## Facts

- Lexmark manufactured and sold patented printer toner cartridges in the United States and abroad.
- Lexmark sold “Regular Cartridges” at full price without stated post-sale limits.
- Lexmark also sold discounted “Return Program” cartridges subject to a single-use/no-resale contractual restriction requiring customers to return empty cartridges only to Lexmark.
- Lexmark included a microchip in Return Program cartridges intended to prevent reuse; remanufacturers developed ways to bypass the microchip.
- Impression Products acquired used Lexmark cartridges (including Return Program cartridges) from U.S. and foreign markets, refilled them, and resold them in the United States.
- Lexmark sued Impression Products for patent infringement based on (1) reuse/resale of Return Program cartridges first sold in the United States and (2) importation and resale in the United States of cartridges first sold abroad.

## Issues

1. Whether an authorized U.S. sale of a patented item exhausts patent rights even when the patentee purports to impose post-sale use or resale restrictions.
2. Whether an authorized foreign sale of a patented item exhausts U.S. patent rights, barring an infringement claim based on later importation and resale in the United States.

## Decision

- The Supreme Court reversed the Federal Circuit.
- An authorized domestic sale exhausts all U.S. patent rights in the sold item, regardless of contractual post-sale restrictions.
- An authorized foreign sale likewise exhausts U.S. patent rights in the sold item, so later importation and resale in the United States is not patent infringement.
- Post-sale restrictions, if enforceable at all, must be pursued through contract remedies rather than patent infringement suits.

## Legal Principles

- Patent exhaustion is a limit on the scope of the patentee’s statutory right to exclude; upon an authorized sale, the patentee’s patent rights in that particular item are terminated.
- After an authorized sale, patent law cannot be used to control downstream use or alienation of the sold item, even if the patentee attempted to condition the sale.
- An authorized sale outside the United States exhausts U.S. patent rights in the item to the same extent as an authorized domestic sale.
- Contractual restrictions may be enforceable only as contract obligations (typically against parties in privity), not as patent-based restraints on downstream purchasers.

## Conclusion

The Court held that authorized sales—whether domestic or foreign—exhaust U.S. patent rights in the sold item, and patentees cannot use patent infringement litigation to enforce post-sale restrictions on reuse or resale.


Impression Prods., Inc. v. Lexmark Int’l, Inc., 581 U.S. 360 (2017)