# Kimble v. Marvel: Stare Decisis and the Ban on Post-Expiration Patent Royalties > A 6-3 Supreme Court invoked stare decisis to reaffirm Brulotte's rule barring royalties for using a patent after it expires, leaving any change to Congress. Topic: Patents | Author: Lidiia Levitska | Source: Intellectual Property Law (outsideipcounsel.com) Canonical: https://outsideipcounsel.com/blog/kimble-v-marvel-post-expiration-royalties/ *Kimble v. Marvel Entertainment, LLC*, 576 U.S. 446 (2015), is the modern Supreme Court's fullest meditation on *stare decisis* in patent law, delivered — memorably — through a run of Spider-Man metaphors. The question was whether to overrule *Brulotte v. Thys Co.*, 379 U.S. 29 (1964), which holds that a patentee cannot lawfully charge royalties for use of an invention after the patent has expired. Writing for a 6–3 Court, Justice Kagan declined. Even accepting that *Brulotte*'s economic reasoning had been widely criticized, the Court held that the enhanced *stare decisis* owed to statutory precedents, plus Congress's repeated refusal to disturb the rule, foreclosed judicial reversal. Kimble's open-ended royalty on a web-shooting toy therefore became unenforceable once his patent expired. The decision is now the leading authority both on post-expiration royalties and on when the Court will — and will not — abandon its own precedent. ## At a glance - **Case:** *Kimble v. Marvel Entertainment, LLC*, 576 U.S. 446 (2015), Docket No. 13-720 - **Court:** Supreme Court of the United States, on certiorari to the U.S. Court of Appeals for the Ninth Circuit - **Decided:** June 22, 2015; 6–3 - **Opinion:** Justice Kagan, for the Court (joined by Scalia, Kennedy, Ginsburg, Breyer, and Sotomayor); Justice Alito dissenting (joined by Chief Justice Roberts and Justice Thomas) - **Subject matter:** Enforceability of a patent-license royalty that continued, at a flat rate, after the licensed patent expired - **Holding:** *Brulotte v. Thys Co.* remains good law; a contract calling for royalties on post-expiration use of a patent is unenforceable, and *stare decisis* bars overruling that rule ## The toy, the settlement, and the expiring patent Stephen Kimble invented and patented a toy that lets a user shoot foam string from the palm of the hand, mimicking a web-slinging superhero. He pitched the idea to the predecessor of Marvel Entertainment, which later marketed a similar "Web Blaster" product. Kimble sued for patent infringement, and the parties settled: Marvel bought Kimble's patent for a lump sum plus a running royalty of 3% on future sales, with **no end date** written into the agreement. Neither side, at the time, was aware of *Brulotte*. Kimble's patent expired in 2010. Marvel later discovered *Brulotte* and sought a declaratory judgment that it could stop paying royalties once the patent term ended. The District Court agreed, and the Ninth Circuit affirmed — while candidly criticizing *Brulotte* as a rule resting on outdated economics that it was nonetheless bound to apply. The Supreme Court granted certiorari to decide whether to overrule it. ## Brulotte, and why the Court refused to overrule it *Brulotte* holds that using a patent's leverage to extract royalties for the period after the patent expires is unlawful per se — an impermissible attempt to project the patent monopoly beyond its statutory term. Kimble did not really defend *Brulotte*'s reasoning; he argued it was economically unsound and should be discarded. Justice Kagan's opinion accepted much of that critique on the merits but held it beside the point. The dispositive fact was that *Brulotte* interprets the Patent Act, and "*stare decisis* carries enhanced force when a decision interprets a statute" because "critics of our ruling can take their objections across the street, and Congress can correct any mistake it sees." Congress had amended the patent laws many times and had repeatedly declined to enact bills that would have overturned *Brulotte*, reinforcing the case for adherence. The Court also found no "special justification" — the additional showing required to overrule precedent — beyond disagreement with the outcome. *Brulotte* had not proved unworkable; parties could and did plan around it. Whatever the merits of its economic premises, it created a clear, easily applied line, and the reliance interests of parties who had structured deals against that backdrop counseled stability. "What we can decide, we can undecide," Kagan wrote, "[b]ut *stare decisis* teaches that we should exercise that authority sparingly." She underscored the point in the opinion's most-quoted lines: "patents endow their holders with certain superpowers, but only for a limited time," and, invoking the comic-book source, "in this world, with great power there must also come — great responsibility." ## What Brulotte does and does not forbid A crucial feature of *Kimble* is its careful account of the rule's scope, which limits its practical bite. *Brulotte* bars royalties for **post-expiration use** of the patent — it does not bar every payment that happens to continue after expiration. Kagan catalogued lawful alternatives. Parties may amortize royalties for pre-expiration use over a longer schedule that extends past the expiration date, so long as the royalties compensate for use during the patent term. They may tie continuing payments to **non-patent rights**, such as trade secrets or know-how, that are not time-limited, provided the patent and non-patent components are properly distinguished (as in *Aronson v. Quick Point Pencil Co.