The federal circuit's licensing law jurisprudence: Its nature and influence

Washington Law Review

Volumn 84, Issue 2, 2009, Pages 199-258

  Gomulkiewicz, Robert W ^a  

^a UNIVERSITY OF WASHINGTON   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 69249171908     PISSN: 00430617     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (521)

1. The Federal Circuit's appellate jurisdiction extends to decisions by all District Courts in patent infringement suits, decisions by the Board of Appeals of the Patent and Trademark Office, as well as decisions by the U.S. International Trade Commission and U.S. Claims Court. 28 U.S.C. § 1295(a)(1) (2000).
2. See Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826 (2002);
3. Paul M. Janicke, Two Unsettled Aspects of the Federal Circuit's Patent Jurisdiction, VA. J.L. & TECH., Spring 2006, at 1, 2, available at http://www.vjolt.net/archives.php?issue=30, permanent copy available at http://www.law.washington.edu/wlr/notes/84washlrev199n1.pdf.
4. See, e.g., Rochelle Cooper Dreyfuss, The Federal Circuit: A Case Study in Specialized Courts, 64 N.Y.U. L. Rev. 1, 28 (1989)
5. Pauline Newman, The Federal Circuit in Perspective,54 AM. U. L. REV. 821,821-23 (2005).
6. See H.R. REP. NO. 97-312, at 20-23 (1981);
7. S. REP. NO. 97-275, at 12-17 (1981)
8. see also Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 234 F.3d 558,571-72 (Fed. Cir. 2000) (en banc).
9. See, e.g., Rochelle Cooper Dreyfuss, The Federal Circuit: A Continuing Experiment in Specialization, 54 CASE W. RES. L. REV. 769 (2004)
10. Glynn S. Lunney, Patent Law, the Federal Circuit, and the Supreme Court: A Quiet Revolution, 11 SUP. CT. ECON. REV. I (2004);
11. S. Jay Plager, The Price of Popularity: The Court of Appeals for the Federal Circuit 2007, 56 AM. U. L. REV. 751 (2007);
12. William C. Rooklidge & Matthew F. Weil, Judicial Hyperactivity: The Federal Circuit's Discomfort with its Appellate Role, 15 BERKELEY TECH. L.J.725 (2000);
13. R. Polk Wagner & Lee Petherbridge, Is the Federal Circuit Succeeding? An Empirical Assessment, 152 U. PA. L. REV. 1105 (2004)
14. See 4 DONALD S. CHISUM, CHISUM ON PATENTS § 11.06[3][e][i], at 11-651 n.262 (2005) ("In the past, the Supreme Court has granted certiorari in only a small percentage of patent cases,");
15. see also Cardinal Chem. Co. v. Morton Int'l, Inc., 508 U.S. 83, 97 (1993) ("As a matter of practice, the possibility that we would grant certiorari simply to review that [Federal Circuit's] resolution of an infringement issue is extremely remote, but as a matter of law we could do so ....")
16. Plager, supra note 4, at 755 (noting that the Supreme Court has intervened when it appears that the Federal Circuit is "creating special rules that are unwarranted").
17. E.g., KSR Int'l Co. v. Teleflex, Inc., 550 U.S. 398 (2007);
18. Microsoft Corp. v. AT&T Corp., 550 U.S. 437 (2007);
19. Medlmmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007);
20. eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006).
21. E.g., Rebecca S. Eisenberg, The Supreme Court and the Federal Circuit: Visitation and Custody of Patent Law, 106 MICH. L. REV. FIRST IMPRESSIONS 28 (2007), http://www.michiganlawreview.org/firstimpressions/vol106/eisenberg.pdf, permanent copy available at http://www.law.washington.edu/wlr/notes/ 84washlrevl99n7.pdf
22. Arthur J. Gajarsa & Lawrence P. Cogswell, The Federal Circuit and the Supreme Court, 55 AM. U. L. REV. 821 (2006). According to Professor Eisenberg, the Supreme Court intervenes: when the Federal Circuit's patent jurisprudence is at odds with treatment of similar issues in other fields of law;
23. when the Federal Circuit has departed from the Supreme Court's patent law precedent; to resolve internal disputes within the Federal Circuit.
24. when the Supreme Court seeks Solicitor General's view and the Solicitor General recommends that the Court take the case (this is important because there are no circuit splits to show possible tensions in the law);
25. when amicus briefs urge acceptance. Eisenberg, supra at 29-30
26. See generally John R. Allison & Mark A. Lemley, How Federal Circuit Judges Vote in Patent Validity Cases, 27 FLA. ST. U. L. REV. 745 (2000)
27. John R. Allison & Mark A. Lemley, Empirical Evidence on the Validity of Litigated Patents, 26 AIPLA Q.J. 185 (1998).
28. See generally Christian A. Chu, Empirical Analysis of the Federal Circuit's Patent Claim Construction Trends, 16 BERKLEY TECH. L.J. 1075 (2001);
29. Christopher A. Cotropia, Patent Claim Interpretation Methodologies and Their Claim Scope Paradigms, 47 WM. & MARY L. REV. 49 (2005);
30. see also Christopher A. Cotropia, Nonobviousness and the Federal Circuit: An Empirical Analysis of the Recent Case Law, 82 NOTRE DAME L. REV. 911 (2007).
31. In this article I use the term "licensing law" to refer to the law that pertains to intellectual property, software, and information licensing.
32. See generally JAY DRATLER, LICENSING OF INTELLECTUAL PROPERTY(1999);
33. ROGER MILGRIM, MILGRIM ON LICENSING (1999);
34. XUAN-THAO N. NGUYEN, ROBERT W. GOMULKIEWICZ, & DANIELLE CONWAY-JONES, INTELLECTUAL PROPERTY, SOFTWARE, AND INFORMATION LICENSING: LAW AND PRACTICE 2-5 (2006);
35. RAYMOND T. NIMMER & JEFF C. DODD, MODERN LICENSING LAW § 1:2 (2005).
36. Outside of patent law and the Federal Circuit's potential influence on antitrust law.
37. see Ronald S. Katz & Adam J. Safer, Should One Patent Court Be Making Antitrust Law for the Whole Country?, 69 ANTITRUST L.J. 687 (2002), the Federal Circuit has been notable for its distinct lack of influence on othercircuit courts.
38. See Dreyfuss, supra note 4, at 779. However, one student commentator has also noted the influence of the Federal Circuit's decisions involving standard forms.
39. See Christopher M. Kaiser, Comment, Take It or Leave It: Monsanto v. McFarling, Bowers v. Baystate, and the Federal Circuit's Formalistic Approach to Contracts of Adhesion, 80 CHI.-KENTL. REV. 487 (2005).
40. E.g., LG Elecs., Inc. v. Bizcom Elecs., Inc., 453 F.3d 1364 (Fed. Cir.2006). This case is discussed infra at Part V.A.
41. See NGUYEN ET AL., supra note 10 at 2-5, 511-49.
42. See, e.g., Paul M. Janicke & LiLan Ren, Who Wins Patent Infringement Cases?, 34 AIPLA Q.J. 1 (2006);
43. Kimberly A. Moore, Judges, Juries, and Patent Cases-An Empirical Peek Inside the Black Box, 99 MICH. L. REV. 36 (2000).
44. 553 U.S.-, 128 S. Ct. 2109 (2008).
45. See discussion of this case infra at Part IV.B.3.
46. E.g., KSR Int'l Co. v. Teleflex, Inc., 550 U.S. 398, 415 (2007) ("We begin by rejecting the rigid approach of the Court of Appeals.")
47. eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 393 (2006) (specifically objecting to the Federal Circuit's approach).
48. See Giulio Mandich, Venetian Patents (1450-1550), 30 J. PAT. & TRADEMARK OFFICE Soc'Y 166, 177 (1948) ("[E]very person who shall build any new and ingenious device in this City, not previously made in our Commonwealth, shall give notice of it to the office of our General Welfare Board ....It being forbidden to every other person in any of our territories and towns to make any further device conforming with and similar to said one, without the consent and license of the author for the term of 10 years." (emphasis added)).
49. See NGUYEN ET AL., supra note 10, at 2-14;
50. see also MICHAEL A. CUSUMANO, THE BUSINESS OF SOFTWARE (2004) (describing the development of the software business and the role that licenses played);
51. Robert W. Gomulkiewicz, How Copyleft Uses License Rights to Succeed in the Open Source Software Revolution and the Implications for Article 2B,26 HOUS. L. REV. 179, 185-86 (1999) (describing how licenses are the "unnoticed force" behind the open source software revolution).
52. Indeed, some believe that innovation is America's sole remaining competitive advantage.
53. See generally 3 DALE W. JORGENSON ET AL., PRODUCTIVITY: INFORMATION TECHNOLOGY AND THE AMERICAN GROWTH RESURGENCE (2005).
54. 3 DALE W. JORGENSON, ECONOMETRICS: GROWTH IN THE INFORMATION AGE (2002);
55. CARL SHAPIRO & HAL R. VARIAN, INFORMATION RULES: A STRATEGIC GUIDE TO THE NETWORK ECONOMY (1999).
56. See Robert W. Gomulkiewicz, General Public License 3.0: Hacking the Free Software Movement's Constitution, 42 Hous. L. REV. 1015, 1019-21 (2005) (explaining the distinction between "open source" and "binary use" software).
57. See ROBERT YOUNG & WENDY GOLDMAN ROHM, UNDER THE RADAR: HOW RED HAT CHANGED TOE SOFTWARE BUSINESS-AND TOOK MICROSOFT BY SURPRISE 81 (1999) (discussing open source products versus "binary" products).
