When you buy a digital camera, can holders of video patents claim ownership of your videos? They certainly claim to. When looking into this, I found an interesting 2008 opinion from the US Supreme Court that suggests, to me (IANAPL), that "exhaustion" through "first sale" might save our bacon: Quanta v. LGE.
Here’s the article that raised the problem of cameras coming with "for non-commercial use only" patent licences:
- Why Our Civilization’s Video Art and Culture is Threatened by the MPEG-LA, by Eugenia Loli-Queru
- The 140+ comments
And here’s the 2008 court opinion I’m reading:
Patent exhaustion is a well-known principle. It says that the patent holder’s rights/powers are exhausted after the first sale of the patented item.
CAVEAT: One problem I see is, if A sells an item with a limited patent licence to B, and B sells the item to C, my interpretation is that C is completely free of patent problems. But if that’s true, it leads to the absurd situation where C could sell the item back to B in an unrestricted way, so B would then escape the restrictions. Thus, anyone who received a limited patent licence could escape the restrictions by selling it to a friend and buying it back. Maybe this problem is sufficiently avoided by the requirement that:
components that essentially, even if not completely, embody an invention (PDF page 11, after half-way)
First, LGE claimed that exhaustion doesn’t apply to methods. The court replied that, yes, it applies to methods, and processes.
this Court has repeatedly held that method patents were exhausted by the sale of an item that embodied the method
We therefore reject LGE’s argument that method claims, as a category, are never exhaustible. (PDF page 14, top paragraph)
The court also cites and affirms a 1873 case, Adams v. Burke, which says:
[W]here a person ha[s] purchased a patented machine of the patentee or his assignee,” the Court held, “this purchase carrie[s] with it the right to the use of that machine so long as it [is] capable of use.
And the court also says:
once lawfully made and sold, there is no restriction on [its] use to be implied for the [patentee’s] benefit
The court says this case is comparable to Univis, where special glass was sold to makers of spectacles. In that case, the patented glass was:
without utility until [they were] ground and polished as the finished lens of the patent.” Ibid. Accordingly, “the only object of the sale [was] to enable the [finishing retailer] to grind and polish it for use as a lens by the prospective wearer.
So, since the point of selling someone a camera is to enable them to make videos, wouldn’t this mean that MPEG-LA’s patent rights are exhausted once the camera gets sold?
(I’ll come back to finish this article soon. Comments very welcome.)