In 2015, the Supreme Court issued its decision in Kimble v. Marvel Entertainment, LLC, 576 U.S. 446 (2015), which upheld a prior decision of the court and provided clarity on a question that frequently arises in patent licenses: whether, and to what extent, is it proper to collect royalties for a license term that extends beyond the expiration date of a licensed patent? For in-house counsel and others regularly involved in licensing transactions, the decision is worth revisiting, as it provides helpful, practical guidance in the complex area of patent licensing.

Background: ‘Brulotte’

In 1964, the Supreme Court in Brulotte v. Thys Co., 379 U.S. 29 (1964), took up the question of whether a patent holder could charge royalties for the use of an invention after the term of the patent in question had expired. The case involved Thys Company, an owner of patents for hop-picking, which sold a machine to farmers for a flat fee and provided a license for use of the machine.