Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-14-01196/USCOURTS-ca13-14-01196-0/pdf.json

Parties Involved:
Bon-Ton Stores, Inc.
Not party
Bravo Media LLC
Appellee
CBS Corporation
Appellee
G4 Media, LLC
Appellee
Helferich Patent Licensing, LLC
Appellant
J.C. Penney Corporation, Inc.
Appellee
New York Times Company
Appellee

Document Text:

United States Court of Appeals 

for the Federal Circuit ______________________ 

HELFERICH PATENT LICENSING, LLC, 

an Illinois limited liability company,

Plaintiff-Appellant

v.

THE NEW YORK TIMES COMPANY, 

a New York Corporation,

Defendant-Appellee

J.C. PENNEY CORPORATION, INC.

Defendant

G4 MEDIA, LLC, THE BON-TON STORES, INC., 

BRAVO MEDIA LLC, CBS CORPORATION,

Third Party Defendants

______________________ 

2014-1196

______________________ 

Appeals from the United States District Court for the 

Northern District of Illinois in No. 1:10-cv-04387, Judge 

John W. Darrah.

______________________ 

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2 HELFERICH PATENT LICENSING v. THE NEW YORK TIMES

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - 

HELFERICH PATENT LICENSING, LLC,

Plaintiff-Appellant

v.

G4 MEDIA, LLC,

Defendant-Appellee

______________________ 

2014-1197

______________________ 

Appeals from the United States District Court for the 

Northern District of Illinois in Nos. 1:11-cv-07395, Judge 

John W. Darrah.

______________________ 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - 

HELFERICH PATENT LICENSING, LLC,

Plaintiff-Appellant

v.

CBS CORPORATION,

Defendant-Appellee

______________________ 

2014-1198

______________________ 

Appeals from the United States District Court for the 

Northern District of Illinois in Nos. 1:11-cv-07607, Judge 

John W. Darrah.

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HELFERICH PATENT LICENSING v. THE NEW YORK TIMES 3

______________________ 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - 

HELFERICH PATENT LICENSING, LLC,

Plaintiff-Appellant

v.

BRAVO MEDIA, LLC, 

Defendant-Appellee

______________________ 

2014-1199

______________________ 

Appeals from the United States District Court for the 

Northern District of Illinois in Nos. 1:11-cv-07647, Judge 

John W. Darrah.

______________________ 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - 

HELFERICH PATENT LICENSING, LLC,

Plaintiff-Appellant

v.

J.C.PENNY CORPORATION, INC.

Defendant-Appellee

______________________ 

2014-1200

______________________ 

Appeals from the United States District Court for the 

Northern District of Illinois in Nos. 1:11-cv-09143, Judge 

John W. Darrah.

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4 HELFERICH PATENT LICENSING v. THE NEW YORK TIMES

______________________ 

Decided: February 10, 2015 

______________________ 

AARON M. PANNER, Kellogg, Huber, Hansen, Todd, 

Evans & Figel, PLLC, Washington, DC, argued for plaintiff-appellant Helferich Patent Licensing, LLC. Also 

represented by MICHAEL E. JOFFR, BRENDAN J. CRIMMINS;

VICTORIA GRUVER CURTIN, Victoria Gruver Curtin, PLC, 

Scottsdale, AZ; STEVEN G. LISA, Law offices of Steven G. 

Lisa, Scottsdale, AZ, JON E. KAPPES; GERALD D. HOSIER, 

Law Offices of Gerald D. Hosier, Ltd., Aspen, CO. 

BRIAN BUROKER, Gibson, Dunn & Crutcher LLP, 

Washington, DC, argued for defendant-appellee The New 

York Times Company. Also represented by BLAIR A.

SILVER; ALEXANDER N. HARRIS, San Francisco, CA. 

DARYL JOSEFFER, King & Spalding LLP, of Washington, DC, argued for defendant-appellee J.C. Penney 

Corporation, Inc. Also represented by ADAM CONRAD, 

Charlotte, NC; R. DAVID DONOGHUE, Holland & Knight, 

LLP, Chicago, IL, ANTHONY J. FUGA; BENJAMIN M. STERN,

Holland & Knight, LLP, Boston, MA. 

EDWARD R. REINES, Weil, Gotshal & Manges LLP, 

Redwood Shores, CA for third party defendants G4 Media, 

LLC, Bravo Media LLC, CBS Coporation. Also represented by BYRON BEEBE. 

______________________ 

Before TARANTO, BRYSON, and CHEN, Circuit Judges.

TARANTO, Circuit Judge. 

Helferich Patent Licensing, LLC, brought this action 

against defendants New York Times Co., G4 Media LLC, 

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HELFERICH PATENT LICENSING v. THE NEW YORK TIMES 5

CBS Corporation, Bravo Media LLC, and J.C. Penney 

Corporation, Inc., alleging infringement of various claims

of seven patents—U.S. Patent Nos. 7,280,838; 7,499,716; 

7,835,757; 8,107,601; 8,116,741; 8,134,450; and 7,155,241. 

The asserted claims, generally speaking, address systems 

and methods for handling information and providing it to 

wireless devices, such as mobile-phone handsets. Other 

claims in two of these (and other) Helferich patents, 

claims not asserted here, address handsets and methods 

of using them. 

The United States District Court for the Northern 

District of Illinois granted summary judgment of noninfringement under the doctrine of patent exhaustion. 

Helferich Patent Licensing, LLC v. New York Times Co., 

965 F. Supp. 2d 971 (N.D. Ill. 2013). It held that, by 

granting handset manufacturers patent licenses conferring broad authority to sell the handsets, Helferich had 

exhausted its ability to enforce its patents not only 

against acquirers of the handsets but also against the 

defendant content providers who use presumptively 

distinct inventions to manage content and deliver it to 

handset users. We reverse, concluding that patent exhaustion has not reached that far and should not be newly 

extended to do so in these cases. 

BACKGROUND

Helferich owns more than thirty United States patents that cover a range of distinct, though related, wireless-communication technologies. All of the patents that 

are relevant here derive from a common specification. 

One subset of Helferich’s claims consists of apparatus and 

method claims directed, generally speaking, to mobile 

wireless-communication devices (handsets) and receiving 

and/or requesting certain content. It is useful to call 

those claims “handset claims.” Another subset of Helferich’s claims consists of claims directed, generally speaking, to systems and methods for storing and updating

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6 HELFERICH PATENT LICENSING v. THE NEW YORK TIMES

information of various types (content) and sending it to 

handsets: for example, a mobile-device news service might 

send a subscriber a message containing the headline of a 

news article along with website-location information that 

permits the subscriber, upon choosing to click a hyperlink,

to gain access to the complete article. It is useful to call 

those claims “content claims,” reflecting the fact that it is 

content providers, not possessors of handsets, that practice them.

Only content claims are asserted here. Two of the patents at issue (the ’838 and the ’716) contain both handset 

claims and content claims. The other five patents contain 

only content claims. 

We must assume that all claims at issue are valid. 

The Patent and Trademark Office issued all of the asserted claims—some of them added or amended or confirmed 

on reexamination (initiated by defendant New York 

Times, J.A. 616)—thereby raising a presumption of validity. 35 U.S.C. § 282; Microsoft Corp. v. i4i Ltd. P’ship, 131 

S. Ct. 2238, 2252 (2011). Moreover, the PTO required 

none of the patents containing the asserted content claims 

to be issued with terminal disclaimers (under 35 U.S.C. 

