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11 May 2009 @ 09:35 pm
Tom Wade
Eng 4180
Syllogism Essay
May 11, 2009

1. All creators of patents are people or corporations that have a right to earn money by selling the inventions those patents produce.
2. Creators of patents will create lawful competition if they license or share their patents with other people or corporations.
3. General Electric Co. is a creator of patents that chose to share its patents through a license with Westinghouse, Inc.

Conclusion: General Electric Co. created lawful competition with Westinghouse, Inc.

Under the exhaustion doctrine the first unrestricted sale of a patented item exhausts the patentee's control over that particular item. By sharing the item and allowing another company to make money from the patent, it does not follow logically that the U.S. Supreme Court would rule that GE had an implied right to control Westinghouse’s sales of a patented item licensed to them for the sole purpose of selling the item.

Request for Appeal

May 11, 2009

Supreme Court of the United States
One First Street N.E.
Washington, DC 20543

Tom Wade, Esq.
300 E. 17th Ave. #1318
Denver, Colorado 80203

Decision of 1926 case United States v. General Electric Co., (271 U.S. at 481). Appeal requested.

It is generally agreed, under the exhaustion doctrine pertaining to intellectual property laws and the rights of patentees, that the sale of an item there by exhausts the patent owners control over that particular singular unit/object/item.
General Electric Co. (GE) developed a license agreement among Westinghouse, Inc., where Westinghouse would manufacture and sell the GE tungsten filament incandescent light bulb. Westinghouse would be allowed to use the patent licensed to them under the condition that GE would have sole control over the pricing of sales to the consumer.
Although the exhaustion doctrine pertains to the sale of an item and not the license of an item it still applies because the license specifically required the sale of the items through Westinghouse as not only a manufacturer but also as a retailer, meaning that the sale of those patented items would then fall under the scope of the exhaustion doctrine.
GE lost its right to control their patent during the course of the license with Westinghouse because the exhaustion doctrine applies.
The U.S. Supreme court decision to uphold GE’s request to control the sale and price of a patent licensed to Westinghouse is based on a fallacious inferred argument and not on existing expressed facts. The U.S. Supreme court ruled that an implied statute exists by the very existence of the license agreement. The inferred statute that the U.S. is upholding is as follows:

“Licensee may make and sell articles under GE’s patent, but not so as to destroy the profit that GE wishes to obtain by making them and selling them pro se.”

It would seem illogical for GE to license a valuable patent to a competitor unless it was going to return a guaranteed profit. Indeed, this is valid reason for why GE would license out such a patent. The GE tungsten filament incandescent light bulb is a consumer necessity.
Imagine that I have a product that everyone wants, and I sell that product to a demanding market. Eventually, I know it won’t be long before competitors develop similar products to which I will then have to compete with. To buy myself time to stay ahead, I am going to offer you an opportunity to sell my product in your store. Wanting the revenue, and having not developed a similar product yet, you agree on the terms that I get to tell you how much to sell the product for in your store. Now, I force you to sell this product at twice the amount I do. You are losing customers, and my consumers are more than happy to leave your store to come get what they need at a better price at mine.
This situation is why such patent-licensing agreements should not be allowed in the U.S. market. It is unfair to other businesses. GE entered into such an agreement with Westinghouse and under the rules of our federal fair-competition act Westinghouse should either have full rights to use exercise the use of that license or GE should retract the agreement.
It is on these grounds 1.) GE, or any other enterprising entity in the U.S., should not enter into an agreement with any other party where the license of a patent includes conditions that allow the licensing party to control pricing during the retail of those patented items, 2.) The ability of one party to abuse its power over another enterprising entity is too great, and 3.) Agreements issuing the licenses of patents between parties must adhere to U.S. codes including but not limited to the first-sale doctrine (exhaustion doctrine), that I request on behalf of my client, Westinghouse, Inc., that the decision be reconsidered and our testimony recorded before the U.S. Supreme Court.

Tom Wade, Esq.

(This is of course a fictitious appeal. I thought that for my purpose the best audience and format would be an appeal to overturn an existing decision, using a syllogism as the backbone of my argument. The case in which I am requesting an appeal for is real however and occurred in 1926. It has since been cited in countless patent-licensing agreement cases. The U.S. Department of Justice has tried numerously to overturn the decision of this case.)