Kimble v. Marvel Entertainment, LLC
135 S. Ct. 2401
| SCOTUS | 2015Background
- Stephen Kimble held U.S. Patent No. 5,072,856 for a Spider-Man "web-shooter" toy and settled a 1997 infringement suit with Marvel’s predecessor: Marvel paid a lump sum plus a 3% royalty on future sales with no contractual end date for royalties.
- Neither party knew of Brulotte v. Thys Co. at the time of settlement; Brulotte (379 U.S. 29) holds that royalties for sales after a patent’s expiration are unlawful.
- When Kimble’s patent term neared expiration, Marvel discovered Brulotte and sought a declaratory judgment that it could stop post-expiration royalty payments; the district court granted relief and the Ninth Circuit affirmed.
- Kimble petitioned the Supreme Court asking it to overrule Brulotte and replace the per se rule with a rule-of-reason/antitrust-style inquiry.
- The Supreme Court (Kagan, J.) affirmed the Ninth Circuit, declining to overrule Brulotte based on stare decisis; Justice Alito dissented (joined by Roberts and Thomas).
Issues
| Issue | Plaintiff's Argument (Kimble) | Defendant's Argument (Marvel/Government) | Held |
|---|---|---|---|
| Whether Brulotte should be overruled | Brulotte is economically unsound and should be replaced by case-by-case rule-of-reason analysis | Brulotte is longstanding statutory interpretation with congressional acquiescence; stare decisis weighs heavily against overruling | Court refused to overrule Brulotte; stare decisis controls |
| Whether Brulotte rested on an erroneous economic premise | Post-expiration royalties often promote competition, enable payment deferral, and do not extend the patent monopoly | Even if economics cut the other way, statutory stare decisis and Congress—not the Court—should change patent policy | Court agreed Brulotte’s economic critique exists but held that Brulotte did not rely on antitrust economics and reversal is for Congress |
| Whether Brulotte is unworkable or causes substantial harm to innovation | Brulotte impedes efficient licensing, risk allocation, and may deter commercialization/innovation | Alternatives exist (deferred payments for pre-expiration use, tying to non‑patent rights, joint ventures); no persuasive empirical proof of harm; policy change belongs to Congress | Court found Brulotte workable, alternatives feasible, and insufficient empirical showing to justify overruling |
Key Cases Cited
- Brulotte v. Thys Co., 379 U.S. 29 (held royalties for post-patent sales unlawful per se)
- Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225 (patent expiration vests free public right to make/use invention)
- Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249 (private restrictions that undermine public access after patent/validity defeat are unenforceable)
- Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100 (permitted deferral of payments for pre-expiration use)
- Illinois Tool Works Inc. v. Independent Ink, Inc., 547 U.S. 28 (patent does not automatically confer market power)
- Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (abandoning a per se antitrust rule in favor of rule of reason)