The patent-exhaustion doctrine states that once someone purchases a patented item, the patent owner loses control over its use. However, the patent owner can still impose restrictions on the item through a contract or licence, as long as they are not unfair. This concept is comparable to the first-sale doctrine in copyright law, which permits individuals to give or sell physical copies of copyrighted works without violating the rights of the copyright owner.
The rule of patent exhaustion states that the sale of a patented product without any conditions terminates the patent owner’s right to control its use. However, the patent owner can still impose restrictions through a contract or licence, provided it does not result in anticompetitive patent misuse. For instance, if a company holds a patent for a new type of smartphone and sells it to a customer, the patent owner’s right to control the use of the smartphone is exhausted. The customer can use, repair, and resell the smartphone without any interference from the patent owner. Nevertheless, the patent owner can still impose limitations on the use of the smartphone through a contract or licence. Similarly, the first-sale doctrine applies to copyrighted works, which allows the purchaser of a physical copy of a copyrighted work, such as a book or CD, to give or sell that copy to someone else without infringing the copyright owner’s exclusive distribution rights. The copyright owner’s distribution right is said to be exhausted with regard to that physical copy. For example, if a person buys a physical copy of a book from a bookstore, they can lend, sell, or give away the book without infringing the copyright owner’s exclusive distribution rights. However, the person cannot make copies of the book without the copyright owner’s permission. These examples demonstrate how the patent-exhaustion doctrine and the first-sale doctrine limit the control that patent and copyright owners have over their products after they are sold. These doctrines enable customers to use, repair, and resell the products without interference from the owners, as long as they do not breach any contractual or licensing agreements.
The Patent-Exhaustion Doctrine is a legal principle that limits the rights of a patent holder after the initial authorized sale of a patented product.
Once a patent holder sells a patented product, they exhaust their rights to control the further use or sale of that specific product. The purchaser of the product can then use or resell it without infringing on the patent.
Yes, the Patent-Exhaustion Doctrine applies to all types of patents, including utility patents, design patents, and plant patents.
The application of the Patent-Exhaustion Doctrine to international sales can be complex. Generally, if a patent holder sells a product internationally, their rights may be exhausted in that specific product, but they may still have rights in other countries.
No, once a patent holder sells a patented product, they cannot impose any restrictions on the use or resale of that specific product under the Patent-Exhaustion Doctrine.
Yes, the Patent-Exhaustion Doctrine also applies to patented methods or processes. Once a patent holder authorizes the use of a patented method or process, they cannot control or restrict its further use.
No, once the Patent-Exhaustion Doctrine applies, the patent holder cannot enforce their rights against the authorized purchaser or subsequent buyers of the patented product.
Yes, a patent holder can waive their rights under the Patent-Exhaustion Doctrine by including specific contractual terms or conditions in the sale agreement.
There are limited exceptions to the Patent-Exhaustion Doctrine, such as when the authorized sale is conditional or restricted, or when the patented product is materially altered or repaired.
Yes, the Patent-Exhaustion Doctrine can be used as a defence in patent infringement lawsuits to argue that the patent holder’s rights have been exhausted due to an authorized sale of the patented product.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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