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Patent Misuse

Intellectual Property

Patent misuse is a term that specifies a specific action by the patent owner that is considered a misuse of the patent. An allegation of patent misuse cannot be brought against a patent holder unless one is the defendant in a lawsuit of infringement brought by the patent holder who is supposedly guilty of patent misuse. Patent misuse is thus a prohibited action by the patent owner. In the USA the term refers to a type of affirmative defence where one may defend an infringement on the grounds of the patent owner being guilty of misusing the exclusive rights granted when the patent was registered. The defender in an infringement case can rely on the patent misuse defence only if the party can show that the patent holder expanded the physical scope of the patent beyond that which is permitted. The patentee cannot enforce the patent if the patentee is guilty of prohibited action which is called patent misuse. This doesn’t mean that the patent cannot be enforced in other instances, only that the patentee will not be able to recover royalties or damages from the defendant.

Instances of patent misuses can be where the patentee forces the licensee to also purchase other goods in order for the licensee to have license rights to the patent or where the patentee extends the patent term and thus extends the time period for which royalties will be payable. Patent misuse can occur when the patentee is guilty of a prohibited action such as an action that is in contrast with that allowed by anti-trust laws. It can also occur when the patentee extends the rights far beyond what the patent is granted for.

Posted on 8 February 2011
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