U.S. Philips Corp. v. International Trade Commission
United States Court of Appeals for the Federal Circuit
424 F.3d 1179 (2005)
Philips (plaintiff) licensed its compact-disc patents only in bundled packages charging a uniform per-disc royalty regardless of how many patents in the package a manufacturer actually used, without offering individual patent licenses; several manufacturers (defendants) stopped paying and, when Philips brought an infringement complaint before the International Trade Commission, argued the packages misused the patents by bundling in patents inessential to disc manufacturing. The administrative law judge and the ITC found the packaging an illegal tying arrangement constituting per se patent misuse, or alternatively invalid under a rule-of-reason analysis; Philips appealed.
Whether a patent package or pool that includes both essential and nonessential patents for practicing a particular technology is per se patent misuse.