacetine at issue 

from Bayer & Co. (or its vendees) or from “others,” but it 

did not matter to the outcome. Id. at 194. “If he bought it 

of others than Bayer & Co. or their vendees, he bought 

with it no right to sell it in the United States, because no 

one but Bayer & Co. and their vendees had that right in 

this country.” Id. “On the other hand, if [Tinling] bought 

the phenacetine he is selling in a foreign country from 

Bayer & Co., or from its vendees, subject to the express 

condition that it should not be imported into the United 

States, or sold within their limits, the exclusive right to 

sell the patented article within the United States which 

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was granted to Bayer & Co. by the patent was not 

abridged by that purchase.” Id.

The Eighth Circuit pointedly noted that it did not 

have to decide what the result would be if no restrictions 

attended a sale made or approved by Bayer. It said: 

“Conceding—but not deciding—that one who buys a 

patented article without restriction in a foreign country 

from the owner of the United States patent” is clear of the 

U.S. patent for domestic sale and use, id. at 195 (citing 

Holiday and Matheson), “there can be no doubt that a 

patentee has the same right and power to sell the patented article upon conditions or with restrictions that he has 

to sell it at all,” id. With Bayer having “sold on the express condition that [the phenacetine] should not be 

imported into or sold within the United States,” Tinling’s 

domestic sale of the purchased product was infringing. 

Id. The Eighth Circuit thus reversed the trial court’s 

denial of an injunction and ordered an injunction to issue. 

Id.

The Second Circuit likewise reversed the denial of infringement relief in Daimler Manufacturing Co. v. 

Conklin, 170 F. 70 (2d Cir. 1909). The U.S. holder of 

certain automobile-component patents (Daimler) sought 

to enjoin the use in the United States of a vehicle containing such components. Conklin had bought the vehicle in 

Europe, under no restrictions as to importation into or use 

within the United States, from a company licensed to sell 

it in Europe by the holder of European patent rights—a 

company distinct from the U.S. patent-holding company,

though with common origins and some overlapping ownership involving the inventor Maybach, see Daimler 

Manufacturing Co. v. Conklin, 160 F. 679 (C.C.S.D.N.Y. 

1908). The Second Circuit, based on Boesch, concluded: 

“The use of articles covered by a United States patent 

within the United States can no more be controlled by 

foreign law than the sale can. The sale by a German 

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patentee of a patented article may take it out of the 

monopoly of the German patent, but how can it take it out 

of the monopoly of the American patentee who has not 

sold?” 170 F. at 72.

In 1920, the Second Circuit affirmed the denial of relief where it was clear from the circumstances that the 

U.S. patentee had granted permission for otherwiseinfringing U.S. activities with airplanes bought in Canada. Curtiss Aeroplane & Motor Corp. v. United Aircraft 

Eng’g Corp., 266 F. 71 (2d Cir. 1920). Curtiss was the 

holder of U.S. patents on various airplane-engine technologies. During World War I, an 83-percent-owned Canadian subsidiary of Curtiss (which the court treated as 

indistinguishable from Curtiss) granted a license—

covering its Canadian patents and applications and any 

further inventions it owned or controlled involving changes to the engines at issue—to an entity created by the 

British government, authorizing the latter to make airplanes for sale to and use by the British government. Id.

at 72–74. The British government bought planes during 

the war and, after the war ended, sold some of them to 

United Aircraft, which brought them into the United 

States for sale and use here. Id. at 72, 74. When Curtiss 

sued, the dispute was over whether “the authorization to

make was general and unrestricted or subject to qualification and conditions, as to the disposition of the planes by 

the British government.” Id. at 77; id. at 75.

The Second Circuit, agreeing with the district court, 

concluded that the authorization gave the British government freedom from U.S. patent constraints on what it

could do with the planes. The court relied on “the very 

nature of things” and “the language used in the agreements.” Id. at 75. It explained that “[a]n aeroplane has 

been said to be the most mobile article manufactured, and 

it is not confined by geographical boundaries,” id.; that 

the British had used airplanes in numerous countries 

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during the war, id.; and that “the aviation fields in Texas 

and in other states were placed at the disposal of the 

British authorities and were actually used by them as 

training fields for Canadian aviators,” id. It concluded: 

“[Curtiss] and the British government alike understood 

and intended that the aeroplanes to be manufactured by 

that government as well as those to be supplied to it by 

[Curtiss] were to become the absolute property of the 

government, and were to be disposed of as the latter 

should see fit. The express language of the contract is 

that the aeroplanes and other articles should ‘become and 

be the absolute property of the British government.’” Id.

Some decisions of district courts from decades later

round out the picture of case law predating Jazz Photo. 

Judge Lord rejected an exhaustion defense in Griffin v. 

Keystone Mushroom Farm, Inc., 453 F. Supp. 1283 (E.D. 

Pa. 1978). Griffin was the owner of the U.S. patent, as 

well as Italian patents, covering certain machinery. 

Keystone bought several machines in Italy from Griffin’s 

exclusive licensee in Italy and brought them into the 

United States, one for use, two for sale. Griffin sued 

Keystone for infringement, and Keystone sought summary judgment based on exhaustion. Judge Lord rejected 

the defense. 

He read Boesch to apply, because in Boesch “[t]he 

source of the alleged infringer’s authorization under 

foreign law . . . was without significance in the Court’s 

reasoning.” Id. at 1285. Therefore, it did not matter 

whether Griffin “owned concurrent United States and 

Italian patents and had entered into analogous licensing 

agreements concerning the same inventions,” giving 

Griffin a share of royalties from the Italian and American 

exclusive licensees. Id. “[T]he basic thrust of the Boesch 

decision” was “that the ‘sale of articles in the United 

States under a United States patent cannot be controlled 

by foreign laws.’” Id. at 1286 (quoting 133 U.S. at 703). 

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In Sanofi, S.A. v. Med-Tech Veterinarian Products, 

Inc., 565 F. Supp. 931 (D.N.J. 1983), Judge Sarokin 

denied a preliminary injunction to U.S. patentee Sanofi, 

S.A., but granted one to U.S. exclusive licensee American 

Home Products. A Sanofi subsidiary in France sold to an 

American processor certain pharmaceutical products

covered by Sanofi’s U.S. patent; the subsidiary “placed no 

restrictions in the sales contract,” and Sanofi had no 

French patent. Id. at 938; see also id. at 934–35. When 

the buyer brought the products to the United States for 

sale, both Sanofi and American Home Products sued.

The court concluded first that “if Sanofi were permitted to impose restrictions upon the resale of its patented 

product, the expectations of the purchaser would be 

defeated.” Id. at 938 (emphasis added). “[W]here the 

owner of a patent exhibits conduct from which one dealing 

with him may properly infer that the owner consents to 

his use of the patent, an implied license will arise.” Id. at 

940 (citing De Forest Radio, 273 U.S. at 241). But a 

different conclusion was required as to American Home 

Products, the U.S. exclusive licensee, the court reasoned, 

which did not cede its patent rights. “Because the purchaser is under an obligation to inquire of the seller as to 

the existence of any outstanding licenses, the purchaser 

cannot claim that his expectations have been frustrated if 

he fails to make the necessary inquiry and later discovers 

that an outstanding license interferes with his right of 

enjoyment.” Id. “If the court were to hold that Sanofi’s 

sale of the product exhausted the patent, it would be 

crediting Sanofi with greater rights than the patentee 

actually had. Sanofi had no right to allow its product to 

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enter this country without the permission of its exclusive 

licensee.” Id. at 941.25

All of the foregoing decisions after Boesch reflect both 

(a) the Boesch principle that foreign laws do not control 

domestic patent rights and (b) some assessment of the 

particular circumstances and language of foreign sales to 

determine if the U.S. patentee gave permission for importation. The pre-Boesch decision in Holiday aside, the 

results accord with the Jazz Photo no-exhaustion rule 

coupled with the availability of a defense based on an 

express or implied license. That combination of principles, supported in the statute and Supreme Court doctrine, provides a clear doctrinal statement that fits the 

pre-Jazz Photo case law from outside the Supreme Court.

5 

Finally, we consider what we can reliably gauge about 

the likely real-world consequences of one answer or another to the exhaustion question presented here. As on 

the first issue before us, the amicus briefs filed here 

present competing arguments about the effect of one 

foreign-sale exhaustion rule or another on their interests 

and the interests they promote, offering varying amounts 

of empirical support. Such arguments necessarily play a 

much more limited role for us than they might for Congress. As on the first issue, all that we can conclude is 

that we see no basis for altering the conclusion we think 

warranted by the legal sources already considered.

a. We have not been shown that substantial problems 

have arisen with the clear rule of Jazz Photo, which has 

 

25 See also Kabushiki Kaisha Hattori Seiko v. Refac 

Tech. Dev. Corp., 690 F. Supp. 1339 (S.D.N.Y. 1988) 

(interpreting settlement agreement to bar patentee Refac 

from suing purchasers of goods from Hattori).

