Page:Impression Products, Inc. v. Lexmark Int’l, Inc. Decision.pdf/21

16 the patentee receives one reward—of whatever amount the patentee deems to be “satisfactory compensation,” Keeler, 157 U. S., at 661—for every item that passes outside the scope of the patent monopoly.

This Court has addressed international patent exhaustion in only one case, Boesch v. Gräff, decided over 125 years ago. All that case illustrates is that a sale abroad does not exhaust a patentee’s rights when the patentee had nothing to do with the transaction. Boesch—from the days before the widespread adoption of electrical lighting—involved a retailer who purchased lamp burners from a manufacturer in Germany, with plans to sell them in the United States. The manufacturer had authority to make the burners under German law, but there was a hitch: Two individuals with no ties to the German manufacturer held the American patent to that invention. These patentees sued the retailer for infringement when the retailer imported the lamp burners into the United States, and we rejected the argument that the German manufacturer’s sale had exhausted the American patentees’ rights. The German manufacturer had no permission to sell in the United States from the American patentees, and the American patentees had not exhausted their patent rights in the products because they had not sold them to anyone, so “purchasers from [the German manufacturer] could not be thereby authorized to sell the articles in the United States.” 133 U. S. 697, 703 (1890).

Our decision did not, as Lexmark contends, exempt all foreign sales from patent exhaustion. See Brief for Respondent 44–45. Rather, it reaffirmed the basic premise that only the patentee can decide whether to make a sale that exhausts its patent rights in an item. The American patentees did not do so with respect to the German products, so the German sales did not exhaust their rights.

Finally, the United States, as an amicus, advocates what it views as a middle-ground position: that “a foreign