§ 253 and 37 C.F.R. § 1.321) in light of other patents; 

thus, it did not conclude that awarding distinct patents 

would constitute double patenting. See In re Hubbell, 709 

F.3d 1140, 1145–46 (Fed. Cir. 2013). Specifically, we 

must assume that all of the asserted content claims are 

“‘patentably distinct from the claims of’ ” other patents 

containing handset claims, because neither the PTO nor 

the district court has determined—and we are not asked 

to determine—that the asserted content claims are “‘obvious over, or anticipated by,’” such handset claims. Id. at 

1145; see generally PTO, Manual of Patent Examining 

Procedure § 804 (elaborating on double-patenting doctrine). In fact, during prosecution, the PTO, exercising its 

discretionary authority under 35 U.S.C. § 121, identified a 

number of separate inventions and demanded that they 

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not be combined in a single application, leading to multiple “divisional” applications that eventually issued as

separate patents.

Claim 1 of the ’450 patent is an example of a content 

claim, one particularly directed to sending content to 

handsets from remote servers: 

1. A method of providing content to a cell phone 

comprising:

a content provider causing the content to 

be stored in an internet accessible storage 

unit;

the content provider initiating a page to a 

content subscriber, the page including a 

notification that: (i) identifies the content, 

and (ii) includes an address of a system to 

be contacted to trigger retrieval of the content, but does not include the content;

wherein the page indicates that the content is available for a specified time; and

the content provider causing the content 

identified by the notification to become inaccessible at the internet accessible storage unit after the specified time identified 

by the initiated page.

’450 Patent, col. 19, lines 22–35; J.A. 295 (certificate of 

correction).

Claim 7 of the ’838 patent is an example of a handset 

claim: 

7. A method of operating a wireless communication device in a communication system that includes a plurality of information storage systems, 

and a mobile radiotelephone network comprising:

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receiving a notification message from the 

mobile radiotelephone network, the notification message including (a) a system 

identifier identifying a particular one of 

the plurality of information storage systems and (b) a message identifier identifying information that is stored in at least 

one of the plurality of information storage 

systems and which information is intended for a user of the wireless communication device;

alerting the user that the notification 

message has been received;

receiving input from the user specifying 

an action to delete, forward, or reply to be 

performed on the information corresponding to the notification message; and

transmitting via a mobile radiotelephone 

network, to the information storage system identified by the system identifier, an 

action identifier corresponding to the action specified by the user;

alerting the user that the action specified 

by the user has been completed.

’838 patent, col. 1, lines 28–51 (reexam. cert.). 

Helferich licensed its portfolio to what, at least at one 

time, constituted most—we may assume all—of the 

manufacturers of mobile handsets for sale in the United 

States. It is undisputed that, under the doctrine of patent 

exhaustion, those licenses eliminate for the owners/possessors of handsets acquired from the licensed 

manufacturers—“authorized acquirers”—any legal restriction the patents would otherwise impose on them

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through the patent statute, 35 U.S.C. §§ 154, 271, regarding their sale or use of their handsets.1

The licenses themselves generally reflect painstaking 

efforts to distinguish the conduct of handset makers and 

possessors from the conduct of others, such as content 

providers, and to distinguish claims practiced by the 

former from claims practiced by the latter. (The parties 

have not clearly identified and explained any differences 

among the licenses that would alter the analysis here.) 

The licenses generally indicate that the Helferich portfolio

contains many claims that would not be infringed by a 

handset manufacturer because those claims “expressly 

recite material additional operations that are carried out 

(or material additional structure that is added) by Third 

Parties, including . . . Content Provider[s] . . . and/or are 

not substantially embodied in the products, services, or 

methods within the scope of the Licensed Fields,” 

J.A. 2102 (emphasis removed)—such Licensed Fields 

being defined as “Mobile Wireless Communications Devices” made, used, etc., by the manufacturer licensee, J.A. 

2100. The licenses generally disclaim any grant of rights 

to such content providers and reserve Helferich’s enforcement rights against them. J.A. 2102–03. In light of 

those provisions, the content providers in these cases rely 

for protection only on the legal doctrine of patent exhaustion, not on a claim of a factually “implied license” to be 

found in the licenses Helferich granted to manufacturers. 

1 We use “authorized acquirers” to refer to those 

who acquire title to the article at issue from the patentee 

or from a licensee authorized to sell, see LifeScan Scot., 

Ltd. v. Shasta Techs., LLC, 734 F.3d 1361, 1374–77 (Fed. 

Cir. 2013), and those who acquire possession and operational control, as by lease, from such a person, Motion 

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

502 (1917). 

 

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See Helferich, 965 F. Supp. 2d at 979 (“The right of Defendants and other third parties here to practice [Helferich’s] patents is based [on] exhaustion, not on an implied 

license . . . .”).

Between July 2010 and March 2012, Helferich filed 

complaints against the defendants individually for directly infringing a number of Helferich’s content claims. 

Helferich alleged that all defendants infringe content 

claims of the ’838, ’716, ’757, ’601, ’741, and ’450 patents

and that Bravo and CBS also infringe the ’241 patent.2 

Although Helferich alleged indirect infringement in the 

alternative, it is undisputed—as Helferich asserted in this 

court without contradiction by defendants, see Helferich 

Opening Br. at 23, 33—that the cases before us involve no 

allegation by Helferich of indirect infringement based on 

handset acquirers’ direct infringement.

The allegations of infringement focus on defendants’ 

conduct in storing content and delivering it to customers

via mobile-device applications, text-messaging subscription services, and third-party networking programs like 

Facebook and Twitter. For example, Helferich contends 

that Bravo infringes when it (a) sends a multimedia 

message service (MMS) text message to a handset user

that includes a brief description of video content and a 

plain-text uniform resource locator (URL) for the video 

stored on a remote server and (b) delivers that content to 

the user upon request, as when the user’s handset has 

2 The asserted claims are these: ’838 patent—

claims 9, 10, 12, 13, 15, 16, 18–20, 98–101, 106, 107, 109, 

and 110; ’716 patent—claims 89–91, 94, 103, 104, and 

106; ’757 patent—claims 1, 2, 6, 11, 18, 20, 37, 44, and 46; 

’601 patent—claims 1, 3, 4, 9–11, 16, and 17; ’741 patent—claims 1–27; and ’450 patent—claims 1, 3–8, 10, 

13–15, 19–23, 27, and 28. Some of the claims were added 

or modified during reexamination. 

 

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recognized the plain-text URL and converted it into a 

hypertext-markup-language (HTML) hyperlink and the 

user clicks the hyperlink. Similarly, Helferich alleges 

that CBS infringes by sending to its Twitter subscribers

text messages containing links to CBS’s content. 

In March 2013, defendants jointly moved for summary judgment of non-infringement, asserting the affirmative defense of patent exhaustion. Helferich cross-moved 

for summary judgment, arguing that exhaustion was

inapplicable as a matter of law. The district court ruled 

in defendants’ favor and denied Helferich’s motion. It

concluded that, because Helferich had authorized “every” 

mobile-phone manufacturer to sell handsets under its 

license agreements, its ability to assert its claims had 

been exhausted—not only against handset acquirers, but 

also against the content providers as third parties interacting with handsets. Helferich, 965 F. Supp. 2d at 978. 

The court did not focus on the particulars of any of 

Helferich’s claims, whether handset or content claims. 