58. A hot topic in the open source community is whether there are, perhaps, too many varieties of open source licenses.
59. See Robert W. Gomulkiewicz,Open Source License Proliferation: HelpfulDiversity or Hopeless Confusion?, 30 WASH. U.J.L. & POL'Y (forthcoming 2009).
60. See Xuan-Thao Nguyen & Jeffery A. Maine, Acquiring Innovation, 57 AM. U. L. REV. 775, 776-92 (2008) (describing how technology companies such as Microsoft and Sun Microsystems improve their products by acquiring third-party technology).
61. See LAWRENCE ROSEN, OPEN SOURCE LICENSING 1-8,51-69(2005).
62. Eric S. Raymond wrote the most famous essays on this collaboration: The Cathedral and the Bazaar, Homesteading the Noosphere, and The Magic Cauldron.
63. ERIC S. RAYMOND, THE CATHEDRAL AND THE BAZAAR: MUSINGS ON LINUX AND OPEN SOURCE SOFTWARE BY AN ACCIDENTAL REVOLUTIONARY 19, 65, 113 (2001).
64. See STEVEN WEBER, THE SUCCESS OF OPEN SOURCE 172-79 (Harvard Univ. Press 2004).
65. See generally RICHARD M. STALLMAN, FREE SOFTWARE, FREE SOCIETY: SELECTED ESSAYS OF RICHARD M. STALLMAN 28 (2002) (Stallman founded the Free Software Foundation and the GNU software-development project), permanent copy available at http://www.law.washington.edu/wlr/notes/84washlrev199n27.pdf.
66. See Richard M. Stallman, The GNU Operating System and the Free Software Movement, in OPEN SOURCES: VOICES FROM THE OPEN SOURCE REVOLUTION, 53, 65-66 (DiBona et al. eds., 1999), permanent copy available at http://www.law. washington.edu/wlr/notes/84washlrevl99n28.pdf.
67. See IETF Overview, http://www.ietf.org/overview.html (last visited Mar. 22, 2009), permanent copy available at http://www.law.washington.edu/wlr/notes/ 84washlrevl99n29.pdf.
68. See W3C in 7 Points, http://www.w3.org/Consortium/Points/ (last visited Apr. 18, 2009), permanent copy available at http://www.law.washington.edu/wlr/ notes/84washlrevl99n30.pdf
69. see generally Mark A. Lemley, Intellectual Property Policy and Standard-Setting Organizations, 90 CAL. L.REV. 1889(2002).
70. See Christine Mumford, Businesses Advised to Diversify Content, Tactics to Keep Up with Changing Web, E-COMMERCE L. DAILY (Dec. 12, 2007), http://www.bna.com/products/ip/ecdm.htm (stating that customers can obtain information in many places through many means and because of this, Gannett Co. has changed its "newsrooms to information centers... delivering information when and where a customer wants it, on whatever platform-be it in a traditional browser, on a blackberry, an iPod, or a widget on a Web page" (quoting Craig Dubow, president and CEO of Gannet Co. Dubow, who attributes this change to Internet entrepreneurs and fierce competition)), permanent copy available at http://www.law.washington.edu/wlr/notes/84washlrevl99n31.pdf
71. see also Kim Komando, Avoid Hassles; Let Sites Run Stores, SEATTLE TIMES, Jan. 28, 2008, at E2 (describing a wide variety of options for product distribution via on-line stores for small and large businesses provided by Amazon.com, Yahoo, and eBay).
72. See Benjamin J. Romano, Microsoft to Add "Community Games," SEATTLE TIMES, Feb. 21, 2008, at CI, C4 (describing on-line distribution and use of games).
73. Robert W. Gomulkiewicz, Getting Serious About User-Friendly Mass Market Licensing for Software, 12 GEO. MASON L. REV. 687 (2004) [hereinafter Gomulkiewicz, Getting Serious];
74. Robert W. Gomulkiewicz, The License Is the Product: Comments on the Promise of Article 2B for Software and Information Licensing, 13 BERKELEY TECH. L.J. 891 (1998) [hereinafter Gomulkiewicz, The License Is the Product];
75. Robert W. Gomulkiewicz & Mary L. Williamson, A Brief Defense of Mass Market Software License Agreements, 22 RUTGERS COMPUTER & TECH. L.J. 335 (1996).
76. See, e.g., Benjamin J. Romano, Microsoft Builds Virtualization Vision, SEATTLE TIMES, Jan. 22, 2008, at El, E4 (reporting on licensing and pricing changes in light of new virtualization technology).
77. See Gomulkiewicz, The License Is the Product, supra note 33, at 897-98 (listing several nonprofit organizations that employ end-user licenses).
78. See Robert W. Gomulkiewicz, De-bugging Open Source Software Licensing, 64 U. PITT. L. REV. 75, 75-76 (2002);
79. Gomulkiewicz, supra note 18, at 181.
80. See generally STEVEN Z. SZCZEPANSKI, ECKSTROM'S LICENSING IN FOREIGN AND DOMESTIC OPERATIONS (1995) (discussing law and practice of licensing).
81. Even though tort law now is considered "old school," its acceptance as a body of law only dates back to the turn of the century. In 1941, Professor William L. Prosser commented in his first treatise on the law of torts that there was no recognition of torts as a distinct branch of law in the mid to late 1800s, and as late as 1871 "the leading American legal periodical said that 'We are inclined to think that Torts is not a proper subject for a law book.'"
82. See WILLIAM L. PROSSER, HANDBOOK OF THE LAW OF TORTS 23-24 (1st ed. 1941).
83. See generally U.C.C. Art. 2 (2005)
84. RESTATEMENT (SECOND) OF CONTRACTS (1981).
85. For example: contract, intellectual property, consumer protection, constitutional, and antitrust law.
86. See NGUYEN ET AL., supra note 10 at 14-39.
87. See McCoy v. Mitsuboshi Cutlery, Inc., 67 F.3d 917, 920 (Fed. Cir. 1995) ("[A] license is a contract governed by ordinary principles of state contract law." (internal citations omitted)). Some in the free and open software community have argued that open source licenses are not contracts, butthat argument is questionable.
88. See Robert W. Gomulkiewicz, Conditions and Covenants in License Contracts: Tales From a Test of the Artistic License, 17 TEX. INTELL. PROP. L.J.335, 345-46 (2009).
89. See id.
90. 17 U.S.C. § 204(2000).
91. See, e.g., S.O.S., Inc. v. Payday, Inc., 886 F.2d 1081 (9th Cir. 1989) (construing license grant with reference to copyright policy).
92. See, e.g., United States v. Microsoft Corp., 253 F.3d 34 (D.C. Cir. 2001)(en banc)(antitrust);
93. Practice Mgmt. Info. Corp. v. American Med. Ass'n, 121 F.3d 516 (9th Cir. 1997) (misuse).
94. See NGUYEN ET AL., supra note 10 at 14-15.
95. Id. at § 15-18.
96. See Raymond T. Nimmer et al., License Contracts Under Article 2 of the Uniform Commercial Code: A Proposal, 19 RUTGERS COMPUTER & TECH. L.J. 281 (1993).
97. See Raymond T. Nimmer, Intangibles Contracts: Thoughts of Hubs, Spokes, and Reinvigorating Article 2, 35 WM. & MARY L. REV. 1337 (1994).
98. See Thom Weidlich, Commission Plans New U.C.C. Article: Committee Prepares to Draft Proposal on Licensing, NAT'L L.J., Aug. 28, 1995, at Bl.
99. See id.
100. See U.C.I.T.A. § 105 (2000) ("Relation to Federal Law").
101. David McGowan, Free Contracting, Fair Competition, and Article 2B: Some Reflections on Federal Competition Policy, Information Transactions, and "Aggressive Neutrality," 13 BERKELEY TECH. L.J. 1173 (1998);
102. Raymond T. Nimmer, Breaking Barriers: The Relation Between Contract and Intellectual Property Law, 13 BERKELEY TECH. L.J. 827 (1998). In response to criticisms about the intellectual property/contract law interplay, the 2002 Amendments to UCITA limit a licensor's ability to prohibit reverse engineering by contract. U.C.I.T.A. § 118 (2002) ("Terms Relating to Interoperability and Reverse Engineering");
103. see also Jonathan Band, Closing the Interoperability Gap: NCCUSL 's Adoption of a Reverse Engineering Exception in UCITA, COMPUTER & INTERNET LAW, May 2002, at 1. Compare this approach to the Federal Circuit's ruling in Bowers v. Baystate Technologies, Inc., 320 F.3d 1317 (Fed. Cir. 2003), discussed infra at Part Vl.A.
104. See U.C.I.T.A. §§ 112-13 (2000) ("Manifesting Assent"; "Opportunity to Review");
105. id. § 209 ("Mass-Market License").
106. Gomulkiewicz, The License Is the Product, supra note 33;
107. Mark A. Lemley, Beyond Preemption: The Law and Policy of Intellectual Property Licensing, 87 CAL. L. REV. 111 (1999).
108. See U.C.I.T.A. § 815 ("Right to Possession and Prevent Use");
109. Julie E. Cohen, Copyright and the Jurisprudence of Self-Help, 13 BERKELEY TECH. L.J. 1089 (1998);
110. David Freidman, In Defense of Private Orderings: Comments on Julie Cohen's "Copyright and the Jurisprudence ofSelf-Help," 13 BERKELEY TECH. L.J. 1151 (1998). NCCUSL's 2002 Amendments to UCITA ban the use of electronic self-help, even if the parties agree to it. See U.C.I.T.A. § 816 ("Limitationson Electronic Self-Help").
