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Patents No Longer Carry a Presumption Of Market Power in Tying Cases
The United States Supreme Court's recent decision in Illinois Tools Works v. Independent Ink, 126 S. Ct. 1281 (2006), reversed almost 50 years of precedent holding that the owner of a patent was presumed to have market power in patent-related tying cases brought under the Sherman Act. The Court noted that Congressional amendments to the patent code explicitly finding that tying was not a per se patent misuse, coupled by the widely accepted view in academia that patents did not inherently lead to market power, had so eroded the legal doctrine supporting the presumption of market power in patent-related tying cases, that a new rule was appropriate. The Court held that in all future tying cases, the plaintiff must allege and prove that the defendant has actual market power in the tying product ' the mere existence of a patent is no longer sufficient.
The District Court Decision
The dispute centered on an arrangement included in license agreements between Trident and its customers, original equipment manufactures (OEMs). The OEMs used Trident's printhead system to manufacture printers that printed bar codes on cartons and paper. In the license agreement, Trident agreed to provide its patented printhead system and unpatented ink cartridges, in exchange for the OEMs agreeing to purchase their ink exclusively from Trident. The agreement also prohibited the OEM or any later distributor from refilling the patented printhead with a competitor's ink. The license agreement thus created a tying agreement basing the sale of a patented product (in this case, the patented printerhead) on the purchase of unpatented product (here, the ink).
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Major Differences In UK, U.S. Copyright Laws
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