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been in place since 2001, or with the comparable legal 

understandings based on a century of case law in the 

area. There is, of course, the possibility—noted by the 

Dissent at 27, citing amici’s assertions—of unintended 

infringement by buyers of goods in foreign countries who 

bring them into the United States, whether to use them 

as components in new goods they make, to sell them, or to 

use them as consumers. But that possibility is limited by 

the availability of an implied-license defense from the 

circumstances of a sale (perhaps, e.g., an unrestricted

patentee sale at a seaport or airport to a buyer loading or 

boarding a vessel or plane bound for the United States). 

In addition, a large share of such possible unintended 

infringement, according to the most common policy complaint by electronics-industry amici, is by definition 

immaterial to any exhaustion—namely, infringement of 

patents asserted by non-practicing entities that have 

neither made nor authorized the sale of patent-covered 

articles. The only scenario relevant to exhaustion is one 

involving patentee-made or -authorized foreign sales, and 

we simply have no reliable evidence that the possibility of 

unintended infringement in that scenario is actually a 

significant issue in practice. The absence of such evidence 

in the many years since Jazz Photo, and the still longer 

period since Boesch, provides good reason to think otherwise.

Indeed, it has long been a feature of the patent-law 

landscape that there can be instances of innocent infringement, because § 271(a) sets a “strict-liability” 

standard. Commil USA, LLC v. Cisco Systems, Inc., 135 

S. Ct. 1920, 1926 (2015). Thus, even domestic purchasers 

of products from domestic sellers who have not obtained 

authority from the owners of patents covering the products’ components could find themselves in that position. 

But Congress has left strict liability in place, even in light 

of the scenario not relevant to exhaustion, i.e., patent 

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94 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

infringement claimed by non-practicing-entity patentees 

that have neither made nor authorized the sales at issue. 

In any event, despite the law in place since Jazz Photo 

and for decades earlier, there is no reason to think that 

this is a distinctive problem for foreign-purchased goods, 

much less a problem affecting a meaningful share of 

foreign sales leading to imports. 

In this respect, we have no reason to think that the 

most serious real-world problems described in Kirtsaeng 

carry over to the patent arena. Prominent among the 

problems in Kirtsaeng were those that would be faced, 

under the rejected interpretation of § 109(a), by libraries, 

museums, and bookshops. Those entities often would be 

dealing on a regular basis with changing inventories of 

large numbers of individually distinct long-shelf-life 

works subject to copyrights that have multiple owners 

and that last for periods far longer than the terms of 

patents (and variable with the life of the authors). See 

Eldred, 537 U.S. at 194–96 (describing copyright terms). 

And there was good reason to think that they built up 

“deeply embedded” reliance interests in the absence of 

clear law pointing against § 109(a)’s applicability just 

because a work was made abroad. Kirtsaeng, 133 S. Ct. 

at 1366. If there is a counterpart to such situations in the 

patent arena, it has not been shown to loom large in the 

full range of circumstances governed by the answer to the 

question of foreign-sale-exhaustion.

b. Overturning Jazz Photo would plausibly cause significant disruption of existing practices adopted under the 

contrary law established by Jazz Photo and decades of 

prior case law. Such disruption is most likely if exhaustion of U.S. rights were held to follow from a foreign sale 

without the U.S. patentee having the ability to reserve its 

U.S. rights. While a conclusive-exhaustion rule is opposed by the government, it is the rule urged by ImpresCase: 14-1617 Document: 339-2 Page: 94 Filed: 02/12/2016
LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 95

sion and certain amici that stress the possibility of unintended infringement we have just discussed.

An example of likely disruption involves pharmaceutical products. There seems to be no dispute that U.S.-

patented medicines are often sold outside the United 

States at substantially lower prices than those charged 

here and, also, that the practice could be disrupted by the 

increased arbitrage opportunities that would come from 

deeming U.S. rights eliminated by a foreign sale made or 

authorized by the U.S. patentee.26 One official recognition of both the fact of low prices abroad and the linkage 

of such prices to territorial resale protection appears in a 

2003 World Trade Organization decision made with the 

agreement of the United States. The WTO there waived 

certain TRIPS patent-recognition provisions in order to 

allow certain countries to import generic versions of 

needed medicines. The WTO took care, however, to 

condition the waiver on agreement by the importing 

countries “to control re-exportation of drugs they import 

in this fashion.” Ganslandt & Maskus, at 1036 (discuss-

 

26 See, e.g., Mattias Ganslandt & Keith E. Maskus, 

Parallel Imports and the Pricing of Pharmaceutical Products: Evidence from the European Union, 23 J. of Health 

Econ. 1035, 1036 (2004) (discussing WTO General Council, Implementation of paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health, Aug. 30, 

2003, www.wto.org/english/tratop_e/trips_e/implem_para6 

_e.htm); Mainak Mazumdar & Dyuti S. Banerjee, On 

Price Discrimination, Parallel Trade and the Availability 

of Patented Drugs in Developing Countries, 32 Int’l Rev. L. 

& Econ. 188, 189–93 (2012); Daniel Jacob Hemel & Lisa 

Larrimore Ouellette, Trade and Tradeoffs: The Case of 

International Patent Exhaustion, 115 Colum. L. Rev. 

Sidebar (forthcoming 2016), http://ssrn.com/abstract 

=2667338. 

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ing WTO General Council, Implementation of paragraph 

6 of the Doha Declaration on the TRIPS Agreement and 

Public Health, Aug. 30, 2003, www.wto.org/english/tratop

_e/trips_e/implem_para6_e.htm). Reversing Jazz Photo

and replacing it with a conclusive-exhaustion rule would 

likely upset such established practices.

c. A presumptive-exhaustion rule, subject to some 

kind of preservation of U.S. rights by the U.S. patentee 

when making or authorizing a foreign sale, would be less 

consequential. After all, to try to negate a potential 

implied-license defense, U.S. patentees would have an 

incentive to make express reservations of U.S. rights in 

making or authorizing foreign sales, simply to make clear 

that no license was being conferred. But even for the U.S. 

patentees that recognize the incentive and try to act on it, 

whether there is a presumptive loss of U.S. rights makes 

a difference. In particular, it makes a difference—though 

we cannot say just how significant—who has the burden 

of proof on the issue: must the patentee prove a reservation (communicated to the accused infringer) to avoid 

exhaustion, or must the accused infringer prove a license? 

A U.S. patentee that wishes to reserve its U.S. rights 

may not be able to do so. For a foreign sale, the required 

reservation is an act in a foreign country. And the foreign 

sovereign, or local governments in the country, may 

prohibit sellers from stating reservations of rights that 

would make importation into and sale in the United 

States more difficult. 

A presumptive-exhaustion rule would place a U.S. patentee’s preservation of U.S. rights within foreign sovereign control. For doctrinal reasons already emphasized, 

we should avoid attributing to Congress such a ceding of 

control over domestic rights to foreign sovereigns without 

clearer reason than we have seen here. The Supreme 

Court’s final statement of its rationale in Boesch says as 

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much: “The sale of articles in the United States under a 

United States patent cannot be controlled by foreign 

laws.” 133 U.S. at 703. Indeed, such foreign control of 

U.S. rights is a mirror image of projecting U.S. patent

rights into foreign sovereigns’ territories. The Supreme 

Court has long recognized that the latter is strongly 

disfavored in reading the Patent Act. See pages 79–81, 

supra. And since Boesch, the Court has twice recognized 

the symmetric impropriety of reading the Patent Act to 

allow projection of foreign sovereigns’ decisions to control 

rights in U.S. territory: “Our patent system makes no 

claim to extraterritorial effect; ‘these acts of Congress do 

not, and were not intended to, operate beyond the limits 

of the United States,’ Brown v. Duchesne, 19 How., at 195; 

and we correspondingly reject the claims of others to such 

control over our markets. Cf. Boesch v. Graff, 133 U.S.

697, 703 (1890).” Deepsouth, 406 U.S. at 531; see Microsoft, 550 U.S. at 455. 

In practical terms, moreover, there is a plausible 

problem with adopting a presumptive-exhaustion rule, 

compared to leaving the matter to express- or impliedlicense doctrine. Intermediary companies between the 

foreign purchase and the importation into the United 

States may be created that make it difficult for the U.S. 

patentee to carry an affirmative burden of proving adequate notice of reservations attached to a foreign-sold 

article. Once the article leaves the hands of the initial 

seller (the U.S. patentee or its authorized seller), the U.S. 

patentee seems likely to have limited knowledge about 

the movement of the article to U.S. markets, through 

what may be multiple hands. On the other hand, if the 

burden is on the U.S. importer/seller to establish a conferral of authority, as it is under the express- or impliedlicense doctrine, there would be incentives to communicate a conferral of authority reliably throughout the chain 

of custody on the way to the U.S. importer and seller. 

