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    Kimble V Marvel Entertainment

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    pyriad
    This case involved a dispute over royalty payments for a Spider-Man toy. Stephen Kimble obtained a patent for the toy that was set to expire in 2010. He had previously settled a patent infringement suit against Marvel in 2001, with Marvel agreeing to pay royalties without an expiration date. When disagreements arose over payments, Kimble sued. The Supreme Court was tasked with deciding whether to overturn the precedent from Brulotte v. Thys Co. that royalty payments cannot continue after a patent expires. The Court upheld the precedent in a 6-3 decision, finding no sufficient reason to overturn the long-standing rule. The dissent argued that the Brulotte rule improperly interferes with licensing negotiations and lacks

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    © All Rights Reserved
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    Kimble V Marvel Entertainment

    Uploaded by

    pyriad
    164 views1 page
    This case involved a dispute over royalty payments for a Spider-Man toy. Stephen Kimble obtained a patent for the toy that was set to expire in 2010. He had previously settled a patent infringement suit against Marvel in 2001, with Marvel agreeing to pay royalties without an expiration date. When disagreements arose over payments, Kimble sued. The Supreme Court was tasked with deciding whether to overturn the precedent from Brulotte v. Thys Co. that royalty payments cannot continue after a patent expires. The Court upheld the precedent in a 6-3 decision, finding no sufficient reason to overturn the long-standing rule. The dissent argued that the Brulotte rule improperly interferes with licensing negotiations and lacks

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    This case involved a dispute over royalty payments for a Spider-Man toy. Stephen Kimble obtained a patent for the toy that was set to expire in 2010. He had previously settled a patent infringement suit against Marvel in 2001, with Marvel agreeing to pay royalties without an expiration date. When disagreements arose over payments, Kimble sued. The Supreme Court was tasked with deciding whether to overturn the precedent from Brulotte v. Thys Co. that royalty payments cannot continue after a patent expires. The Court upheld the precedent in a 6-3 decision, finding no sufficient reason to overturn the long-standing rule. The dissent argued that the Brulotte rule improperly interferes with licensing negotiations and lacks

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    164 views1 page

    Kimble V Marvel Entertainment

    Uploaded by

    pyriad
    This case involved a dispute over royalty payments for a Spider-Man toy. Stephen Kimble obtained a patent for the toy that was set to expire in 2010. He had previously settled a patent infringement suit against Marvel in 2001, with Marvel agreeing to pay royalties without an expiration date. When disagreements arose over payments, Kimble sued. The Supreme Court was tasked with deciding whether to overturn the precedent from Brulotte v. Thys Co. that royalty payments cannot continue after a patent expires. The Court upheld the precedent in a 6-3 decision, finding no sufficient reason to overturn the long-standing rule. The dissent argued that the Brulotte rule improperly interferes with licensing negotiations and lacks

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Kimble v Marvel Entertainment

    FACTS:

    In 1990, Stephen Kimble obtained a patent for a Spider-Man toy that was set to expire in May 2010.
    Kimble claimed that he discussed the idea with the president of Marvel Enterprises Inc., and that he
    would be compensated for use of his ideas. Although no agreement was reached, Marvel produced a toy
    that was similar to Kimble's design. In 1997, Kimble sued for patent infringement, and the parties settled
    in 2001, with Marvel agreeing to purchase the patent and pay royalties to the petitioner without an
    expiration date. The case was subsequently dismissed. In 2006, Marvel entered a licensing agreement
    with Hasbro Inc. that gave it the right to produce the toy. Disagreements arose between Kimble and
    Marvel concerning the royalty payments, and Kimble claimed that the original patent would be infringed
    if royalties were not paid. Kimble sued Marvel in Arizona state court, and the case was then removed to
    the federal district court.

    The magistrate judge determined that settlement agreement was a "hybrid" agreement, in which patent
    and non-patent rights were inseparable, and that the Supreme Court decision in Brulotte v. Thys
    Co. applied. In that case, the Court ruled that, when patents are sold in return for a royalty payment, the
    purchaser was not obligated to continue these payments beyond the expiration date of the patents
    because doing so would over-compensate the seller of the patent and improperly extend the patent
    monopoly beyond the intended time limit. On recommendation of the magistrate, the district court
    granted summary judgment in favor of Marvel and ruled that the settlement agreement transferred
    patent rights, but that it was unclear if non-patent rights were transferred. Kimble appealed and argued
    that the settlement agreement transferred both patent and non-patent rights and that, while royalty
    payments ended for the patent, they did not end for the toy itself. The U.S. Court of Appeals for the
    Ninth Circuit affirmed the decision of the district court.

    Issue: Should the decision in Brulotte v. Thys Co, which held that a patentee cannot continue to receive
    royalty payments after the patent has expired, be overturned?

    Held: No.

    Justice Elena Kagan delivered the opinion for the 6-3 majority. The Court held that the precedent
    established in Brulotte v. Thys Co.—that a patentee cannot receive royalty payments after the patent
    has expired—should be upheld because there was no sufficient reason to overturn it. Patent law
    jurisprudence has typically struck down statutes that overly limit free access to formerly patented
    inventions, and the Brulotte decision was in line with these cases. Because no subsequent legal
    developments have made the rule announced in that decision obsolete and it has remained workable,
    there is no reason to overturn the decision. The Court also noted that Congress had ample opportunity
    to enact a statute that forecloses the Brulotte rule but has not done so.

    Justice Samuel A. Alito, Jr. wrote a dissent in which he argued that, because the Brulotte rule
    impermissibly interferes in parties’ abilities to negotiate licensing agreements that reflect the true value
    of the product, the decision has no precedential weight and should be overturned. The Brulotte rule
    represents a poor interpretation of the Patent Act and promotes economic inefficiency, so the decision
    lacks the support of legal standing as well as public policy, and therefore the Court should not uphold it.
    Chief Justice John G. Roberts, Jr. and Justice Clarence Thomas joined in the dissent.

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