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Abstract

In Quanta Computer, Inc. v. LG Electronics, Inc., the Supreme Court recalibrated the balance between the rights of a patentee to contractually control the post-sale transfer and the use of patented goods. Specifically, the Court extended the doctrine of patent exhaustion to cover the exhaustion of patents not recited in the license, as well as the practice of technology that does not infringe any patent, but which can only be used in a manner by customers that would infringe a patent. While Quanta arose out of facts concerning computer technology, the implications of this decision will be widespread, permeating diverse fields like biotechnology, including the future of the patent-protected seed industry. Above all, Quanta, the latest of several Supreme Court responses to Federal Circuit judicial activism, should serve as warning to the patent community that it is far better to have the Federal Circuit shape the patent law than to have occasional guidance from the Court.

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