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That is because the latter, at the end of supply chain,

would have the incentive to insist on ultimately receiving 

such information in order to establish the license defense.

A related point may be made about the reasonable 

expectations of a potential U.S. reseller of goods acquired 

abroad in sales made or authorized by a U.S. patentee. 

As to the reseller’s freedom from the patentee’s U.S. 

rights, the difference between a rule leaving the matter to 

the reseller’s affirmative proof of a license (express or 

implied) and a rule of presumptive exhaustion (subject to 

disproof by the U.S. patentee) is significant just when 

there are genuine uncertainties about whether a license 

could be established. But in that situation the reseller is 

not entitled to a strong expectation that it has permission 

to conduct its otherwise-infringing activities in the United 

States. 

CONCLUSION

We hold that, when a patentee sells a patented article 

under otherwise-proper restrictions on resale and reuse

communicated to the buyer at the time of sale, the patentee does not confer authority on the buyer to engage in 

the prohibited resale or reuse. The patentee does not 

exhaust its § 271 rights to charge the buyer who engages 

in those acts—or downstream buyers having knowledge of 

the restrictions—with infringement. We also hold that a 

foreign sale of a U.S.-patented article, when made by or 

with the approval of the U.S. patentee, does not exhaust 

the patentee’s U.S. patent rights in the article sold, even 

when no reservation of rights accompanies the sale. Loss 

of U.S. patent rights based on a foreign sale remains a 

matter of express or implied license. 

Under our first holding, we reverse the district court’s 

judgment of non-infringement as to the Return Cartridges 

first sold in the United States. Under our second holding, 

we affirm the district court’s judgment of infringement as 

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to the cartridges first sold abroad. The case is remanded 

for entry of a judgment of infringement for Lexmark and 

for any further proceedings necessary upon entry of such 

judgment.

Costs awarded to Lexmark.

AFFIRMED IN PART, REVERSED IN PART, AND 

REMANDED

Case: 14-1617 Document: 339-2 Page: 99 Filed: 02/12/2016
United States Court of Appeals 

for the Federal Circuit ______________________ 

LEXMARK INTERNATIONAL, INC.,

Plaintiff-Cross-Appellant

v.

 

IMPRESSION PRODUCTS, INC.,

Defendant-Appellant

QUALITY CARTRIDGES, INC., JOHN DOES, 1-20, 

BLUE TRADING LLC, EXPRINT INTERNATIONAL,

INC., LD PRODUCTS, INC., PRINTRONIC 

CORPORATION, TESEN DEVELOPMENT (HONG 

KONG) CO. LTD., BENIGNO ADEVA AND HIS 

COMPANIES,

Defendants

______________________ 

2014-1617, 2014-1619

______________________ 

Appeals from the United States District Court for the 

Southern District of Ohio in No. 1:10-cv-00564-MRB, 

Judge Michael R. Barrett.

______________________ 

DYK, Circuit Judge, dissenting, with whom Circuit Judge

HUGHES joins. 

I respectfully dissent from the majority’s holding that 

Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (Fed. 

Cir. 1992), and Jazz Photo Corp. v. International Trade 

Commission, 264 F.3d 1094 (Fed. Cir. 2001), remain good 

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2 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

law. First, I agree with the government that Mallinckrodt

was wrong when decided, and in any event cannot be 

reconciled with the Supreme Court’s recent decision in 

Quanta Computer, Inc. v. LG Electronics, Inc., 553 U.S. 

617 (2008). We exceed our role as a subordinate court by 

declining to follow the explicit domestic exhaustion rule 

announced by the Supreme Court. 

Second, I would retain Jazz Photo insofar as it holds 

that a foreign sale does not in all circumstances lead to 

exhaustion of United States patent rights. But, in my 

view, a foreign sale does result in exhaustion if an authorized seller has not explicitly reserved the United States 

patent rights.

I. DOMESTIC EXHAUSTION

A 

Both here and in Mallinckrodt the patentee itself sold 

the patented item to the purchaser. In Mallinckrodt, “the 

device [was] manufactured by [the patent owner], who 

[sold] it to hospitals as a unitary kit.” 976 F.2d at 702. 

Here, as the majority recognizes, “Lexmark sells its 

cartridges . . . directly to end users, and [] to ‘resellers’ 

(including wholesalers, dealers, and distributors).” Maj. 

Op. at 11. Lexmark’s sales of so-called “Return Program 

Cartridges” were subject to a single-use/no-resale restriction that barred the purchaser from reusing the 

cartridge, or transferring a used cartridge to anyone 

besides Lexmark. See Maj. Op. at 10 & n.1. Those sales 

were authorized by the patent holder and transferred title 

to the purchaser. 

Beginning in the 1850s, the Supreme Court recognized that such authorized sales exhaust the patentee’s 

patent rights in the items sold. The patentee’s right to 

exclude under the Patent Act expires with an authorized 

sale. The question of whether the seller has “authorized” 

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the buyer to use or resell the item is simply irrelevant. 

The Court’s language is unequivocal: 

• “[W]hen the machine passes to the hands of the 

purchaser, it is no longer within the limits of the 

monopoly. It passes outside of it, and is no longer 

under the protection of the act of Congress. . . . Contracts in relation to it are regulated 

by the laws of the State, and are subject to State 

jurisdiction.” 

Bloomer v. McQuewan, 55 U.S. 539, 549–50 (1852).

• “[W]hen [patentees] have made and vended to others to be used one or more of the things patented, 

. . . they have parted with their exclusive right. . . . 

By a valid sale and purchase the patented machine 

becomes the private individual property of the purchaser, and is no longer specially protected by the 

laws of the United States, but by the laws of the 

State in which it is situated. . . . [I]f a person legally acquires a title to that which is the subject of letters patent, . . . he may repair it or improve upon it 

as he pleases, in the same manner as if dealing 

with property of any other kind.” 

Bloomer v. Millinger, 68 U.S. 340, 350–52 (1863). 

• “[W]hen [the patented article] rightfully passes 

from the patentee to the purchaser, [it] ceases to be 

within the limits of the monopoly.” 

Mitchell v. Hawley, 83 U.S. 544, 548 (1872).

• “The true ground on which [McQuewan, Millinger,

and Mitchell] rest is that the sale by a person who 

has the full right to make, sell, and use such a machine carries with it the right to the use of that machine to the full extent to which it can be used in 

point of time. . . . [I]t is open to the use of the purCase: 14-1617 Document: 339-2 Page: 102 Filed: 02/12/2016
4 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

chaser without further restriction on account of the 

monopoly of the patentees.” 

Adams v. Burke, 84 U.S. 453, 455–56 (1873). 

• “[W]hen the patentee . . . sells a machine or instrument whose sole value is in its use, he receives 

the consideration for its use, and parts with the 

right to restrict that use . . . . [I]t is open to the use 

of the purchaser, without further restriction on account of the monopoly of the patentee . . . .” 

Hobbie v. Jennison, 149 U.S. 355, 361–62 (1893). 

• “[O]ne who buys patented articles of manufacture 

from one authorized to sell them becomes possessed 

of an absolute property in such articles, unrestricted in time or place.” 

Keeler v. Standard Folding Bed Co., 157 U.S. 659, 

666 (1895).

• “[B]y virtue of the patent law one who had sold a 

patented machine and received the price and had 

thus placed the machine so sold beyond the confines of the patent law, could not by qualifying restrictions as to use keep under the patent monopoly 

a subject to which the monopoly no longer applied.” 

Bos. Store of Chi. v. Am. Graphophone Co., 246 U.S. 

8, 25 (1918). 

• “[W]here 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.”

United States v. Gen. Elec. Co., 272 U.S. 476, 489 

(1926).

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• “The first vending of any article manufactured under a patent puts the article beyond the reach of 

the monopoly which that patent confers.” 

United States v. Univis Lens Co., 316 U.S. 241, 252 

(1942). 

Thus, by the mid-1850s and continuing for the next 

century, even before Quanta, the Supreme Court repeatedly held that the authorized sale of a patented article 

exhausted all of the patentee’s patent rights in that 

article, and freed the article from any restrictions on use 

or sale based on the patent laws. Post-sale restrictions 

were enforceable only as a matter of state contract law.1 

B 

The sole Supreme Court case to depart from that 

principle, Henry v. A.B. Dick Co., 224 U.S. 1 (1912), was 

explicitly overruled five years later by Motion Picture 

Patents Co. v. Universal Film Manufacturing Co., 243 

U.S. 502, 518 (1917). See Quanta, 553 U.S. at 625–26. In 

Henry v. A.B. Dick Co., the A.B. Dick Company sold a 

rotary mimeograph, and affixed to it a restriction stating 

that it could only be used with stencil paper, ink, and 

other supplies made by the patentee. 224 U.S. at 11. The

Supreme Court in A.B. Dick upheld that restriction, and, 

more broadly, held that

 

1 See, e.g., Keeler, 157 U.S. at 666 (“Whether a patentee may protect himself and his assignees by special 

contracts brought home to the purchasers is not a question before us, and upon which we express no opinion. It 

is, however, obvious that such a question would arise as a 

question of contract, and not as one under the inherent 

meaning and effect of the patent laws.”) (emphasis added); see also Quanta, 553 U.S. at 637 n.7. 

