Whether International Sales Under Worldwide Licenses Exhaust U.S. Patents: The Days of the Jazz Photo, Ninestar and Benun Line of Cases May Be Numbered

Reprinted with permission from Bloomberg BNA. Any opinions in this article are not those of Winston & Strawn or its clients. The opinions in this article are the author’s opinions only.

In Quanta, the U.S. Supreme Court reiterated that ‘‘the right to vend is exhausted by a single, unconditional sale, the article sold being thereby carried outside the monopoly of the patent law and rendered free of every restriction which the vendor may attempt to put upon it.’’ And although its decision in Quanta opened the door for exhausting method claims by the unrestricted, authorized sale of components that substantially embodied them, it did not expressly address whether there the patent exhaustion defense was extraterritorial in nature, or hold that an international sale could exhaust an embodied claim.