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IP News

BY Matt Berkowitz
October 30, 2007

Supreme Court to Weigh In on Patent Exhaustion Doctrine

On Sept. 25, 2007, the Supreme Court granted certiorari in Quanta Computer, Inc. v. LG Electronics, Inc., No. 06-937, 2007 U.S. LEXIS 9068 (U.S. Sept. 25, 2007).

In 2001, LG Electronics, Inc. ('LGE') asserted five patents relating to personal computers against a number of defendants, all of whom purchased microprocessors and chipsets from Intel or its authorized distributors and installed them in computers. While Intel was authorized to sell these products under an agreement with LGE, it informed the defendants that they were not authorized under that agreement to combine the products with non-Intel products. LGE then brought suit against defendants, asserting that the combination of microprocessors or chipsets with other computer components infringed LGE's patents on those combinations. The trial court granted summary judgment of non-infringement, holding that LGE's rights were exhausted as to the asserted system claims and were contractually barred as to the asserted method claims. LGE appealed.

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