Impression Products, Inc. v. Lexmark International, Inc.
In Impression Products, Inc. v. Lexmark International, Inc., Lexmark owns the patents of its cartridges which sold both in the United States and internationally.[1] All cartridges at issue were sold at a discounted price and subjected to an express single-use/no-resale restrictions.[2] Impression Products Inc. acquired the cartridges both domestically and internationally for resell in the United States.[3] A third party modified the cartridges to enable re-use.[4] Impression Products had acted in violation of the no-resell and single-use terms.[5] Two issues raised from this case: (1) whether a buyer can resell a patented item with expressly communicated restriction under the doctrine of patent exhaustion; (2) whether patentee’s foreign sale confer the right for downstream buyers to import to the United States or to resell and use it in the United States.[6]
Southern District of Ohio Western Division denied the motion to dismiss filed by the Impression Products on March 27 2014. But Southern District of Ohio Cincinnati Division dismissed Lexmark’s claim and granted Impression’s motion to dismiss.[7]
Federal Circuit followed the decision in Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (Fed.Cir.1992) for the first issue and reversed the Southern District of Ohio Cincinnati Division’s decision on February 12th 2016.[8] The Federal Court held that the downstream buyers of a patented item are not authorized to violate the expressly communicated no-resell and single-use restrictions.[9]
Second, Federal Circuit adhered to the holding of Jazz Photo Corp. v. International Trade Comm’n, 264 F.3d 1094 (Fed.Cir.2001) that the buyers of a patented item cannot import, resell or use the item in the United States.[10] The Federal Circuit explained that the Jazz Photo decision is not in contrary to Kirtsaeng v. John Wiley & Sons, Inc., 133 S. Ct. 1351, 1363 (2013), because Kirtsaeng only applied to copyright law.[11]
Several institution and corporations filed many amici curiae briefs on behalf of both parties.[12] The issues in this case will have impact on both intellectual property protective groups and retail industries. On December 2nd 2016, SCOTUS granted the certiorari to review the case.
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