111. See MD. CODE ANN., COM. LAW §§ 22-101 to 22-816 (West 2005);
112. VA. CODE ANN. §§ 59.1-501.1 to 59.1-509.2 (2006).
113. Iowa, North Carolina, Vermont, and West Virginia have passed such legislation in various forms.
114. See lOWA CODE ANN. § 554D.125 (West 2001 & Supp. 2009);
115. N.C. GEN. STAT. §66-329 (2007).
116. VT. STAT. ANN. tit. 9, § 2463a (2006);
117. W. VA. CODE ANN. § 55-8-15 (LexisNexis 2008). Legislation to prevent the application of UCITA has come to be known as "bomb shelter" legislation. NCCUSL responded to some of the criticisms of UCITA by passing a series of amendments in 2002, but no additional states have adopted UCITA. Note that Maryland and Virginia adopted UCITA prior to the 2002 Amendments.
118. See Raymond T. Nimmer, UCITA and the Continuing Evolution of DigitalLicensing Law, COMPUTER & INTERNET LAW., March 2004, at 10, 10-11 (describing the adoption process for UCC 2 and comparing it to the adoption process for UCITA).
119. See NGUYEN ET AL., supra note 10, at 17.
120. Id.
121. See, e.g., Lorin Brennan, Why Article 2 Cannot Apply to Software Transactions, 38 DUQ. L. REV. 459 (2000).
122. See, e.g., iLAN Sys., Inc. v. Netscout Serv. Level Corp., 183 F. Supp. 2d 328, 332 (D. Mass.) (stating "Article 2 technically does not, and certainly will not in the future, govern software licenses, but for the time being, the Court will assume it does" and noting a "legislative void" of useful contract law for licenses).
123. See generally Nimmer, supra note 49.
124. See generally Linda J. Rusch, A History and Perspective of Revised Article 2: The Never Ending Saga of a Search for Balance, 52 SMU L. REV. 1683 (1999).
125. See JAMES J. WHITE & ROBERT S. SUMMERS, UNIFORM COMMERCIAL CODE: REVISED ARTICLE l AND AMENDED ARTICLE 2-SUBSTANCE AND PROCESS SUPPLEMENT 49-52 (2005).
126. Id.
127. See U.C.C. § 2-103(k)(2003).
128. See Henry Deeb Gabriel & William H. Henning, Introduction to 2003 AMENDMENTS TO UNIFORM COMMERCIAL CODE ARTICLE 2-SALES 1,2 (LexisNexis 2003);
129. see also UCC 2-l03(k) (providing that the term "goods" does not include information).
130. U.C.C. § 2-103 cmt. 7 ("When a transaction includes both the sale of goods and the transfer of rights in information, it is up to the courts to determine whether the transaction is entirely within or outside of this article ....");
131. see also the official Oklahoma Code Comment regarding UCC 2:[T]he definition of 'goods' in this article has been amended expressly to exclude information.... There are important differences that exist between goods and information in law, practice, under intellectual property laws and even under the First Amendment. Given these differences, a court fashioning the resolution of a dispute should not simply apply Article 2 by analogy or under a predominate purpose test, but rather should consider the issue, federal policies and rules regarding information, the consequences of applying an Article 2 rule on established practice, and other relevant considerations.
132. OKLA. ST. ANN. tit. 12A, § 2-105 cmt. 1 (West 2004 & Supp. 2009) (internal citations omitted). For two recent cases in which courts have wrestled with this issue
133. see Wachter Management Co. v. Dexter & Chaney, Inc., 144 P.3d 747, 751 (Kan. 2006) (addressing a contract including rights to software, installation services, training, and consulting, and ruling that UCC 2 applied to the transactio even though software services were an incidental part of the transaction)
134. TK Power, Inc. v. Textron, Inc., 433 F. Supp. 2d 1058, 1062 (N.D. Cal. 2006) (stressing that a case-by-case analysis is appropriate in software transactions because software packages vary depending on the needs of the customer; in this case, applying the common law because "most of the price was for the development of software code" and because the contract for the prototypes was for "knowledge, skill, and ability" rather than "for the actual material goods").
135. See L.J. KuTTEN, COMPUTER SOFTWARE: PROTECTION, LIABILITY, LAW, FORMS § 10:8 (2009) (describing UCITA as "dead").
136. Professor Nimmer argues that any final pronouncement about the viability of UCITA is premature judged in light of UCC 2's long and often controversial journey toward widespread adoption
137. Nimmer,supra note 57
138. see also Robert A. Hillman & Jeffrey J. Rachlinski, Standard Form Contracting in the Electronic Age, 77 N.Y.U. L. REV. 429, 491 (2002) ("UCITA maintains the contextual, balanced approach to standard terms that can be found in the paper world..")
139. Nim Razook, The Politics and Promise of UCITA, 36 CREIGHTON L. REV. 643 (2003).
140. See, e.g., David A. Szwak, Uniform Computer Information Transactions Act [UC.I.T.A.]: The Consumer's Perspective, 63 LA. L. REV. 27 (2002) (criticizing UCITA as a threat to consumers).
141. The American Law Institute (ALI) has begun a project called the "Principles of the Law of Software Contracts." In ALI parlance, a "Principles" project differs from a "Restatement." A Principles project is appropriate when the ALI believes the law is still in its formative stage. As a consequence, a Principles document "accounts for the case law and recommends best practices, without unduly hindering the law's adaptability to future developments." PRINCIPLES OF THE LAW OF SOFTWARE CONTRACTS 2 (Tentative Draft No. 1 March 24, 2008). "Courts can apply the Principles as definitive rules, as a 'gloss' on the common law or U.C.C. Article 2, or not at all, as they see fit."
142. Id. at 2-3;
143. see generally Maureen A. O'Rourke, An Essay on the Challenges of Drafting a Uniform Law of Software Contracting, 10 LEWIS & CLARK L. REV. 925 (2006) (describing the Principles of Software Contracts project).
144. See iLAN Sys., Inc. v. Netscout Serv. Level Corp., 183 F. Supp. 2d 328, 332 (D. Mass. 2002) (noting a "legislative void" of useful contract law for licenses). Some of UCITA's provisions have influenced the development of the common law.
145. See, e.g., Specht v. Netscape Commc'ns Corp., 306 F.3d 17 (2d Cir. 2002) (looking to UCITA for guidance on formation of contract issue).
146. Rhone Poulenc Agro, S.A. v. DeKalb Genetics Corp., 284 F.3d 1323, 1330-31 (Fed. Cir. 2002) (looking to UCITA for guidance on bona fide purchaser rule in patent licensing case).
147. AGT Int'l, Inc. v. Level 3 Commc'ns, L.L.C., No. 02-CV-684, 2002 WL 31409879, at *5 (S.D. Ohio July 29, 2002) (looking to UCITA for guidance on duration of object-code license where copy of software is delivered for fixed fee);
148. see also Llewellyn Joseph Gibbons, Stop Mucking Up Copyright Law: A Proposal for a Federal Common Law of Contract, 35 RUTGERS L.J. 959, 1027 (2004) (stating that this new federal common law could "accrete UCITA provisions into law as necessary if they provided the superior alternative to the existing contract law model or as gap fillers to another body of contract law").
149. See Charles W. Adams, the Court of Appeals for the Federal Circuit: More than a National Patent Court, 49 MO. L. REV. 43, 55-57 (1984);
150. Dreyfuss, supra note 2, at 6-7.
151. See Federal Courts Improvement Act of 1982, Pub. L. No. 97-164,96 Stat. 25 (1982).
152. See supra notes 2 & 3 and accompanying text.
153. R. Polk Wager & Lee Petherbridge, supra note 4, at 1116.
154. 28 U.S.C. § 1291 (2000).
155. Contract issues may be litigated in state court or in federal court under its diversity jurisdiction. 28 U.S.C.§ 1332 (2000).
156. 28 U.S.C. §§ 1295(a), 1338 (2000).
157. See Holmes Group, Inc. v. Vornado Air Circulation Sys. Inc., 535 U.S. 826 (2002).
158. Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 808-09 (1988) (holding that a patent issue must appear in well-pleaded complaint).
159. 28 U.S.C. § 1338(a) (2000). However, if the patent-law issue arises in the context of a case in which the trial court does not have jurisdiction under § 1338, such as a case in which only contract or copyright claims are pled, then the regional federal circuit (or perhaps a state appellate court for a claim based exclusively on state law) would have appellate jurisdiction, not the Federal Circuit.
160. See Janicke, supra note 1, at 12. The literature on the Federal Circuit's jurisdiction is voluminous.
161. See, .e.g., John Donofrio & Edward C. Donovan, Christianson v. Colt Industries Operating Corp.: The Application of Federal Question Precedent to Federal Circuit Jurisdiction Decisions, 45 AM. U. L. REV. 1835 (1996);
162. Rooklidge & Weil supra note 4;
163. Larry D. Thompson Jr., Adrift on a Sea of Uncertainty: Preserving Uniformity in Patent Law Post-Vomado Through Deference to the Federal Circuit, 92 GEO. L. J. 523 (2004).
164. E.g., Jacobsen v. Katzer, 535 F.3d 1373 (Fed. Cir. 2008) (addressing breach-of-contract and copyright-infringement issues in open source software license);
165. see also Gomulkiewicz, supra note 41.
166. In fact, circuits other than the Federal Circuit decide cases that influence patent licenses.
167. See, e.g., Everex Sys., Inc. v. Cadtrak Corp., 89 F.3d 673 (9th Cir. 1996) (discussing the assignability of patent license);
168. PPG Indus., Inc. v. Guardian Indus. Corp., 597 F.2d 1090 (6th Cir. 1979) (same);
169. Unarco Indus., Inc. v. Kelley Co., 465 F.2d 1303 (7th Cir. 1972) (same).
170. See Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826, 838-39 (2002) (Stevens, J., concurring);
171. Dreyfuss, supra note 2 at 60.
172. Methodology: search of the BNA Intellectual Property Library database using BNA headnote numbers related to licensing of various types of intellectual property: patents, software, copyrights, trademarks, and trade secrets. The staff of the Marian Gould Gallagher Law Library of the University of Washington School of Law ran these searches. The searches identified cases decided between the dates February 15, 2008 and October 1, 1982. For other articles using a similar methodology.
