The Sale That Ends Your Rights: Exhaustion, First Sale, and the Gray Market Across Three Regimes
By Casey Scott McKay ·
One authorized sale can end the right to control what happens next, and the rule differs across patent, copyright, and trademark in ways that decide real cases. This article works patent exhaustion after Impression Products v. Lexmark, which made exhaustion automatic on any authorized sale and extended it to foreign sales, and explains why post-sale restrictions are now a contract question rather than an infringement one. It works copyright first sale after Kirtsaeng, which read lawfully made under this title to cover foreign manufacture. And it works the trademark gray market, where the material differences doctrine gives rights holders more leverage than either of the other regimes. It closes with what actually controls a distribution channel once exhaustion is assumed.
IP and Technology > General IP | Article | Published 15 May 2025 - Updated 9 August 2026 | Casey Scott McKay - marksy.us
Summary. One authorized sale can end the right to control what happens next, and the rule differs across patent, copyright, and trademark in ways that decide real cases. This article works patent exhaustion after Impression Products v. Lexmark, which made exhaustion automatic on any authorized sale and extended it to foreign sales, and explains why post-sale restrictions are now a contract question rather than an infringement one. It works copyright first sale after Kirtsaeng, which read "lawfully made under this title" to cover foreign manufacture. And it works the trademark gray market, where the material differences doctrine gives rights holders more leverage than either of the other regimes. It closes with what actually controls a distribution channel once exhaustion is assumed.
Keywords: patent exhaustion · Impression Products v Lexmark · international exhaustion · copyright first sale · Kirtsaeng v John Wiley · lawfully made under this title · trademark gray market · material differences doctrine · Lever Brothers rule · section 526 Tariff Act · customs recordation · parallel imports · authorized sale · post-sale restrictions · single use only · repair versus reconstruction · Quanta Computer · licensed sale · importation and section 337 · channel control
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