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[t]he property right to a patented machine may 

pass to a purchaser with no right of use, or with 

only the right to use in a specified way, or at a 

specified place, or for a specified purpose. The unlimited right of exclusive use which is possessed 

by and guaranteed to the patentee will be granted 

if the sale be unconditional. But if the right of use 

be confined by specific restriction, the use not 

permitted is necessarily reserved to the patentee. 

If that reserved control of use of the machine be 

violated, the patent is thereby invaded.

Id. at 24–25 (emphasis added). The Court reasoned, in 

part, that the patent owner’s “larger right” of excluding 

all others from using the patent “embraces the lesser of 

permitting others to use upon such terms as the patentee

chooses to prescribe.” Id. at 35. 

The holding of A.B. Dick, that a patent owner has the

right to impose post-sale restrictions under the patent 

law, provided the purchaser has sufficient “notice that he 

buys with only a qualified right of use,” id. at 26, is the 

same as the panel’s holding in Mallinckrodt and the 

majority’s holding in this case. 

A.B. Dick was quickly overruled in Motion Picture 

Patents, 243 U.S. at 518, which stands as compelling 

authority against the majority’s conclusion.2 There, the 

 

2 Even before Motion Picture Patents, the Court had 

declined to follow A.B. Dick. The Court had held that a 

packaging notice that set a minimum retail price for a 

patented tonic, Bauer & Cie v. O’Donnell, 229 U.S. 1, 8

(1913), and a purported “License Notice” that operated to 

fix the price at which phonographs could be resold, Straus 

v. Victor Talking Mach. Co., 243 U.S. 490, 500–501 

(1917), were not enforceable under the patent laws. In 

Straus, the Court stated that courts “would be perversely 

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licensee-manufacturer sold film projectors subject to an 

attached notice restricting their use to unpatented films 

made by the Motion Pictures Patents Company, and other 

restrictions “not stated in the notice, but which are to be 

fixed, after sale.” Id. at 505–09. When a purchaser used 

the projector to display films made by another company, 

the Motion Picture Patents Company sued for infringement. Id. at 508. The question was whether the restrictions were enforceable after the sale. The Court 

rejected the basic rationale of A.B. Dick 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,” id. at 514, and concluded that 

A.B. Dick “must be regarded as overruled,” id. at 518. 

Instead, the Court reaffirmed that “the right to vend is 

exhausted by a single, unconditional sale, the article sold 

being thereby carried outside the monopoly of the patent 

law and rendered free of every restriction which the 

vendor may attempt to put on it.” Id. at 516. 

The majority attempts to distinguish Motion Picture 

Patents, on the ground that it only “held particular restrictions improper . . . relying on the 1914 Clayton Act,” 

but “did not rule that all restrictions on a patentee’s sale 

were ineffective to preserve the patentee’s patent-law 

rights.” Maj. Op. at 50. That is not accurate. Motion 

Picture Patents did not leave behind the remnants of A.B. 

Dick—minus tie-ins and resale price maintenance. To the 

contrary, the Court in Motion Picture Patents found that 

 

blind if they failed to look through such an attempt as 

[the] ‘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.” Id.

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“[t]he patent law furnishes no warrant for” the restrictions imposed by the patent owner. 243 U.S. at 516. 

The passage of the Clayton Act only “confirmed” the 

Patent Act holding reached in Motion Picture Patents. Id.

at 517. 

In later cases, the Court characterized Motion Picture 

Patents as having broadly settled the ineffectiveness of all 

post-sale restrictions under the patent law. In Boston 

Store of Chicago v. American Graphophone Co., Motion 

Picture Patents was viewed as “concern[ing] whether the 

monopoly of the patent law can be extended beyond the 

scope of that law or, in other words, applied to articles

after they have gone beyond its reach.” 246 U.S. at 26 

(emphasis added). The Court stated that Motion Picture 

Patents accordingly settled “the general question of the 

power of the patentee to sell and yet under the guise of 

license or otherwise to put restrictions which in substance 

were repugnant to the rights which necessarily arose from 

the sale which was made.” Id. at 24. Resting on patent 

exhaustion principles, Motion Picture Patents “decided 

that as by virtue of the patent law one who had sold a 

patented machine and received the price, and had thus 

placed the machine so sold beyond the confines of the 

patent law, could not by qualifying restrictions as to use

keep under the patent monopoly a subject to which the 

monopoly no longer applied.” Id. at 25 (emphasis added). 

In Quanta, the Court reiterated the broad patent exhaustion rule and left no room for a resurrection of A.B. 

Dick. LG Electronics (“LG”) owned system and method 

patents related to computer technology. Quanta, 553 U.S. 

at 621–22. LG licensed Intel to manufacture microprocessors and chipsets that used the LG patents. Id. at 623. 

The licensing agreement stipulated that no license was 

given to Intel’s customers to combine the licensed Intel 

products with non-Intel components in ways that practiced the LG patents. Id. A separate master agreement 

required Intel to provide a notice to its customers that 

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they were not licensed to practice the LG patents by 

combining Intel products with non-Intel products. Id. at 

623–24. Quanta purchased microprocessors and chipsets 

covered by the LG patents from Intel but combined them 

with non-Intel products to manufacture computers. LG 

filed suit against Quanta for patent infringement. Id. at 

624. 

The Court found that the Intel products embodied the 

LG patents and that Intel had authority to sell its products to Quanta. Id. at 635, 636–37. It then expansively 

held that “[t]he authorized sale of an article that substantially embodies a patent exhausts the patent holder’s 

rights and prevents the patent holder from invoking 

patent law to control postsale use of the article.” Id. at

638. Significantly, Quanta described Motion Picture 

Patents as having “reiterated the rule that ‘the right to 

vend is exhausted by a single, unconditional sale, the 

article sold being thereby carried outside the monopoly of 

the patent law and rendered free of every restriction 

which the vendor may attempt to put upon it.’” 553 U.S. 

at 626 (quoting Motion Picture Patents, 243 U.S. at 516). 

After Quanta, the Court confirmed again that the 

“doctrine of patent exhaustion limits a patentee's right to 

control what others can do with an article embodying or 

containing an invention. Under the doctrine, ‘the initial 

authorized sale of a patented item terminates all patent 

rights to that item.’” Bowman v. Monsanto Co., 133 S. Ct. 

1761, 1766 (2013) (quoting Quanta, 553 U.S. at 625).3 

 

3 The majority relies on the fact that the Supreme 

Court in Quanta did not expressly overrule Mallinckrodt, 

as urged by both the petitioner and the government. The 

majority cites no authority for the proposition that the 

Court’s failure to explicitly overrule circuit authority is an 

implicit endorsement of that authority. Influential comCase: 14-1617 Document: 339-2 Page: 108 Filed: 02/12/2016
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The patent exhaustion doctrine, as stated by Quanta, 

admits of no exception. Authorized sales “prevent[] the 

patent holder from invoking patent law to control postsale 

use.” Quanta, 553 U.S. at 638.

Contrary to the majority, Quanta’s reference to an 

“unconditional sale,” id. at 626, a reference appearing as 

well in other exhaustion cases, can hardly be read to 

contradict the Court’s central holding that post-sale 

restrictions are unenforceable under the patent laws. The 

language referring to “conditions” imposed on sale or 

“unconditional” sales is used in these cases in two different senses. On the one hand, there are cases in which 

such language is used to denote the existence of post-sale 

restrictions imposed by the patent holder. A.B. Dick and 

Motion Picture Patents fall into this category. A.B. Dick

stated that exhaustion applied only if the sale was “unconditional[],” i.e., free of post-sale restrictions. 224 U.S. 

at 19. Motion Picture Patents, in overruling A.B. Dick, 

rejected the notion that a seller could impose “conditions,” 

i.e., restrictions on post-sale use. 243 U.S. at 514–15. The 

use of such language in those cases refutes the majority’s 

theory, since Motion Picture Patents holds that conditions 

(i.e., restrictions) are not permissible under the patent 

laws. 

In the few other cases that use the “unconditional 

sales” language, the reference to an “unconditional” sale is 

 

mentators have viewed the Supreme Court’s decision in 

Quanta as having overruled our decision in Mallinckrodt. 

