Illinois Tool Works, Inc. v. Independent Ink, Inc.

547 U.S. 28 (2006)

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Nature of the Case

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Facts

D manufactures and market printing systems that include three relevant components: (1) a patented piezoelectric impulse ink jet printhead; (2) a patented ink container, consisting of a bottle and valved cap, which attaches to the printhead; and (3) specially designed, but unpatented, ink. D sells to original equipment manufacturers (OEMs) who are licensed to incorporate the printheads and containers into printers that are in turn sold to companies for use in printing barcodes on cartons and packaging materials. P has developed an ink with the same chemical composition as the ink sold by Ds. After an infringement action brought by D against P was dismissed for lack of personal jurisdiction, P filed suit seeking a judgment of noninfringement and invalidity of the patents. In an amended complaint, it alleged that Ds are engaged in illegal tying and monopolization in violation of §§ 1 and 2 of the Sherman Act. The District Court granted D's motion for summary judgment on the Sherman Act claims. The court reasoned that D does not necessarily have market power in the market for the tying product as a matter of law solely by virtue of the patent on their printhead system, thereby rendering [the] tying arrangements per se violations of the antitrust laws. Since P had submitted no affirmative evidence defining the relevant market or establishing D's power within it, the court concluded that P could not prevail on either antitrust claim. The Court of Appeals reversed. The Appeals Court invoked the presumption of market power, applicable in the antitrust context when a seller conditions its sale of a patented product (the 'tying' product) on the purchase of a second product (the 'tied' product), under the judicially created patent misuse doctrine. The court ignored the fact that in 1988, Congress substantially undermined that foundation, amending the Patent Act to eliminate the market power presumption in patent misuse cases. The Supreme Court granted certiorari.