Quanta Computer, Inc. v. LG Electronics, Inc.

LG (plaintiff) licensed its computer patents to Intel, authorizing Intel to sell components but expressly stating the license did not extend to third parties combining Intel's components with other parts; Quanta and other manufacturers (defendants) bought Intel's components, which had no reasonable use other than practicing LG's patented methods, and combined them with non-Intel parts following LG's patented specifications. The district court and court of appeals held patent exhaustion applied to LG's apparatus claims but not its method claims.