173. see Barton Beebe, The Continuing Debacle of U.S. Antidilution Law: Evidence from the First Year of the Trademark Dilution Revision Act Case Law, 24 SANTA CLARA COMPUTER & HIGH TECH. L.J. 449 (2007-08);
174. Jake Dear & Edward W. Jessen, "Followed Rates" and Leading State Cases, 1940-2005,41 U.C. DAVIS L. REV. 683 (2007).
175. The Ninth Circuit decides many copyright cases because of its proximity to the movie industry.
176. The Ninth Circuit decides many copyright cases because of its proximity to the movie industry. See White v. Samsung Elec. Inc., 989 F.2d 1512, 1521 (9th Cir. 1993) (Kozinski, J., dissenting) (referring to the Ninth Circuit as the "Hollywood Circuit"). The Second Circuit decides many copyright cases because of its proximity to the publishing industry.
177. See 1 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON COPYRIGHT § 3.07[A], at 3-40 (2008) (referring to the influence of the Second Circuit in copyright-related cases).
178. One would actually expect the Federal Circuit to have decided more cases in trademark licensing because of its jurisdiction over appeals from the Trademark Office. However, it may be that most of these cases involve the underlying question of protectability rather than issues related to commercialization of trademarks (i.e., licensing). 88. As software developers increasingly use patents to protect software, more cases involving software have come to the Federal Circuit. See, e.g., Bowers v. Baystate Tech., Inc., 320 F.3d 1317 (Fed. Cir. 2003); Atari Games Corp. v. Nintendo of Am. Inc., 975 F.2d 832, 844 (Fed. Cir. 1992). These cases tend to raise copyright, trade secret, and sometimes trademark issues as well as patent issues.
179. See Robert W. Gomulkiewicz, Legal Protection For Software: Still a Work in Progress, 8 TEX. WESLEYAN L. REV. 445 (2002). As firms focus more on the importance of intellectual property as an asset in the information economy, many other types of transactions will also involve licenses to multiple types of intellectual property.
180. The Federal Circuit decides any copyright, trademark, or trade secret issues applying the law of the circuit from which the case came.
181. See Hutchins v. Zoll Med. Corp., 492 F.3d 1377, 1383 (Fed. Cir. 2007). Often the Federal Circuit must intuit this precedent because the applicable circuit does not have any cases on point.
182. See Bowers v. Baystate Tech., Inc., 320 F.3d 1317 (Fed. Cir. 2003). In the early 1990s, the Federal Circuit avoided a conflict over the issue of whether reverse engineering software to discover unprotectable ideas was a Copyright Act "fair use." The Federal Circuit's decision in Atari Games Corp. v. Nintendo of America, Inc., 975 F.2d 832 (Fed. Cir. 1992), is consistent with the Ninth Circuit's decision in Sega Enterprises v. Accolade, Inc., 977 F.2d 1510 (9th Cir. 1993).
183. See also Sony Corp. v. Connectix Corp., 203 F.3d 596 (9th Cir. 2000).
184. E.g., McCoy v. Mitsuboshi Cutlery, Inc., 67 F.3d 917 (Fed. Cir. 1995).
185. E.g.,Bowers, 320 F.3d 1317.
186. Id.
187. E.g., Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (Fed. Cir. 1992).
188. E.g., Power Lift, Inc. v. Weatherford Nipple-Up Sys., Inc., 871 F.2d 1082 (Fed. Cir. 1989).
189. E.g., Augustine Med., Inc. v. Progressive Dynamics, Inc., 194 F.3d 1367 (Fed. Cir. 1999).
190. E.g., Rhone Poulnec Agro S.A. v. DeKalb Genetics Corp., 284 F.3d 1323 (Fed. Cir. 2002).
191. E.g., B. Braun Med., Inc. v. Abbott Labs., 124 F.3d 1419, 1426-27 (Fed. Cir. 1997).
192. E.g., Intergraph Corp. v. Intel Corp., 195 F.3d 1346 (Fed. Cir. 1999).
193. See, e.g., Davis v. Blige, 505 F.3d 90, 104 (2d Cir. 2007) (examining whether copyright license or assignment can operate retrospectively)
194. Lasercomb Am., Inc. v. Reynolds, 911 F.2d 970,973 (4th Cir. 1990) (reasoning that because patent law had a misuse doctrine, copyright law should too). In intellectual property cases, the Supreme Court has drawn on patent-law analogies, most famously in Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417 (1984) (beta max case), and most recently in Eldred v. Ashcroft, 537 U.S. 186 (2003) and eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 392 (2006) (discussing injunctive relief in patent and copyright cases).
195. See Eldred, 537 U.S. at 217.
196. See Appendix I.
197. E.g., A&M Records v. Napster, Inc., 239 F.3d 1004, 1015 (9th Cir. 2001) (citing Federal Circuit, including once for its interpretation of Ninth Circuit law);
198. E. & J. Gallo Winery v. Gallo Cattle Co., 955 F.2d 1327, 1337 (9th Cir. 1992) ("We agree with the Federal Circuit that a simultaneous assignment and license-back of a mark is valid, where, as in this case, it does not disrupt continuity of the products or services associated with a given mark.");
199. EyeTicket Corp. v. Unisys Corp., 155 F. Supp. 2d 527, 535 (E.D. Va. 2001) (adopting Federal Circuit's categories to classify licenses).
200. Blizzard .Entm't, Inc. v. Jung, 422 F.3d 630, 639 (8th Cir. 2005);
201. see also, e.g., Foad Consulting Group, Inc. v. Azzalino, 270 F.3d 821, 828 n.11 (9th Cir. 2001);
202. In re CFLC, Inc., 89 F.3d 673, 677 (9th Cir. 1996);
203. Burlington Indus., Inc. v. Solutia, Inc., 256 F. Supp. 2d 433 (M.D.N.C. 2003);
204. Natterman & Cie GmbH v. Bayer Corp., 428 F. Supp. 2d (E.D. Pa. 2006).
205. See Dreyfuss, supra note 4, at 779. A study in the late 1990s indicated the Federal Circuit's lack of influence in most areas of law.
206. See William M.Landes et al., Judicial Influence: A Citation Analysisof Federal Courts of Appeals Judges, 27 J. LEGAL STUD. 271, 277-78, 317-18(1998).
207. Some patent-law scholars have used methods of statistical analysis. For a recent example
208. see David L. Schwartz, Practice Makes Perfect? An Empirical Study of Claim Construction Reversal Rates in Patent Cases, 107 MICH. L. REV. 223 (2008) and Paul M. Janicke & LiLan Ren, Who Wins Patent Infringement Cases?, 34 AIPLA Q.J. 1 (2006). Other scholars have gleaned important and interesting insights using less "scientific" methods.
209. See, e.g., Ronald J. Mann, Do Patents Facilitate Financing in the Software Industry?, 83 TEX. L. REV. 961 (2005).
210. See Appendix I, infra at 251.
211. Given the importance of licensing transactions in the information economy, it is safe to assume that the absolute number of licensing-law cases will continue to be significant and will most likely continue to rise.
212. See generally John Richards et al., Monsanto v. Scruggs: the Scope of Downstream Licensing Restrictions, 16 FORDHAM INTELL. PROP. MEDIA & ENT. L.J. 1025 (2006) (discussing Lexmark's reliance on Mallinckrodt case).
213. If the Federal Circuit's jurisprudence is unfaithful to the intellectual property statutes or the cases that have construed them, then it goes without saying that the Federal Circuit's course should be corrected. If an adjustment needs to be made, then an adjustment should be made. If that happens, then other courts and the public will fall into line as they must and always do. My point is simply that any adjustment made should be made with full awareness of the broader implications.
214. See, e.g., Sean M. O'Connor, Using Stock and Stock Options to Minimize Patent Royalty Payment Risks After Medlmmune v. Genentech, 3 N.Y.U. J. LAW & Bus. 381 (2007) (pointing out that the Supreme Court's Medlmmune decision had significant negative unintended consequences for the university technology-transfer community's licensing practices).
215. Quanta Computer, Inc., v. LG Elecs., Inc., 553 U.S.-, 128 S. Ct. 2109 (2008).
216. This area has also attracted the attention of commentators. E.g., Mehdi Ansari, LG Elecs., Inc. v. Bizcom Elecs., Inc.: Solving the Foundry Problem in the Semiconductor Industry, 22 BERKELEY TECH. L.J. 137 (2007);
217. John W. Osborn, A Coherent View of Patent Exhaustion: A Standard Based on Patentable Distinctiveness, 20 SANTA CLARA HIGH TECH. L.J. 643 (2004);
218. William P. Skladony, Commentary on Select Patent Exhaustion Principles in Light of the LG Electronics Cases, 47 INTELLECTUAL PROP. L. REV. 235 (2006).
219. 976 F.2d 700 (Fed. Cir. 1992). For articles discussing the Mallinckrodt decision at the time
220. see James B. Koback, Jr., Contracting Around Patent Exhaustion: Some Thoughts About the CAFC's Mallinckrodt Decision, 75 J. PAT. & TRADEMAK OFF. Soc'Y 550 (1993) and Richard H. Stem, the Unobserved Demise of the Exhaustion Doctrine in US Patent Law, 15 EUR. INTELL. PROP. REV. 460 (1993). For a more recent article
221. see Mark R. Patterson, Contractual Expansion of the Scope of Patent Infringement Through Field-of-Use Licensing, 49 WM. & MARY L. REV. 157 (2007).
