Bottom line: Claim sets that include independent claims directed to different types of entities (e.g., manufacturer v. end user, receiver v. transmitter, method v. apparatus) may enable the patent owner to license its patents to one entity without implicating patent exhaustion for a different entity. In Helferich v. NY Times (Fed. Cir. 2015), the patent owner licensed a set of “handset claims” contained in its patents to mobile phone manufacturers. When content providers (e.g., NY Times) sent messages to the mobile phones, the patent owner alleged that the content providers infringed the “content claims” contained in its patents. The content providers argued that the patent owner had exhausted its patent rights with respect to the “content claims” when it had licensed the “handset claims” to the mobile phone manufacturers. The court reviewed the family of patents and found that the Patent Office treated the content claims and the handset claims as being directed to different inventions, and thus, did not hold that the licensing of one set of claims implicated patent exhaustion for the other set of claims.
Under the doctrine of patent exhaustion, once there has been an authorized sale of a patented item, that sale “ ‘ confers on the purchaser, or any subsequent owner, ‘the right to use [or] sell’ the thing as he sees fit.” The Helferich opinion answers the question of how far patent exhaustion should reach in order to limit the power of a patent to exclude another from practicing the invention. For example, if one or more patents within a family are directed to a (1) product, (2) a consumable used in conjunction with the product and (3) a combination of the product and the consumable, would the purchase of the product exhaust the patent owner’s ability to stop sellers of the consumable? (e.g., Keurig v. Strum (Fed. Cir. 2013). Did the purchase of the product by the user exhaust the patent owner’s rights with respect to the combination? Can others sell the consumable to buyers of the product? These are some of the issues that patent exhaustion deals with. The inventor or lay person may view each of these components as being a part of the same inventive system. However, the law does not view the invention in those terms but views them under a slightly stricter standard set forth by the Patent Office. This strict standard may render a method of manufacturing a product a different invention from the product itself.
In Helferich, the patent owner (Helferich) owned multiple patents with independent claims directed to mobile phones (i.e., handset claims) and methods for delivering content (i.e., content claims) to the mobile phones. These were pioneering patents and all mobile phone manufacturers licensed the handset claims from the patent owner. Content providers (e.g., The New York Times) would send content to mobile phone users. The patent owner alleged that these content providers were infringing the content claims of its patents. The defendant argued that Helferich’s patent rights with respect to the content claims were exhausted when Helferich licensed the handset claims to all mobile phones.
In short, the premise of defendant’s exhaustion defense is that since all handsets in the United States were licensed and the asserted claims contemplated a use of the handset by handset owners/possessors, there should be an across the board exhaustion of its patents related to the handset claims, without differentiation with the content claims.
The Court concluded that the exhaustion defense, as framed by defendants here, did not bar Helferich’s claims. The main reason was that the various patents were presumed to be directed to different inventions based on how the Patent Office treated the handset and content claims. As discussed above, although the mobile handset claims and the content claims are all part of the same inventive system, then law may treat them as being different inventions. To show that these are different inventions, the court looked to the prosecution history of the patents at issue. The court noted that the examiner did not make a double patenting rejection between the handset claims and the content claims. The double patenting rejection only occurs when the examiner believes that two claims are claiming the same invention. Since there was no double patenting rejection, the court concluded that the Patent Office treated the handset and content claims as different inventions and so would the court.
Moreover, the court noted that the examiner had rendered a restriction requirement between the handset claims and the content claims which further confirms that these are different inventions. Restriction Requirements are rendered when the examiner believes that the claims are directed to two or more inventions. As such, the exhaustion of the handset claims which occurred when the patent owner licensed these handset claims to the mobile phone manufacturers did not exhaust the patent owner’s rights to the content claims which were asserted against content providers.
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