See, e.g., 12 Phillip A. Areeda & Herbert Hovenkamp,

Antitrust Law ¶2044, at 300 & 301 n.15 (3d ed. 2012) (“In 

its Quanta Computer decision the Supreme Court reaffirmed a strong version of the first-sale doctrine, striking down more relaxed Federal Circuit precedent. . . . To 

the extent that Mallinckrodt relaxed the first-sale doctrine, it was overruled by Quanta Computer . . . .”).

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to a sale in which title passes, not to a sale in which no 

restrictions are imposed.4 The contemporaneous understanding of “conditional sale” was as a security device, 

i.e., an “agreement to sell upon a condition to be performed.” Harkness v. Russell, 118 U.S. 663, 665 (1886); see 

also Motion Picture Patents, 243 U.S. at 520–21 (Holmes, 

J., dissenting) (“[A] conditional sale retaining the title 

until a future event after delivery has been decided to be 

lawful again and again by this court.”).5 

That the use of the term “unconditional” in those cases is not referring to a sale without restrictions is crystal 

clear from Quanta itself, where the Court stated that 

Motion Picture Patents “reiterated the rule that ‘the right 

to vend is exhausted by a single, unconditional sale, the 

article sold being thereby carried outside the monopoly of 

the patent law and rendered free of every restriction 

which the vendor may attempt to put upon it.’” 553 U.S. 

at 626 (quoting Motion Picture Patents, 243 U.S. at 516).

 

4 Mitchell stated that “where the sale is absolute, 

and without any conditions, the rule is well settled that” 

the patentee’s rights are exhausted. 83 U.S. at 548; see 

also Motion Picture Patents, 243 U.S. at 516; In re Paper 

Bag Cases, 105 U.S. 766, 770–71 (1881) (“The right of the 

owner of a patented machine, without any conditions 

attached to his ownership, to continue the use of his 

machine during an extended term of the patent, is well 

settled.”).

5 See also 1 Grant Gilmore, Security Interests in 

Personal Property § 3.7, at 81 (1965) (“For most lawyers 

the term [‘conditional sale’] came to have a reasonably 

precise meaning: a purchase money security transaction, 

subject in most states to statute, in which title to the 

goods was retained by the seller or his assignee until the 

full purchase price had been paid, usually in periodic 

installments.”).

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12 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

In other words, a sale with restrictions could nonetheless 

be an “unconditional” sale in which title passes, with the 

restrictions invalid under the patent laws because of 

exhaustion. 

C 

The rule articulated in the Supreme Court’s cases is 

consistent with the common law rule against restraints on 

the use or alienation of chattels, which formed the background of the patent statute. In Kirtsaeng v. John Wiley & 

Sons, Inc., 133 S. Ct. 1351, 1363 (2013), the Court noted, 

in the context of copyright law, that the “‘first sale’ doctrine is a common law doctrine” traceable to “the common 

law’s refusal to permit restraints on the alienation of 

chattels.” The Court cited Lord Coke’s 17th century 

observation that 

[If] a man be possessed of . . . a horse, or of any 

other chattel . . . and give or sell his whole interest . . . therein upon condition that the Donee or 

Vendee shall not alien[ate] the same, the [condition] is voi[d], because his whole interest . . . is out 

of him, so as he hath no possibilit[y] of a Reverter, 

and it is against Trade and Traffi[c], and bargaining and contracting betwee[n] man and man . . . . 

Id. (quoting 1 Edward Coke, Institutes of the Laws of 

England § 360, at 223 (1628)). Kirtsaeng concluded that 

“[a] law that permits a copyright holder to control the 

resale or other disposition of a chattel once sold is similarly ‘against Trade and Traffi[c], and bargaining and contracting.’” 133 S. Ct. at 1363. 

So too a rule permitting a patent holder to enact postsale restraints would be contrary to the general common 

law. Post-sale restraints would “cast a cloud of uncertainty over every sale,” Tessera, Inc. v. Int’l Trade Comm’n, 

646 F.3d 1357, 1370 (Fed. Cir. 2011). The Supreme Court 

has repeatedly instructed us not to ignore traditional 

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LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 13

legal principles to fashion rules “unique to patent disputes.” eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 

393 (2006); see also Global-Tech Appliances, Inc. v. SEB 

S.A., 131 S. Ct. 2060, 2069 (2011); MedImmune, Inc. v. 

Genentech, Inc., 549 U.S. 118, 132 n.11 (2007). We should 

decline to do so here. There is no indication in the patent 

laws that there should be a special exception for patent 

holders to the general longstanding common law doctrine 

that promotes free competition in the resale market and 

certainty in commercial transactions. Allowing the patent 

holder to impose conditions on the sale of a patented item 

would indeed largely eviscerate the exhaustion doctrine, 

by permitting the imposition of all manner of post-sale 

restrictions except for tie-ins, price-fixing, and other 

violations of the patent misuse and antitrust law. 

D 

The majority’s justifications for refusing to follow Supreme Court authority establishing the exhaustion rule 

misconceive our role as a subordinate court.

First, the majority characterizes the statement of the 

exhaustion rule in the Supreme Court cases as mere 

dictum because in those cases there was either no restriction imposed or the restriction would otherwise 

violate the antitrust laws.6 But the cases impose no such 

qualification on the rule announced. The Supreme Court 

has repeatedly advised the courts of appeals that our task 

is to follow the rules proclaimed by the Court, and not to 

attempt to distinguish Supreme Court cases on their 

 

6 See Maj. Op. at 51 (“[A]lthough some language in 

Univis, like language in other decisions in the area, can 

be taken out of context . . . we do not think it appropriate 

to give broad effect to language in Univis, taken out of 

context, to support an otherwise unjustified conclusion 

here . . . .”). 

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14 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

facts. See, e.g., Rivers v. Roadway Express, Inc., 511 U.S. 

298, 312 (1994) (“[O]nce the Court has spoken, it is the 

duty of other courts to respect that understanding of the 

governing rule of law.”); Thurston Motor Lines, Inc. v. 

Jordan K. Rand, Ltd., 460 U.S. 533, 534–35 (1983) (per 

curiam) (A court of appeals must not “confus[e] the factual 

contours of [a Supreme Court decision] for its unmistakable holding” in an effort to reach a “novel interpretation” 

of that decision.). 

Previously we have faithfully adhered to this rule. See 

Ariad Pharm., Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1347 

(Fed. Cir. 2010) (en banc) (“As a subordinate federal court, 

we may not so easily dismiss [the Supreme Court’s] 

statements as dicta but are bound to follow them.”); Stone 

Container Corp. v. United States, 229 F.3d 1345, 1349–50 

(Fed. Cir. 2000) (“[W]e do not share the Supreme Court’s 

latitude in disregarding the language in its own prior 

opinions.”).7 We cannot appropriately depart from it here.

 

7 See also Nat. Res. Def. Council, Inc. v. Nuclear 

Regulatory Comm’n, 216 F.3d 1180, 1189 (D.C. Cir. 2000)

(“[C]arefully considered language of the Supreme Court, 

even if technically dictum, generally must be treated as 

authoritative.”) (quotation marks and citation omitted); 

Alston v. Redman, 34 F.3d 1237, 1246 (3d Cir. 1994)

(“Though this passage . . . is essentially dicta . . . we must 

consider it with deference, given the High Court’s paramount position in our three-tier system of federal courts,

and its limited docket.”) (quotation marks and citation 

omitted); Hendricks Cty. Rural Elec. Membership Corp. v. 

N.L.R.B., 627 F.2d 766, 768 n.1 (7th Cir. 1980) (“A dictum 

in a Supreme Court opinion may be brushed aside by the 

Supreme Court as dictum when the exact question is later 

presented, but it cannot be treated lightly by inferior 

federal courts until disavowed by the Supreme Court.”) 

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Second, the majority relies on 35 U.S.C. §§ 271(a) and

154(a)(1) to suggest that a broad reading of the exhaustion doctrine is inconsistent with statutory language

making an act of infringement, inter alia, any use or sale 

of a patented invention “without authority” of the patent 

owner, and providing the patent owner with a “right to 

exclude.” Maj. Op. at 19, 22–23. That reliance is misplaced. Patent exhaustion is a limit on the patentee’s 

statutory right to control what purchasers can do with an 

article embodying or containing a patented invention. See 

Bowman, 133 S. Ct. at 1766 & n.2 (recognizing that 

patent exhaustion removes restrictions imposed by

§§ 271(a) and 154(a)(1)). The focus of patent exhaustion is 

not whether the buyer has been expressly or impliedly 

authorized to sell or use a product in a certain way after 

the sale. Instead, it begins and ends with an inquiry of 

whether the seller had authorization to make a sale. The 

exhaustion doctrine is simply a limit on the scope of the 

patent monopoly, that is, a limit on the exclusive rights of 

the patentee. The right to exclude expires (or is “exhausted”) by an authorized sale.8 

 

(citation omitted), rev’d on other grounds, 454 U.S. 170

(1981).