222. Mallinckrodt, 976 F.2d at 702.
223. Id.
224. Mallinckrodt, Inc. v. Medipart, Inc.,15 U.S.P.Q.2d 1113 (N.D. 111. 1990).
225. Mallinckrodt, 976 F.2d at 709.
226. Id.
227. Id. at 708 (internal citations omitted)
228. see also id. at 703.
229. 124 F.3d 1419, 1426-27 (Fed. Cir. 1997).
230. Id. at 1426 (internal citations omitted).
231. Id.
232. 123 F.3d 1445 (Fed. Cir. 1997).
233. Id. at 1447.
234. Id. at 1453 (emphasis added).
235. Id.
236. see also Jazz Photo Corp. v. ITC, 264 F.3d 1094, 1108 (Fed. Cir. 2001) (Newman, J.) (ruling in an action under Section 337 of the Tariff Act to stop the repurposing of "single use" cameras, that package instructions were not in the form of an enforceable contractual agreement, so therefore the "single use" condition was not enforceable).
237. 363 F.3d 1336 (Fed. Cir. 2004).
238. 459 F.3d 1328 (Fed. Cir. 2006).
239. First sale legal issues aside, the Monsanto line of cases raises interesting, challenging, and controversial ethical issues about food and agricultural policy. These issues, though important, are outside the scope of this article. My analysis focuses solely on Monsanto's general right to use licensing for its business-model innovation, not on Monsanto's business objective in using its licensing scheme. For commentary on the latter
240. see Peter Carstensen, Post-Sale Restraints Via Patent Licensing: A "Seedcentri" Perspective, 16 FORDHAM INTELL. PROP. MEDIA & ENT. L.J. 1053 (2006);
241. Richards et al., supra note 108;
242. Jason Savich, Monsanto v. Scruggs: The Negative Impact of Patent Exhaustion on Self-Replicating Technology, 22 BERKELEY TECH. L.J. 115 (2007);
243. The End of Cheap Food,THE ECONOMIST ,Dec. 8, 2007, at 11.
244. See also a news article by Kristi Heim, Agricultural Aid a Hard Sell, SEATTLE TIMES, Jan. 20, 2008, at Bl, which reports concerns that the Gates Foundation's new agricultural aid initiatives will be too technology- andmarket-oriented, including concerns about use of genetically modified crops. Heim also reports that according to a farmer from Common Ground Farmers,afarming NGO, farmers share local seeds with other farmers and cannot affordto buy seeds, let alone more expensive transgenic varieties that often require fertilizer and pesticide.
245. Id. She quotes the farmer as saying, "People do not know the hidden agenda behind it... that once [farmers] get the high-yielding seed, they have to keep buying it. Once you get in the system, then getting out becomes difficult."
246. Id.
247. Scruggs, 459 F.3d at 1333.
248. Id.
249. Id.
250. Id. at 1333.
251. As explained infra at Part V.B.2, the McFarling case did not squarely address the first sale issue.
252. Scruggs, 459 F.3d at 1336.
253. Id.
254. 53 F.3d 1364 (Fed. Cir. 2006).
255. Id. at 1368.
256. Id.
257. Id.
258. Id.
259. Id.
260. Id. at 1369-70.
261. Id. at 1370.
262. Id.
263. According to the Brief of the United States as amicus curiae on the petition for writ of certiorari in Quanta Computer, "The foundation of the Federal Circuit's approach to the first sale doctrine is Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (1992).
264. Brief of the United States as Amicus Curiae at 14, Quanta Computer,Inc. v. LG Elecs., Inc., 553 U.S.-(2008) (No. 06-937).
265. Judge Newman also wrote the opinion in the Jazz Photo case in which the court ruled that "single use" package instructions were not sufficient to form an enforceable contract.
266. See supra note 125. She was also on the panel that decided LG Electronics, Inc. v. Bizcom Electronics, Inc., discussed supra at note 136.
267. See generally Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (Fed. Cir. 1992).
268. 243 U.S. 502(1917).
269. 304 U.S. 175(1938).
270. 976 F.2d at 701 (internal citations omitted).
271. Id. ("On review of these issues in the posture in which the case reaches us ...." (emphasis added)).
272. Id.
273. Id.
274. Id. at 703.
275. See B. Braun Med., Inc. v. Abbott Labs., 124 F.3d 1419, 1426 (Fed. Cir. 1997) ("Because the district court improperly instructed the jury that it must find Braun guilty of patent misuse if Braun placed any use restrictions on its sales of the SafSite® valves... we remand the case for further proceedings.").
276. 35 U.S.C. § 154(2000).
277. The Federal Circuit cited the Supreme Court's opinion in E. Bement & Sons v. National Harrow Co., 186 U.S. 70, 91 (1902) for the proposition that "[a]s in other areas of commerce,private parties may contract as they choose, provided no law is violated thereby."
278. Mallinckrodt 1992 976 F.2d at 703 (Fed. Cir. 1992).
279. 106 U.S. 89 (1882).
280. Id. at 91. The Court also discussed the limited license in Providence Rubber Co. v. Goodyear, 76 U.S. (9 Wall.) 788 (1869).
281. 305 U.S. 124, 127 (1938) (internal citations omitted).
282. Mallinckrodt 976 F.3d at 708.
283. Id. at 709.
284. 316 U.S. 241 (1942).
285. See Brief of the United States as Amicus Curiae at 6, Quanta Computer, Inc. v. LG Elecs., Inc., 553 U.S. (2008) (No. 06-937) (characterizing Univis Lens as the last Supreme Court case that "squarely addressed" the patent exhaustion doctrine).
286. Perhaps there is general confusion about the significance of the Univis Lens case.
287. See generally John W. Osborne, A Coherent View of Patent Exhaustion: A Standard Based on Patentable Distinctiveness, 20 SANTA CLARA COMPUTER & HIGH TECH. L.J. 643, 643 (2004)("Sixty-two years later, Univis Lens is still misinterpreted.").
288. See B. Braun Med., Inc. v. Abbott Labs., 124 F.3d 1419, 1426 (Fed. Cir. 1997).
289. See General Talking Pictures, 305 U.S. at 126.
290. Note that Justice Black's dissent, id. at 128-33, echoes many of the objections voiced by petitioner and the United States as amicus curiae in LG Electronics.
291. See 3l6 U.S. 241, 253 (1941).
292. See id. at 243-54.
293. 363 F.3d 1336 (Fed. Cir. 2004). The Federal Circuit also ruled on other aspects of the dispute between Monsanto and McFarling.
294. See Monsanto Co. v. McFarling, 488 F.3d 973, 978 (Fed. Cir. 2007) (remedies)
295. Monsanto Co. v. McFarling, 302 F.3d 1291, 1294 (Fed. Cir. 2002)(forum selection).
296. Monsanto Co. v. Scruggs, 459 F.3d 1328 (Fed. Cir. 2006).
297. McFarling had signed the Technology Agreement so, as in Mallinckrodt, the validity of the license restriction was not challenged on that basis.
298. See Monsanto Co. v. McFarling, 363 F.3d 1336,1338 (Fed. Cir. 2004).
299. See id. at 1339.
300. Id. at 1341.
301. Id. at 1341-42.
302. Id. at 1342-43.
303. Id. at 1343.
304. Id.
305. See Monsanto Co. v. Scruggs, 459 F.3d 1328, 1333 (Fed. Cir. 2006).
306. Id.at 1336.
307. It appears that McFarling raised patent exhaustion as a defense in his answer, but the Federal Circuit did not address the issue in its opinion. Presumably, it was not argued in the district court or raised on appeal. See McFarling, 363 F.3d at 1340 (mentioning that McFarling raised patent exhaustion and first sale as defenses in his answer).
308. Scruggs, 459 F.3d at 1335-36. The court also rejected Scruggs' implied-license, misuse, and antitrust defenses.
309. See id. at 1336, 1339-41. Judge Dyk dissented on the antitrust issue but not the first sale issue.
310. See id. at 1342 (Dyk, J., concurring in part and dissenting in part).
311. Id. at 1336.
312. Id. (internal markings omitted).
313. General Talking Pictures Corp. v. Western Elec. Co., 305 U.S. 124, 125-26 (1938).
314. Id. at 126.
315. Id. at 127.
316. Id.
317. 459F.3d at 1333.
318. See id. at 1334-38. Unlike General Talking Pictures, however, the patentee did not sue the manufacturer.
319. Id. at 1333 (patentee suing the grower).
320. 459F.3d at 1336.
321. More culpable because the grower infringed both the "use" and the "make" rights.
322. I recognize that some believe that there are higher moral imperatives at stake when it comes to reuse of seeds.
323. The case was called LG Electronics, Inc. v. Bizcom Electronics, Inc.at the circuit-court level. 453 F.3d 1364 (Fed. Cir. 2006).
324. As described supra at Part I.A, many firms team up in the computer industry to create the product that we call a personal computer.
325. The court in LG Electronics refers to computer sellers as "OEMs" which stands for "original equipment manufacturer." 453 F.3d at 1371. The term "OEM" was created at a time when companies like Compaq and Digital Equipment Corp. actually assembled computers. As the computer industry has evolved, many of these OEMs have subcontracted or outsourced assembly to companies that do this work at a lower cost. Thus, the term "original equipment manufacturer" now is often a misnomer.
326. A microprocessor is a component of a computer system.
327. See LG Elecs., 453 F.3d at 1368, 1373.
328. Id. at 1370.
329. Id.
330. Or, the manufacturer could acquire microprocessors from a company that has acquired the right from LG Electronics to shield the manufacturer's downstream customers.
