Csu, L.L.C. v. Xerox Corp. In Re Independent Service Organizations Antitrust Litigation

203 F.3d 1322 (Fed. Cir. 2000)

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Nature of the Case

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Facts

D manufactures, sells, and services high-volume copiers. D established a policy of not selling parts unique to its series 10 copiers to independent service organizations (ISOs), including P unless they were also end-users of the copiers. In 1987, the policy was expanded to include all new products as well as existing series 9 copiers. D cut off P's direct purchase of restricted parts. D also implemented an 'on-site end-user verification' procedure to confirm that the parts ordered by certain ISOs or their customers were actually for their end-user use. P used parts cannibalized from used Xerox equipment, parts obtained from other ISOs, and parts purchased through a limited number of its customers. P also obtained parts from Rank Xerox, a majority-owned European affiliate of Xerox, until Xerox forced Rank Xerox to stop selling parts to P and other ISOs. D settled an antitrust lawsuit with a class of ISOs by which it agreed to suspend its restrictive parts policy for six and one-half years and to license its diagnostic software for four and one-half years. P opted out of that settlement and filed this suit alleging that D violated the Sherman Act by setting the prices on its patented parts much higher for ISOs than for end-users to force ISOs to raise their prices. This would eliminate ISOs in general and P in particular as competitors in the relevant service markets for high-speed copiers and printers. D counterclaimed for patent and copyright infringement. D also claimed that P could not assert a patent or copyright misuse defense. The court granted D’s motion for summary judgment. It held that if a patent or copyright is lawfully acquired, the patent or copyright holder's unilateral refusal to sell or license its patented invention or copyrighted expression is not unlawful exclusionary conduct under the antitrust laws, even if the refusal to deal impacts competition in more than one market. The court held that the right holder's intent in refusing to deal and any other alleged exclusionary acts committed by the right holder are irrelevant to antitrust law. P appealed.