Journal Article

<i>Brulotte</i>'s continuing shadow over patent licensing

Sean Gates and Jeny Maier

in Journal of Intellectual Property Law & Practice

Volume 4, issue 3, pages 181-189
Published in print March 2009 | ISSN: 1747-1532
Published online January 2009 | e-ISSN: 1747-1540 | DOI: http://dx.doi.org/10.1093/jiplp/jpn247
Brulotte's continuing shadow over patent licensing

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Legal context

In Brulotte v. Thys Co., the US Supreme Court held that patent holders are forbidden from collecting royalties after the expiration date of the patent. The Court reasoned that this type of conduct would ‘project the patent monopoly’ beyond the patent's term. Although the application of Brulotte to a licence involving a single patent is clear, its application to other licensing arrangements, such as package licences, remains turbid.

Key points

Although Brulotte involved a licence for single patent licence cases, the decision still heavily influences other licensing arrangements such as package licences, hybrid licences, and licences for packages of patents and patent applications. In these cases, the courts seek to determine whether the patent holder has extended its patent monopoly. Court decisions applying Brulotte to these other types of licences have generally focused on two issues—whether the licence agreement was ‘coerced’ by the licensor and whether the agreement provides for the same royalty rate in both the pre- and the post-expiration periods as the patents expire. This article explores cases and decisions in which the courts have applied Brulotte to these other types of licences and the implications of these cases on licence negotiation strategies.

Practical significance

The application of Brulotte in cases involving package licences, hybrid licences, and licences for a package of patents and patent applications provides guidance on how patent holders can be cognizant of Brulotte's impact on licensing structures and how to avoid potential patent misuse claims through their licensing practices.

Journal Article.  7692 words. 

Subjects: Arbitration ; Intellectual Property Law

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