331. LG Elecs.453 F.3d at 1370.
332. "[T]his conditional agreement required Intel to notify its customers of the limited scope of the license, which it did."
333. Id.
334. See Brief of the United States as Amicus Curiae, Quanta Computer, Inc. v. LG Elecs., Inc., 553 U.S.-(2008) (No. 06-937).
335. See id. at 14-20;
336. Brief Amicus Curiae of Consumers Union et al., at 2-4, 21, Quanta Computer, 553 U.S -128 S. Ct. 2109;
337. Brief Amicus Curiae of Automotive Engine Rebuilders Ass'n et al., at 21-25, Quanta Computer, 553 U.S.-, 128 S. Ct. 2109.
338. Quanta Computer, 553 U.S.-,128 S. Ct. at 2117.
339. Id.
340. Id.
341. Id. at 2119.
342. Id. at 2120.
343. 304 U.S. 175 (1938).
344. Quanta, 553 U.S., 128 S. Ct. at 2121.
345. Id. at 2114.
346. Id. at 2122.
347. See id at 2122 n.7.
348. See generally Greg A. McAllister, Quanta Computer v. LG Electronics: The Supreme Court Applies Its Patent Exhaustion Precedent and Rejects Recent Federal Circuit Modifications to the Doctrine, CASRIP NEWSL. (Ctr. for Advanced Study & Research on Intellectual Prop., Seattle, Wash.), Summer 2008, http://www.law.washington.edu/casrip/newsletter/voll5/newsvl5i2QuantaLG.html, permanent copy available at http://www.law.washington.edu/wlr/notes/ 84washlrevl99n217.pdf.
349. Quanta, 553 U.S.-, 128 S. Ct. at 2117-21.
350. Id. at 2121 (emphasis added).
351. Id. at 2113. "Intel's authorized sale to Quanta thus took its products outside the scope of the patent monopoly, and as a result, LGE can no longer assert its patent rights against Quanta."
352. Id. at 2122.
353. Id. at 2122.
354. See id.
355. But see McAllister, supra note 217, at Part I ("The case overturns the Federal Circuit's patent exhaustion jurisprudence, under which patent rights were exhausted only by unconditional sales....").
356. Mr. McAllister's conclusion does not seem supported by the Court's reasoning in Quanta Computer. Justice Thomas's opinion did not announce a new "rule" about first sale, and he did not renounce the Federal Circuit's approach. Instead, the Supreme Court paid special attention to whether the parties had placed conditions on Intel's sales (and ultimately found that they had not, at least none that were binding). Moreover, as to the characterization that Quanta Computer creates a new "rule," the Supreme Court has been particularly averse to establishing rigid rules in patent-related cases.
357. See, e.g., KSR Int'l Co. v. Teleflex, Inc., 550 U.S. 398, 415 (2007) ("We begin by rejecting the rigid approach of the Court of Appeals.");
358. see also eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006).
359. See Harold C. Wegner, Post-Quanta, Post-Sale Patentee Controls, 7 J. MARSHALL REV. INTELL. PROP. L. 682, 694-95 (2008) (arguing that the Supreme Court overruled B. Braun sub silentio but did not overrule Mallinckrodt)
360. Quanta, 533 U.S.-,128 S. Ct. at 2121-22.
361. See Patterson, supra note 112, at 160-61.
362. See, e.g., Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417 (1984) (using patent law's staple article in commerce doctrine to decide copyright contributory infringement case)
363. see also cases cited supra, note 99.
364. 421 F.3d 981 (9th Cir. 2005).
365. The enforceability of the contract was raised in the context of a consumer-protection violation: the plaintiff alleged that Lexmark's assertionthat it could enforce a post-sale restriction was wrong as a matter of law,and was therefore an unfair and deceptive practice.
366. Id. at 985. To resolve the consumer-protection issue, the Ninth Circuit had to decide the issue of contract enforceability.
367. Id. at 986-88.
368. The district court had relied extensively on Mallinckrodt, but the Ninth Circuit went back to first principles and relied on California contract law. See id. at 986-88. The Electronic Frontier Foundation urged the Ninth Circuit to use the Arizona Cartridge case as a vehicle to reject the Mallinckrodt case, but the court did not take the bait, saying that the plaintiff did not raise the argument on appeal and had conceded in its brief that "the otherwise unfettered use of a patented good can be constrained."
369. Id. at 987.
370. Id. at 988. Unlike many other patent first sale cases, the court did not need to examine whether Lexmark was acting beyond the scope of its patent. The plaintiff had not raised the argument on appeal and had conceded in its brief that "the otherwise unfettered use of a patented good can be constrained."
371. Id. at 987.
372. Conditions on "use" must be analyzed differently in the context of licenses of various types of intellectual property. In patent law, the right to control "use" is one of the exclusive rights of the patent holder.
373. 35 U.S.C. § 154(a)(1) (2006) (discussing patentee's right to exclude others from making, using, or offering the patented invention for sale). In trademarkand trade secret licensing, setting parameters on use of a trademark or trade secret is the very essence of the license grant. .In copyright law, theright to control "use" is not one of the exclusive rights of the copyright holder (copyrights include the exclusive right to copy, distribute, create derivative works, and publicly perform or display under 17 U.S.C. § 106).
374. However, in a copyright license, a license grant describing permissible uses sometimes implicates one of the exclusive rights, such as the right to copyor create derivative works. Other times, however, a grant controlling "use"means simply that. In the latter case, if the licensee's use exceeds the scope of use granted, then the cause of action is for breach of contract rather than a copyright infringement.
375. See Nat'l Car Rental Sys., Inc. v. Computer Assoc. Int'l, Inc., 991 F.2d 426, 427 (8th Cir. 1993) (addressing a state-law .breach-of-contract claim alleging that the licensee of computer software exceeded limitations on the use of computer software contained in the license agreements).
376. Many cases were also decided on contract-formation grounds. Courts across circuits and state courts have applied modern contract-formation rules, finding an enforceable contract in some cases but not others.
377. See, e.g., Specht v. Netscape Commc'ns Corp., 306 F.3d 17 (2d Cir. 2002);
378. Arizona Retail Sys., Inc. v. Software Link, Inc., 831 F. Supp.(D. Ariz. );
379. M.A. Mortenson Co. v. Timberline Software Corp., 140 Wash. 2d 568,998 P.2d 305 (2000).
380. The Copyright Act provides the exclusive source of protection for "all legal and equitable rights that are equivalent to any of the exclusive rights" granted by the Copyright Act. 17 U.S.C. § 301(a) (2006). The Copyright Act's Section 301 expressly preempts any state law that attempts to provide equivalent rights. Conversely, of course, the Copyright Act does not prevent state law from enforcing non-equivalent legal or equitable rights.
381. A classic state-statute preemption case in the area of end user licensing was Vault Corp. v. Quaid Software Ltd., 847 F.2d 255 (5th Cir. 1988). In that case, the plaintiffs challenged the Louisiana Software License Enforcement Act, which permitted software publishers to enforce terms against end users provided that the terms were in a license comporting with the statute. According to the statute, enforceable terms "include the prohibition of: (1) any copying of the program for any purpose; and (2) modifying and/or adapting the program in any way, including adaptation by reverse engineering, decompiliation or disassembly."
382. Id. at 268-69. The Fifth Circuit held that the Louisiana statute conflicted with the rights of computer-program owners conferred in Section 117 of the Copyright Act, which permits the owner of a copy to make certain adaptations that are essential steps in the utilization of the program and to make archival copies.
383. Id. at 270.
384. 991 F.2d 426 (8th Cir. 1993).
385. Id. at 433.
386. See Acorn Structures Inc. v. Swantz,846 F.2d 923,926(4th Cir. 1988).
387. See Taquino v. Teledyne Monarch Rubber, 893 F.2d 1488, 1501 (5th Cir.1990).
388. See Wrench, L.L.C. v. Taco Bell Corp., 256 F.3d 446,457 (6th Cir. 2001).
389. See ProCD, Inc. v. Zeidenberg, 86 F.3d 1447, 1455 (7th Cir. 1996). In addition, intuiting First Circuit law, the Federal Circuit in Bowers v. Baystate Technologies, Inc. held that a "no reverse engineering" clause in a shrinkwrap license was not preempted by the Copyright Act. 320 F.3d 1317 (Fed. Cir. 2003).
390. 86 F.3d 1447 (7th Cir. 1996).
391. Id. at 1455.
392. Id. at 1449.
393. The end user in the ProCD case was notified of the license condition on four separate occasions (on the product packaging, in the user guide, upon installation of the software, and prior to gaining access to the product's data). The end user's explanation for violating the condition was not that he did not know about it, but that he thought it was unenforceable (i.e., essentially a legal conclusion).
394. See ProCD, Inc. v. Zeidenberg, 908 F. Supp. 640, 651 (W.D. Wis. 1996) ("In defendant's view, the contract for the sale of SelectPhone was completed at the time of sale and the license represents additional terms to which they cannot be bound ....").
395. ProCD, 86 F.3d at 1452-53.
396. The court cautioned that it is "prudent to refrain from adopting a rule that anything with the label 'contract' is necessarily outside the preemption clause: the variations and possibilities are too numerous to foresee."
397. 86 F.3d at 1455.
398. See Daniel Laster, The Secret is Out: Patent Law Preempts Mass Market License Terms Barring Reverse Engineering for Interoperability Purposes, 58 BAYLOR L. REV. 621 (2006)(arguing that patent law, rather than copyrightlaw, should be the proper focus of preemption analysis in cases of reverse engineering).