Rather, the court relied on the simply stated premise that 

“[a]ll of the patents-at-issue require the use of a handset 

device.” Id. The court did not state that the defendants 

were using handsets. Nor did it state that handset possessors practiced any of the asserted claims. Thus, it did 

not state that handset possessors performed all or even

any of the steps of the claimed methods or, as to the 

system claims, that they put the claimed systems into 

service and thereby “used” them. See Centillion Data 

Sys., LLC v. Qwest Commc’ns Int’l, Inc., 631 F.3d 1279,

1284 (Fed. Cir. 2011) (“[T]o ‘use’ a system for purposes of 

infringement, a party must put the invention into service, 

i.e., control the system as a whole and obtain benefit from 

it.”). The court also did not state that the asserted content claims, to the extent they contemplate someone’s use 

of a handset, require that handset to have the inventive 

features claimed in particular handset claims. Rather, 

citing one patent’s Abstract, and without reference to 

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particular claims, the court relied on the conclusion that 

“[t]he handset devices have the capability to receive 

content from content providers, and the patents all require devices capable of receiving content or messages.” 

Helferich, 965 F. Supp. 2d at 978.

The court reasoned that, because “every handset device has been licensed to practice [Helferich’s] patents,” 

“no handset device can infringe [Helferich’s] patents.” Id. 

Moreover, the court held that the handsets, with the 

content-and-message-receiving capability, “sufficiently 

embody the patents in suit.” Id. As a policy matter, the 

court added: “There would be little value to the handset 

manufacturers (or their end users) to have purchased 

licenses to [Helferich’s] patents to receive content from a 

third-party content provider if the content provider, like 

Defendants, could not send the message to the licensed 

handset device without infringing the patent.” Id. at 978–

79. The court held: “Once the handset manufacturers sell 

the handsets which embody [Helferich’s] patents, [Helferich’s] patents are exhausted as to all third parties, including Defendants.” Id. at 979.

On reconsideration, the district court left its decision 

unaltered except for correcting the omission of a reference 

to the ’241 patent. Helferich Patent Licensing, LLC v. 

New York Times Co., No. 10-CV-4387, 2013 WL 6354209, 

at *1 (N.D. Ill. Dec. 4, 2013). Helferich timely appealed. 

We have jurisdiction under 28 U.S.C. § 1295(a)(1).

DISCUSSION

We review the district court’s grant of summary 

judgment de novo. See Charles Mach. Works, Inc. v. 

Vermeer Mfg. Co., 723 F.3d 1376, 1378 (Fed. Cir. 2013); 

Mullin v. Temco Mach., Inc., 732 F.3d 772, 776 (7th Cir. 

2013). We read the record in the light most favorable to 

Helferich (the non-moving party), drawing all reasonable 

inferences from the evidence in its favor. Anderson v. 

Liberty Lobby, Inc., 477 U.S. 242, 255 (1986); Naficy v. 

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Illinois Dep’t of Human Servs., 697 F.3d 504, 509 (7th Cir. 

2012). Summary judgment requires that there be no 

reasonably disputed facts capable of altering the outcome. 

Fed. R. Civ. P. 56(a); Naficy, 697 F.3d at 509. Patent 

exhaustion may be decided by summary judgment when 

there are no such genuine disputes of material fact. 

Keurig, Inc. v. Sturm Foods, Inc., 732 F.3d 1370, 1373 

(Fed. Cir. 2013).

A 

In defining the issue presented for decision, we begin 

with the broad premise on which defendants rest their 

exhaustion defense in this court—a modified version of

the broad premise of the district court’s holding. In an 

effort to affirm the one-fell-swoop judgment as to all of the 

asserted claims, without differentiation among those 

claims, defendants rely on the simple premise that all of 

the asserted claims contemplate a use of a handset by a

Helferich-authorized handset acquirer (not by the allegedly infringing defendants). Thus, defendants’ Statement of 

the Issue is: “Whether the district court correctly held 

that [Helferich’s] infringement claims are barred due to 

patent exhaustion because they necessarily involve the 

use of already-licensed handsets.” Defendants’ Br. at 3. 

Defendants identify the “involve[d]” handset use 

broadly, though inconsistently. In their Summary of 

Argument, they say that “[e]very claim of every asserted 

[Helferich] patent requires some use of a licensed handset: to receive a message or to initiate a request for content based on an identifier in the message.” Id. at 17

(emphasis added). In their Argument, they assert, more 

restrictively, that “[e]ach asserted claim requires a ‘request’ or a ‘reply’ to come from a licensed handset,” id. at 

29, and, still more restrictively, that “[e]very asserted 

patent claim requires a wireless handset that can render 

a hyperlink and send a content request,” id.; see id. at 29–

31.

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In certain respects, defendants’ assertions overreach. 

For one thing, the term “require” works against clear 

understanding here, because it inaccurately tends to 

suggest something the accused infringer must do. The 

district court did not find, and defendants have not argued, that accused infringers of the asserted claims 

generally, or defendants themselves, “use” the handsets.3

We will therefore use “contemplate” or “involve” as shorthands when speaking generally, see Defendants’ Br. at 3, 

16, because those words, by their facial imprecision, 

signal the need to elaborate more precisely. And we will 

proceed on the premise, accepted by defendants, that only 

handset owners/possessors, not those who practice the 

asserted content claims, “use” the handset.4 

3 In their brief, defendants never assert that they 

use the handsets or are alleged in the complaints to do so; 

nor do they assert, more generally, that persons “using” 

the methods or systems of the asserted content claims, 

under 35 U.S.C. § 271, are using the handsets. Instead, 

from its first pages, the brief (a) pervasively uses passivevoice and other formulations to say that “a handset is 

used” or “the use of a handset” is required, without designating the subject engaging in that use, e.g., Defendants’ 

Br. at 1–2, 16, 29–31, while (b) sometimes referring 

specifically to the handset owner/possessor (never the 

content provider) as the one “using” the handset, e.g., id.

at 5–7, 13, 24 (“the handset user”). 

4 In a related context, where a defendant’s practice 

of a claimed invention presupposes that other persons 

engage in additional conduct, we have said that the 

additional conduct is part of “the environment” in which 

the claim is practiced, and not something the defendant

need engage in for infringement to be found. Uniloc USA, 

Inc. v. Microsoft Corp., 632 F.3d 1292, 1309 (Fed. Cir. 

 

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In addition, as to what use of a handset is contemplated by the asserted claims, defendants’ position goes 

beyond what the district court found and what their 

citations support. The district court—referring not to 

particular claims but to the patents as a whole—relied 

only on the receiving capability of handsets, not on actual 

receipt of information by handsets or handset-generated 

requests for information. Helferich, 965 F. Supp. 2d at 

978–79. Moreover, defendants’ few pages of general, 

selective discussion are not adequate to demonstrate—

what was disputed on summary judgment—that all 

asserted claims contemplate that a handset user will use 

the handset to initiate a request for content or, even more 

specifically, that the handset renders text into a userclickable hyperlink for initiating such a request.5 Nor 

have defendants shown that all asserted claims contemplate that, for infringement to occur, a handset user must 

2011); see also Advanced Software Design Corp. v. Fiserv, 

Inc., 641 F.3d 1368, 1374 (Fed. Cir. 2011). 

5 As to text-to-hyperlink rendering generally, defendants cite a Helferich filing during reexamination of 

the ’241 patent (a content-claim-only patent) as saying 

that the inventive aspect of the handset was the transformation of text strings into clickable links. Defendants’ 

Br. at 5, 30 (citing J.A. 1982). The cited filing does not 

say that. It distinguishes prior art as containing an alert 

about emails on the ground that the alert sent to a recipient “does not contain any information identifiers or message identifiers,” requiring an interested recipient to 

“separately pull information from the email list service,” 

which waits to be contacted. J.A. 1982. 

