By Tony Mauro, From The National Law Journal

The inventor of a Spider-Man web-shooting device cannot extend his reach for royalties beyond the expiration of his patent, the U.S. Supreme Court ruled on Monday.

The 6-3 ruling in Kimble v. Marvel Enterprises, written by Justice Elena Kagan, was a testament to stare decisis—the concept of adhering to precedent—by invoking and upholding a 1964 patent ruling, Brulotte v. Thys. That ruling, long criticized by economists, stated that a patent holder may not continue to receive royalties after the patent expires.

“What we can decide, we can undecide. But stare decisis teaches that we should exercise that authority sparingly,” Kagan wrote. “Finding many reasons for staying the stare decisis course and no ‘special justification’ for departing from it, we decline Kimble’s invitation to overrule Brulotte.”

Kagan also quoted from a Spider-Man comic to bolster her opinion: “In this world, with great power there must also come—great responsibility.” And in another Spider-Man reference, she said that “Patents endow their holders with certain superpowers.”

 

But dissenting justices, led by Samuel Alito Jr., said that in this case, the adherence to precedent was misguided because the Brulotte precedent was “a clear case of judicial overreach” in the first place.

Joined by Chief Justice John Roberts Jr. and Justice Clarence Thomas, Alito also wrote, “That decision was not based on anything that can plausibly be regarded as an interpretation of the terms of the Patent Act. It was based instead on an economic theory—and one that has been debunked.” The precedent, he wrote, interferes with the ability of parties to negotiate licensing agreements that “reflect the true value of a patent.”

During oral argument in March, Roberts noted that the high court has overruled numerous precedents from the 1960s. “It’s a problem with the ’60s,” he joked.

Stephen Kimble obtained a patent in 1991 for a toy allowing users to shoot foam “string” from a glove—just as Spider-Man would. Kimble met with Marvel and reached an agreement that if Marvel used his concept in a product, he would be compensated. Marvel later told Kimble that it was not interested, but then created a “Web Blaster” toy with similar attributes.

Kimble sued for infringement and breach of contract and won a partial jury verdict. The two sides then agreed that Marvel would buy Kimble’s patent and give him a 3 percent royalty. The parties did not put an ending date on the royalty arrangement.

But then, as Kagan put it, Marvel “stumbled across Brulotte” and sought to cut off royalty payments after 2010. The district court and the U.S. Court of Appeals for the Ninth Circuit sided with Marvel. Monday’s ruling means Marvel will not have to pay further royalties to Kimble.

Roman Melnik of Goldberg, Lowenstein & Weatherwax in Los Angeles argued for Kimble. Marvel was represented by Thomas Saunders of Wilmer Cutler Pickering Hale and Dorr.

Credit: Marvel

For more on this story and to read the Supreme Court’s ruling in Kimble v. Marvel Entertainment go to: http://www.nationallawjournal.com/id=1202730097431/Supreme-Court-Cuts-Off-Royalties-for-SpiderMan-Toy#ixzz3f3FWzhWd