Rather that assessing whether the implied licence had been terminated as On appeal, the Full Federal Court found entirely in favour of
The implied licence was terminated such that Calidad was infringing Seiko’s Phonograph Company of Australia Ltd v Menck (1911) 12 CLR 15 AC 336.īurley J held that by repurposing and modifying some of the Epson Cartridges, Licence’ doctrine referring to the decision of the Privy Council in National Journey to the High CourtĪt trial, Burley J of the Federal Court applied the ‘implied To import and sell the repurposed Epson Cartridges arising from the original CalidadĬounterclaimed alleging, amongst other things, that it had an implied licence Seiko claimed that Calidad infringed its patents by importingĪnd selling the repurposed Epson Cartridges in Australia. The repurposed ink cartridges from Ninestar and imported and sold the Image (Malaysia) legally sourced used Epson Cartridges from recyclers andĬonsumers and then modified the cartridges to enable re-use. Seiko manufactures and sells ‘Epson’ branded single-use inkĬartridges the subject of two Seiko patents ( Epson Cartridges). the doctrine of implied licence which provides that, subject to any express conditions imposed at the time of sale, the purchaser has an implied licence to use the particular product without infringing the patent.
the doctrine of exhaustion of rights for patents which provides that the patentee’s rights in the particular product are extinguished upon first sale.In an attempt to overcome this tension, two competing doctrines have emerged: The High Court’s decision brings Australia more in line with the long-standing jurisprudence in the USA and Europe.Īn inherent tension exists in patent law between the exclusive right of a patentee to exploit their patented product and the rights of a purchaser (or product owner) to use and dispose of their purchased products.Patentees will need to rely on express contractual restrictions to control the use of patented products after sale and patenting strategies will need to be adjusted accordingly.It is now the law in Australia that whilst patentees retain the exclusive right to ‘make’ products embodying the claims of a patent, all other exclusive rights are exhausted upon first sale of a patented product unless the patentee expressly imposes conditions on use by way of contract.In Calidad v Seiko Epson HCA 41, a narrow four-to-three majority of the High Court of Australia ( High Court) adopted the doctrine of ‘exhaustion of rights’ for patents, diverging from more than 100 years of application of the ‘implied licence’ doctrine.Royal Commissions, Inquiries & Inquests.
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