Defendants describe only one handset claim in their 

brief—method claim 7 of the ’838 patent, as modified on 

reexamination. Defendants’ Br. at 6–7. That claim does 

not speak of text-to-hyperlink rendering. See supra pp. 7–

8. 

 

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actually receive information from the accused infringer. 

For example, method claim 1 of the ’450 patent, quoted 

above, on its face may be read to recite a process that is 

complete without any handset receipt of information, 

either a “page” or “content,” let alone a handset-generated 

information request. The content provider’s initiation of a 

page and accessibility of content seem to be enough under 

the claim language, which has not been construed. 

Two limits defining the issue before us are independent of the foregoing problems and are revealed by noting 

what defendants do not argue. First, like the district 

court, defendants do not contend that handset possessors 

practice any of the asserted claims—that such handset 

users perform the steps of the claimed methods (even any 

of the steps) or put into service and thereby use the 

claimed systems. Second, defendants do not argue that

the content claims’ contemplated handset use must involve a handset that has the inventive features claimed in 

Helferich’s handset claims. Although both parties have 

made suggestions that (some or maybe all) handsets in 

the market do have features that bring them within some 

handset claims, see J.A. 1023, 2056, 2058; Defendants’ Br. 

at 55, defendants do not argue that infringement of the 

asserted content claims logically entails a handset user’s 

practice of handset claims or any other claims.6 The 

6 The only handset claim that defendants discuss—

claim 7 of the ’838 patent, as modified on reexamination—

requires, among other things, that the handset receive 

from the user an input “specifying an action to delete, 

forward, or reply to be performed on the information 

corresponding to the notification message.” See supra pp. 

7–8. Defendants’ discussion of the claim does not address 

that limitation or suggest that it must be met for a handset to do what is contemplated by all asserted content 

claims. Defendants’ Br. at 6–7. 

 

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district court did not conclude otherwise. As defendants 

present these cases to us, then, handset acquirers’ practice of handset claims or any other claims is not necessarily implied by content providers’ alleged infringement of 

the content claims. 

In short, the premise of defendants’ exhaustion defense is that all handsets in the United States are licensed and that the asserted claims contemplate a use of 

handsets by handset owners/possessors, one that does not 

necessarily practice any of Helferich’s claims. Standing 

on that simple ground enables defendants to urge acrossthe-board exhaustion, without differentiation among 

asserted content claims. We judge the exhaustion defense 

on the basis presented to us. 

B 

We conclude that the exhaustion defense, as framed 

by defendants here, does not bar Helferich’s claims. 

Based on the record and arguments presented to us, these 

cases raise an exhaustion question in the context of 

multiple related and separately patentable inventions. 

The situation, to simplify, involves a single inventor’s 

coming up with two inventions presumed to be separately 

patentable, one invention to be practiced by one group of 

users, the other invention by another group, where each 

invention tends to make the other more useful when thus 

separately practiced. Defendants here rely on the reciprocal enhancement of utility to argue that the patentee’s

licensing of the first group terminates the patentee’s 

rights against the second group for practicing the second 

invention, when practicing the second invention in some 

way contemplates the first group’s use of a product made 

under the license (even if not actually embodying the first 

invention). But the exhaustion doctrine’s lifting of patentlaw restrictions on a licensed product has never been 

applied to terminate patent rights in such complementary

activities or goods in these circumstances. And we do not 

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think that this judicially fashioned doctrine should be 

extended to do so in the present cases. 

1 

Exhaustion protects an authorized acquirer’s freedom 

from the legal restrictions imposed by the patent statute. 

The statute grants a patentee the right to exclude others 

from, e.g., making or using or selling a patented invention, 35 U.S.C. § 154(a)(1), and it then imposes concomitant legal restrictions on acts that violate the exclusivity 

right by defining, in closely related terms, what it means 

for a person to “infringe” the right, § 271. Patent exhaustion removes those legal restrictions on certain persons in 

certain circumstances: it eliminates the legal restrictions 

on what authorized acquirers “can do with an article 

embodying or containing an invention” whose initial sale 

(or comparable transfer) the patentee authorized. Bowman v. Monsanto Co., 133 S. Ct. 1761, 1766 & n.2 (2013). 

Specifically, once there has been an authorized sale of a 

patented item, that sale “ ‘confers on the purchaser, or 

any subsequent owner, ‘the right to use [or] sell’ the thing 

as he sees fit.” Id. at 1766 (quoting United States v. 

Univis Lens Co., 316 U.S. 241, 249–50 (1942)).

In applying and refining the doctrine for a century

and a half, the Supreme Court has considered various 

issues about the doctrine’s scope, including issues concerning the character of the article authorized to be sold 

and its relation to the asserted claims. See Quanta Computer, Inc. v. LG Elecs., Inc., 553 U.S. 617 (2008). But the 

doctrine’s protection against infringement allegations has, 

apparently, always remained within a limit that reflects 

the core notion that exhaustion lifts legal restrictions on 

an authorized acquirer. The doctrine has never applied

unless, at a minimum, the patentee’s allegations of infringement, whether direct or indirect, entail infringement of the asserted claims by authorized acquirers—

either because they are parties accused of infringement or 

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because they are the ones allegedly committing the direct 

infringement required by the indirect infringement 

charged against other parties. Here, as noted, that is not 

so, because infringement of the content claims has not 

been asserted or shown to require that handset acquirers 

are practicing those claims. 

Thus, in Quanta, patent owner LGE alleged direct infringement by Quanta, an authorized acquirer of chips 

that LGE had authorized Intel to sell. See id. at 624. In 

Univis, 316 U.S. at 243–48, an antitrust case, the conduct 

at issue was patentee Univis’s assertion of patent claims 

against downstream lens wholesalers and retailers after 

authorizing their acquisition of blanks embodying the 

claimed invention. Ethyl Gasoline Corp. v. United States, 

309 U.S. 436, 455–57 (1940), also an antitrust case, 

similarly involved a patentee’s assertion of patent claims 

against jobbers’ sale of lead-treated fuel that it had authorized refiners to make and to sell to them. In Motion 

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

502, 505–08 (1917), patentee Motion Picture Patents had 

authorized Precision Machine to make and sell film 

projectors that practiced Motion Picture’s patent on filmfeeding mechanics, then charged (a) direct infringement 

by a “playhouse” operator that properly acquired one of 

the Precision projectors by purchase followed by lease and 

(b) indirect infringement by a supplier of film to the 

operator based on the operator’s direct infringement by 

use of the film. See also Keeler v. Standard Folding Bed 

Co., 157 U.S. 659, 666 (1895) (suit against authorized 

acquirer; “one 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”); Morgan Envelope Co. v. Albany Perforated Wrapping Paper Co., 152 U.S. 425 (1894) (described infra); 

Hobbie v. Jennison, 149 U.S. 355 (1893) (suit against 

authorized acquirer); Adams v. Burke, 84 U.S. 453 (1873)

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(suit against authorized acquirer); Bloomer v. Millinger, 

68 U.S. 340, 350 (1863) (suit against authorized maker/owner of machine; exhaustion protects “owner of the 

machine”); Bloomer v. McQuewan, 55 U.S. 539 (1852)

(suit against authorized makers/owners of machines). 

In short, the decisions finding exhaustion (or relying 

on exhaustion to reject an antitrust defense) have done so 

only when the patentee’s assertion of infringement was, 

or depended on, an assertion that an authorized acquirer 

was using the same invention by infringing the asserted 

claims. Neither the parties nor we have identified any

case from the Supreme Court that has found exhaustion 

without this common feature. 