*, 440 U.S. 257 (1979)). And they may use joint ventures or other business arrangements to share ongoing value. In short, *Brulotte* constrains the **form** of a deal, not the total consideration; competent drafting can achieve most of what a perpetual patent royalty would. ## Open questions *Kimble* settled that *Brulotte* stays, but it left the economics unresolved and the doctrine's edges soft. Justice Alito's dissent — joined by Chief Justice Roberts and Justice Thomas — argued that *Brulotte* "was an antitrust decision masquerading as a patent case," built on the discredited premise that post-expiration royalties are inherently anticompetitive, and that no text in the Patent Act supports it. He would have overruled it as "a bald act of policymaking." The majority did not defend the economics; it defended the *institutional* choice to leave correction to Congress. That leaves practitioners to navigate a rule the Court itself doubts on the merits, and it invites recurring disputes over the boundary between a permissible deferred-payment or hybrid (patent-plus-know-how) license and a forbidden post-expiration royalty. How aggressively courts police that line — and whether Congress ever acts — remains the live question after *Kimble*. ## Implications - **A patent royalty must end when the patent does.** Do not write an open-ended running royalty tied to use of a single patent; it will be unenforceable for the post-expiration period under *Brulotte* and *Kimble*. - **Structure around the rule deliberately.** Amortize pre-expiration use over a longer term, or tie continuing payments to trade secrets, know-how, or other non-patent rights — and document the allocation so the non-patent basis is clear. - **Step-down clauses matter.** In hybrid licenses covering several patents or patents plus know-how, provide for royalty reductions as patents expire to keep the surviving payments lawfully grounded. - **Statutory precedents are hard to move.** *Kimble* is a leading citation for the proposition that overruling a statutory decision requires a special justification; assume the Court will defer to Congress on statutory patent rules. ## Frequently asked questions **What did Kimble v. Marvel decide?** That the Supreme Court would adhere to *Brulotte v. Thys Co.* (1964), which makes a patent holder's attempt to collect royalties for use of an invention after the patent expires per se unenforceable. Kimble could not enforce the open-ended 3% royalty once his patent term ended. **Why did the Court keep a rule it admitted was economically criticized?** Statutory *stare decisis*. *Brulotte* interprets the Patent Act, so Congress can change the rule if it disagrees; it has repeatedly declined to do so. Justice Kagan stressed that overruling a statutory precedent requires a special justification beyond a belief that the case was wrongly decided. **Can parties still structure deals around Brulotte?** Yes. Kagan's opinion listed lawful alternatives: deferring payments for pre-expiration use over a longer post-expiration period, tying royalties to non-patent rights such as trade secrets or know-how, and using joint ventures or other business arrangements. The rule bars royalties for post-expiration use of the patent itself, not every payment that continues after expiration. ## Authorities and sources - *Kimble v. Marvel Entertainment, LLC*, 576 U.S. 446 (2015), Docket No. 13-720 (decided June 22, 2015). [Justia](https://supreme.justia.com/cases/federal/us/576/446/); [Cornell Legal Information Institute](https://www.law.cornell.edu/supremecourt/text/13-720). - Case files and opinion analysis via [SCOTUSblog](https://www.scotusblog.com/cases/case-files/kimble-v-marvel-enterprises-inc/). - Kagan authorship, 6–3 vote, and Alito dissent (joined by Roberts and Thomas) corroborated by [Wikipedia: Kimble v. Marvel Entertainment, LLC](https://en.wikipedia.org/wiki/Kimble_v._Marvel_Entertainment,_LLC). - Underlying rule: *Brulotte v. Thys Co.*, [379 U.S. 29 (1964)](https://www.law.cornell.edu/supremecourt/text/379/29); hybrid-license background: *Aronson v. Quick Point Pencil Co.*, [440 U.S. 257 (1979)](https://www.law.cornell.edu/supremecourt/text/440/257).