399. Some commentators argue that mass-market licenses, in reality, create something more like an in rem right
400. See, e.g., id. at 674-77.
401. ProCD, 86 F.3d at 1454.
402. Some courts use the term "extra element" to explain the point about non-equivalency between contract rights and copyrights. They note that a breach-of-contract claim has an extra element that a copyright-infringement claim does not, namely proof of contractual relationship. The need to prove the existence of this relationship in a breach-of-contract case makes a contract claim different from a copyright claim.
403. See Gates Rubber Co. v. Bando Chem. Indus., Ltd., 9 F.3d 823 (10th Cir. 1993) (trade-secret claim not preempted by copyright claim) .
404. Baltimore Orioles v. Major League Baseball Players Ass'n, 805 F.2d 663 (7th Cir. 1986).
405. See Gomulkiewicz, Getting Serious, supra note 33, at 687 (noting that in the past twenty years over one hundred scholarly articles have been written on the subject of mass-market software licenses, most of them critical, and many of them criticizing the ProCD decision on various grounds).
406. For a recent example, see Elizabeth I. Winston, Why Sell What You Can License? Contracting Around Statutory Protection of Intellectual Property, 14 GEO. MASON L. REV. 93 (2006).
407. See NGUYEN ET AL., supra note 10 at 538;
408. SOFTWARE AND INTERNET LAW 337 (3d ed. 2006) ("Since ProCD, a majority of courts have enforced shrinkwrap licenses.").
409. 422 F.3d 630 (8th Cir. 2005).
410. Id. at 640-41.
411. Id. at 637.
412. Id. at 635-36.
413. Id. at 637.
414. Id at 638.
415. One recent commentator disagrees with this outcome.
416. See Laster, supra note 248, at 693-701.
417. Wall Data Inc. v. L.A. County Sheriffs Dep't, 447 F.3d 769, 785, 785 n.9 (9th Cir. 2006).
418. Although much of the discussion supra focuses on information technology, licensing is also important in other areas of the economy
419. See, e.g., Sean M. O'Connor, The Use of MTAs to Control Commercialization of Stem Cell Diagnostics and Therapeutics, 21 BERKELEY TECH. L.J. 1017 (2006).
420. In addition to the cases described supra, as the court that reviews government-contract appeals, the Federal Circuit sees many cases involving intellectual property, software, and information licenses between firms and the United States government.
421. See, e.g., Campbell Plastics, Inc. v. Brownlee, 389 F.3d 1243 (Fed. Cir. 2004);
422. see also NGUYEN ET AL., supra note 10, at 757-868 (describing licensing in the government-contracts setting);
423. Danielle Conway-Jones, Research and Development Deliverables Under Government Contracts, Grants, Cooperative Development Agreements and CRADAs, 9 COMPUTER L. REV. & TECH. J. 181 (2004).
424. Jacobsen v. Katzer, 535 F.3d 1373 (Fed. Cir. 2008)
425. see generally Gomulkiewicz, supra note 41.
426. See, e.g., Amazon.com, Inc. v. BarnesAndNoble.com, 239 F.3d 1343 (Fed. Cir. 2001).
427. The Federal Circuit is often perceived as an expert in all types of intellectual property, not just patents.
428. See Lawrence Rosen, Bad Facts Make Good Law: The Jacobsen Case and Open Source, Nov.-Dec. 2008, at 1, permanent copy available at http://www.law. washington.edu/wlr/notes/84washlrevl99n266.pdf ("The Jacobsen case found its way to the Court of Appeals for the Federal Circuit (CAFC), arguably the most important court short of the U.S. Supreme Court for intellectual property matters." (emphasis added)).
429. Arguably some of the most important contemporary copyright cases and issues deal with the distribution of copyright works rather than the creative process.
430. See Peter S. Menell, Envisioning Copyright Law's Digital Future, 46 N.Y.L. SCH. L. REV. 63 (2003).
431. In terms of cases, see, for example, MGM Studios, Inc. v. Grokster, Ltd., 545 U.S. 913 (2005). In terms of issues, the Google Books Library Project is a good example.
432. See Google Book Search Library Project, http://www.google.com/ googlebooks/library.html (last visited Apr. 18, 2009), permanent copy available at http://www.law.washington.edu/wlr/notes/84washlrev199n267.pdf.
433. See e.g., Bowers v. Baystate Tech., Inc., 320 F.3d 1317 (Fed. Cir.2003) (copyrights, contracts, patents).
434. Intergraph Corp. v. Intel Corp., 195 F.3d 1346 (Fed. Cir. 1999) (contracts, trade secrets, patents);
435. Atari Games Corp. v. Nintendo of Am., inc., 975 F.2d 832 (Fed. Cir. 1992) (copyrights and patents).
436. See Colloquy, Monsanto v. Scruggs: The Scope of Downstream Licensing Restrictions, 16 FORDHAM INTELL. PROP. MEDIA & ENT. L.J. 1025, 1040 (2006) (quoting Dick Ulmer, counsel in Arizona Cartridge Remanufacturing Ass'n v. Lexmark International, Inc., 421 F.3d 981 (9th Cir. 2005), speaking about Lexmark: "Lexmark was very careful in structuring this program. They very closely followed the Mallinckrodt case, which was of great interest to them. The other key case in this field, although it is not a patent case, is the ProCD case, which, to our mind, is the key case.");
437. Gomulkiewicz The License Is the Product, supra note 33.
438. See Joel Rothstein Wolfson, Contract and Contracts Are Not at War, 87 CAL. L. REV. 79 (1999) (explaining how the information industry relies on licenses in light of Feist Publications, Inc. v. World Telephone Service Co., 499 U.S. 340 (1991), a case which makes more difficult to claim a copyright in a database).
439. See O'Connor, supra note 109 (pointing out that the Supreme Court's decision in Medlmmune, .Inc. v. Genentech, Inc., 549 U.S. 118 (2007), had significant negative unintended consequences for the university technology-transfer community's licensing practices).
440. See Robert W. Gomulkiewicz, Entrepreneurial Open Source Hackers-MySQL and Its Dual Licensing, 9 COMPUTER L. REV. & TECH. J. 203 (2004);
441. see also Progress Software Corp. v. MySQL AB, 195 F. Supp. 2d 328 (D. Mass. 2002);
442. see generally Ronald J. Mann, Commercializing Open Source Software: Do Property Rights Still Matter?, 20 HARV. J.L. & TECH. 1 (2006);
443. Jason B. Wacha, Taking the Case: Is the GPL Enforceable?, 21 SANTA CLARA COMPUTER & TECH. L.J. 451 (2005);
444. Daniel B. Ravicher, Facilitating Collaborative Software Development: The Enforceability of Mass-Market Public Software Licenses, 5 VA. J.L. & TECH. 11 (2000);
445. WEBER,supra note 26, at 190-223.
446. Monsanto has not always been on the winning side.
447. See Rhone Poulnec Agro S.A. v. DeKalb Genetics Corp., 284 F.3d 1323 (Fed. Cir. 2002) (rejecting bona-fide-purchaser defense raised by Monsanto).
448. See generally U.S. Philips Corp. v. Int'l Trade Comm'n, 424 F.3d 1179 (Fed. Cir. 2005) (patent package licensing);
449. In re Indep. Serv. Orgs. Antitrust Litig., 203 F.3d 1322 (Fed. Cir. 2000) (copier equipment and maintenance policy);
450. Bowers v. Baystate Tech., Inc., 320 F.3d 1317 (Fed. Cir. 2003) (end-user software license);
451. discussion of the Mallinckrodt, Monsanto, and LG Electronics cases, supra Part V.B.
452. See Hewlett Packard Co. v. Repeat-O-Type Stencil Mfg. Corp., 123 F.3d 1445 (Fed. Cir. 1997) (re-use of printer ink cartridges);
453. Jazz Photo Corp. v. Int'l Trade Comm'n, 264 F.3d 1094 (Fed. Cir. 2001) (single-use cameras);
454. cf. Campbell Plastics Eng'g & Mfg., Inc. v. Brownlee, 389 F.3d 1243 (Fed. Cir. 2004) (government-contract licensing case).
455. See, e.g., Monsanto Co. v. Scruggs, 459 F.3d 1328, 1336 (Fed. Cir. 2006).
456. See B. Braun Med., Inc. v. Abbott Labs., 124 F.3d 1419 (Fed. Cir. 1997).
457. 424 F.3d 1179 (Fed. Cir. 2005).
458. see also In re Indep. Serv. Org. Antitrust Litig., 203 F.3d 1322 (Fed. Cir. 2000) (intuiting the Tenth Circuit's approach, the Federal Circuit refused to impose antitrust liability for unilateral refusal to sell or license a patent).
459. Intergraph Corp. v. Intel Corp.,195 F.23d 1346 (Fed. Cir. 1999) (vacating preliminary-injunction remedy of mandatory disclosure of trade secrets and other provision of intellectual property).
460. U.S. Philips, 424F.3d at 1193.
461. 441 U.S. 1 (1979) (discussing the efficiencies of ASCAP and BMI public-performance copyright licensing and ruling the licensing scheme was not a per se violation of antitrust law).
462. 320 F.3d 1317 (Fed. Cir. 2003).
463. See NGUYEN ET AL., supra note 10, at 38-39.
464. Atari Games Corp. v. Nintendo of Am., Inc., 975 F.2d 832, 843 (Fed. Cir. 1992).
465. Id. at 1325-26.
466. See Janicke & Ren, supra note 14, at 38 ("The Federal Circuit has often been accused of having a pro-patent leaning.").
467. Dreyfuss, supra note 4, at 770;
468. see also Janicke & Ren, supra note 14, at 38 ("There is nothing in our findings that would support [a pro-patent leaning] view.").