This court’s decisions appear to be in accord. Recently, for example, in LifeScan, 734 F.3d at 1365, the patentee rested its allegation of indirect infringement by a 

manufacturer of disposable test strips used in patented 

blood-glucose meters on the assertion that use of such 

strips with such meters would cause direct infringement 

by the authorized acquirers of the meters. Similarly, in 

Keurig, 732 F.3d at 1374, the patentee rested its allegation of indirect infringement by the seller of coffee pods 

for use with a patented coffee brewer on the assertion that

the use would cause direct infringement by the authorized 

acquirers of the brewers. See also TransCore, LP v. 

Electronic Transaction Consultants Corp., 563 F.3d 1271 

(Fed. Cir. 2009) (infringement suit against installation 

firm given patented articles by purchaser); Tessera, Inc. v. 

Int’l Trade Comm’n, 646 F.3d 1357, 1369–71 (Fed. Cir. 

2011) (infringement charge, by ITC, against purchaser of 

patented articles); Intel Corp. v. ULSI Sys. Tech., Inc., 995 

F.2d 1566 (Fed. Cir. 1993) (infringement suit against 

purchaser of patented articles); Hewlett-Packard Co. v. 

Repeat-O-Type Stencil Mfg. Corp., 123 F.3d 1445 (Fed. 

Cir. 1997) (infringement suit against purchaser of patented articles). 

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Because defendants rely heavily on Keurig, it is worth 

stressing that Keurig does not depart from this pattern. 

The allegation by the patentee in Keurig was that the 

defendant was inducing a brewer owner to infringe the 

asserted method claim. 732 F.3d at 1374. In that familiar context, the court held that exhaustion covered the 

method claim because it appeared in a patent that also 

contained an apparatus claim reading on the acquired 

brewer. Id. at 1374–75. That rationale is inapplicable to 

five of the asserted seven patents here, even aside from 

whether the rationale’s premise is present. And in fact 

the premise is missing here: in contrast to Keurig, the 

present cases involve no assertion that the defendants are 

inducing or contributing to authorized acquirers’ infringement of the claims asserted against defendants. 

2 

Finding exhaustion in the present cases would run 

counter to the pronouncement of the Supreme Court—

dictum in Morgan, 152 U.S. 425—that is most on point for 

the issue presented here. The Court in Morgan, addressing exhaustion, indicated the doctrine would not apply in 

circumstances where the alleged infringement involved 

distinct, though related, validly patented inventions. Id.

at 435. This court, among others, has noted Morgan’s 

significance for such circumstances.

In Morgan, the plaintiff, Morgan Envelope Co., owned 

(by assignment) patents on (1) a toilet paper dispenser, (2) 

an “oval roll” of toilet paper designed to be used with the 

dispenser, and (3) a combination including the dispenser 

and the roll. 152 U.S. at 429–31. The defendant, Albany 

Perforated Wrapping Paper Co., resold dispensers it had 

acquired from Morgan (i.e., it was an authorized acquirer), and it also sold its own version of oval rolls; but 

Morgan “refused to sell [dispensers] except to persons also 

ordering [Morgan’s] paper.” Id. at 431–32. Morgan sued 

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Albany for infringing both the oval-roll and the dispenserroll-combination patents by selling new rolls. 

The Supreme Court first invalidated Morgan’s patent 

on its “oval roll” technology, id. at 427–30, then addressed 

Morgan’s allegation that Albany infringed its combination 

patents by selling the oval rolls with knowledge that its 

customers would combine them with dispensers, id. at 

431–32. The Court concluded that, where an unpatented 

article (like the oval roll, post-invalidation) “is an article 

of manufacture perishable in its nature . . . which must be 

renewed periodically,” the patentee could not restrict its 

sale. Id. at 433. Individuals who had lawfully purchased 

the dispenser-and-roll combination did not infringe the 

combination patents by refilling the dispensers with the 

unpatentable rolls, and consequently Albany was free to 

manufacture and sell paper rolls for a willing consumer’s 

use without risking infringement liability. Id. at 435.

In reaching its conclusion, the Court carefully distinguished a circumstance in which the patent owner sold to 

purchasers two distinct, separately patentable inventions, 

even when they are designed to be used together. Specifically, the Court approved the treatment of that situation 

by the Circuit Court for the District of New Hampshire in

Aiken v. Manchester Print Works, 1 F. Cas. 245, No. 113

(C.C.D.N.H. 1865), speaking through Circuit Justice 

Clifford. See Morgan, 152 U.S. at 435.

In Aiken, Walter Aiken owned patents on—and sold 

as a pair—both a knitting machine and needles specifically designed for use in the machine. Aiken, 1 F. Cas. at 

245; see Morgan, 152 U.S. at 435 (describing Aiken). The 

needles wore out after about four weeks of use, Aiken, 1 F. 

Cas. at 245, and the machine would not work without the 

patented needles, id. at 246. Declaring that the machine 

and its needles had “become private, individual property,” 

insulated from infringement liability by virtue of an 

authorized sale, the court held that while owners may 

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“repair the needles they purchased, . . . they cannot 

manufacture new ones, without license,” because “the 

needle is subject to a patent.” Id. at 247. The Morgan

Court expressly embraced the Aiken court’s analysis, 

understanding it to mean that the sale of the machine 

along with its separately patented needles “did not confer 

upon the purchaser any right, after the needles were worn 

out and became useless, to manufacture other needles, 

and use the same in the knitting machine so sold and 

purchased.” Morgan, 152 U.S. at 435. 

The Morgan Court thus indicated that, even though 

an authorized buyer of product X was free of the patent 

owner’s patent on that product, the buyer could not, by 

virtue of his purchase, prevent the patent owner from 

enforcing his patent as to product Y, even though Y was 

specifically designed to be used with X and, at a minimum, made X more useful than it otherwise would be

and, indeed, was essential to X’s utility. In LifeScan, 

supra, this court underscored the significance of Morgan’s 

distinction between situations where related, complementary products are both patented and situations where only 

one is patented. Specifically, LifeScan relied on the 

absence of a patent on product Y (test strips used in a 

glucose test meter) in concluding that the authorized sale 

of product X (the glucose meters) exhausted the patent 

owner’s method patent on the two products used together. 

LifeScan, 734 F.3d at 1371 (“To be sure, if a patent had 

actually issued on the strips, the patentability of the 

strips could be relevant to exhaustion. That principle was 

announced in Morgan . . . .”).

The Seventh Circuit’s holding in Hunt v. Armour & 

Co., 185 F.2d 722, 729 (7th Cir. 1950), is to a similar 

effect. The patentee had separate (valid) claims on (a) a 

machine for plucking chicken feathers and (b) components 

(fingers) for use in the machine. When the patentee sued 

the defendant for infringement based on use of licensed 

fingers in machines it had bought from an unlicensed

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manufacturer, the defendant urged exhaustion as a 

defense, on the ground that it had bought, in a sale authorized by the patentee, the components it was using 

with the machine. Id. The Seventh Circuit rejected the 

defense because of the distinctness of the claimed machine and component inventions. Id.; see also C. & R. 

Research Corp. v. Write, Inc., 19 F.2d 380, 381 (D. Del. 

1927) (“[I]n order to sustain the main contention of the 

defendant, it is essential that there be found in the mere 

sale of the machine by the patentee an implied license, 

running to the purchaser and subsequent owners of the 

machine, to make the separately patented parts to repair 

the machine as a whole. I think such license cannot be 

inferred from a mere sale.”). 

