Brussels / 2 & 3 February 2019


The surprising interaction of open source and patent exhaustion

When people think of the interaction between patents and open source, the most frequent questions have to do with the existence and scope of patent licenses, either express or implied. However, patent exhaustion may end up being far more impactful than licenses. This discussion will present the results of some recent analysis of the caselaw and discuss some of the unexpected implications of recent patent exhaustion cases.

A patent gives its owner the right to exclude others from making, using, and selling the claimed invention. In contrast, FOSS licenses grant broad rights to modify, compile, distribute, and use software. Absent explicit treatment in the license, the patent-related right to exclude and the open-source-granted right to use are at least apparently in tension. One of the ways in which this tension is addressed is through the doctrine of patent exhaustion. An analog to copyright's "first sale" doctrine, any authorized sale of a patented object by a patent owner or a licensee exhausts all patent rights in the product sold, which prohibits a patent owner from enforcing post-sale restrictions through patent infringement suits.

It is uncontroversial to say that patent exhaustion applies to FOSS. A patent holder that "sells" a software product, or sells a physical product with with FOSS software embedded, will clearly be subject to patent exhaustion as applied to any downstream customers of the patent holder. But that is not the end of the analysis. What does it mean to "sell" a "product" sufficiently to invoke patent exhaustion? How does that correspond to the normal ways in which organizations typically interact with FOSS?

This presentation will quickly go through the essential holdings from five cases[1], and then present an argument regarding how the holdings of these cases interact with typical FOSS practices in a far more extensive fashion than people may have previously considered.

[1] Cases: * Quanta Computer, Inc. v. LG Electronics, Inc. * Impression Products v. Lexmark International * Lifescan Scotland, Ltd. v. Shasta Technologies * Cascades Computer Innovation, LLC v. Samsung Electronics Co. * Intel Corp. v. ULSI System Technology, Inc.


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