Federal Circuit Held Today: No International Exhaustion of Patent Rights in a Product Sold Outside and Imported Back Into The United States; Lawful Re-Sale or Use Restriction is Effective to Prevent Exhaustion of Patent Rights with Respect to Downstream Sales in Breach of the Restriction

In a 10 – 2  decision, the Court of Appeals for the Federal Circuit en banc this morning decided Lexmark v. Impression, holding  that when a product is sold subject to  a lawful re-sale or use restriction, this restriction is effective to prevent exhaustion of rights with respect to downstream sales in breach of the restriction and also that the Supreme court’s decision in Wiley v Kirstaeng, that there was international exhaustion in the copyright field when the owner sold copyrighted works abroad that were subsequently imported into the United States, did not apply to patented articles because the wording of the statutes is different and the economic impacts of international exhaustion in copyright and patent law are different.

For a full analysis, see the article in our Education Center.