Also known as: offers for sale · offered for sale · offering for sale · offer to sell
Written by attorneys — see sources below.
A proposal by the owner of property to transfer an interest in exchange for consideration from a third party.
Orson Ochoa owns a parcel and grants his neighbor a right of first refusal in a donative transfer. When Orson receives a bona fide offer from a third party at a fair price and gives the neighbor thirty days to match it, the neighbor's right activates because the terms are reasonable. The neighbor exercises the right and acquires the parcel on the same terms.
Onyx Pharmaceuticals holds a patent on a drug compound. It learns that Oasis Resorts has sent letters to potential buyers quoting a price and delivery date for the compound before the patent expires. The letters constitute an offer for sale that infringes the patent even though no actual sale occurs.
eBay Inc. operates a popular Internet Web site that allows private sellers to list goods they wish to sell, either through an auction or at a fixed price. Petitioner Half.com, now a wholly owned subsidiary of eBay, operates a similar Web site. Respondent MercExchange, L.L.C., holds several patents, including a business method patent for an electronic market designed to facilitate the sale of goods between private individuals by establishing a central authority to promote trust among participants. See U.S. Patent No. 5,845,265. MercExchange sought to license its patent to eBay and Half.com, as it had previously done with other companies, but the parties failed to reach an agreement. MercExchange subsequently filed a patent infringement suit against eBay and Half.com in the United States District Court for the Eastern District of Virginia. A jury found that MercExchange's patent was valid, that eBay and Half.com had infringed that patent, and that an award of damages was appropriate. eBay and Half.com continue to challenge the validity of MercExchange's patent in proceedings pending before the United States Patent and Trademark Office. Following the jury verdict, the District Court denied MercExchange's motion for permanent injunctive relief, 275 F. Supp. 2d 695 (2003). The Court of Appeals for the Federal Circuit reversed, applying its general rule that courts will issue permanent injunctions against patent infringement absent exceptional circumstances, 401 F.3d 1323, 1339 (2005). The Supreme Court granted certiorari to determine the appropriateness of this general rule, 546 U.S. 1029 (2005).
View caseOakridge Manufacturing makes and markets a device. After the court construes the patent claims, the marketing materials are found to propose a sale of a device that falls within those claims. The proposal qualifies as an infringing offer for sale regardless of whether any units change hands.
Markman owns United States Reissue Patent No. 33,054 for his Inventory Control and Reporting System for Drycleaning Stores. The patent describes a system that can monitor and report the status, location, and movement of clothing in a dry-cleaning establishment. The Markman system consists of a keyboard and data processor to generate written records for each transaction, including a bar code readable by optical detectors operated by employees, who log the progress of clothing through the dry-cleaning process. Respondent Westview's product also includes a keyboard and processor, and it lists charges for the dry-cleaning services on bar-coded tickets that can be read by portable optical detectors. Markman brought an infringement suit against Westview and Althon Enterprises, an operator of dry-cleaning establishments using Westview’s products. Part of the dispute hinged upon the meaning of the word inventory, a term found in Markman’s independent claim 1, which states that Markman’s product can maintain an inventory total and detect and localize spurious additions to inventory. The case was tried before a jury, which heard, among others, a witness produced by Markman who testified about the meaning of the claim language. After the jury compared the patent to Westview’s device, it found an infringement of Markman’s independent claim 1 and dependent claim 10. The District Court for the Eastern District of Pennsylvania granted Westview’s deferred motion for judgment as a matter of law. One of its reasons was that the term inventory in Markman’s patent encompasses both cash inventory and the actual physical inventory of articles of clothing. The court directed a verdict on the ground that Westview’s device does not have the means to maintain an inventory total. Markman appealed to the United States Court of Appeals for the Federal Circuit, which affirmed the district court’s judgment. Markman sought review, and the Supreme Court granted certiorari.
View caseThe offer activates the right when the owner proposes to transfer the interest to a third party in exchange for consideration and the right's terms are reasonable as to price and exercise period. If those conditions are met the right is not treated as a restraint on alienation.
No. In patent infringement an offer for sale can give rise to liability even if the contemplated sale never occurs, provided the offer is made before patent expiration.
If the designated person must pay a reasonable price and receives a reasonable period to decide, the right is not a disabling, forfeiture, or promissory restraint. Unreasonable terms convert the right into a prohibited restraint judged under separate rules.
An offer for sale manifests willingness to be bound on stated terms. A conditional or exploratory response operates as a counteroffer or rejection that terminates the power of acceptance rather than constituting an acceptance.
…March 21, 2017—Decided May 30, 2017 A United States patent entitles the patent holder to “exclude others from making, using, offering for sale, or selling [its] invention throughout the United States or importing the invention into the United States.” 35 U. S. C. §154(a). Whoever engages in one of these acts “without authority”…