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Speaker 1: Well, now it's time for our daily Bloomberg Law Brief,

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Speaker 1: exploring legal issues in the news. It's brought to you

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Speaker 1: by American Arbitration Association. Business disputes are inevitable, Resolve Faster

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Speaker 1: with the American Arbitration Association, the global leader and alternative

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Speaker 1: dispute resolution for over ninety years. More at a dr

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Speaker 1: dot org. Today Bloomberg Lahos Jing Grosso and Greg Sture

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Speaker 1: discussed Tuesday's ruling in a Supreme Court case involving patents

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Speaker 1: for printer cartridges. They speak with the Robin Felman, director

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Speaker 1: of the Institute for Innovation Law Do you see Hastings

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Speaker 1: and Gregory Dolan, co director of the Center for Medicine

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Speaker 1: and Law at the University of Baltimore. Greg, before we

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Speaker 1: get into all the important legal questions in this case,

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Speaker 1: can you just explain to us who was involved in

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Speaker 1: the case and what the dispute between the two companies was.

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Speaker 1: Sure the case of two companies both involved in making

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Speaker 1: printer cartridges. The plaintiff lex Mark. They make printer cartridges

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Speaker 1: that many people using their printers to um print documents

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Speaker 1: and um as many people know. These cartridges have ink

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Speaker 1: or other materials that mean, eventually cards just run out,

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Speaker 1: and they can be you can either replace the whole

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Speaker 1: cartridge or you can refill the old one and um,

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Speaker 1: you know, reuse it. And the issue at this case

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Speaker 1: was whether or not these corsages could be refilled. Lexmark

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Speaker 1: had two ways of selling their initial cartridges. They either

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Speaker 1: sold it to their customers at full price, thus and

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Speaker 1: then customers could do them what they wanted. They could

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Speaker 1: throw them out, they could readfill whatever, or they sold

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Speaker 1: them at a significant discount about discounts on a condition

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Speaker 1: that they will not be refilled, and then instead the

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Speaker 1: cartridges spent cart would be sent back to Lexmark Impression products.

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Speaker 1: They defended in this case until these old cartridges, both

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Speaker 1: the ones that were sold in the United States and

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Speaker 1: the ones who were sold abroad, whether or not they

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Speaker 1: were under the first or second program, and refilled them

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Speaker 1: and then sold them obviously for cheaper than the original manufacturer.

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Speaker 1: And that was a dispute whether or not doing so

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Speaker 1: violates lex Marks pat and Robin. How did the Supreme

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Speaker 1: Court come to its decision today is a big win

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Speaker 1: for free enterprise, which is reflected in the language throughout

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Speaker 1: the Supreme Court. Under patent exhaustion. When a product is sold,

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Speaker 1: the patent right ends. In other words, if I buy

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Speaker 1: a hammer, I should be able to hit any nail

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Speaker 1: I want, or resell it to anyone I want. Anything

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Speaker 1: else creates bottlenecks in the flow of commerce, and it

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Speaker 1: comes up the system. The Supreme Court decision spoke in

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Speaker 1: terms of an auto repair shop in a way that

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Speaker 1: should make sense to all consumers. If a car owner

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Speaker 1: drives into the shop, the repair should be able to

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Speaker 1: fix the car and not have to worry about invisible

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Speaker 1: restrictions that might exist on each tiny component of the car.

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Speaker 1: The Supreme Court said patent system doesn't work that way.

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Speaker 1: When you sell an item, that's the end of the

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Speaker 1: patent rights. As Robin Fellman, director of the Institute for

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Speaker 1: Innovation Law, Do You See Hastings, and Gregory Dolan, co

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Speaker 1: director at the Center for Medicine and Law at the

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Speaker 1: University of Baltimore, speaking with Bloomberg Law host doom Grasso

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Speaker 1: and Greg Sture. You can listen to Bloomberg Law weekdays

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Speaker 1: at one pm Wall Street Time here on Bloomberg Radio Now.

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Speaker 1: Among the top legal stories from Bloomberg Law, Deutsche Bank

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Speaker 1: will pay forty one million dollars to settle a Federal

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Speaker 1: Reserve money laundering investigation. The FED claimed the bank's US

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Speaker 1: operations fail to maintain adequate protections against money laundering. Regulators

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Speaker 1: say the case involved billions of dollars and potentially suspicious transactions.

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Speaker 1: And that's this morning's Bloomberg Law Brief. You can find

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Speaker 1: more legal news at Bloomberg law dot com and Bloomberg

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Speaker 1: BNA dot com. Attorneys will find exceptional legal research and

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Speaker 1: business development tools there as well. Visit Bloomberg law dot

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Speaker 1: com and Bloomberg BNA dot com for more information