8 See, e.g., Quanta, 553 U.S. at 636–38 (concluding 

“[t]he authorized sale of an article that substantially 

embodies a patent exhausts the patent holder's rights”); 

Univis, 316 U.S. at 249 (“[T]he authorized sale of an 

article which is capable of use only in practicing the 

patent is a relinquishment of the patent monopoly with 

respect to the article sold.”); Bos. Store of Chi., 246 U.S. at 

25 (Sale “placed the machine so sold beyond the confines 

of the patent law . . . .”); Mitchell, 83 U.S. at 548 (“[W]hen 

[the patented article] rightfully passes from the patentee 

to the purchaser, [it] ceases to be within the limits of the 

monopoly.”); McQuewan, 55 U.S. at 549 (“[W]hen the 

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Third, the majority claims that giving full sweep to 

the articulation of the exhaustion doctrine in Quanta and 

other cases would be inconsistent with the Supreme 

Court’s decision in General Talking Pictures Corp. v. 

Western Electric Co., 304 U.S. 175 (1938), aff’d on reh’g, 

305 U.S. 124 (1938). The majority asserts that General 

Talking Pictures “held that a patentee can preserve its 

patent rights by authorizing a manufacturing licensee to 

make and sell a patented article under an otherwiseproper restriction, including a restriction on the buyer’s 

post-purchase use.” Maj. Op. at 42. The majority suggests 

it would be incongruous if “a patentee cannot preserve its 

patent rights against uses of a patented article . . . if, 

instead of licensing someone else to make and sell the 

article, it chooses to make and sell the article itself.” Id. 

The majority urges there is “no sound legal basis” for 

distinguishing restrictions on a purchaser from restrictions on a licensee. Id. at 8.9 

In General Talking Pictures, a patent owner granted a 

non-exclusive license to a licensee to manufacture and sell 

patented sound amplifier products. 304 U.S. at 180. The 

license contained a field-of-use restriction: the licensee 

could only make and sell amplifiers for non-commercial 

use. Id. Nonetheless, in violation of the license terms, the 

licensee made and sold the products knowing that they 

were to be used in a commercial theater, and the buyer 

had actual knowledge that the licensee lacked authority

to make such a sale. Id. The Court stated the “controlling 

 

machine passes to the hands of the purchaser, it is no 

longer within the limits of the monopoly.”).

9 See also Maj. Op. at 25 (“no sound reason”); id. at 

27 (“formalistic distinctions of no economic consequence”) 

(quotation marks and citation omitted); id. at 39 (“no good 

reason”); id. at 42 (“no basis in the policy of the patent 

statute”); id. at 43 (“unjustifiably formalistic”). 

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facts” as, “[t]he patent owner did not sell to petitioner the 

amplifiers in question or authorize [the licensee] to sell 

them or any amplifiers for use in theaters or any other 

commercial use. The sales made by the [licensee] were 

outside the scope of its license and not under the patent.” 

Id. at 180. There had been no authorized first sale, for the 

licensee “could not convey to [the ultimate purchaser] 

what both knew it was not authorized to sell,” and thus 

both were liable for infringement. Id. at 181–82.

There is nothing anomalous about General Talking 

Pictures. The Supreme Court has clearly distinguished 

between sales and licenses, holding that while a patentee 

cannot impose post-sale restrictions on an authorized 

sale, it can impose restrictions on a licensee. See Gen. 

Elec., 272 U.S. at 489–90; McQuewan, 55 U.S. at 549–50; 

6A Donald S. Chisum, Chisum on Patents § 19.04[3][h] 

(2015).

That the exhaustion of rights applies only to sales and 

not licenses was clear in Kirtsaeng, which stated that 

under the copyright “first sale” doctrine, 17 U.S.C. 

§ 109(a), because many movie theater owners “were 

lessees, not owners, of their copies [of copyrighted films], 

. . . they (like bailees and other lessees) cannot take 

advantage of the ‘first sale’ doctrine.” 133 S. Ct. at 1361.10 

Thus, in Quanta, the Court stated that General Talking Pictures “held that exhaustion did not apply because 

 

10 Similarly, the Court explained in Mitchell that 

purchasers “who buy goods from one not the owner, and 

who does not lawfully represent the owner, however 

innocent they may be, obtain no property whatever in the 

goods, as no one can convey . . . any better title than he 

owns, unless the sale is made in market overt, or under 

circumstances which show that the seller lawfully represented the owner.” 83 U.S. at 550.

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the manufacturer [licensee] had no authority to sell the 

amplifiers for commercial use.” 553 U.S. at 636. But 

Quanta held that where the licensee does have authority

to sell, the authorized sale results in exhaustion. In 

Quanta, Intel, a licensee, did have authority to make 

sales to purchasers, and “exhaustion turns only on Intel’s 

own license to sell products practicing the [patentee’s 

patents].” Id. at 637.11 

The majority makes much of the fact that the sale 

from the licensee to the ultimate purchaser in General 

Talking Pictures did not result in exhaustion. See Maj. 

Op. at 42, 48–49. But this is not surprising. The licensee 

infringed the patent by its manufacture and sale of the 

item. The sale of the amplifier by the infringer to the 

ultimate purchaser was the antithesis of an authorized 

sale, and it is hardly surprising that an infringer’s unauthorized sale did not result in exhaustion.

In any event, even if there were some tension between 

the Supreme Court’s broad statement of the exhaustion 

rule and General Talking Pictures, it is not our task to 

ignore Supreme Court rulings as “unjustifi[ed]” or 

“[un]sound” because they are purportedly inconsistent 

with other Supreme Court cases. The distinction between 

restrictions on sales (impermissible) and restrictions on 

licensees (permissible) exists in the Court’s precedent, 

and it is not for us to decide if it is a sound distinction. “If 

a precedent of th[e] Court has direct application in a case, 

yet appears to rest on reasons rejected in some other line 

 

11 The Supreme Court has never even decided that 

an authorized sale by a licensee with a limited license 

does not exhaust the patentee’s patent rights in the item 

sold. That question was reserved by the Court in General 

Talking Pictures. 305 U.S. at 127 (“Nor have we occasion 

to consider the effect of a ‘licensee’s notice’ which purports 

to restrict the use of articles lawfully sold.”).

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of decisions, the Court of Appeals should follow the case 

which directly controls, leaving to th[e] Court the prerogative of overruling its own decisions.” Rodriguez de Quijas 

v. Shearson/Am. Express, Inc., 490 U.S. 477, 484 (1989); 

see also State Oil Co. v. Khan, 522 U.S. 3, 20 (1997) (Even 

if a Supreme Court precedent contains many “infirmities” 

and rests upon “wobbly, moth-eaten foundations,” it 

remains the “Court’s prerogative alone to overrule one of 

its precedents.”).

Finally, the majority proposes that we should somehow sustain the restriction here because it may be procompetitive. Exhaustion does not turn on whether a 

particular post-sale restriction is desirable or undesirable, 

pro-competitive or anti-competitive, but whether the sale 

was authorized and the item has passed beyond the scope 

of the patent monopoly. In any case, the Court has suggested that a prohibition on resale is “manifestly anticompetitive.” Kirtsaeng, 133 S. Ct. at 1363.12 

 

12 Id. (stating that “competition, including freedom 

to resell, can work to the advantage of the consumer” and 

noting that “restraints with ‘manifestly anticompetitive 

effects’ are per se illegal”) (quoting Leegin Creative Leather Prods., Inc. v. PSKS, Inc., 551 U.S. 877, 886 (2007)). 

Even on its own terms, the majority’s view that 

Lexmark’s post-sale restrictions can be pro-competitive is 

questionable. The majority posits that Lexmark’s singleuse/no-resale restriction may not be inconsistent with the 

antitrust laws because “non-price vertical restraints are 

to be judged by a rule of reason.” Maj. Op. at 57. But 

Lexmark’s single-use/no-resale restriction imposed on the 

defendants is not a vertical restraint. “Restraints imposed 

by agreement between competitors have traditionally 

been denominated as horizontal restraints, and those 

imposed by agreement between firms at different levels of 

distribution as vertical restraints.” Bus. Elecs. Corp. v. 

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There is, in sum, no colorable basis for the majority’s 

failure to follow the exhaustion rule for domestic sales as 

articulated by the Court in Quanta and numerous other 

cases. 

II. FOREIGN EXHAUSTION

The second issue here concerns foreign exhaustion. 

