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The doctrine of patent misuse is thus grounded in the policy-based desire to prevent a patentee from using the patent to obtain market benefit beyond that which inheres in the statutory patent right. It follows that the key inquiry under the patent misuse doctrine is whether, by imposing the condition in question, the patentee has impermissibly broadened the physical or temporal scope of the patent grant and has done so in a manner that has anticompetitive effects. Where the patentee has not leveraged its patent beyond the scope of rights granted by the Patent Act, misuse has not been found.
The patentee licensed the discs and tied the license with an agreement that a competitor would not license a potentially competing technology. The patentee asserted claims for infringement. An administrative law judge first denied relief finding the patents were unenforceable for patent misuse because of the tying arrangement and on additional grounds. The Commission affirmed, but a panel of the Court of Appeals for the Federal Circuit reversed, including the ruling that of patent misuse, under the rule of reason. On remand, the Commission found no misuse. On the second appeal, a divided panel ruled against the Commission and the patentee, vacated the Commission's remedial orders and remanded the case.
Did the decision of the Commission holding that the doctrine of patent misuse bar the patentee from enforcing its patent rights against the licensees?
In the third appeal, the majority of the divided en banc court the court found that it was not the power of the patentee's rights in its patents that was being misused. Although the tying agreement might be vulnerable to challenge under the antitrust laws, it could not reasonably be characterized as misuse of the patents. The licensee did not show a reasonable probability that the suppressed technology, if available for licensing, would have matured into a competitive product.