469. See, e.g., Patterson, supra note 112.
470. See Mark A. Lemley, Terms of Use, 91 MINN. L. REV. 459,459-60, (2006) ("Every court to consider the issue has found 'clickwrap' licenses... enforceable. A majority of courts in the past ten years have enforced shrinkwrap licenses ... Finally, and more recently, an increasing number of courts have enforced 'browsewrap' licenses ....").
471. Compare, e.g., Hewlett Packard Co. v. Repeat-O-Type Stencil Mfg. Corp., 123 F.3d 1445 (Fed. Cir. 1997) with Specht v. Netscape Commc'ns Corp., 306 F.3d 17 (2d Cir. 2002) (closely examining contract formation in both cases).
472. See also Storage Tech. Corp. v. Custom Hardware Eng'g & Consulting, Inc., 421 F.3d 1307 (Fed. Cir. 2005) (ruling for the licensee over Judge Radar's dissent, and carefully construing a license for software repair and maintenance while tackling several challenging license-interpretation issues, including the intersection between the license and 17 U.S.C. §§ 117(c) (2000)).
473. Cf. Florencia Marotta-Wurgler, Are "Pay Now, Terms Later" Contracts Worse For Buyers? Evidence From Software License Agreements, LAW & ECON. RESEARCH WORKING PAPER SERIES No. 05-10 (N.Y.U. Sch. of Law, New York, N.Y.), Sept. 7, 2005, permanent copy available at http://www.law.washington.edu/ wlr/notes/84washlrevl99n290.pdf (finding that, contrary to conventional wisdom, the substantive terms of "pay now, terms later" licenses are actually better in most cases than terms where assent is manifest in advance of payment).
474. Xuan-Thao Nguyen, Justice Scalia's "Renegade Jurisdiction ": Lessons for Patent Law Reform, 83 TUL. L. REV. 111 (2008) (challenging conventional wisdom that the U.S. District for the Eastern District of Texas should be considered a notorious haven for patent litigation).
475. See Robert W. Gomulkiewicz, The License Is the Product, supra note 33. 292. For a recent example, see Jacobsen v. Katzer, 535 F.3d 1373 (Fed. Cir. 2008), which involves a dispute over interpretation of the Artistic License used with open source software used by model railroad enthusiasts.
476. See, e.g., John A. Rothchild, the Incredible Shrinking First-Sale Rule: Are Software Resale Limits Lawful?, 57 RUTGERS L. REV. 1 (2004).
477. See, e.g., Dennis J. Karjala, Federal Preemption of Shrinkwrap and On-Line Licenses, 22 U. DAYTON. L. REV. 511 (1997)
478. Maureen A. O'Rourke, Drawing the Boundary Between Copyright and Contract: Copyright Preemption of Software License Terms, 45 DUKE L.J. 479 (1995).
479. See, e.g., Video Pipeline, Inc. v. Buena Vista Home Entm't, Inc., 342 F.3d 191 (3d Cir. 2003);
480. Practice Mgmt. Info. Corp. v. Am. Med. Ass'n, 121 F.3d 516 (9th Cir. 1997);
481. Va. Panel Corp. v. MAC Panel Corp., 133 F.3d 860 (Fed. Cir. 1997) (discussing threat to void warranty not patent misuse).
482. See, e.g., U.S. Philips Corp. v. Int'l Trade Comm'n, 424 F.3d 1179 (Fed. Cir. 2005).
483. See, e.g., Wall Data, Inc. v. L.A. County Sheriffs Dept., 447 F.3d 769 (9th Cir. 2006);
484. Blizzard Entm't, Inc. v. Jung, 422 F.3d 630 (8th Cir. 2005);
485. Video Pipeline, Inc. v. Buena Vista Home Entm't, Inc., 342 F.3d 191 (3d Cir. 2003). In the Federal Circuit
486. see Bowers v. Baystate Technologies, Inc., 320 F.3d 1317 (Fed. Cir. 2003) and DSC Communication Corp. v. Pulse Communication, Inc., 170 F.3d 1354 (Fed.
487. In addition to the Specht, Arizona Cartridge, Blizzard Entertainment, National Car Rental, and ProCD cases discussed supra Part V.C, there are several other pertinent cases.
488. See, e.g., Micro Star v. Formgen Inc., 154 F.3d 1107 (9th Cir. 1998)
489. Adobe Sys., Inc. v. Stargate Software, Inc., 216 F. Supp. 2d 1051 (N.D. Cal. 2002);
490. i.LAN Sys., Inc. v. Netscout Serv. Level Corp., 183 F. Supp. 2d 328 (D. Mass.2002).
491. Storm Impact, Inc. v. Software of the Month Club, 13 F. Supp. 2d 782 (N.D. ILL. 1998);
492. Ariz. Retail Sys., Inc. v. Software Link, Inc., 831 F. Supp. 759 (D. Ariz. 1993);
493. I-A Equip. Co. v. I-Code, Inc., 43 U.C.C. Rep. Serv. 2d 807 (Mass. Dist. Ct. 2000);
494. M.A. Mortenson Co. v. Timberline Software Corp., 140 Wash. 2d 568, 998 P.2d 305 (2000).
495. While upholding modern licensing practices as a general rule, courts have not enforced all licenses or license terms, particularly where the licensor did not provide a meaningful opportunity to review the terms or there was no meaningful manifestation of assent, or where a term was unconscionable or violated antitrust law or constituted a misuse of intellectual property. The Specht and Arizona Retail cases, for example, approved of some license transactions but found others to be unenforceable because of shoddy contracting practices.
496. The courts in Lasercomb America, Inc. v. Reynolds,911 F.2d 970 (4th Cir. 1990).
497. Acatel USA, Inc. v. DGI Technologies, Inc., 166 F.3d 772 (5th Cir. 1999), and Assessment Technologies of Wisconsin, L.L.C. v. WIREdata, Inc., 350 F.3d 640 (7th Cir. 2003) refused to enforce the copyright because certain provisions in software licenses amounted to a "misuse" of the copyright.
498. In United States v. Microsoft Corp., 253 F.3d 34 (D.C. Cir. 2001), the court held that provisions in Microsoft's OEM licenses were used to illegally maintain its Windows software monopoly. Several courts have refused to enforce mandatory arbitration, choice-of-law or venue provisions in consumer licenses, finding them unconscionable.
499. See, e.g., Bragg v. Linden Research, Inc., 487 F. Supp. 2d 593 (E.D. Pa. 2007) (finding mandatory arbitration provision unconscionable);
500. Brower v. Gateway 2000, Inc., 676 N.Y.S.2d 569 (1998);
501. Comb v. Paypal, Inc., 218 F. Supp. 2d 1165 (N.D. Cal. 2002).
502. In Bowers, the court considered whether a contractual limitation on reverse engineering should be enforceable. This pits the notions of freedom and certainty of contract against the notion of a copyright being a limited exclusive right.
503. See David A. Rice, Copyright and Contract: Preemption After Bowers v.Baystate, 9 ROGER WILLIAMS L. REV. 595 (2004) (criticizing the Bowers v. Baystate decision).
504. See, e.g., Video Pipeline, Inc. v. Buena Vista Home Entm't, Inc., 342 F.3d 191 (3d Cir. 2003).
505. Blizzard Entm't, Inc. v. Jung, 422 F.3d 630 (8th Cir. 2005).
506. Cf. Eisenberg, supra note 7, at 29 ("Unfortunately, the Supreme Court's own patent jurisprudence is mostly quite old, limiting its value as a guide to the most pressing unresolved issues of today.").
507. See, e.g., Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 586 (1991);
508. Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972);
509. ee generally 1 E.A. FARNSWORTH, FARNSWORTH ON CONTRACTS 4.26-4.27 (1990).
510. Nw. Nat'l Ins. Co. v. Donovan, 916 F.2d 372, 377 (7th Cir. 1990)("Ours is not a bazaar economy in which the terms of every transaction, or even of most transactions, are individually dickered; even when they are, standard clauses are commonly incorporated into the final contract, without separate negotiation of each of them.").
511. See, e.g., TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23 (2001) (attempted use of trade dress after patent had expired);
512. Dastar Corp. v. Twentieth Cent. Fox Film Corp., 539 U.S. 23 (2003) (attempted use of Lanham Act to extend copyright protection).
513. See Aronson v. Quick Point Pencil Co., 440 U.S. 257, 266 (1979).
514. But see Lear, Inc. v. Adkins, 395 U.S. 653,674 (1969) (declining to enforce licensee estoppel term).
515. See Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 486 (1974) ("Another problem that would arise if state trade secret protection were precluded is in this area of licensing others to exploit secret processes. The holder of the trade secret would not likely share his secret with a manufacturer who cannot be placed under binding legal obligation to pay a license fee or to protect the secret. The result would be to hoard rather than to disseminate knowledge.").
516. 545 U.S. 913 (2005). Many believed that the Supreme Court would use the Grokster case to update its jurisprudence on secondary liability for copyright infringement. The Court, however, declined to do so and instead based its ruling on the evidence before it, which showed pervasive inducement to infringe.
517. 545 U.S. at 934-40. This, in effect, allowed a variety of file-sharing business models to survive so long as the proprietors did not promote themselves in the manner that the defendants had in Grokster.
518. See, e.g., III. Tool Works, Inc. v. Indep. Ink, Inc., 547 U.S. 28, 31 (2006) (ruling that one cannot presume a patent confers market power, leaving in place a business practice whereby OEMs are required to buy both unpatented and patented ink cartridges)
519. Verizon Commc'ns, Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398, 410 (2004) (refusing to find that an alleged violation of 1996 Telecommunications Act states a claim for a "refusal to deal" under the Sherman Act).
520. 123 F.3d 1445 (Fed. Cir. 1997).
521. For one critique, see Kaiser, supra note 11.