Lexmark sold patented ink cartridges outside the United 

States to foreign purchasers. As the majority recognizes, 

“Lexmark made the foreign sales without communicating 

a reservation of U.S. patent rights.” Maj. Op. at 59. These 

were, in other words, authorized sales by the holder of 

United States patent rights, and the sales of so-called 

Regular Cartridges did not contain “any sale terms restricting reuse or resale.” Maj. Op. at 10. If those latter 

sales had been made in the United States, even under the 

majority’s cramped view of exhaustion, there is no question that the sales would have exhausted Lexmark’s

domestic patent rights. The issue is whether the foreign 

 

Sharp Elecs. Corp., 485 U.S. 717, 730 (1988). A restriction 

on the defendants’ resale is not a restraint on “firms at 

different levels of distribution,” as between a manufacturer and a dealer. The restraint is applied to competitors in 

the sale of Lexmark ink cartridges. Reconditioned durable 

products compete with new products in the same market. 

See United States v. Aluminum Co. of Am., 148 F.2d 416, 

424–25 (2d Cir. 1945) (Hand, J.). And horizontal restraints of trade are ordinarily per se unlawful under the 

antitrust laws. See Nat’l Collegiate Athletic Ass’n v. Bd. of 

Regents of Univ. of Okla., 468 U.S. 85, 100 (1984); see also

2 Herbert Hovenkamp, Mark D. Janis, Mark A. Lemley, 

& Christopher R. Leslie, IP and Antitrust § 30.2, at 30-2 

(2d ed. Supp. 2010) (“A restraint is ‘horizontal’ when at 

least two of the relevant participants are (1) actual rivals 

or (2) would or could be actual rivals but for the restraint.”).

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location of the sale should lead to a different result, as we 

previously held in Jazz Photo, 264 F.3d at 1111. 

Like the majority I would retain Jazz Photo insofar as 

it holds that a mere foreign sale does not in all circumstances lead to exhaustion of United States patent rights. 

But the government argues, and I agree, that the foreign 

sale should result in exhaustion if the authorized seller 

does not explicitly reserve its United States patent rights.

A 

Let us first consider the centerpiece of the majority’s 

holding that there is a doctrinal blanket ban on foreign 

exhaustion, namely the Supreme Court’s decision in 

Boesch v. Graff, 133 U.S. 697 (1890). Boesch announced 

no such blanket ban. It did not even involve an authorized 

sale by the holder of U.S. patent rights but rather a sale 

by a third party under a foreign law’s prior use exception. 

In that case, a seller in Germany sold patented lamp 

burners to two individuals, Boesch and Bauer. Id. at 701. 

The seller was not the U.S. patent holder, or a German 

patent holder, nor was he even a licensee. Id. Under 

German law, the seller could make and sell the burners 

because he had made preparations to manufacture them 

prior to the filing of the German patent by the holder of 

the U.S. patent rights. Id. When Boesch and Bauer imported and sold the lamp burners in the United States, 

the American assignees sued for infringement. Id. at 698. 

The Court affirmed the holding of infringement, finding

that Boesch’s and Bauer’s sales were “in defiance of the 

rights [of] patentees under a United States patent. . . . 

The sale of articles in the United States under a United 

States patent cannot be controlled by foreign [(i.e., German)] laws.” Id. at 703. 

Thus Boesch does not apply here because the foreign 

sales were made by Lexmark—the U.S. patent rights

holder—itself. The accused infringer does not rely on 

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22 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

foreign law as the source of its authority but the doctrine 

of exhaustion resulting from an authorized sale by a U.S. 

rights holder. 

Just as Boesch is inapposite, so too is the doctrine of 

extraterritoriality, reflected in Deepsouth Packing Co. v. 

Laitram Corp., 406 U.S. 518 (1972); Dowagiac Manufacturing Co. v. Minnesota Moline Plow Co., 235 U.S. 641 

(1915); and Brown v. Duchesne, 60 U.S. 183 (1856). See

Maj. Op. at 79–80. The question here is not whether the 

manufacture or use of a patented product wholly outside 

of the United States is patent infringement under U.S. 

law, see Deepsouth, 406 U.S. at 527, or whether foreign 

law creates a defense to infringement in the United 

States, see Boesch, 133 U.S. at 703. Rather, the question 

is whether United States patent law recognizes exhaustion that occurs abroad from an authorized foreign sale by 

the holder of the U.S. patent rights and without reservation of U.S. rights.13 The majority itself admits that 

foreign activity, such as express or implied license, can 

have an impact on the rights of a United States patent 

owner. See Maj. Op. at 9. 

B 

Strikingly, every one of the lower court decisions before Jazz Photo applied exactly the rule for which the 

government argues. When the sale was made by an entity 

not holding U.S. patent rights, as in Boesch, or when the 

authorized foreign seller clearly reserved U.S. rights, 

there was no exhaustion. See Sanofi, S.A. v. Med-Tech 

Veterinarian Prods., Inc., 565 F. Supp. 931, 934–35 

(D.N.J. 1983) (foreign sale not authorized by U.S. exclusive licensee); Griffin v. Keystone Mushroom Farm, Inc., 

 

13 Foreign law cannot affect, of course, the significance of the reservation of U.S. patent rights. See Boesch, 

133 U.S. at 703.

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453 F. Supp. 1283, 1285, 1287 (E.D. Pa. 1978) (foreign 

sale not authorized by U.S. exclusive licensee); Daimler 

Mfg. Co. v. Conklin, 170 F. 70, 70, 72–73 (2d Cir. 1909) 

(foreign sale was not authorized by U.S. patent holder); 

see also Dickerson v. Tinling, 84 F. 192, 193 (8th Cir. 

1897) (foreign sale made with prohibition on import into 

and sale within United States); Dickerson v. Matheson, 57 

F. 524, 525–26 (2d Cir. 1893) (foreign sale with prohibition on import into United States). 

But the cases uniformly recognize or assume that 

where the foreign sale was made by a seller holding U.S. 

patent rights without a contractual reservation of U.S. 

rights, exhaustion occurred as a result of an authorized 

foreign sale. In Holiday v. Mattheson, 24 F. 185, 185 

(C.C.S.D.N.Y. 1885), the U.S. patentee sold its patented 

article in England “without restriction or conditions” to a 

first purchaser. A second purchaser obtained the article 

from the first, and brought the article back to the United 

States. Id. The circuit court affirmed the trial court’s 

judgment of noninfringement, stating, “[w]hen the owner 

sells an article without any reservation respecting its use 

. . . the purchaser acquires the whole right of the vendor 

in the thing sold . . . . The presumption arising from such 

a sale is that the vendor intends to part with all his rights 

in the thing sold.” Id. In Dickerson v. Matheson, in 1893, 

the Second Circuit concluded that “[a] purchaser in a 

foreign country, of an article patented in that country and 

also in the United States, from the owner of each patent, 

or from a licensee under each patent, who purchases 

without any restrictions . . . acquires an unrestricted 

ownership in the article, and can use or sell it in this 

country.” 57 F. at 527. Similarly in Dickerson v. Tinling, 

in 1897, the Eighth Circuit “[c]onced[ed,] [but did not 

decide,] that one who buys a patented article without 

restriction in a foreign country from the owner of the 

United States patent has the right to use and vend it in 

this country.” 84 F. at 195. The Second Circuit also found 

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24 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

foreign exhaustion in Curtiss Aeroplane & Motor Corp. v. 

United Aircraft Engineering Corp., 266 F. 71 (2d Cir. 

1920). There, the U.S. patent owner licensed a corporation 

to build airplanes in Canada with “no restriction or limitation as to time, or place, or manner of use of the aeroplanes.” Id. at 80. A buyer who purchased the airplanes in 

Canada and then brought them back to the United States 

was not liable for infringement. See id. In Sanofi, S.A. v. 

Med-Tech Veterinarian Products, Inc., in 1983, the district

court found exhaustion because even “assuming that 

Sanofi had a right to enjoin the reselling of the goods in 

[the United States], it waived that right by not placing 

any written restrictions upon the purchaser at the time of 

sale.” 565 F. Supp. at 938. 

This uniform approach, existing well before the 1952 

Patent Act and continuing thereafter, strongly supports 

the government’s position. There is indeed a strong argument that the 1952 Act should be read as adopting these 

earlier cases. See SCA Hygiene Prods. Aktiebolag v. First 

Quality Baby Prods., LLC, 807 F.3d 1311, 1321 (Fed. Cir. 

2015) (en banc) (well-established doctrine of laches codified by 1952 Patent Act). 