The Morgan Court’s approval of Aiken is contrary to 

the theory advanced by defendants here—that exhaustion 

as to product X ends the patentee’s rights even as to a 

validly patented product Y, simply because the intended 

utility of X would be diminished by permitting the patentee to preserve his patent rights over Y. Under the Morgan/Aiken principle, exhaustion is inapplicable even when 

it is the owner of product X that would also be using 

product Y. The present cases seem a fortiori ones: here, it 

is not even the owner of X but someone else who is using 

Y, to the indirect benefit of X’s owner. 

3 

Patent exhaustion is a judicially fashioned doctrine 

without a specific source in congressionally enacted text

stating the terms of this limitation on patent rights. See 

Bloomer v. McQuewan, 55 U.S. at 549–50. We presume, 

from Congress’s refusal to disturb the existing decisional 

law of this doctrine (which predated the 1952 Act by 

nearly a century), an implicit authorization to continue 

applying the doctrine within its familiar boundaries. See 

also 35 U.S.C. § 273(d) (without defining “exhaust[ion],” 

giving sale or disposition by person having prior-use 

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defense same exhaustion effect as sale or disposition by 

patent owner); 35 U.S.C. § 273(b)(2) (2006). But we do not 

think that Congress has granted the courts a license to 

erase those boundaries and expand the doctrine into 

difficult new territory unmapped by lines drawn, or even 

sketched, by Congress. That would be the result of what 

defendants stressed at oral argument as their core position—that exhaustion bars patent enforcement based on a 

practical inquiry into whether enforcement would constrain authorized acquirers’ use of the articles they acquired.

The authorities we have described do not support that 

position in holdings and run counter to it in pronouncements. Moreover, even outside this setting, there is a 

familiar, common-sense distinction between legal restrictions applicable to one person and indirect (positive 

or negative) effects on that person of legal constraints

imposed on another person. It is reflected, for example, in 

traditional non-constitutional third-party standing doctrine, whose very existence presupposes that one person 

may be adversely affected by (suffer injury in fact from) 

legal constraints on another and yet not have a legal right 

to seek elimination of those constraints. See, e.g., Kowalski v. Tesmer, 543 U.S. 125, 129–31 (2004); Allen v. 

Wright, 468 U.S. 737, 751 (1984).

The role that the exhaustion doctrine has played to 

date—avoiding re-imposition of section 271 constraints on 

an authorized acquirer—reflects the doctrine’s origin in 

common-law rules limiting servitudes, and specifically 

alienability restrictions, on personal property. In 

Kirtsaeng v. John Wiley & Sons, Inc., the Supreme Court 

explained the “impeccable historic pedigree” of the Copyright Act’s express “first sale” doctrine, codified at 17 

U.S.C. § 109(a), which authorizes a lawful owner of a copy 

to sell or dispose of it without permission from the copyright owner. 133 S. Ct. 1351, 1363 (2013) (describing the 

doctrine as rooted in the common law’s refusal to allow 

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the seller of property to “control the resale or other disposition of a chattel once sold”). The common-law background, coupled with the fact that exhaustion is triggered 

by “authorized transfers of title in [the] property” at issue, 

LifeScan, 734 F.3d at 1377, fits the doctrine’s limited role 

to date: ensuring the continued absence of certain legal 

restrictions on the rights of the transferee (and successors) 

in the acquired item.

Defendants’ focus on practical enhanced utility for the 

authorized acquirer as a basis for limiting a patentee’s 

rights against other persons proves too much. As defendants acknowledged at oral argument, that rationale would 

sometimes apply to allow invocation of exhaustion to bar 

the patentee from enforcing a patent claim against the 

making, selling, and using of new, patentee-unauthorized 

copies of an article covered by the claim. For example, 

suppose that buyer A’s enjoyment of a walkie-talkie 

bought with the patentee’s authorization would be impaired unless other people (B, C, and D) also had their 

own copies of the same patented walkie-talkie required 

for communication with A. Under defendants’ rationale, 

exhaustion could be invoked to bar the patentee’s enforcement of the patent to prevent the unauthorized 

making of copies for, or their sale to or use by, B, C, and 

D. The inquiry, under defendants’ rationale, would be 

how much A would benefit from being able to communicate with B, C, and D. Oral Argument at 35:30–38:40,

Helferich Patent Licensing, LLC v. The New York Times 

Co., No. 2014-1196; id. at 52:45–53:30 (Counsel for defendants: “[I]f the two walkie-talkies . . . required communication with another walkie-talkie, then I think that 

you would, could have exhaustion as to the individual 

transactions at issue, because [person A] paid for his 

walkie-talkie, he should be able to communicate with 

another person, and at least as to his communications 

there should be exhaustion.”). 

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That approach would extend exhaustion far beyond 

the doctrine’s traditional scope, and it does not lie within 

a sensible range of judicial elaboration pursuant to implied congressional authority. The economic implication 

would be dramatic. As the Supreme Court said in Bowman about the suggestion that “simple copying [is] a 

protected use,” if defendants’ rationale were accepted as a 

substitute for a focus on the authorized acquirer’s own 

legal rights, “a patent would plummet in value after the 

first sale of the first item containing the invention” in a 

broad range of market circumstances. 133 S. Ct. at 1768. 

In the walkie-talkie example, the patentee would have to 

demand an exorbitant, likely unachievable, price for the 

first item if selling it terminated patent rights as to other 

potential users. Subjecting patentees to such impracticable limits could be expected to have a depressing effect on 

investments in innovation in many areas. 

It is commonplace that a product in one person’s 

hands can vastly increase in value if many others possess 

the same product. Telephones, software, and socialnetworking platforms are just a few of the many products 

whose value to each individual purchaser increases as 

more people buy or use the product. See, e.g., Memorandum of the United States of America In Support of Motion 

To Enter Final Judgment and In Opposition To The 

Positions of I.D.E. Corporation and Amici, Exh. 1 at 6 

(Decl. of Kenneth J. Arrow), United States v. Microsoft 

Corp., No. C.A. 94–1564 (D.D.C., Jan. 18, 1995); Mark A. 

Lemley and David McGowan, Legal Implications of Network Economic Effects, 86 Cal. L. Rev. 479 (1998). Even 

more generally, “complementary goods” are pervasive: a 

television’s value to a consumer depends on others’ deploying transmission technology and others’ creating and 

transmitting programs; a computer operating system’s 

value depends on the programs written to run on that 

system. See Arrow Decl. at 6; Joseph Farrell & Garth 

Saloner, Standardization, Compatibility, and Innovation, 

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16 RAND J. Econ. 70, 70–71 (1985). Such phenomena are 

ubiquitous. 

Because complements may be important to a product’s 

success, it is economically sensible to expect a single 

entity to engage in innovation in complementary goods to 

jump-start the launch of products and enhance their 

value.7 Such economically productive complementary 

innovation is reasonably likely to generate complementary patents in the hands of a single patentee. Defendants’ practical-effects approach would therefore open 

substantial new fields of inquiry for exhaustion doctrine. 

And it would do so, as far as we have been shown, with no 

reliable basis for judicial fashioning of standards that 

would guarantee an appropriate balance of innovation 

and efficiency results and set stable, predictable boundaries on what amounts to a rule defining property rights. 

