Quanta Brief - Christine Roetzel
Quanta Computer, Inc. v. LG Electronics Inc.
The Question at Hand is: Whether the Federal Circuit erred by holding, conflicting decisions of the Court and other courts of appeals, that the respondent’s patent rights were not given due to license agreement with Intel Corporation and Intel’s subsequent sale of the product under the license to petitioners. This brief was written on behalf of Motorola Inc, a public corporation incorporated in Delaware. Motorola supports petitioners’ position with respect to the question presented. The reason Motorola is interested in this particular case is because Motorola owns thousands of U.S. patents and has entered into many different types of agreements relating to its patent portfolio, or parts of the portfolio, including license agreements with other companies. Motorola has rights to hundreds of third-party patents pursuant to various agreements including license agreements. Motorola often purchases from licensed suppliers components for assembly into Motorola products. Accusations are sometimes made against Motorola that the use of such components with a telecommunication network infringes patent rights of others. This is why Motorola wants clarification of the patent exhaustion doctrine specified in this case. Argument: The court should not decide what patent exhaustion effect, it any, the Release LGEe granted to Intel as part of the license agreement has on products sold by Intel before the release.…LGE’s attempt to contract around the patent exhaustion doctrine with a license to Intel purportedly limiting the use rights conveyed to Intel’s customers is an bad attempt to use the patent laws to extract a second payment from the vertical distribution chain. LGE-Intel agreement at issue in this case granted a prospective license and a retroactive release to Intel. The existence of the release is consistent with LGE’s assertion of infringement against Intel prior to the LGE-Intel agreement. It is reasonable to assume Intel sold microprocessors and chipsets prior to the date it entered into the licensing arrangement with LGE.
For the reasons above, Motorola believes the Court should reverse the judgment of the Court of Appeals for the Federal Circuit and the Court should limit its holding to products sold pursuant to a license agreement.