C 

So too congressional legislation described by the majority, far from contradicting the government’s approach, 

confirms it. Each bilateral trade agreement cited by the 

majority requires preservation of U.S. patent rights only 

where the U.S. rights have been expressly reserved.14

 

14 Even if these trade agreements were to the contrary, the acts implementing each agreement make clear 

that they cannot override U.S. patent law. See United 

States-Morocco Free Trade Agreement Implementation 

Act, Pub. L. No. 108-302, § 102, 118 Stat. 1103 (2004) (“No

provision of the Agreement, nor the application of any 

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This is illustrated by the U.S.-Australia agreement, where 

the patentee’s domestic rights must be preserved “where 

the patentee has placed restrictions on importation by 

contract or other means.” United States-Australia Free 

Trade Agreement, Aus.-U.S., art. 17.9.4, May 18, 2004, 

KAV 6422 (2005). Likewise the U.S.-Singapore agreement 

requires recognition of an action to prevent or redress the 

unauthorized procurement of a patented pharmaceutical 

product, including where it was first sold abroad, but only 

where someone “knows or has reason to know that such 

product is or has been distributed in breach of a contract 

between the right holder and a licensee.” United StatesSingapore Free Trade Agreement, Sing.-U.S., art. 16.7.2, 

May 6, 2003, 42 I.L.M. 1026 (2003). And the U.S.-Morocco 

agreement permits the United States to limit foreign 

exhaustion, as it did previously with Australia and Singapore, “to cases where the patent owner has placed 

restrictions on importation by contract or other means.” 

United States-Morocco Free Trade Agreement, MoroccoU.S., art. 15.9.4, n.10, June 15, 2004, 44 I.L.M. 544 

(2005). 

 

such provision to any person or circumstance, which is 

inconsistent with any law of the United States shall have 

effect. . . . Nothing in this Act shall be construed . . . to 

amend or modify any law of the United States.”); United 

States-Australia Free Trade Agreement Implementation 

Act, Pub. L. No. 108-206, § 102, 118 Stat. 919 (2004) (“No 

provision of the Agreement, nor the application of any 

such provision to any person or circumstance, which is 

inconsistent with any law of the United States shall have 

effect.”); United States-Singapore Free Trade Agreement 

Implementation Act, Pub. L. No. 108-78, § 102, 117 Stat. 

948 (2003) (same).

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26 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

D 

This brings us to the Supreme Court’s decision in 

Kirtsaeng v. John Wiley & Sons, Inc., 133 S. Ct. 1351 

(2013). I agree with the majority that Kirtsaeng does not 

compel identity between the “first sale” doctrine in copyright and patent exhaustion, due to the differences between copyright and patent law. 

But unlike the majority, I think that Kirtsaeng provides significant guidance and cannot be dismissed as 

simply a copyright case, or as limited to the “first sale” 

provision of the Copyright Act.15 The policies that animated Kirtsaeng are in large part applicable to patent 

exhaustion. The Court emphasized the importance of 

leaving purchasers free to resell goods to enhance competition in the marketplace. Id. at 1363. The Court found 

that the “first sale” doctrine “frees courts from the administrative burden of trying to enforce restrictions upon 

difficult-to-trade, readily movable goods.” Id. The Court 

also found significant the plea of technology companies, 

who informed the Court that “automobiles, microwaves, 

calculators, mobile phones, tablets, and personal computers contain copyrightable software programs or packaging.” Id. at 1365 (internal quotation marks omitted). “A 

geographical interpretation [of the ‘first sale’ doctrine] 

would prevent the resale of, say, a car, without the permission of the holder of each copyright on each piece of 

copyrighted automobile software. . . . Without that permission a foreign car owner could not sell his or her used 

car.” Id. 

 

15 Kirtsaeng recognized that the “first sale” doctrine 

“played an important role in American copyright law” 

even before its first codification by the Copyright Act of 

1909, § 41, 35 Stat. 1084. 133 S. Ct. at 1363 (citing BobbsMerrill Co. v. Straus, 210 U.S. 339 (1908)). 

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Those commercial consequences are equally applicable to patent exhaustion. Automobiles, microwaves, 

calculators, mobile phones, tablets, and personal computers also contain patented components. To paraphrase, “a 

geographical interpretation [of patent exhaustion] would 

prevent the resale of, say, a car, without the permission of 

the holder of each [patent] on each piece of [patented] 

automobile [software or hardware]. . . . Without that 

permission a foreign car owner could not sell his or her 

used car.” 

Refusing to find presumptive exhaustion by foreign 

sales would have serious adverse consequences in the 

patent area, just as in the area of copyright. Technology 

companies have echoed the concerns in Kirtsaeng and 

report that “modern devices include components from 

dozens—if not hundreds—of suppliers.” Brief for LG 

Electronics, Inc., Dell Inc., Google Inc., Intel Inc., et al. as 

Amici Curiae 2. The majority’s rule would require a 

manufacturer to “trace the patent rights of every component it purchases and then negotiate appropriate license 

arrangements with the component manufacturer (as well 

as any sub-component manufacturer),” and ultimately “it 

is consumers who suffer most directly through higher 

prices.” Id. at 5, 8. A major retailer informs us that it 

“often sells patented products that, although genuine, 

were not purchased directly from the patent holder” and 

that “[s]ome of those products were first sold outside of 

the United States.” Brief for Costco Wholesale Corp. et al.

as Amici Curiae at 1. A domestic-only patent exhaustion 

rule would seriously impair international trade. 

Kirtsaeng emphasized the “ever-growing importance 

of foreign trade to America,” 133 S. Ct. at 1367, which 

includes trade not just in artwork and books but also

automobiles, appliances, mobile phones, tablets, and 

personal computers. The Court concluded:

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28 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

[T]he fact that harm has proved limited so far 

may simply reflect the reluctance of copyright 

holders so far to assert geographically based resale rights. They may decide differently if the law 

is clarified in their favor. Regardless, a copyright 

law that can work in practice only if unenforced is 

not a sound copyright law. It is a law that would 

create uncertainty, would bring about selective 

enforcement, and, if widely unenforced, would 

breed disrespect for copyright law itself.

Id. at 1366. So too with patent law. 

E 

Despite these significant policy considerations favoring foreign exhaustion for both copyright and patent, 

there are significant differences between copyright and 

patent law that cut the other way. The premise of exhaustion is that the rights holder has been compensated for its 

efforts. See Univis, 316 U.S. at 251 (“The reward he was 

demanded and received is for the article and the invention 

which it embodies . . . . He has thus parted with his right 

to assert the patent monopoly with respect to it . . . .”). In 

the area of copyright, given the uniform international 

protection of copyrights, it is reasonable to assume that 

the rights holder will receive compensation for a foreign 

sale. But patent law is different. It is not uniform from 

country to country. Indeed, there are typically significant 

differences from country to country. Many countries offer 

no realistic protection or very little protection for items 

patented under U.S. law. In other words, there is reason 

to doubt that the rights holder has been fully compensated for a foreign sale. This suggests an accommodation 

between the interests of the rights holder and the unsuspecting buyer must be found. 

Even the majority recognizes the need for such an accommodation. The majority acknowledges that the law 

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fringement by buyers of goods in foreign countries who 

bring them into the United States,” but believes that 

problem could be solved by the availability of an express 

or a vague implied license defense. See Maj. Op. at 93, 98. 

That defense provides little comfort, however, because it 

places the burden on the purchaser to obtain a statement 

from each patentee of a patented component in a product 

that it has permission to import the component into the 

United States, or else prove in court that the circumstances of each patentee’s sale of its component to the 

manufacturer constituted an implied license to import 

into the United States. 

In my view, the necessary accommodation between 

the interests of the rights holder and the unsuspecting 

buyer can only be achieved by the government’s proposal 

to put the burden on the U.S. rights holder to provide 

notice of a reservation of U.S. rights to the purchaser, an 

approach supported by the earlier lower court decisions 

and legislative action. 

In other words, the country-to-country differences in 

patent laws, and the different economic choices patentees 

must make as a result, suggest that patentees should be 

able to reserve their U.S. patent rights when making or 

authorizing foreign sales.16 But Kirtsaeng’s policy concerns indicate that that right should not extend to situations where the patentee is silent or unclear. If a patentee 

wishes to reserve its U.S. rights, it should be required to 

 

16 There is significant uniformity and reciprocity in 

international copyright law, see Kirtsaeng, 133 S. Ct. at 

1359–60 (observing that American copyright laws protect 

“works ‘first published’ in any one of the nearly 180 

nations that have signed a copyright treaty with the 

United States”), but as the majority describes, the availability and scope of patent protection differ from country to 

country. See Maj. Op. at 73–76. 

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30 LEXMARK INT’L, INC. v. IMPRESSION PRODS., INC. 

do so unmistakably. The patentee is in a better position to 

reserve its rights than the purchaser is to inquire into any 

reservation. A rule requiring reservation would protect 

both the interests of the authorized seller and the unsuspecting buyer. 

* * * * * 

In conclusion, I would overrule our decision in 

Mallinckrodt as inconsistent with governing Supreme 

Court authority and overrule Jazz Photo to the extent 

that it imposes a blanket ban on foreign exhaustion. I 

would recognize foreign exhaustion where the U.S. rights 

holder has not notified the buyer of its retention of the 

U.S. patent rights. I respectfully dissent from the majority’s contrary holdings. 

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