Indeed, an expansion of exhaustion doctrine could do 

harm to existing patterns of licensing. Within the boundaries of the current doctrine of exhaustion, a patentee 

owning multiple patents covering complementary goods 

produced by different producers has the freedom to negotiate different licenses, subject to all the complexities and 

variations of market forces and existing institutional 

structures. We have no reason to conclude that inefficien7 See, e.g., Cablevision Sys. Corp. v. FCC, 649 F.3d 

695, 721 (D.C. Cir. 2011) (recognizing innovation benefits 

of some vertical integration, e.g., cable-television operators created much new video programming); Stanley M. 

Besen & Joseph Farrell, Choosing How to Compete: Strategies and Tactics in Standardization, 8 J. Econ. Persp. 

117, 123 (Spring 1994); see generally David S. Evans, The 

Antitrust Economics of Multi-Sided Platform Markets, 20 

Yale J. on Reg. 325 (2003); Daniel F. Spulber, Solving the 

Circular Conundrum: Communication and Coordination 

in Internet Markets, 104 Nw. U.L. Rev. 537 (2010). 

 

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cies result from this freedom—or, more precisely, that this 

freedom yields greater inefficiencies than would result 

from an expansion of exhaustion doctrine, or that disrupting arrangements negotiated through this freedom would 

produce net benefits. In the recognition of what we do not 

know we find a strong reason to avoid expanding the 

judicial doctrine as defendants suggest. 

Our reluctance to adopt defendants’ proposed expansion is in accord with what two scholars have described as 

our legal tradition’s general disfavoring of judicial, flexibility-introducing changes in the “forms” or “dimensions” 

of property rights. Thomas W. Merrill & Henry E. Smith, 

Optimal Standardization in the Law of Property: The 

Numerus Clausus Principle, 110 Yale L.J. 1 (2000). 

Exhaustion doctrine, following the common-law limitation 

on servitudes on chattels, creates an implied-in-law 

property right based on an authorized acquisition, beyond 

what an implied-in-fact analysis would support under 

“implied license” principles. Caution about expanding the 

reach of exhaustion is of a piece with the broader judicial 

practice of generally maintaining the contours of property 

rights in the absence of legislative prescriptions. 

4 

Neither statutory provisions nor elements found within existing exhaustion doctrine supply good grounds for 

extending the doctrine to cover these cases as presented 

to us. Most generally, Congress has not provided pertinent guidance on exhaustion in the patent setting. In 

contrast, Congress included an express provision in the 

Copyright Act stating the terms of a general exhaustion 

(“first sale”) limitation on the copyright law’s general 

grant of exclusivity rights. See 17 U.S.C. § 109(a). After 

extensive industry-wide consultations, Congress also 

enacted additional protections for lawful acquirers of 

computer-program copies, limiting copyright owners’ 

rights against third parties in specified circumstances 

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where authorized acquirers’ enjoyment of their copies 

requires the involvement of the third parties in otherwiseinfringing activities. 17 U.S.C. § 117(a)(1).8 In the patent 

statute, Congress has not codified the exhaustion doctrine 

itself. Nor has it enacted a counterpart to the copyright 

law’s carefully crafted extension of owner protection—an 

extension whose existence, however, tends to reinforce the 

premise that the general “first sale” rule offers limited 

protection to third parties. Cf. eBay Inc. v. MercExchange, LLC, 547 U.S. 388, 392–93 (2006) (analogizing 

the Court’s treatment of injunctions between owners of 

copyrights and patents); LifeScan, 734 F.3d at 1375–76 

(looking to copyright law to determine whether “authorized sale[s]” include items transferred by gift). 

Turning from what can be found in the statutes to exhaustion doctrine itself, defendants rely on the often8 Section 117(a) says that “it is not an infringement 

for the owner of a copy of a computer program to make or 

authorize the making of another copy or adaptation of that 

computer program provided: (1) that such a new copy or 

adaptation is created as an essential step in the utilization of the computer program.” 17 U.S.C. § 117(a)(1) 

(emphasis added); see Krause v. Titleserv, Inc., 402 F.3d 

119, 125 (2d Cir. 2005); Softech Worldwide, LLC v. Internet Tech. Broad. Corp., 761 F. Supp. 2d 367, 373–74 (E.D. 

Va. 2011). Section 117 resulted from the work of the 

National Commission on New Technological Uses of 

Copyrighted Works (CONTU), established by Congress in 

1974. Pub. L. No. 93-573, § 201, 88 Stat. 1873, 1873–74 

(1984); see Robert P. Merges, One Hundred Years of 

Solicitude: Intellectual Property Law, 1900-2000, 88 Cal. 

L. Rev. 2187, 2198–200 (2000) (“CONTU . . . might well 

serve as a paradigm for intellectual property policymaking.”).

 

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articulated principle that exhaustion doctrine seeks to 

prevent “double recoveries.” Defendants’ Br. at 28 (citing 

Keeler, 157 U.S. at 663 (patentees “are never entitled to 

but one royalty for a patented machine”) (internal quotations omitted)). But that principle has never served as an 

independent test for determining whether exhaustion

applies. It is hard to see how it could do so unless courts 

first established the dollar value of the proper reward to 

determine when the patentee had received it and therefore had to stop seeking additional recoveries. Exhaustion doctrine has never required such an inquiry, which 

would present difficulties akin to those recognized in 

other areas where the judicial determination of a proper 

price has been avoided.9 Instead, the principle of limiting 

a patentee to one royalty for an embodiment of an invention expresses an underlying goal that is achieved, indirectly, by reliance on other standards that define when 

exhaustion applies based on the sale of certain items. 

Once such an item is sold, the conclusion follows that 

further exaction of royalties from an owner’s use of that 

item would be deemed a “double recovery.” Something 

other than “double recovery,” however, must supply the 

tests to justify ultimately using that language as a conclusion. 

In Quanta, the Court, following Univis, considered 

whether the authorized sale of an article triggered exhaustion of method claims by asking if the article “sub9 See, e.g., Verizon Commc’ns Inc. v. Law Offices of 

Curtis V. Trinko, LLP, 540 U.S. 398, 408 (2004) (in the 

antitrust context, courts are “ill suited” “to act as central 

planners, identifying the proper price, quantity, and other 

terms of dealing”); Town of Concord v. Boston Edison Co., 

915 F.2d 17, 25 (1st Cir. 1990) (Breyer, C.J.) (“[A]ntitrust 

courts normally avoid direct price administration, relying 

on rules and remedies . . . that are easier to administer.”).

 

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stantially embodied” the claimed method. Quanta, 553 

U.S. at 637, 638; Univis, 316 U.S. at 250–51. The Court 

summarized the inquiry as asking whether the sold 

article “had no reasonable noninfringing use and included 

all the inventive aspects of the patented methods.” Quanta, 553 U.S. at 638. If the two questions were to be transposed into this context, they would not help defendants’ 

case for exhaustion.

As to the “inventive aspects” portion: This court in 

LifeScan indicated that the question is “whether the 

additional steps needed to complete the invention from 

the product are themselves ‘inventive’ or ‘noninventive.’” 

734 F.3d at 1368. Here, if the inquiry compares handset 

claims and content claims, we cannot find that either set 

wholly contains the invention found in the other. Each 

has its own inventiveness, as the cases come to us. 

As we have noted, defendants have not contended or 

shown that all of the asserted content claims contemplate 

handset users’ use of handset features that bring them 

within the handset claims. Even aside from the fact that

some of the handset claims claim features such as selective enablement and disablement of acknowledgement 

signals (what has been called “airplane mode”), see J.A. 

2260–69, we cannot rule out inventiveness in the handset 

claims apart from the content claims. Conversely, asserted content claims claim operations performed or systems 

run by content providers, such as updating content, 

making it inaccessible after a time, and sending providercrafted content identifications. Handsets, and in particular handsets meeting the limitations of handset claims, do 

not perform those functions. And defendants have identified no basis in the specification or prosecution history for 

concluding that, for the asserted content claims, the 

patented advance over prior art lay in the handsets. See 

supra p. 15 n.5 (noting prosecution history); J.A. 2238–39, 

2242–43, 2245–46, 2249 (Helferich’s expert discussing 

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HELFERICH PATENT LICENSING v. THE NEW YORK TIMES 33

novel features of the content claims not contained in 

handset claims). 

As to the “reasonable noninfringing use” portion of the 

Quanta approach: For reasons related to those just noted, 

this inquiry, which echoes language in 35 U.S.C. § 271(c)

defining contributory infringement, cannot help defendants any more than does the “inventive aspects” inquiry. 

We so conclude applying this inquiry in accordance with

this court’s clarification in LifeScan that “alternative uses 

are relevant to the exhaustion inquiry under Quanta only 

if they are both ‘reasonable and intended’ by the patentee.” 734 F.3d at 1369 (quoting Quanta, 553 U.S. at 631)

(emphasis in original).

Thus, we cannot say that the inventions of the asserted content claims have no reasonable use other than one 

involving someone’s practicing of the handset claims, 

because we cannot say that the asserted content claims 

call on use of the inventive features of the handset claims: 

at most an ordinary handset is required. And in the 

opposite direction, defendants have not persuasively 

demonstrated what functions the handset claims require; 

but even if we accept defendants’ focus on text-tohyperlink rendering, Helferich submitted evidence, in 

opposition to the defendants’ summary-judgment motion, 

that there is a substantial, reasonable, intended use other 

than one that plays a role in content providers’ infringement of the asserted content claims. Specifically, the

evidence is that text-to-hyperlink rendering has such a 

use in receiving, and acting on, a notification from person 

A about information available from person B (not under 

A’s control), e.g., a URL for B’s website. J.A. 2253–55 

(noting that “peer-to-peer” sharing of links to a third 

party’s content does not perform all claims of the content 

patents and nor does a content provider’s sharing with 

subscribers a link to content controlled and hosted by a 

different content provider). 

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34 HELFERICH PATENT LICENSING v. THE NEW YORK TIMES

For those reasons, it is not true that preserving 

Helferich’s rights in the asserted content claims would 

“render the licenses to the handset industry essentially 

worthless.” Defendants’ Br. at 2; cf. Helferich, 965 F. 

Supp. 2d at 978–79 (making the more limited point that 

licenses from Helferich would provide “little value” to 

handset makers and users if “the content provider . . . could not send the message to the licensed handset 

device without infringing the patents”). According to 

Helferich’s evidence, handset users can take advantage of 

the distinct handset inventions without content providers’ 

practicing the asserted content claims, including by using 

features like airplane mode and by receiving from one 

person information for obtaining content at the website of 

another (not under the former’s control). Even more 

fundamentally, as a practical matter, there is evident 

value in obtaining a product (and permission to use it)—

for example, a network product like the walkie-talkie 

mentioned above—whose value depends on other people

obtaining complementary products, even when the latter 

must themselves obtain a patent license. This is a commonplace phenomenon, and what the initial product 

licensees obtain is not just immediate value, which might

be limited, but the potential for increasing value as the 

rights owner acts on its incentive to license the complementary sales. Thus, to the extent that the handset 

inventions increase in value with the prevalence of content providers’ practicing the asserted content claims, 

handset makers and users, in paying to make and acquire 

the handsets, obtain benefits that increase over time as 

Helferich licenses ever more content providers. 

If the foregoing aspects of exhaustion doctrine do not 

aid defendants here, neither do certain aspects of the 

patent statute that speak to distinctiveness of inventions. 

As we have already noted, see supra pp. 6–7, these cases 

come to us without any finding or contention that any of 

the asserted claims flunks the tests of “double patentCase: 14-1196 Document: 60-2 Page: 34 Filed: 02/10/2015
HELFERICH PATENT LICENSING v. THE NEW YORK TIMES 35

ing”—either the “statutory” or “non-statutory” variety. In 

particular, none of the asserted claims in the five patents 

that contain only content claims have been determined (or 

argued) to lack patentable distinctiveness over patents 

that contain handset claims.

Finally, we do not see how defendants are aided, in 

their effort to treat the handset and content claims as 

effectively unified, by the history of Helferich’s patents at 

issue. All of the relevant claims in the Helferich portfolio 

evidently grew out of a common specification, but it is 

common for a single specification to describe quite distinct 

inventions. Section 121 recognizes that fact by granting

the PTO authority to restrict particular applications so as 

to separate “independent and distinct inventions” into 

separate applications. 35 U.S.C. § 121. 

Here, the PTO imposed a number of restriction requirements. That fact tends to confirm the independence 

or distinctiveness of the separated claims, see MPEP 

§§ 802.01, 803 (either suffices for restriction), as does the 

absence of double-patenting impediments to issuance of 

the final claims. On the other hand, two of the patents at 

issue retain both handset and content claims—but even 

for them, an inference of lack of distinctiveness is not 

warranted. See 35 U.S.C. § 121 (“the Director may require the application to be restricted” if there are “two or 

more independent and distinct inventions” (emphasis 

added)); id. (“The validity of a patent shall not be questioned for failure of the Director to require the application 

to be restricted to one invention.”); MPEP § 803.01 (“requirements for restriction under 35 U.S.C. § 121 are 

discretionary with the Director”). In these circumstances, 

which provide some fuel for each side’s argument (though 

perhaps not the same amount), all we need to say is that, 

in the end, we do not draw from the patent history any 

conclusion helpful to defendants’ exhaustion defense. 

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36 HELFERICH PATENT LICENSING v. THE NEW YORK TIMES

In short, we have scrutinized defendants’ argument 

that the content and handset claims at issue are distinguished only by “semantics,” Defendants’ Br. at 34, or 

“artful drafting,” id. at 39, by which they must mean that 

different words are used for what amount to the same 

substance. We have examined all suggested statutorily 

and doctrinally grounded approaches to defining legal 

identity of substance. We do not find that the two groups 

of claims here can be collapsed into one. We see no sound 

basis for expanding exhaustion doctrine to hold that 

authorized sales to persons practicing the handset claims 

exhaust the patentee’s rights to enforce the asserted 

content claims against different persons.

C 

The only issue before us is patent exhaustion. We 

have decided the issue as it has been framed by the record 

and arguments in these cases. We reject the defense for 

the combination of reasons set forth. We need not rule 

more broadly to indicate which reasons would be sufficient, without others, for rejection of an exhaustion defense framed more narrowly. In particular, we do not 

foreclose an exhaustion defense that is tied to particular 

handset claims and targets particular content claims; that 

establishes premises for such particular claims not asserted or established in the broad-brush defense before 

us—such as the presence of essentially the same inventive 

features in paired handset-content claims, as determined 

under a standard grounded in the statute, and the necessity that someone practice a handset claim for an asserted 

content claim to be practiced; and that tries to address the 

other issues we have identified in rejecting the defense 

presented to us. We express no view on the merits of any 

such narrower defenses, which are not before us. 

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HELFERICH PATENT LICENSING v. THE NEW YORK TIMES 37

CONCLUSION

For the foregoing reasons, we reverse the judgment of 

the district court. 

REVERSED

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